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in terms of Section 7(3) and Section 7(3-A) of the Payment of Gratuity Act, 1972 (hereinafter referred to as ‘the Act’), Gratuity is required to be paid within a period of thirty days from the date on which it becomes due and if it is not paid within that period, then interest is required to be paid at the rate notified by the Central Government from time to time for repayment on long term deposits. 9. In the present case, the Circular issued by the petitioners goes well beyond the statute and gives six months’ time for the petitioners to make payment. But, unfortunately, even this period has not been adhered to by the petitioners. The Tribunal was justified, on the facts of this case, to direct the petitioners to pay interest to the 1st respondent.

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THE HON’BLE THE CHIEF JUSTICE SHRI MADAN B. LOKUR

AND

THE HON’BLE SHRI JUSTICE SANJAY KUMAR

                                         Writ Petition No. 1389 OF 2012

DATED:24-01-2012

Between:

Union of India

Represented by its Secretary,

Railway Board,

Ministry of RailwaysNew Delhi and others.

                        …  Petitioners

 

And

 

K. Radha Krishna and others.

                                    … Respondents

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

THE HON’BLE THE CHIEF JUSTICE SHRI MADAN B. LOKUR

AND

THE HON’BLE SHRI JUSTICE SANJAY KUMAR

Writ Petition  No. 1389 OF 2012

 

 

 

ORDER: (per the Hon’ble the Chief Justice Shri Madan B. Lokur)

 

 

1.         The 1st respondent applied for voluntary retirement by making an application on 10.4.2008.  The application was based on certain domestic grounds.

2.         The request for voluntary retirement was accepted by the petitioners with effect from 1.8.2008 after completion of three months notice period.

3.         The 1st respondent was thereafter entitled to post-retiral benefits including Gratuity amount of Rs.3,47,689/-.  This amount was paid to the 1st respondent on 15.10.2009, after more than a year.

4.         The 1st respondent was aggrieved by the delayed payment and approached the Central Administrative Tribunal for payment of interest on the delayed payment.

5.         The Tribunal framed three issues that arose in the case.  We are not concerned with the first two issues, which deal with the alleged harassment of the 1st respondent and his alleged unauthorized occupation of the quarters allotted to him.  It may be mentioned that the first issue relating to harassment was decided against the                1st respondent. While the second issue was decided against the petitioners and it was held that the 1st respondent had not unauthorizedly occupied the quarters allotted to him.  The third issue related to the entitlement of the 1st respondent for interest on the delayed payment of Gratuity.

6.         The Tribunal referred to Circular dated 15.4.1991 relating to payment of interest on account of delayed payment of retirement-cum-death gratuity.  In terms of the relevant part of the Circular, it has been laid down that where the payment of Gratuity is delayed in certain circumstances, beyond a period of six months from the date of retirement, interest should be paid for the period of delay beyond six months from the date of retirement. The Circular also deals with the concerned circumstances, that is, defaults on the part of the employee in not submitting his papers in time.

7.         In so far as the present case is concerned, there is no allegation that the 1st respondent had not submitted his papers in time.  Notwithstanding this, there was a delay of about one year in making the payment of the death-cum-retirement benefits to the 1st respondent.  Under these circumstances, the Tribunal directed the petitioners to make payment of interest on the delayed payment of death-cum-retirement gratuity.

8.         Feeling aggrieved, the petitioners are now before us.  We do not find any reason to disagree with the view expressed by the Tribunal. There is no justification given for the delayed payment. We may also mention that in terms of Section 7(3) and Section 7(3-A) of the Payment of Gratuity Act, 1972 (hereinafter referred to as ‘the Act’), Gratuity is required to be paid within a period of thirty days from the date on which it becomes due and if it is not paid within that period, then interest is required to be paid at the rate notified by the Central Government from time to time for repayment on long term deposits.

9.         In the present case, the Circular issued by the petitioners goes well beyond the statute and gives six months’ time for the petitioners to make payment.  But, unfortunately, even this period has not been adhered to by the petitioners.  The Tribunal was justified, on the facts of this case, to direct the petitioners to pay interest to the 1st respondent.

10.       The writ petition is dismissed.

11.       The miscellaneous application is also dismissed.

 

 

 

MADAN B. LOKUR, CJ

 

 

 

   SANJAY KUMAR, J

24-01-2012

 

pnb

 

 

 

 

 

 

 

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