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Pandi Rp v. The Managing Director

Madras HC22 Jan 2026WP(MD)/1460/2026

Case brief

AI extract

What is this about?

Belated payment of retirement/terminal benefits - provident fund, gratuity, leave encashment; interest at 6% per annum for delayed settlement; Tamil Nadu State Transport Corporation (Kumbakonam) Ltd; writ of mandamus under Article 226, Constitution of India; S.K.Dua v. State of Haryana (2008) 3 SCC 44; Division Bench common order dated 04.07.2014 in W.A.(MD)No.403 of 2010 batch; compensation for delayed payment of pensionary benefits; Madras High Court, Madurai Bench; single judge B.PUGALENDHI, J.; disposal at admission stage by consent.

What did the court decide?

Interest at 6% per annum on the belated retirement benefits from 01.08.2024 till the date of actual disbursement, payable within six months from the date of receipt of a copy of the order; no costs. ¶46

Pandi Rp Vs The Managing Director — Writ and Judicial Review | Madras HC (2026)

What the court decided

AI extract

Outcome

Interest at 6% per annum on the belated retirement benefits from 01.08.2024 till the date of actual disbursement, payable within six months from the date of receipt of a copy of the order; no costs.

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Issue for consideration

Whether the petitioner is entitled to interest at 6% per annum on his belatedly paid terminal/retirement benefits (provident fund, gratuity, leave encashment) from the date of retirement until the date of actual payment.

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Court's answer

The employer is liable to settle retirement benefits to its employees without any delay; where the settlement is belated, it must be compensated by way of interest for the belated payment.

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Ratio / Principle

Following the dictum in S.K.Dua and the Division Bench common order in W.A.(MD)No.403 of 2010 batch, the writ petition is disposed of with a direction to the respondent Transport Corporation to pay interest for the belated payment of retirement benefits at 6% per annum from 01.08.2024 till the date of actual disbursement, within six months from receipt of a copy of the order; no costs.

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Detailed headnote1 paragraphs

Madras High Court (Madurai Bench), WP(MD)No.1460 of 2026, decided 22.01.2026 by B.PUGALENDHI, J.: A retired Checking Inspector of Tamil Nadu State Transport Corporation (Kumbakonam) Ltd, who retired on 31.07.2024 after 29 years of service and whose Provident Fund, Gratuity and leave encashment were settled only on 02.12.2025, sought a mandamus for interest at 6% per annum on the belatedly paid terminal benefits. Following S.K.Dua v. State of Haryana, (2008) 3 SCC 44, and the Division Bench common order dated 04.07.2014 in W.A.(MD)No.403 of 2010 batch, the Court held that an employer must settle retirement benefits without delay and that belated settlement must be compensated by interest, and disposed of the writ petition directing the Corporation to pay interest at 6% per annum from 01.08.2024 till the date of actual disbursement, within six months from receipt of a copy of the order. No costs.

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WP(MD)No.1460 of 2026

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BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT

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DATED: 22.01.2026

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CORAM:

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THE HONOURABLE MR.JUSTICE B.PUGALENDHI

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WP(MD)No.1460 of 2026

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R.P.Pandi ... Petitioner

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1.The Managing Director, Tamil Nadu State Transport Corporation (Kumbakonam) Ltd, Railway Station New Road, Kumbakonam.

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2.The General Manager, Tamil Nadu State Transport Corporation (Kumbakonam) Ltd, Karaikudi Region, Managiri, Karaikudi, Sivagangai District. ...Respondents

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PRAYER: Writ Petition filed under Article 226 of the Constitution of India, to issue a writ of mandamus directing the respondent to pay the interest at the rate of 6% per annum to the petitioner for the belated payment of gratuity, provident fund, EL surrender and leave salary from the date of retirement to the date of actual payment within a time frame as may be fixed by this court.

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https://www.mhc.tn.gov.in/judis

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WP(MD)No.1460 of 2026

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For Petitioner	: Mrs.D.Ramya
For Respondent	: Mr.K.Ramaiah,
No.1	Standing Counsel
For Respondent No.2	: Mr.S.C.Herold Singh

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ORDER

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This writ petition is filed for a Mandamus, directing the respondent to pay interest to the petitioner at the rate of 6% per annum for the belated payment of terminal benefits from the date of his retirement till the actual payment, within the time stipulated by this Court.

