Central Administrative Tribunal - Delhi
Brijendra Singh (Retd. Udc) vs The Union Of India on 20 September, 2011
Central Administrative Tribunal Principal Bench O.A.No.1611/2011 New Delhi, this the 20th day of September, 2011 Honble Shri Shailendra Pandey, Member (A) Brijendra Singh (Retd. UDC) s/o Late Sh. Tikam Singh served under OC762 TPT Coy ASC (Civ GT) (Ex 5682 ASC Bn) Bathinda Cnatt. r/o H.No.1369, Ambarish Tila Kachchi Sadak Mathura (U.P.) 281 001. . Applicant (Applicant in person) Versus 1. The Union of India Through Secretary, Min. of Defence Govt. of India, South Block DHQ PO, New Delhi-11. 2. The Quarter Master General QMG Branch, Integrated HQ, MoD (Army) New Delhi 11. 3. The Controller General of Defence Accounts Ulan Batar Road, Palam, Delhi Cantt. 110010. 4. The Officer Commanding 762 TPT Coy ASC (Civ GT) Bathinda Cantt. Respondents (By Advocate: Sh. R.C.Gautam) O R D E R By Shailendra Pandey, Member (A):
In compliance of the directions passed by this Tribunal in OA No.1021/2009, the respondents passed order dated 23.07.2010, which has now been challenged in the present OA and the following reliefs have been sought:
to grant interest @ 12 per cent per annum on the delay payment of the pay and allowances as shown in Para 4.3 (a) & (b) being Legal Admissible for amount of Rs.22009.00 and 293348.00 from 16 Jan 1996 and 30 March 1999 respectively.
To grant interest @ 12 percent per annum on the delay payment of Retirement dues under arbitrary and culpable delay in setting retirement dues as shown under sub paras (a), (b), (c) and (d) of Para 4.4 as admissible on account of GP Fund, Pension and Gratuity and Encashment of Earned Leave for Rs.54687.00, 241546.00, 52635.00, 65951.00 from 01 Feb 2006 for all cases respectively.
2. The applicant, who retired on 31.01.2006 from the post of UDC on superannuation, has sought the aforesaid reliefs on the ground that his retirement benefits have not been paid within a reasonable time, and he is, therefore, entitled to interest thereon at the market rate, i.e., 12% per annum as there was an arbitrary and culpable delay in settling the retirement dues. In this connection, the applicant has in para 3 of the rejoinder stated that the following statement would show the extent of delay in payment of the various amounts to him:
S. No. On What Account Amount Rs. Due date of payment Amount paid on date Interest required @ Rs.12/- pa from date
a) Half Pay Leave and Bonus (16 Sep 1995 to 16 Jan 1996) 22009/- 16 Jan 1996 19 Oct. 2010 16 Jan 1996
b) Arrears 16 Jan 1996 to 18 Mar 1999 293348/- 30 Mar 1999 27 Feb 2006 30 Mar 1999 c Final Settlement of GPF Fund A/c No.588973 54687/- 30 Mar 2006 22 May 2006 01 Feb 2006 d Pension & Gratuity 241546/- 30 Mar 2006 30 May 2006 01 Feb 2006 e Leave Encashment (150 days) 52635/- 30 Mar 2006 15 May 2007 01 Feb 2006 01 Feb 2006 f Arrears of Leave aforesaid Encashment 13315/- 01 feb.2006 20 Apr 2010 01 Feb. 2006 g Leave Encashment 150 days 65951/- 30 Mar 2006 19 Oct 2010 01 Feb. 2006
3. The respondents have filed their reply and have stated that Arrears of pay and allowances for the period from 12.10.1995 to 18.05.1999 were paid to the applicant on 14.02.2006 and in this connection, it is stated that the orders of the Honble High Court of Delhi were received by the Nodal Unit on 11.11.2005. Supplementary Pay Bill was prepared by 16.12.2005 for Rs.293348/- and the same was forwarded to the audit authorities for pre-audit of the Supplementary Pay Bill at Chandigarh on 19.12.2005, and this claim was received back, duly concurred by audit, in the nodal unit on 14.02.2006 and the amount was paid to the individual through the Bank on 27.02.2006. Therefore, they state that there was no delay in making the payment to the applicant on this account.
