The Government Of Tamil Nadu v. M.Deivasigamani

(Judgment of the Court was delivered by S.MANIKUMAR, J.) Before the Tribunal, the first respondent has challenged the order, dated 08.09.1995 passed by the District Collector, Periyar District, Erode and prayed for a consequential direction to the respondents to pay interest at the rate of 18% per annum for the delayed payment of pension, commutation of pension, death-cum-retirement gratuity, Encashment of Earned leave, General Provident Fund, Special Provident Fund and pay fixation arrears. The said Original Application was subsequently transferred to this Court and renumbered as W.P.No.8707 of 2006. On contest, the learned Single Judge, placing reliance on a decision in Dr.Uma Agarwal v. State of U.P., (1999) 3 SCC 438, wherein, it has been held that the pension is not a bounty, but right of a retired employee and the Government is obliged to initiate process for payment, according to time schedule, prescribed in the departmental rules, set aside the impugned order made in the Writ Petition, dated 08.09.1995, passed by the District Collector, Periyar District and consequently, held that the first respondent is entitled to interest at the rate of 10% per annum for the belated payment of on pension, commutation of pension, DCRG and other retiral benefits.

2. Assailing the order made in the Writ Petition, Mr.A.Arumugam, learned Special Government Pleader, submitted that the learned single Judge ought to have considered the fact that the respondent was not permitted to retire, in view of the disciplinary proceedings, which was set aside only in the year 1992, though he was due to retire on 31.01.1987, on attaining the age of superannuation. He further contended that the though there are government Orders enabling payment of interest on belated payment of DCRG and belated payment of DCRG, interest cannot be awarded in respect of pension, commutation of pension, Encashment of Earned Leave, General Provident Fund, Special Provident Fund and Pay Fixation arrears. He placed reliance on the second proviso to Rule 45-A(1) of the Tamil Nadu Pension Rules.

3. Learned Special Government Pleader further submitted that an appeal was preferred by the respondent against the order of dismissal from service and final orders were passed only in the year 1992 in G.O.(2D) No.123, Revenue Department, dated 18.11.1992. Inasmuch as the departmental proceedings were pending, the first respondent is not entitled to interest on pension and other benefits. He further submitted that the Writ Court has failed to consider that interest can be awarded only on DCRG, in case of delay and not on other retiral benefits.

We have heard the learned counsel for the parties and perused the materials available on record.

4. Pleadings disclose that the first respondent was due to retire on 31.01.1987, on attaining the age of superannuation. But, he was not allowed to retire on that day, on account of pending charges. On completion of the enquiry, he was dismissed from service in and by the proceedings of the District Collector, Periyar District, dated 03.09.1988. Thereafter, the petitioner filed an appeal before the Special Commissioner and Commissioner for Revenue Administration, Madras, which was rejected on 06.11.1988. Thereafter, the petitioner has preferred an appeal before the Government on 22.12.1988. Since no orders were passed by the Government, the petitioner was constrained to file O.A.No.943 of 1992 before the Tamil Nadu Administrative Tribunal, Madras for a direction, directing the Government to pass orders on his appeal. Pursuant to the order of the Tribunal, dated 17.02.1992, the Government, by its order in G.O. (2D) No.123 Revenue Department dated 18.11.1992, have set aside the order of dismissal and allowed the petitioner to retire from service. Though the respondent has preferred the statutory appeal in the year 1998, the Government have taken nearly four years to pass orders on the appeal. Though, the Government have passed orders in 1992, exonerating him from the charges and allowed him to retire, pensionary and other benefits have been granted only in the year 1994, after two years. The District Collector, Erode, by impugned order, dated 18.11.1992, has disallowed interest for the belated payment of pension, Commutation of pension and other retiral benefits. However, he had recommended to the Government for sanction of interest amount of Rs.10,381/- for the belated payment of DCRG made to the first respondent, based on the Government Order in G.O.Ms.No.517, Finance (Pension), dated 12.06.1987 and G.O.Ms.No.818, Finance (Pension), dated 01.12.1988. Subsequently, G.O.(D) No.192, dated 13.04.2007, has been passed, sanctioning payment of Rs.11,890/-, towards interest on belated payment of Death cum Retirement Gratuity. But for the disciplinary action and erroneous dismissal, in normal course, the respondent would have retired from service on attaining the age of superannuation and granted pension and other retiral benefits.

5. In Dr.Uma Agarwal v. State of U.P., reported in (1999) 3 SCC 438, the Supreme Court held that,

"....grant of pension is not a bounty but a right of the government servant. The Government is obliged to follow the Rules mentioned in the earlier part of this order in letter and in spirit. Delay in settlement of retiral benefits is frustrating and must be avoided at all costs. Such delays are occurring even in regard to family pensions for which too there is a prescribed procedure. This is indeed unfortunate. In cases where a retired government servant claims interest for delayed payment, the Court can certainly keep in mind the time-schedule prescribed in the Rules/Instructions apart from other relevant factors applicable to each case."

6. The contention of the appellant that as per the Government norms, interest can be paid only on Death-cum-Retirement Gratuity, in case of delay and the same cannot be awarded to any other retiral benefits, is not tenable, in view of the decision of the Supreme Court in S.K.Due v. State of Haryana reported in 2008 (3) SCC 44. In the reported case, the appellant therein was served with three charge sheets/show cause notices in June 1998, few days before his retirement. However, he retired on 30.06.1998 on reaching the age of superannuation. He was paid provisional pension, but other retiral benefits were not given to him, which included commuted value of pension, leave encashment, gratuity, etc. They were withheld till the finalisation of disciplinary proceedings. While answering the issue as to whether the appellant therein was entitled to interest on delayed payment of retiral benefits, in the absence of any statutory rules/administrative instructions or guidelines, the Supreme Court, at Paragraph 14 of the judgment, held as follows:

"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 the 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 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 limine even without issuing notice to the respondents."

7. In view of the judgment of the Supreme Court, it is now well settled that an employee is entitled to interest on belated payment of pension and other retiral benefits, even in the absence of statutory rules/administrative instructions or guidelines and he K.RAVIRAJA PANDIAN, J.

and S.MANIKUMAR, J.

claim for interest, under Part III of the Constitution, relying on Articles 14, 19 and 21 of t can make his he Constitution.

8. In view of the above, we do not find that there is any infirmity in the impugned order. Hence, the Writ Appeal is dismissed.

(K.R.P.,J.) (S.M.K.,J.) 17.12.2008 skm To

1. The Secretary, Government of Tamil Nadu, Revenue Department, Fort St. George, Chennai 9.

2. The District Collector, Erode District, Erode.

W.A. No.886 of 2007