1. Heard Sri D.C Mukerjee, learned counsel for the petitioner and learned Standing Counsel for the respondents. The controversy relates to payment of interest over the delayed payment of gratuity and commutation of pension by the respondents.

2. The brief facts giving rise to the present writ petition are that the petitioner was initially appointed as Overseer on 30-8-1963 in the irrigation department and later on he was promoted to the post of Assistant Engineer on 6-3-1998. While working in Saryu Canal Division in district Bahraich, he retired from service on 30-6-1998. According to the learned counsel for the petitioner, at the time of retirement of the petitioner, neither any departmental proceeding was pending nor any other enquiry was going on, which could have created hurdle in payment of post retiral dues. In spite of the fact that the petitioner retired in June 1998, the gratuity and commuted pension were paid in September 2000. Accordingly, the petitioner claims payment of interest from the period June 1998 to September 2000. Learned counsel for the petitioner has relied upon the Apex Court's judgments reported in 1999 (2) UPLBEC 1006 : (1999 All LJ 973); Dr. Uma Agrawal v. State of U.P and (2000) 9 SCC 560 : AIR 2000 Supreme Court 3513 (1); S. Saleema Bi v. S. Pyari Begum. On the other hand, it has been submitted by the learned Standing Counsel that the petitioner had completed necessary formalities in the month of December 1999. Accordingly, the dues were paid in the month of August 2000. Learned Standing Counsel has invited attention of the Court towards Annexure SCA-1 filed with the Supplementary Counter Affidavit to point out that certain documents were required for the purpose, which were deposited by the petitioner in the month of December 1999. Accordingly, the submission of the learned Standing Counsel is that the petitioner is not entitled for interest on account of his own fault.

3. Sri D.C Mukerjee, learned counsel for the petitioner has invited attention of this Court towards letter dated 31-3-1999 sent by Executive Engineer indicating therein that neither any enquiry is pending against the petitioner nor he is liable to pay any dues to the department. Executive Engineer also informed that “No Objection Certificate” shall be sent separately. Learned counsel for the petitioner further invited attention of this Court towards the letter dated 26-2-2000 sent by the Executive Engineer which shows zero liability on the part of the petitioner. While claiming interest over the delayed payment, it has been submitted by the learned counsel for the petitioner that at no stretch of time the respondents have sent letter to the petitioner raising demand of certain documents or for the completion of some formality.

4. In the case of Dr. Uma Agrawal, (1999 All LJ 973) (supra), the Hon'ble Supreme Court has shown it's anguish and displeasure over the delayed payment and disbursement of post retiral dues. It has been observed by the Hon'ble Supreme Court that necessary formalities should be completed on behalf of the department itself in advance for disbursement of retiral benefits. The authorities ought to initiate necessary formality two years before the date of retirement of the Government servant and process should be completed well in advance before the date of retirement of the Government employee. The Hon'ble Supreme Court has considered the provisions contained in Para 8 of the Financial Hand Book and observed that necessary process should be initiated well in advance so that the government servant, who is at the verge of retirement, may not be put to suffer for his due rights. For convenience, paragraphs 3, 4 and 5 from the judgment of Dr. Uma Agrawal (supra) is reproduced as under:—