4. As regards GP Fund, it is stated that final settlement of G.P.Fund claim was forwarded to P.C.D.A, WC, Chandigarh by the nodal unit on 31.12.2005, it was returned back by the PCDA, WC, with some observations such as non receipt of original G.P.Fund statement of account vide their letter dated 08.02.2006. However, with the compliance of their observation, the G.P.Fund settlement claim was resubmitted to the P.C.D.A, Chandigarh by the nodal Unit on 04.04.2006, Cheque for Rs.54687/- on account of final settlement of GP Fund was forwarded to the individual (applicant) by the CDA (Fds) Meerut on 07.06.2006. Thus, according to them, no undue delay on the part of the respondents is established.
5. As regards Pension & Gratuity payment thereof, the respondents have stated that the applicant retired from service on 31.01.2006; thereafter, the commuted pension amount and DCRG amount was sanctioned by the PCDA (P) Allahabad on 26.04.2006 and it was forwarded for payment to the applicants Banker on 05.05.2006, and thus there was no delay on the part of the respondents.
6. As regards Leave encashment of 150 days, the respondents have stated that the payment on this account was made to the applicant on 10.05.2007 and have further stated that leave encashment is not held to be a pensionary benefit and is granted under the leave rules only.
7. In respect of Ad hoc bonus for the year 1995-99 and arrears of HPL payment thereof, it is stated that the due to some administrative problems the payment was made to the applicant on 31.07.2010.
8. Lastly, they have stated that in view of the above, as the payments were not unduly delayed, no interest is payable to the applicant on any account.
9. We have heard the applicant, who argued the case in person, and also the respondents counsel and have been through the pleadings on record.
9.1 The respondents have raised a preliminary objection about the case being barred by the doctrine of res-judicata. However, this is not accepted as the issue of interest on these delayed payments has not been adjudicated before.
9.2 Rule 68 of the CCS (Pension) Rules, 1972 and decision of the Government India, mentioned under Rule 68 of the CCS (Pension) Rules, 1972, are reproduced below:
68 Interest on delayed payment of gratuity (1) If the payment of gratuity has been authorized later than the date when its payment becomes due, and it is clearly established that the delay in payment was attributable to administrative lapses, interest shall be paid at such rate as may be prescribed and in accordance with the instructions issued from time to time:
Provided that the delay in payment was not caused on account of failure on the part of the Government servant to comply with the procedure laid down by the Government for processing his pension papers.
(2) Every case of delayed payment of gratuity shall be considered by the Secretary of the Administrative Ministry or the Department in respect of its employees and the employees of its attached and subordinate offices and where the Secretary of the Ministry or the Department is satisfied that the delay in the payment of gratuity was caused on account of administrative lapse, the Secretary of the Ministry or the Department shall sanction payment of interest.
(3) The Administrative Ministry or the Department shall issue Presidential sanction for the payment of interest after the Secretary has sanctioned the payment of interest under sub-rule(2).
(4) In all cases where the payment of interest has been sanctioned by the Secretary of the Administrative Ministry or the Department such Ministry or the Department shall fix the responsibility and take disciplinary action against the Government servant or servants who are found responsible for the delay in the payment of gratuity. Government of Indias decision:
Admissibility of interest on gratuity allowed after conclusion of judicial/departmental proceedings:- 1. Under the rules, gratuity becomes due immediately on retirement. In case of a Government servant dying in service, a detailed time-table for finalizing pension and death gratuity has been laid down, vide Rule 77 onwards.
