M.H. Nadaf vs The Accountant General (A and E) and Others

A.S. Bopanna, J.—The petitioner who was applicant before the Karnataka Appellant Tribunal (''KAT'' for short) in application No. 15354/2002 is before this Court assailing the order dated 25.07.2011 passed by the KAT.

The petitioner who retired as Superintendent of Police was not paid his terminal benefits more particularly CVP and DCRG. In that view, the petitioner had filed application before the KAT seeking that respondent No. 1 be directed to pay the withheld amount with interest at 12% per annum till the realisation of the amount. The respondents had appeared before the KAT and had resisted the claim putforth by the petitioner. The contention on behalf of respondent No. 3 is that quarters belonging to them had been allotted in favour of the petitioner. Though he had been transferred and relieved on 08.08.1997 he had continued to occupy the quarters until he vacated the same on 15.10.1999. In that view, it was contended that he had overstayed in the quarters for a period of two years and one month. Hence, it was contended that as per the Rule 26(a) of the P.W.D. Rules, respondent No. 3 was required to levy penal rent in the manner as provided therein. It was contended that for the next one month after grace period, three times usual rent was to be levied and for the remaining period until one vacate quarters five times the usual licence fee is to be charged. In that view, it was contended that the amount which was to be charged byway of licence fee and penal licence fee was in a sum of Rs. 1,30,418/-. On deducting the amount which was available the penal rent payable was in a sum of Rs. 1,05,991/-. Hence, it was sought to be justified that the amount withheld was towards the recovery of the said amount. The stand on behalf of respondent No. 1 is that since the amount was due and payable to respondent No. 3 in respect of accommodation that had been provided during the services and further since Rule 215(2)(c) of KCS Rules provides for recovery of non government dues also from the retiral benefits of a Government servant, the power therein was exercised and the amount was withheld to pay the dues to respondent No. 3.

The KAT while considering the rival contentions has taken note of the several contentions which had been putforth on behalf of appellant to contend that the deductions of the amount from the retiral benefits cannot be made. In that regard, on taking note of the position of law as enunciated in the different decisions, the KAT has arrived at a conclusion that respondent No. 3 would be entitled to the amount since the petitioner had overstayed in the quarters and respondent No. 1 would be entitled to withhold such amount from the retired benefits for payment. The penal rent as charged was also upheld. However, KAT has proceeded to hold that the amount of Rs. 1,60,000/- would be the amount which would have to be recovered as the dues of respondent No. 3 and on permitting the same, KAT has further held that the amount in excess of the same could not have been withheld by respondent, No. 1 and therefore has ordered that said amount be refunded with interest at the rate of 6% per annum.

Having heard the learned counsel for the parties, we have perused the petition papers. With regard to the fact that the petitioner had overstayed in the quarters which had been allotted to him by respondent No. 3, there can be no dispute whatsoever. With regard to the penal rent, the Rule providing for imposing such penal rent has been taken into consideration and based on the same the penal rent has been imposed. Therefore, to the said extent the petitioner cannot make out any grievance. Having arrived at the above conclusion, the question that would also arise for consideration is the actual amount which was required to be deducted from the retiral benefits and the rate at which respondent No. 1 ought to have been directed to pay the interest for the unpaid retiral benefits which had been withheld without authority of law.

In that regard, from the order passed by the KAT we find no explanation as to how the amount of Rs. 1,60,000/- has been quantified. In that background, a perusal of the objection statement filed on behalf of respondent No. 3 would indicate that for the overstayed period of two years and one month the rent even if calculated as provided under Rule 26(a) of P.W.D. Rules and after providing the deduction of the available amount, only a sum of Rs. 1,05,991/- was the amount which could have been recovered on behalf of respondent No. 3. It is clear that as on the date when the objection statement had been filed that was the only amount that was payable in respect of the quarters as the petitioner had vacated the quarters on 15.10.1999 and no further amount could have accrued in addition to what has been stated in the objection statement.

Therefore, in the circumstance where respondent No. 3 themselves have indicated the quantum of amount due towards penal rent as Rs. 1,05,991/-, no further amount could have been awarded by the KAT and that too without any justification in that regard. Hence, we are of the opinion that conclusion reached by the KAT that a sum of Rs. 1,60,000/- could be withheld from DCRG is not justified. The justification can only be for withholding a sum of Rs. 1,05,991/-. Hence, to the said extent the respondents would be justified. Even as on the date of the retirement of the petitioner on 31.12.2001, the amount which was payable to respondent No. 3 was in a sum of Rs. 1,05,991/- and the remaining amount had become payable to the petitioner. Therefore, for the amount beyond Rs. 1,05,991/- which had been withheld by respondent No. 1 though at the request of the respondent No. 3 the petitioner would be entitled to interest. The question is, at what rate the interest is liable to be paid. The Tribunal has awarded interest at 6% per annum. The Government Order byway of circular which is at Annexure-A3 would indicate that when there is delay in disbursement of pension and such other retiral benefits, the interest payable is at 7% per annum for the period from six months to one year. Thereafter, the interest payable is at 10%. Therefore, depending on the delayed period the interest would have to be paid. In the instant case, it is contended that the amount which was due and payable to the petitioner has been withheld for a period of more than one year. The date on which the amount was due to be paid to the petitioner shall be taken into consideration as per the rules, as it had become payable and from the said date, if the delay is more than one year, the petitioner would be entitled to interest at 10% per annum on the amount which was due.

Therefore, the respondents though may deduct a sum of Rs. 1,05,991/- from the total DCRG amount due and payable to the petitioner, the excess amount which had been withheld by respondent No. 1 shall be paid to the petitioner with interest at 10% per annum. The payment of the said amount if has not been made as on today shall be paid to the petitioner within eight weeks from the date of receipt of copy of this order. If the said amount is not paid within eight weeks, the said amount shall carry interest at 16% per annum after the expiry of eight weeks.

In terms of the above, petition stands disposed of.