Important Point
Government Department must start the process for payment of retiral benefits to a retiring employee two years before an employee is due to retire and benefits must be paid promptly immediately on the very next day of retirement; any delay on the party of the Government department would make it liable for payment of interest.

Judgment

M. Jagannadha Rao, J.-The petitioner was working as Medical Officer in the service of the Government of Uttar Pradesh and retired on 30.4.1993 on completion of 58 years. She filed this writ petition on 18.11.1995 complaining that she has not been paid her retiral benefits, namely, gratuity, provident fund, pension etc. This Court admitted the writ petition on 4.12.1995 and issued notice to the respondents. The res­pondents submitted to this Court that, after her retirement, in spite of the petitioner being requested to send three sets of pension papers, petitioner did not send them. This was, however, denied by the petitioner. This Court directed the respondents on 12.2.1996 that upon petitioner furnishing three sets of pension papers with all relevant documents, the same should be processed. The respondents then sent a special messenger to various places to get details of her service and thereafter the pension papers were sent on 24.12.1996 to the Director General, Medical Health, U.P. It was stated that provisional pension was paid in December, 1996 and February, 1997. Arrears were paid on 17.3.1997. Papers were sent on 29.1.1997 to the Pension Directorate, Lucknow. In regard to the GIS it was pointed out that the petitioner had not paid premium of Rs. 4770/- and there­after, the petitioner deposited the same on 9.12.1997. The GIS was sent to petitioner on 17.12.1997, 90% of GPF was paid on 20.1.1998, balance was paid on 25.4.1998. The Gratuity was paid on 25.6.1997 and the encashment of earned leave was also paid on the same date. The petitioner demanded interest while the respondents contended that no interest was payable. Though some other questions relating to promo­tion etc. were referred to in the writ petition, learned senior coun­sel for the petitioner stated that the petitioner is confining this writ petition only in regard to the pensionary benefits. Now the only question that remains to be decided is the question relating to payment of interest. Learned counsel for the petitioner requested us that some guidelines may be issued regarding the steps to be taken by departments for prompt payment of retiral benefits.

Now-a-days, several writ petitions are being filed in this Court and various High Courts seeking relief for disbursement of retiral benefits, because of inordinate delays in payment of these benefits. As Krishna Iyer, J. stated in State of Mysore v. C.R. Sheshadri & Ors.1, ‘a retired government official is sensitive to delay in drawing monetary benefits. And to avoid posthumous satisfaction of the pecuni­ary expectation of the superannuated public servant-not unusual in government’, it is becoming necessary to issue directions, in several cases, for early payment of these dues. In yet another case in State of Kerala & Ors. v. M. Padmana­bhan Nair2, this Court had occasion to point out that usually ‘the delay occurs by reason of non-production of the L.P.C. (last pay certificate) and the N.L.C. (no liability certificate) from the concerned department’s but both the documents pertain to matters, records whereof would be with the concerned government departments. It was observed that inasmuch as the date of retirement of every government servant was very much known in advance, it was difficult to appreciate why the process of collecting the requisite information and issuance of the abovesaid two documents should not be completed well before the date of retirement so that the payment of gratuity amount could be made on the date of retirement or on the following day and the pension, at the expiry of the following month. This Court stated that the necessity for prompt payment of the retirement dues to a government servant immediately after his retirement could not be over-emphasised and it would not be unreasona­ble to direct that there would be a liability to pay penal interest on these retirement benefits. In several cases, decided by this Court, interest at the rate of 12% per annum has been directed t