In order to mitigate the hardship to the Government servants who, on the conclusion of the proceedings are fully exonerated, it has been decided that the interest on delayed payment of retirement gratuity may also be allowed in their cases, in accordance with the aforesaid instructions. In order words, in such cases, the gratuity will be deemed to have fallen due on the date following the date of retirement for the purpose of payment of interest on delayed payment of gratuity. The benefit of these instructions will, however, not be available to such of the Government servants who die during the pendency of judicial/disciplinary proceedings against them and against whom proceedings are consequently dropped. (2) Interest for delayed payment of Retirement/Death Gratuity to be at the rate applicable to GPF deposits:- It has been decided that where the payment of DCRG has been delayed beyond three months from the date of retirement, an interest at the rate applicable to GPF deposits will be paid to retired/dependants of deceased Government servants.
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(i) In case of Government servants against whom disciplinary/judicial proceedings are pending on the date of retirement and in which gratuity is withheld till the conclusion of the proceedings:-
In such cases, if the Government servant is exonerated of all charges and where the gratuity is paid on the conclusion of such proceedings, the payment of gratuity will be deemed to have fallen due on the date following the date of retirement vide O.M.No.1(4)/Pen. Unit/82, dated the 19th January, 1983 [Para 3 of Decision (1) above]. If the payment of gratuity has been authorized after three months from the date of his retirement interest may be allowed beyond the period of three months from the date of retirement. (Emphasis supplied) Thus, Rule 68(1) provides for payment of interest on delay in payment of retiral dues. If the payment of gratuity has been authorized later than the date when its payment becomes due, and it is clearly established that the delay in payment was attributable to administrative lapses, interest shall be paid at such rate as may be prescribed and in accordance with the instructions issued from time to time, provided that the delay in payment was not caused on account of failure on the part of the Government servant to comply with the procedure laid down by the Government for processing his pension papers. Rule 68(2) and (3) further provide for the procedure to be followed for grant of the interest viz., cases of delayed payment to a Government employee shall be considered by the Secretary of the Administrative Ministry/Department and where it is found that the delay was on account of administrative reasons, the Administrative Ministry/Department shall have to issue Presidential sanction for the payment of interest on the delayed payment of gratuity.
The Government of Indias decision, below Rule 68, clearly provides that interest on delayed payment of retirement/gratuity will also be allowed to the Government servants who, on the conclusion of the proceedings are fully exonerated. It also clarifies that in such cases the gratuity will be deemed to have fallen due on the date following the date of retirement for the purpose of payment of interest on delayed payment of gratuity.
10. The Honble Apex Court has also considered this issue in several judgments and has held that delay in settlement and disbursement of dues on retirement must be visited with the penalty of interest at appropriate rates of interest. In this connection, the following judgments of the Honble Apex Court may be usefully referred to:
In the case of State of Kerala and Others v. M. Padmanabhan Nair, (1985) 1 SCC 429, when the delay in payment of retiral benefits occurred because of the non-production of the Last Pay Certificate and the No Liability Certificate by the concerned Government Departments and since the date of retirement of every Government servant is very much known in advance, the Honble Apex Court observed as under:
1. Pension and gratuity are no longer any bounty to be distributed by the Government to its employees on their retirement but have become, under the decisions of this Court, valuable rights and property in their hands and any culpable delay in settlement and disbursement thereof must be visited with the penalty of payment of interest at the current market rate till actual payment.