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2.The case of the petitioner is that the petitioner joined as a Checking Inspector in the respondent Transport Corporation on 01.04.1995. After completion of 29 years of service, he retired from service on 31.07.2024. However, the retirement benefits, namely, Provident Fund, Gratuity and Encashment of leave was settled only on 02.12.2025. Since the benefits have been settled belatedly, the respondent is liable to pay interest for the belated payment.

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https://www.mhc.tn.gov.in/judis

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WP(MD)No.1460 of 2026

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Therefore, the petitioner gave a representation dated 08.12.2025 to the respondents, however, the same did not evoke any response. Therefore, the petitioner has filed this writ petition for the above said relief.

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3.The learned counsel for the petitioner submits that in similar

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writ petitions, this Court has ordered for payment of interest at the rate of 6% p.a. for the belated payment of retirement benefits and therefore, the petitioner is also entitled for the same relief.

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It is reported on behalf of the respondents that the terminal

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benefits have been settled to the petitioner on 02.12.2025.

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By consent of both the parties, the writ petition is taken up

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for final hearing at the admission stage itself.

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https://www.mhc.tn.gov.in/judis

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WP(MD)No.1460 of 2026

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6.This Court paid its anxious consideration to the rival

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submissions made and also perused the materials placed on record.

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7.The employer is liable to settle the retirement benefits to its employees without any delay and in case, if it is settled belatedly, it has to be compensated by way of interest for the belated payment. In this regard, the Hon'ble Apex Court in S.K.Dua vs. State of Haryana reported in 2008 (3) SCC 44 , has held as follows:

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“14. In the circumstances, prima facie, we are of the view that the grievance voiced by the appellant appears to be well founded that he would be entitled to interest on such benefits. If there are statutory rules occupying the field, the appellant could claim payment of interest relying on such rules. If there are administrative instructions, guidelines or norms prescribed for the purpose, the appellant may claim benefit of interest on that basis. But even in absence of statutory rules, administrative instructions or guidelines, an employee can claim interest under Part III of the Constitution relying on Articles 14, 19 and 21 of the Constitution. The submission of the learned counsel for the appellant, that

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https://www.mhc.tn.gov.in/judis

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WP(MD)No.1460 of 2026

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retiral benefits are not in the nature of “bounty” is, in our opinion well founded and needs no authority in support thereof. In that view of the matter, in our considered opinion, the High Court was not right in dismissing the petition in living even without issuing notice to the respondents.”

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8.Following the same, in a similar issue, a Division Bench of this Court, in W.A.(MD)No.403 of 2010, etc. batch, vide common order dated 04.07.2014, has fixed the rate of interest at 6% per annum and held as under:-

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“5. ..... even though there is no provision in the Tamil Nadu State Transport Corporation Employees Pension Fund for payment of interest, cannot stand in the light of the law laid down by the Supreme Court in S.K.Dua v. State of Haryana and another, reported in (2008) 3 SCC 44. As a matter of fact, the Rules do not contemplate belated payment of retirement benefits. The Rules contemplate prompt payment. When the Rules contemplate prompt payment and not bleated payment, the Rules will not contain a provision for payment of interest. The Pension Fund which was created as a Trust by the Corporation was supposed to act in trust for the

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https://www.mhc.tn.gov.in/judis

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WP(MD)No.1460 of 2026

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employees' benefit. If the Trust could not make payments within the time stipulated, then, irrespective of whether there is any provision for payment of interest or not, the Corporation is obliged to make payment.”

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9.Following the dictum laid down on this issue, the writ petition is disposed of with a direction to the respondent/Transport Corporation to pay interest for the belated payment of retirement benefits at the rate of 6% per annum from 01.08.2024 till the date of actual disbursement, within a period of six months from the date of receipt of a copy of this order. No costs.

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22.01.2026

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NCC: Yes/No Index:Yes/No

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DSK

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https://www.mhc.tn.gov.in/judis

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WP(MD)No.1460 of 2026