Jetho Balani vs State of Rajasthan and Others

Sandeep Mehta, J.

By way of the instant writ petition, the petitioner has approached this Court assailing the action of the respondents in failing to pass any order on the application dated 12.2.2007 submitted by the petitioner seeking voluntary retirement and the order Annexure-8 dated 23.11.2007 whereby the petitioner was terminated from service for alleged unauthorized absence.

The case is a classic example of rank apathy and failure of the departmental authorities in adhering to the lawful practices and procedures and has landed a hapless employee to resort to an unwarranted litigation adding to the ever growing coffers of cases pending in the Courts without any justification whatsoever.

It is not in dispute that the petitioner though belatedly preferred an appeal against the order Annexure-8 dated 23.11.2007. The appeal though admittedly received by the respondent authorities was not decided for more than six years despite the authorities being put to notice when the copy of the writ petition was served to them.

The order Annexure-8 dated 23.11.2007 is assailed on the ground that the same was passed without following the mandatory procedure of holding enquiry as prescribed under the Rajasthan State Electricity Board Employees (Classification, Control and Appeal) Regulations, 1962. It being the undisputed position on record that the order terminating the petitioner from services for his so-called unauthorized absence was passed without holding any disciplinary enquiry, the learned counsel for the respondent had, on the previous date sought some time to instruct the officers to pass an appropriate order in the matter and set the things right. Today Mr. Bhansali has placed on record a copy of the order dated 11.2.2015, as per which, the order dated 23.11.2007 whereby the petitioner was terminated from service has been quashed while deciding the departmental appeal dated 23.11.2008 preferred by the petitioner. As a consequence, his request for voluntary retirement has been accepted w.e.f. 16.2.2007. Thus, the only question which remains alive for Court''s consideration is regarding the consequential benefits admissible to the petitioner.

Learned counsel for the petitioner submits that the C.P.F., Gratuity and the Leave encashment and any other dues which accrued to the petitioner on the date of his voluntary retirement are required to be paid to him along with interest as of right. He relies on the provisions of Section 7Q of the Employees'' Provident Funds and Miscellaneous Provisions Act, 1952, Section 7(3) and 7(3-A) of the Payment of Gratuity Act, 1972 and Rule 89 of the Rajasthan Civil Services (Pension) Rules 1996 and contends that the aforesaid statues make it clear that whenever the benefits falling due to an employee under the said provisions are paid belatedly, interest is required to be applied mandatorily. Learned counsel further submits that the petitioner was not paid salary for 16 days in the month of Feb., 2007 during which he was still in service. He contends that the petitioner is also entitled to the arrears with interest accruing to him upon the recommendations of the Sixth Pay Commission being adopted by the respondent. He further submits that order dated 11.2.2015 casts a stigma on the petitioner as it unjustifiedly reflects that the petitioner was absconding whereas the petitioner had before hand submitted the application for voluntary retirement which was not acted upon by the respondent Nigam, and therefore, the word "absconding" which has been used in the order deserves to be expunged.

Per contra Mr. Ravi Bhansali, learned counsel for the respondent Nigam tried to counter the submissions advanced by the counsel for the petitioner. However, he admits that realizing the mistake that the order Annexure-8 dated 23.11.2007 whereby the petitioner was terminated from service was passed without following the procedure prescribed in law, the same has been reversed in the petitioner''s departmental appeal decided by the Board of Directors on 11.2.2015. The termination order dated 23.11.2007 was set aside and simultaneously, the employee''s request for voluntary retirement was accepted and he was given voluntary retirement from the respondent Nigam''s service w.e.f. 16.2.2007 by the order dated 11.2.2015. He thus submits that the petitioner''s prayer for awarding interest on the retiral dues should not be accepted as it would incur heavy financial burden on the already depleted finances of the Nigam.

Heard and considered the arguments advanced at the bar. Perused the material available on record. The order dated 11.2.2015 which has been placed on record today was passed in pursuance of verbal observations made during the course of hearing held on 5.2.2015. The learned counsel for the respondents fairly conceded that the order dated 23.11.2007 terminating the petitioner from service was passed without holding any departmental enquiry, which is a mandatory requirement as per law. Furthermore, the appeal preferred by the petitioner against the said order was kept undecided and gathering dust for years together without any justification whatsoever. The respondents had been put to notice of all these facts when the notices of the writ petition were served. Yet, for reasons best known to the concerned officials, no action was taken in the matter. No justification is shown as to why, the application for voluntary retirement submitted by the petitioner was not acted upon as required under regulation 18-3(a) and (c) of the Employees Service Regulations, 1964 which read as below:--

"18. Age of Retirement;

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(3)(a) Retirement on completion of 20 years qualifying service:

A Board employee may after giving atleast 3 months notice in writing to the Appointing Authority, retire from Board''s service on the date of which he completes 20 years of qualifying service or attains the age of 45 years whichever is earlier or any date thereafter to be specified in the notice:

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(c) If a Board employee seeks retirement under this sub-regulation while he is on leave not due, without returning to duty, the retirement shall take effect from the date of commencement of the leave not due and the leave salary paid in respect of such leave shall be recovered from him."

