Commissioner vs Mr. Foquirappa Dodamani

A.P. Lavande, J.—Heard Mr. Dessai, learned Counsel for the Petitioner and Mr. Mane, learned Counsel for the Respondent.

Rule. By consent of the learned Counsel for the parties heard forthwith.

By this petition, the Petitioner has challenged the judgment and order dated 11th November, 2009 passed by the Presiding Officer, Labour Court-II, in Case No. Ref.LC-II/LCC/02/09 to the extent the Labour Court has granted interest at the rate of 18% p.a. from the date of the retirement of the Respondent till actual payment.

By the impugned judgment and order, the learned Labour Court has allowed the application filed by the Respondent u/s 33C(2) of the Industrial Disputes Act, 1947 and directed the Petitioner to pay the sum of Rs. 5,83,473/- towards the gratuity, encashment of leave and PF contribution along with interest thereon with 18 % p.a. from the date of his retirement till actual payment.

Mr. Dessai, learned Counsel for the Petitioner states that the interest rate awarded by the Labour Court is very excessive and having regard to the prevailing bank rates of interest, the award of interest at the rate of 18 % p.a. is not justified and is patently illegal and deserves to be set aside. According to Mr. Dessai, the Labour Court ought to have awarded the interest not more than 8 % p.a. on the amount awarded.

Per contra, Mr. Mane, learned Counsel for the Respondent supported the impugned order.

Having heard the learned Counsel for the parties and having perused the record, I am of the considered opinion that having regard to the prevailing bank rates of interest, interest of justice would be served if the interest rate awarded by the Labour Court is reduced to 10 % p.a. Accordingly, the judgment and order passed by the Labour Court, stands modified. The Respondent is entitled to the amount of Rs. 5,83,473/-. with interest at the rate of 10% p.a. instead of 18% p.a. as has been awarded by the Labour Court.

Rule is made absolute in aforesaid terms with no order as to costs.