“3. As these delays have increased in the last few years, it has become necessary to refer to the Rules and Departmental instructions which do contain adequate provisions for compilation of all the necessary data and preparation of the necessary documents for disbursement of retiral benefits, well in advance. The present case arises from Uttar Pradesh and we find that the Government of Uttar Pradesh has issued instructions to the effect that “the Head Office, or other authority responsible for preparing the pension papers should initiate the pension case, two years before retirement of the Government servant. At that stage, the essential information necessary for working out the qualifying service should be collected, and the entire service book and other service records should be examined and completed with a view to remove deficiencies and imperfections, if any, in the service book/records. This process should be completed” at least eight months in advance of the date of retirement of the Government servant. The actual computation and preparation of the pension papers should then start and “any deficiency or imperfection, or omission which still remains in the service records should be ignored, and the determination of qualifying service should be proceeded with on the basis of entries in the service records, whatever the degree of imperfection to which it might have been possible to bring them by that time”. “The process of determining the qualifying service and the average emoluments and the admissible pension and gratuity should be positively completed within a period of 2 months and the pension papers sent to the Accountant-General not later than 6 months before the date of retirement. The said office is to issue the pension payment order (including the order for the payment of the Death-cum-retirement gratuity) one month in advance of the date of retirement”. “It should be ensured that the payment of superannuation pension commences on the first of the month following the month in which the government servant retires”. This appears to be the clear position in Uttar Pradesh.

4. We may in this connection also refer to F.R 58 which relates to “preparation of pension papers”. It states that “every Head of Office shall undertake the work of preparation of pension papers in Form 7 two years before the date on which the Government servant is due to retire on superannuation or on the date on which he proceeds on leave preparatory to retirement whichever is earlier”. F.R 59 deals with the stages for the ‘completion of pension papers’. Sub-clause (1)(a) bears the heading, the first stage, and refers to the verification of service details. There are five parts in this sub-clause. Sub-clause (1)(b) refers to the second stage, namely, making good the omissions in the service book. Sub-clause 1(b)(ii) is important and it states very clearly as follows:

“Every effort shall be made to complete the, verification of service, as in clause (a) and to make good omissions, imperfections or deficiencies referred to sub-clause (i) of this clause. Any omission, imperfections or deficiencies including the portion of service shown as unverified in the service book which it has not been possible to verify in accordance with the procedure laid down in clause (a) shall be ignored and service qualifying for pension shall be determined on the basis of the entries in the book.”

This directive in the rules is obviously intended to see that once the period is quite close to 10 months before the retirement of an employee, further time is not to be wasted in verifying data which it has not been possible to verify by following the procedure in sub-clause (1)(a) of F.R 59. Sub-clause (1)(c) refers to the third stage and it says that at least 10 months before the date of retirement, the Head office shall take various steps by issuing a Certificate to the government servant and the officer can offer his remarks and thereafter, he shall be furnished Form 4 and Form 5 which he has to fill-up and send to the Head Office at least 8 months before the date of retirement. F.R 60 refers to ‘completion of pension papers’ in Part-I of Form 7 at least 6 months before the date of retirement of the government servant. F.R 61 deals with the ‘Forwarding of Pension Papers to Accounts Officer’, in Form 5 and Form 7 with a covering letter in Form 8 along with service book duly completed, up to date, and other documents. This has to be done at least 6 months before the date of retirement. Rule 63 refers to recovery of amounts due by the government servant and the particulars in this behalf are to be sent at least 2 months before the date of retirement, so that the same could be recovered from the gratuity. F.R 64 deals with provisional pension. F.R 65 requires the Accounts Officer to assess the amount of pension and gratuity at least one month before the date of retirement. F.R 68 requires interest to be paid on delayed payment of gratuity. As already stated, in cases of delayed payment of pension, this Court has levied interest at 12% per annum in several cases.

5. We have referred in sufficient detail to the Rules and instructions which prescribe the time-schedule for the various steps to be taken in regard to the payment of pension and other retiral benefits. This we have done to remind the various governmental departments of their duties in initiating various steps at least two years in advance of the date of retirement. If the rules/instructions are followed strictly much of the litigation can be avoided and retired government servants will not feel harassed because after all, grant of pension is not a bounty but a right of the government servant. 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.”

5. In the case of S. Saleema Bi, ((2000) 9 SCC 560 : AIR 2000 SC 3513 (1) (supra), the Hon'ble Supreme Court again taken serious note on delayed payment of post retiral dues and directed to pay interest @ 18%.