In this view of the matter and looking to the subsequent developments, this Court is of the opinion that better senses have now prevailed with the respondents who have themselves, vide order dated 11.2.2015 quashed the termination order dated 23.11.2007 and have accepted the prayer of the employee for voluntary retirement w.e.f. 16.2.2007. The word "absconding" was used in the order dated 11.2.2015 without any justification and is thus deleted and expunged.

Now coming to the prayer for applying interest on the delayed payments. An employee whose retiral and other service benefits are withheld without any cause or justification, is entitled to interest as of right under the provisions of Payment of Gratuity Act, 1972, the Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 and Rule 89 of the Rajasthan Civil Services Pension Rules. The relevant provisions of the above noted statutes are quoted hereinbelow for ready reference:--

"Section 7 of the Payment of Gratuity Act, 1972 reads as under:--

"7. Determination of the amount of gratuity.--(1) A person who is eligible for payment of gratuity under this Act or any person authorized, in writing to act on his behalf shall send a written application to the employer within such time and in such form, as may be prescribed, for payment of such gratuity.

(2) As soon as gratuity becomes payable, the employer, shall, whether an application referred to in sub-section (1) has been made or not, determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the controlling authority specifying; the amount of gratuity.

(3) The employer shall arrange to pay the amount of gratuity within thirty days from the date it becomes payable to the person to whom the gratuity is payable.

(3-A) If the amount of gratuity payable under Sub-section (3) is not paid by the employer within the period specified in sub-section (3), the employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government from time to time for repayment of long-term deposits, as that Government may, by notification specify:

Provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has obtained permission in writing from the controlling authority for the delayed payment on this ground." Notification specifying interest (1987)

Section 7Q of the Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 reads as under:--

"7Q. Interest payable by the employer.-The employer shall be liable to pay simple interest at the rate of twelve per cent per annum or at such higher rate as may be specified in the Scheme on any amount due from him under this Act from the date on which the amount has become so due till the date of its actual payment:

Provided that higher rate of interest specified in the Scheme shall not exceed the lending rate of interest charged by any scheduled bank." 11. Rule 89 of the Rajasthan Civil Services (Pension) Rules, 1996 reads as under:--

"89. Interest on delayed payment of retiral benefits : 2 "[(1) If the payment of retiral benefits has been authorised after 60 days from the date when its payment became due, and it is established that the delay in payment was not on account of failure on the part of the Government servant in compliance of the procedure laid down in this chapter or elsewhere in these rules, interest @ 9% per annum from the date retiral benefits become due would be payable till the end of the month preceding the month in which the retiral benefits are authorised.]"

(2) Every case of delayed payment of retiral benefits shall, suo moto, be examined by the Head of Office and shall be forwarded to the Administrative Department through the Head of the Department, and where the Administrative Department is satisfied that the delay in the payment of retiral benefits was caused on account of administrative lapse or inaction, the Administrative Department concerned shall issue sanction for the payment of interest to the Director, Pension Department.

(3) In all cases, where payment of interest has been authorised, the Administrative Department concerned shall fix responsibility and take disciplinary action under the Rajasthan Civil Services (C.C.A.) Rules, 1958 against the Government servant(s) who is/are found responsible for the delay in the payment of retiral benefits and shall recover the loss caused to the Government due to payment of interest to the pensioner from the Government servant(s) held responsible.

(4) In the order for payment of interest, the Administrative Department shall also mention the name (s) of officer(s)/official(s) responsible for delay and the amount of interest recoverable from him/them.

(5) If as a result of Government''s decision taken subsequent to the retirement of a Government servant, the amount of retiral benefits already paid on his retirement is enhanced on account of - (a) grant of emoluments higher than the emoluments on which retiral benefits, already paid, were determined, or (b) liberalisation in the provisions of these rules from a date prior, to the date of retirement of the Government servant concerned. No interest on the arrears of retiral benefits shall be paid.

(6) In case any delay is caused in the Pension Department, responsibility shall be fixed for such delay and suitable action taken against such erring official(s) to recover the interest paid to the pensioner."

In view of the specific provisions of law quoted hereinabove, it is evident that the interest is rightfully claimed by the petitioner under statutory provisions. The denial of the amount must have caused great deal of hardship to the petitioner who was denied of his rightful retiral dues owing to the grossly unjust and arbitrary action of the concerned officials. Thus, this Court is of the opinion that the prayer made by learned the counsel for the respondents not to apply interest on the accrued amount is unacceptable as being contrary to law.

As a consequence, the writ petition deserves to be and is hereby allowed. The respondents shall make payment to the petitioner of his due salary upto 16.2.2007, gratuity, C.P.F., leave encashment, and any other lawful dues with interest @ 9% (rationalized uniformly for all dues in order to avoid complications). The entire amount shall be paid to the petitioner within a period of two months from the date of this order failing which the interest shall stand enhanced to 12% per annum.

The respondent Nigam would be well advised to initiate action as per Rule 89(3) of the Pension Rules for recovering the extra financial burden suffered by it in the above facts and circumstances.

No order as to costs.