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THE GAUHATI HIGH COURT, (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
DEVASHIS BARUAH
Management, Holy Child School, Represented By Its President Sr. Kathreena Kannampuzha – Appellant
Versus
State Of Assam, Rep By The Commissioner And Secretary To The Govt Of Assam Deptt Of Labour And Employment – Respondent
JUDGMENT :
DEVASHIS BARUAH, J.
Heard Mr. G. Choudhury, the learned counsel appearing on behalf of the Petitioner and Mr. M. Chetia, the learned Government Advocate appearing on behalf of the Respondent Nos. 1 and 2. I have also heard Mr. N. Patiri, the learned counsel appearing on behalf of the Respondent No.3.
2. The Petitioner herein has approached this Court challenging the orders dated 04.03.2025 and 08.05.2025 passed in LPG case No.42/2024 whereby the Respondent No.2 had arrived at the finding that the Respondent No.3 is entitled to an amount of Rs.7,34,123/- on account of gratuity and as an amount of Rs. 1,00,000/- has already been paid, the Petitioner was further required to pay an amount of Rs.6,34,123/- along with interest at the rate of 10% per annum from the date it fell due.
3. This Court while entertaining the instant writ petition and issuing notice on 19.09.2025 categorically observed that the Respondent No.3 herein is entitled to the gratuity of Rs.7,34,123/- in terms with the Payment of Gratuity Act, 1972 (for short ‘the Act of 1972’) and therefore and as an amount of Rs.1,00,000/- have already been paid to the Respondent No.3 earlier, this Court directed the Petitione
An employer must pay gratuity within 30 days and is liable for interest if delayed, regardless of an employee's application.
Employer must pay gratuity within 30 days of it becoming due, with interest chargeable after this period, regardless of employee application.
The right to interest on delayed gratuity payments is statutory and mandatory under Section 7(3-A) of the Payment of Gratuity Act, 1972.
The statutory notification setting the interest rate for gratuity under the Payment of Gratuity Act is binding until modified by a new notification from the government.
Interpreting Act unequivocally indicate that payment of gratuity would not depend upon employee filing an application before employer demanding gratuity but will have to be paid immediately on cessat....
The mandatory obligation of employers to pay gratuity within the specified timeframe includes the responsibility to pay interest on delayed payments, as established by the Payment of Gratuity Act.
Interest under the Payment of Gratuity Act is due from the date of entitlement unless hindered by claim delays, resulting in dismissal of a petition for earlier interest claims.
The right to interest on delayed gratuity payments is statutory and mandatory under Section 7(3-A) of the Payment of Gratuity Act, 1972.
The statutory interest rate for delayed gratuity payments is 10%, as mandated by Section 7(3A) of the Payment of Gratuity Act, 1972, and prior contrary rulings are not binding.
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