An employee is entitled to interest on delayed promotional benefits, even if the employer acted in good faith in withholding the promotion due to pending criminal charges, if the employer utilized the pecuniary benefit during the interim period and the employee was not at fault for the delay.

Ashim Kumar Banerjee, J.

FACTS :

Respondent Krishnananda Banerjee was an officer of Reserve Bank of India. He was a Class-I Grade-A Officer and working as Assistant Manager in the Foreign Exchange Department. He was promoted as Assistant Manager (promotee) on ad hoc and temporary basis with effect from October 16, 2001. The Authority regularized such promotion with effect from November 8, 2001, effective from November 7, 2001. He claimed to have an unblemished service career. He complained of not getting the benefit of assured personal promotion as per the scheme introduced on November 21, 2005. The Authority took the plea, he was subjected to a departmental proceeding and he was suspended being involved in a criminal case initiated at the instance of his the then wife Smt. Kabita Banerjee. Facts would depict, the couple was married on April 15, 2001.

The lady complained of being physically and mentally tortured by the husband and the family members. The husband was arrested on April 30, 2005 and released on bail on May 5, 2005. We are told, ultimately Krishnananda got an honourable acquittal that was affirmed by the Court of appeal. At the instance of the wife, the couple got divorce subsequently. The Authority supported their stand under Regulation 46(5) read with Regulation 39(2) of the RBI Staff Regulation, 1948. The Authority alleged, he absented himself unauthorisedly for four days when he was in custody. The Authority granted him extraordinary leave without pay for the period when he was in custody. He filed a writ petition just before his retirement, complaining of not getting the assured promotion. However, we are told, during pendency of the application, the Authority gave him appropriate benefit of promotion. The writ petition being W.P. No. 494 of 2008 came up for hearing before the learned Single Judge. The learned Single Judge disposed of the same by judgment and order dated March 15, 2013 appearing at pages 376-384 of the paper book. He challenged the letter dated August 22, 2007 addressed to him by the Bank whereby the Bank justified their action in delaying the process of assured promotion relying on Regulation 18.4.4 of the Master Circular. He contended, the Regulation 18.4.1 to 18.4.4 would relate to disciplinary proceeding and/or any criminal proceeding, relating to service of an employee. Since the allegation made against him under Section 498A of the Indian Penal Code would relate to a private complaint made by his ex-wife on a matter not in any way connected with the official work, such regulation and/or guideline and/or circular would have no role to play. However, he admitted, during pendency of the writ petition, he retired from service and the Authority transferred him the benefit of the promotion by transferring the pecuniary benefit to his Savings Bank Account without informing him. Hence, he claimed interest on such delayed payment. The learned Judge recorded his contention. The relevant extract is quoted below:

“He also submitted that the delay caused by the respondent-Bank prejudiced his interest and he suffered monetary loss since he could not invest money to earn something out of it. The respondent-Bank kept the money with them and also commercially utilized. Therefore, they are obliged to pay interest on the amount from October, 2006”.

The learned counsel appearing for the Bank Authority would however confront such allegation by contending, the Bank acted in good faith as per the service regulation and after the respondent had been acquitted of criminal charges the Authority paid him all his retiral benefit including the promotional benefit. This payment was made in 2011. We find from the judgment, the arrear was paid on May 23, 2011. The Bank paid the gratuity on July 8, 2011. The arrear pension was paid on December 1, 2011. The Bank also paid arrear salary and the difference of encashment of ordinary leave on December 13, 2011 and pension on 30th December, 2011. Significant to note