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5. We are also of the view that the State Government is being rightly saddled with a liability for the culpable neglect in the discharge of his duty by the District Treasury Officer who delayed the issuance of the L.P.C. but since the concerned officer had not been impleaded as a party defendant to the suit the Court is unable to hold him liable for the decretal amount. It will, however, be for the State Government to consider whether the erring official should or should not be directed to compensate the Government the loss sustained by it by his culpable lapses. Such action if taken would help generate in the officials of the State Government a sense of duty towards the Government under whom they serve as also a sense of accountability to members of the public. In the case of S.K.Dua Vs. State of Haryana & another (2008 (3) SCC 44), when the applicant therein retired on 30.06.1998, and thereafter the departmental proceedings initiated against him were finally dropped and all retiral benefits were paid to the applicant after four years, i.e., between June, 11 and July 18, 2002, the Honble Supreme Court made the following observations:
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 proscribed 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 retiral benefits are not in the nature of `bounty is, in our opinion, well founded and needs no authority in support thereof. Thus, the thrust of the rules and instructions and the case law cited above is that a retiring Government servant shall be paid his dues on the date of his superannuation and any delay beyond a reasonable period (which has been prescribed as 3 months in the case of pension and gratuity) which is not on account of the fault of the Government servant would attract payment of interest till the date the actual payment is made. In determining the extent of delay, what is of crucial importance is the date on which the amounts became due for payment and the date of the actual payment to the Government servant concerned. Any internal reasons for delay such as non-finalization due to late receipt of sanction, late receipt of LPC, etc. which are not ascribable to the Government servant concerned, would also be deemed to be delay on the part of the Government, which may, in turn, choose to recover it from the erring officials concerned, but in no way should the retiring Government servant be made to suffer.
Over the years, additional dues over and above gratuity, pension and GPF have become payable to a Government servant on the date of his retirement e.g. leave encashment. Leave encashment is payable to the extent of the leave accumulated by the Government servant on his superannuation and would, therefore, fall under the group of `retiral benefits or `dues/benefits payable on retirement. It is difficult to be persuaded to accept the argument of the respondents that leave encashment being granted under the leave rules cannot be considered to be a retiral benefit and would not attract payment of interest as prescribed in the case of pension/gratuity.
11. In the present case, the applicant, on attaining the age of superannuation, retired from service on 31.01.2006. On that date he became entitled to payment of pension, gratuity, GPF and leave encashment. Before the retirement of the applicant, an order was passed by the respondents on 11.10.1995 removing him from service on the ground of unauthorized absence from the place of his posting. Aggrieved by this, the applicant had filed an appeal. The appellate authority set aside the order of the penalty of removal from service vide its order dated 31.07.1996, and an order imposing compulsory retirement on the applicant with full pension and gratuity was passed. Thereafter, both the above orders were challenged before this Tribunal and the same were quashed on the ground that the said orders had been passed without reference to and without being conscious of the orders passed by the Tribunal on 2.6.1995, 26.07.1995 and 8.9.1995. Thereafter, the applicant filed a Civil Writ Petition No.1476/1999 in the High Court of Delhi, which was decided on 05.09.2005, wherein it was clearly observed that the aforesaid order substituting the order of removal by an order imposing the penalty of compulsory retirement were passed oblivious of the directions issued by the Tribunal. It was observed as under:
4. Therefore, in view of the aforesaid facts and circumstances we are in full agreement with the decision rendered by the learned Tribunal that the order of removal from service of the petitioner and the subsequent order passed by the appellate authority substituting the order of removal with the penalty of compulsory retirement were unjust, improper and illegal. We are of the opinion in the facts of the case that the order of the Tribunal was justified and legal. The High Court of Delhi further observed as under:
5. The period of suspension of the petitioner and all other periods shall now be treated in accordance with the provisions of FR-54 as on duty and the period of absence of the petitioner shall be regularized in accordance with law and the petitioner shall be paid pay and allowances in accordance with the provisions of the aforesaid rules.
6. In terms of the aforesaid order and directions, the writ petition stands disposed of. It is clear from the above orders that the applicant has been fully exonerated, and thus in terms of Government of Indias decision below Rule 68 (referred to in para 9.2 above) his gratuity will be deemed to have fallen due on the date following the date of retirement for the purpose of payment of interest on delayed payment of retirement gratuity. On the same analogy, the other dues such as pension, GPF and leave encashment are also deemed to have fallen due on the date following the date of retirement, i.e. on 01.02.2006. However, the dues have actually been paid to him well after this date. We are, therefore, of the view that for the period from the date they have fallen due for payment to the date of actual payment, the applicant would in all fairness need to be compensated by way of payment of interest, at least at the applicable GP Fund rate of interest. This is on the premise, that if the amounts towards the above retirement benefits are made available to a Government employee on the date following his date of retirement, he can gainfully invest the same and can earn some interest to supplement the sudden fall in his income after retirement. Further, a Government servant can use the amount for occasions such as marriage of his children, etc. (for which often a Government servant has to obtain loans, etc. at higher rates of interest). Therefore, as a result of the delay in payment of amounts legitimately due to him on retirement, the applicant has been adversely affected by being denied the benefit of these dues (for investment, etc) for the `delayed period.
