The right to interest on delayed gratuity payments is statutory and mandatory under Section 7(3-A) of the Payment of Gratuity Act, 1972.

JUDGMENT :

Hemant M. Prachchhak, J.

1. By way of present petition under Article 226 & 227 of the Constitution of India, the petitioner has prayed for the following reliefs :

"a) YOUR LORDSHIPS be pleased to admit the present Special Civil Application;

(b) YOUR LORDSHIPS be pleased to allow this Special Civil Application by way of passing appropriate order, writ, mandamus or directions or writ of certiorari quashing and setting aside the impugned order dated 18.06.2021 passed by the respondent No.2 - Appellate Authority in Appeal No.138/2020 as well as the impugned order dated 21.09.2020 passed by respondent No.3 in Gratuity Application No.56/2019;

(c) Pending the admission, final hearing and disposal of the present Special Civil Application be pleased to stay the implementation, execution & operation of the impugned order dated 18.06.2021 passed by the respondent No.2 - Appellate Authority in Appeal No.138/2020 as well as the impugned order dated 21.09.2020 passed by respondent No.3 in Gratuity Application No.56/2019;

(d) Be pleased to pass such other and further orders as the nature of the case may be required and the Honourable Court may deem thought fit to pass such order."

2. The brief facts giving rise to the present petition are as under :

2.1. The respondent No.1, who was born on 01.06.1960 was recruited as Additional Assistant Engineer by the Gujarat Water Supply & Sewerage Board (hereinafter referred to as "Board" for short) on 03.09.1984 and was superannuated on 30.06.2018 on attaining the age of superannuation. That, his basic pay was of Rs.82,600 + D.A., House Rent Allowance, Medical Allowance and Vehicle Allowance, aggregating to Rs.91,796/-. That, the respondent No 1 was immediately released a benefit of leave encashment as he had settled down in Australia after his retirement on 30.06.2018 and therefore, amount of Rs.10 lakh towards gratuity was paid on 14.02.2019 after following due procedure. That at the relevant point of time, upper limit towards gratuity was of Rs. 10 lakh as per the provisions of Payment of Gratuity Act, 1972. That the members of the Board considered the proposal of enhancement of upper limit of gratuity to Rs. 20 lakhs in its meeting dated 10.07.2018 and also resolved to seek approval of the State Government. Thereafter, proposal was forwarded by the head office of Board on 28.09.2018 to Narmada Water Supply, Water Resources and Kalpsar Department of the Government of Gujarat. That after due deliberation and correspondence, the said proposal was approved on 17.09.2019 by the Government of Gujarat in Narmada Water Supply, Water Resources and Kalpsar Department and accordingly, upper limit of gratuity was enhanced to Rs.20 lakhs. That, the Board is having contributory provident fund scheme and gratuity is payable as per the provisions of the Payment of Gratuity Act, 1972. Hence, in all, approximately hundreds employees were required to be paid a differential amount towards gratuity after approval dated 17.09.2019 granted by the Government of Gujarat. Accordingly, respondent No. 1 was released a differential amount of Rs.7,33,490/- towards gratuity on 06.12.2019.

2.2. It is the case of the petitioner Board that, in spite of this factual background, respondent No. 1 preferred Gratuity Application No.56/2019 before the Controlling Authority under the provisions of Payment of Gratuity Act ie. respondent No.3. During the course of hearing, all the facts were brought to the notice of respondent No.3 by way of filing written submissions, but the respondent No.3 failed to appreciate the same and allowed the Gratuity Application No.56/2019 in spite of delay in filing thereof, by way of directing the petitioner Board to pay interest @ 10% p.a. for a period commencing from 7 months and 15 days for delayed payment of gratuity of Rs. 10 lakhs and for a period of 17 months and 6 days for delayed payment of differential amount of gratuity of Rs.7,33,647/-. The said order was challenged by way of filing Appeal No.