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Ram Narain Tripathi v. Finance Secretary, U.P. Govt. Lucknow And Others - WRIT - A No. 19348 of 2003 [2006] RD-AH 2408 (31 January 2006)


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Civil Misc. Writ Petition No.19348  of 2003

Ram Narain Tripathi................. ..............................Petitioner


Finance Secretary, U.P. Government,

Lucknow and others.............................................Respondents.


Hon.Tarun Agarwala,J.

Heard Sri S.K.Shukla, the learned counsel for the petitioner and Sri Suresh Singh, the learned counsel appearing for the Zila Panchayat, Jhansi and the learned Standing Counsel for the other respondents.

The petitioner has filed the present petition praying for a writ of mandamus commanding the respondents to pay interest @ 18% per annum on the retirement benefits which had not been paid to him for almost 12 years. It transpires, that the petitioner retired on 31.1.1991 from the post of an Executive Officer in Zila Parishad, Jhansi. Upon his retirement after 40 years of service, he was entitled for the post retirement benefits, namely, pension, gratuity, etc. These legitimate dues and benefits were, however, not paid nor released by the respondents for reasons best known to them. The petitioner approached this Court by filing Writ Petition No.7449 of 1996 which was disposed of with a direction to the authority to decide the representation and the claim of the petitioner. The authority, while deciding the claim of the petitioner, admitted that he was liable to be paid the pension and other retirement benefits but pleaded their helplessness in releasing the money, on the ground of financial constraints. It further transpires, that the petitioner moved a contempt application. During the pendency of these proceedings, a sum of Rs.2.85 lacs was paid on various dates, i.e., between 3.5.2002  and 29.10.2002 towards gratuity, pension and arrears of dearness allowance.  Since interest was not paid by the respondents,  consequently, the present writ petition was filed.

The learned counsel for the petitioner submitted that it was admitted by the respondents that the petitioner was entitled for the payment of the post retirement benefits and the only ground for the non-payment was the lack of finance. The petitioner submitted that in view of the admitted position and, in view of the fact that the fault clearly lay with the respondents, the petitioner was, therefore, entitled for interest @ 18% per annum on the belated payments.

On the other hand, the learned counsel for the respondents submitted that the payment of the interest could not be given to the petitioner as a matter of right since there is no statutory provision for the payment of the interest. The learned counsel for the respondents however, admitted that the payment of the interest could only be given on equitable grounds, provided it was found that the respondents were not justified in withholding the amount. In support of his submission, the learned counsel for the respondents relied upon a Division Bench decision of this Court, in the case of Jaiswal Grain Agency and another Vs. State of U.P. and another, 2005(3)AWC 2989,  in which it was held that the interest could be awarded on equitable ground, provided it was found that the respondents were not justified in withholding the amount. The Court held-

"Thus, the law can be summarised that the interest, being compensatory in nature, should be awarded if it is provided in the contract/agreement or the statutory provisions provide for it. It may  also be awarded on equitable grounds provided the facts and circumstances of the case justify it and the law does not prohibit it."

Further reliance was made in the decision of the Supreme Court in Union of India vs. Upper Ganges Sugar and Industries Ltd., 2005(1)SCC 750,  wherein it was held that if the Tribunal did not grant any interest while awarding the compensation, the same could not be claimed again by the respondents and that the interest could be awarded on the ground of equity provided  the payment was withheld unjustifiably.

There is no quarrel with the aforesaid proposition. The interest would be payable on equitable grounds, if the amount had been withheld unjustifiably by the respondents. In the present case, the respondents have admitted that the post retirement benefits was payable to the petitioner with effect from the date of his retirement, but the same was not paid. The only ground alleged was that the respondents did not have the finance to pay the post retirement benefits. In my opinion, this cannot be a ground for not releasing the post retirement benefits. In State of U.P. vs. M. Padmanabhan Nair, 1985(1)SCC 429, the Supreme Court held that the pension and gratuity are no longer a bounty to be distributed by the Government to its employees on their retirement and that the pension and gratuity are valuable rights and property in their hands and that any culpable delay in the settlement and disbursement of the post retirement benefits must be visited with the penalty and payment of interest at the current market rate till the date of the actual payment.

In H.Gangahanume Gowda vs. Karnataka Agro Industries Corporation Ltd, 2003(3)SCC 40,  the Supreme Court held that if there was a delay on the part of the employer in not releasing the post retirement benefits, it was mandatory for the Court to award interest. Similar view was also given by this Court in Tirath Raj Upadhyay vs. State of U.P. and others, 2004(2)UPLBEC 1652 as well as in R.Kapur vs. Director of Inspection (Painting and Publication) Income Tax and another,1994(6)SCC 589.

In view of the aforesaid decisions, it does not lie in the mouth of the respondents to contend that they do not have the finance to pay the post retirement benefits. Consequently, in the opinion of the Court, since the post retirement benefits has been paid after a period of 10 years and the delay was without any justification, consequently, the respondents are liable to pay penal interest. Since the post retirement benefits is the lifeline for a person after his retirement, the non-disbursement of the post retirement benefits clearly and squarely infringes the fundamental right under Article 21 of the Constitution of India to a citizen to live a life of retirement with dignity. The petitioner was made to run from pillar to post by the respondents without any justification. Consequently, the petitioner is  not only entitled for interest but also cost of this litigation.

In my opinion, remitting the matter back to the authorities to calculate the interest would serve no useful purpose as it would further delay and harass the petitioner who has now reached the age of 75 years. If the amount had been released by the respondents immediately after the retirement of the petitioner, the petitioner would have earned some interest if the same was invested. Even if this Court awards interest @ 10% per annum, the minimum amount towards interest would come to approximately Rs.35,000/-. The petitioner is also entitled for cost of litigation and for the mental harassment that he underwent. Consequently, considering the entire matter, this Court quantifies the interest as well as cost at Rs.50,000/-. This amount shall be paid without any further delay within two months from the date a certified copy of this judgment is produced before the authority concerned.

The writ petition stands allowed.




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