12. It is an admitted position that the applicants dues relating to pension & gratuity and final settlement of GPF (as per the statement of the applicant referred to hereinbefore), were paid to him on 30.05.2006 and 22.05.2006 respectively. However, as these became due on the date following the date of retirement, i.e., 01.02.2006, he should be paid interest for payment from the date when the dues became due for payment to the date of actual payment.
For Leave Encashment also, as already explained earlier, this is a benefit that is payable on retirement and is due for payment on the date following the date of retirement and, therefore, in the case of leave encashment also the applicant would need to be paid interest for the period of `delay in actual disbursement. However, as the applicant and respondents have given different versions of the amounts due and dates of payment of leave encashment dues, the same may be verified from the records and the interest for the period of delay as reckoned above, as in the case of gratuity, may be calculated and it should also be paid to the applicant.
As regards arrears for the period of absence from 16.01.1996 to 18.03.1999, no interest need be paid. This is for the reason that the High Court in its order passed on 05.09.2005 (the relevant portion of the High Court order already referred hereinbefore) while directing the period of suspension and all other periods to be treated in accordance with the provisions of FR 54 as on duty and the period of absence of the applicant to be regularized in accordance with law, did not direct any interest to be paid. Further, it is stated that a copy of the High Courts order was received by the Nodal Unit on 11.11.2005 and orders to regularize the period of absence were issued vide letter dated 01.12.2005, and thereafter a supplementary pay bill was prepared on 16.12.2005 and forwarded to the audit authorities at Chandigarh on 19.12.2005 and was received back with their concurrence by the Nodal Unit on 14.02.2006 and the amount was paid to the applicant through Bank on 27.02.2006. Thus, we do not find any culpable delay in authorization of these dues and, therefore, no interest would be payable.
In so far as Bonus and HPL is concerned, the Secretary of the Department may take a decision with regard to the extent of delay attributable to administrative lapses, keeping in view the facts and circumstances of the case, and pass appropriate orders in accordance with rules on the subject keeping our observations in Para 10 above in mind.
In view of the aforementioned facts and circumstances of the case, therefore, we direct as follows:
i) the applicant should be paid interest on the pension/gratuity amount at the applicable GP Fund rate of interest from 01.05.2006 (i.e. allowing 3 months time for processing after his superannuation on 31.01.2006) till the date of actual payment, i.e., 30.05.2006
ii) in respect of delayed payment of `final GPF payment the applicant should be paid interest as prescribed in the GPF Rules till the date of actual payment.
iii) in respect of the payment of leave encashment/arrears of leave encashment, interest at the GPF rate for the period from the date when the same became due (the date following the date of retirement) to the date of actual payment (minus 3 months time allowed for processing), may be calculated and be paid to the applicant, as in the case of gratuity,.
iv) in respect of payment of arrears of pay and allowances for the period of absence from 12.10.1995 to 18.05.1999, no interest would be payable.
v) as regards other dues, namely, bonus and HPL the matter with full facts may be placed before the Secretary of the Department for taking a decision with regard to the extent of delay attributable to administrative lapses, keeping in view the facts and circumstances of the case and our observations in para 10, and appropriate orders in accordance with rules on the subject may be passed.
13. The interest on the delayed payment of the dues mentioned at (i), (ii) and (iii) above should be paid within a period of two months from the date of receipt of a copy of this order, and in respect of dues under (v) above, appropriate orders should be passed within 3 months from the date of receipt of a copy of this order.
14. The OA is disposed of in terms of the aforesaid directions. No costs.
(Shailendra Pandey) Member (A) /nsnrsp/