Madras High Court
R.Velayutham vs The Chief Postmaster General on 2 September, 2014
Author: T.S.Sivagnanam
Bench: T.S.Sivagnanam
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 02.09.2014 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM W.P.(MD) No.3114 of 2013 R.Velayutham ... Petitioner -vs- 1.The Chief Postmaster General Chennai-2 2.The Postmaster General Southern Region (Tamil Nadu) Madurai-2 3.The Postmaster Sivakasi Head Post Office Sivakasi ... Respondents PRAYER Writ Petition is filed under Article 226 of the Constitution of India to issue a writ of mandamus directing the respondents to pay interest for the extended period from 2006-2007 to 2010-2011 towards the petitioner's PPF (HUF) Account No.100032 with the third respondent. !For Petitioner : Mrs.Lakshmi Gopinathan For Respondents : Mr.A.Uthaman :ORDER
The prayer in this writ petition is for issuance of a writ of mandamus to direct the respondents to pay interest for the extended period from 2006-2007 to 2010-2011 for the petitioner's public provident fund (HUF) Account bearing No.100032 with the third respondent.
2. The petitioner opened a public provident fund account, on behalf of his HUF, with the third respondent on 30.03.1991 and the account was to be closed on 31.03.2006. On a request made by the petitioner, it was extended for a further period of five years from 2006-2007 to 2010-2011. The third respondent accepted the request of the petitioner for extension and made entries in the passbook. During March, 2011, the respondents directed the petitioner to close the account stating that it cannot be extended after maturity and no interest will be paid for the extended period. The respondents denied interest for the extended period and according to the petitioner he is entitled to a total sum of Rs.6,88,939/-, inclusive of interest, but, he has been paid only a sum of Rs.4,69,985/-. As against the denial of interest, the petitioner has approached this Court by way of this writ petition for the aforementioned relief.
3. The learned counsel for the petitioner reiterated the submissions made in the affidavit filed in support of the writ petition and referred to the interdepartmental communication and submitted that the respondents had consciously extended the period and therefore denial of interest for the extended period is arbitrary and unreasonable.
4. The learned Standing Counsel appearing for the respondents, by relying upon the counter affidavit, submitted that as per Rule 17 of the Post Office Savings Bank General Rules, 1981, (hereinafter, referred to as 'the Rules'), as amended from time to time, where the account is found to have been opened in contravention of any relevant rules, the relevant Head Savings Bank, at any time, can direct the account to be closed and the deposit made in the account refunded to the depositor without interest.
5. By referring to an order, dated 13.02.2010, it is submitted that PPF accounts opened in the name of HUF prior to 13.05.2005 cannot be further extended after maturity. In terms of the said order, PPF accounts opened in the name of HUF prior to 13.05.2005 will be closed on maturity i.e., 31st March of 16th financial year for the year in which account was opened and no further interest will be admissible.
6. It is further submitted that the petitioner requested for extension of account after the date of maturity i.e., 31.03.2006 and the extension was irregular, following which the interest accrued is also irregular. That during the inspection conducted by P & T Audit Office, from 29.01.2012 to 17.02.2012, an objection was raised stating that subscription accepted and interest has been posted in violation of the order, dated 13.02.2010 and direction was issued to recover the irregularly paid interest and stopped collecting deposits from the account holder. Therefore, the petitioner was requested for closure of the account and the same was closed on 30.10.2012 with admissible interest. Further, by referring to Rule 18 of the Rules, it is submitted that the authority is competent to recover any interest or any other amount paid in excess as arrears of land revenue. Therefore, the respondents seek to justify their action stating that they rightly denied interest as the claim for interest was irregular and in contravention of the rules.
7. Heard the learned counsel for the parties and perused the materials placed on record.
8. From the averments made in the counter affidavit, it is seen that the extension of the deposit has been admitted and the interest credited has also been admitted. Now, the respondents seek to deny payment of interest by referring to Rule 17 of the said rules. The respondents did not on their own volition take any action, but the action appears to have been taken pursuant to the audit inspection conducted in January-February 2012. Therefore, until such time, the account was in operation and deposits were accepted and interest was periodically credited. From the documents filed in the typed set of papers, more particularly the copy of the passbook, it is evidently clear that the respondents have credited interest. In such circumstances, to deny payment of interest to the petitioner on the deposits, which was in the hands of the respondents, by referring to a rule and an audit report is arbitrary.
9. Admittedly, the account was not directed to be closed in 2006. The request made by the petitioner for extension was accepted and the account was valid and operational till October 2012, when it was ordered to be closed. Therefore, the money having been retained in deposit by the respondents is bound to be repaid along with interest. For no fault committed by the petitioner, he should not be penalized, more particularly a senior citizen, who has invested his hard earned money in the public provident fund account, which is in fact an HUF account of the petitioner. Furthermore, based on the audit report submitted during October, 2012, interest, which has been credited to the petitioner's account cannot be retrospectively annulled. Therefore, the respondents are bound to pay interest for the amount retained by them all along. For all the above reasons, the petitioner is entitled to succeed.
10. In the result, the writ petition is allowed and the respondents are directed to pay interest for the extended period from 2006-2007 to 2010-2011, in respect of the petitioner's PPF (HUF) account bearing No.100032, within a period of eight weeks from the date of receipt of a copy of this Order. No costs.
To
1.The Chief Postmaster General, Chennai-2.
2.The Postmaster General, Southern Region (Tamil Nadu), Madurai-2.
3.The Postmaster, Sivakasi Head Post Office, Sivakasi.