6. Hon'ble Supreme Court in (1985) 1 SCC 429 : (AIR 1985 SC 356), State of Kerala v. M. Padmanabhan Nair ruled that the necessity for prompt payment of retiral dues to a government servant immediately after his/her retirement cannot be over emphasized and it would not be unreasonable to direct that the liability to pay penal interest on the dues at current market rate should commence at the expiry of two months from the date of retirement. Hon'ble Supreme Court was inclined to grant 12% interest on account of delayed payment of dues. However, said interest was not paid because of decree of Civil Court granting lower interest.

7. In (1998) 4 SCC 379 : (AIR 1998 SC 2090), Ex. Capt. R.S Dhull v. State of Haryana, the Hon'ble Supreme Court on account of delayed payment of gratuity and provident fund had allowed 12% interest on the withheld amount of GPF, gratuity etc., from the dates amounts became payable after superannuation.

8. In (2001) 9 SCC 687 : (AIR 2000 SC 3513 (2), Vijay L. Mehrotra v. State of U.P, their Lordships of Hon'ble Supreme Court again deprecated the delayed payment of post retiral dues and awarded simple interest at the rate of 18% from the date of retirement to the date of actual payment.

9. In (2003) 3 SCC 40 : (AIR 2003 SC 1526), H. Gangahanume Gowda v. Karnataka Agro Industries Corpn. Ltd.., Hon'ble Supreme Court had shown his displeasure on account of delayed payment of gratuity and employer was directed to pay interest at the rate of 10% on the amount of gratuity to which the employee was entitled from the date it became payable till the date of actual payment of amount of gratuity.

10. While defending the State action, the respondents have not specifically pleaded the steps taken by them in light of the judgment of the Hon'ble Supreme Court in the case of Dr. Uma Agrawal, (1999 All LJ 973) (supra). The judgment of Hon'ble Supreme Court is binding under Article 141 of the Constitution) of India. Being law of land, it was incumbent upon the respondents to take initiatives for; payment of post retiral dues, well in advance, before two years of retirement. Needless to say that the case of Dr. Uma Agrawal (supra) relates to State of Uttar Pradesh and deals with the financial hand book and covers the present controversy.

11. In the present case, neither any steps were taken by the respondents nor the petitioner was called on to complete some formality or deficiency, well in advance, as such, the petitioner does not seem to be at fault and seems to be entitled for payment of interest over the delayed payment of dues in question.

12. It shall be appropriate for the State Government and its local bodies to take care of the retiring employees and initiatives should be taken for payment of post retiral dues in light of the judgment of Hon'ble Supreme Court in the case of Dr. Uma Agrawal (supra).

13. In the event of inaction or fault on the part of the officials, resulting in delayed payment of post retiral dues, Government or the Head of the Department may fix responsibility after due enquiry and interest paid to the retired employee on delayed payment may be recovered from such officers.

14. Inaction or negligence in payment of post retiral dues must be taken as misconduct and faulty officer may be punished in appropriate manner under the service; rules.

15. In view of above, the writ petition is allowed. A writ in the nature of mandamus is issued commanding the opposite parties to pay interest @ 12 per cent from the date of retirement to the date of actual payment of dues in question.

16. Let necessary exercise be done expeditiously and preferably within a period of four months from the date of receipt of a certified copy of this judgment.

17. A writ in the nature of mandamus is further issued directing the State Government/Chief Secretary of the State to issue appropriate Government orders or circulars to all the departments, local bodies and corporations to initiate process for payment of post retiral dues in light of the law laid down by Hon'ble Apex Court in the case of Dr. Uma Agrawal : (1999 All LJ 973) (supra) and observation made in the present judgment, in public interest.

18. Let a compliance report be submitted to this Court by the Chief Secretary of the State within two months from the date of receipt of a certified copy of this judgment. Registry of this Court shall send a copy of the present judgment to the Chief Secretary of the State within three week from today and shall take follow up action. The writ petition is allowed accordingly. No order as to costs.

19. Petition allowed.