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2023 Supreme(P&H) 1785

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Harsimran Singh Sethi, J.
Financial Commissioner and Principal Secretary to Govt. of Haryana & Ors. – Appellants
Versus
Randhir Singh Yadav – Respondent
R.S.A.No. 2963 of 2014
Decided On : 11-01-2023

Advocates appeared:
For the Appellant : Mrs. Vibha Tewari AAG, Haryana
For the Respondent: Mr. R.D. Yadav

Headnote:(A) Civil Procedure Code - Section 34 - Pensionary benefits - Claim for interest on delayed release of pensionary benefits following retirement - Courts below awarded interest at 18% on delayed payments, which was challenged by the State - Established principle that interest is payable when there is undue delay in disbursement - Trial Court's decree upheld by the lower Appellate Court, confirming right to interest. (Paras 5-11)

(B) Interest on Delayed Payment - The principle that an employee is entitled to timely payment of pensionary benefits and can claim interest for the delay - Duty on the State to ensure timely disbursement, with consequences for failure to do so established in precedent cases. (Paras 9-11)

(C) Rate of Interest - Court modified award from 18% to 9% following established legal principles and absence of evidence for higher market rates at the time of the delayed payments. (Paras 12-19)

Facts of the case:
The respondent-plaintiff, after retiring on 31.07.2008, waited until 2009 for pensionary benefits, leading to a civil suit for interest on the delayed payment, which was decreed at 18%. The State appealed, but the lower court upheld the interest awarded.

Findings of Court:
Confirmed entitlement to interest on delayed payments is founded on statutory duty, with courts upholding the respondent's claim.

Issues: Whether the delayed pensionary benefits entitle the plaintiff to interest, and whether the 18% interest rate was justifiable under law.

Ratio Decidendi: The court affirmed that pension and benefits are to be released within two months post-retirement, and failure results in entitlement to interest; thus, the lower rate is appropriate in accordance with statutory guidelines.

Result: The appeal is disposed of; interest modified to 9%.

Table of Content
1. facts leading to the appeal (Para 1 , 2 , 3)
2. arguments regarding interest on delayed pension (Para 4 , 5 , 6)
3. delay in pension release entitles interest (Para 9 , 10 , 11)
4. assessment of proper interest rate (Para 12 , 13 , 14 , 15 , 16 , 17 , 18)
5. final ruling on interest awarded (Para 19 , 20 , 21)

Judgment

Mr. Harsimran Singh Sethi, J.

Before adverting to the grounds raised in the present Regular Second Appeal, certain facts needs to be enumerated which has led to the filing of the present Regular Second Appeal.

2. The respondent-plaintiff retired on 31.07.2008 and became entitled for the release of the pensionary benefits in respect of the service rendered by him with the Government of Haryana. The pensionary benefits were only released in favour of the respondent-plaintiff in the year 2009 and the respondent-plaintiff claimed interest on the delayed release of the pensionary benefits. As the benefit of interest was not extended to him, he preferred a civil suit claiming interest on the delayed release of the pensionary benefits and his suit was decreed by the trial Court on 18.04.2011 allowing him the interest on the delayed release of the pensionary benefits with 18% interest. The judgment of the trial Court was appealed by the respondent-State, which appeal has been dismissed by the lower Appellate Court on 31.05.2013 upholding the grant of interest @ 18% in favour of the respondent-plaintiff.

3. Present Regular Second Appeal has been filed by the State against the order of the trial Court dated 18.04.2011 by which, the interest on the delayed release of the pensionary benefits has been allowed @ 18% as well as the judgment of the lower Appellate Court dated 31.05.2013 by which the appeal filed by the State of Haryana has been dismissed and the judgment of the trial Court dated 18.04.2011 has been upheld.

4. Learned counsel for the appellants submits that the respondent-plaintiff himself, after he retired on 31.07.2008 wrote certain letters for the grant of benefit of particular number of years of service rendered by him, which application was under consideration due to which, there was a delay in the release of the pensionary benefits, hence, as there was no intentional delay on the part of the Department, the grant of interest by the Courts below on the release of pensionary benefits is contrary to the facts on record as well as the settled principle of law.

5. Learned counsel for the appellants further submits that the grant of 18% interest on the delayed payment is contrary to the Section 34 of the CPC according to which, the interest can only be granted by the Courts keeping in view the bank rate, hence, grant of interest @ 18% is not only contrary to the provisions of law but also to the judgment of the Hon’ble Supreme Court of India in Civil Appeal No.7113 of 2014 titled as D.D. Tewari (D) through LRs vs. Uttar Haryana Bijli Vitran Nigam Ltd. and others, decided on 01.08.2014 wherein, only 9% interest was granted.

6. Learned counsel for the respondent-plaintiff controvert the plea of the appellants and submits that once there was no impediment in the release of the pensionary benefits, whatever the respondent-plaintiff was entitled for, the same should have been released to him within the specified period. Learned counsel for the respondent-plaintiff further submits that as there was delay, which is conceded but being termed as procedural one, the same cannot come to the rescue of the Department so as to avoid the payment of interest keeping in view the settled principle of law.

7. I have heard learned counsel for the parties and have gone through the record with their able assistance.

8. From the evidence, which has come on record, the delay in release of the pensionary benefits is conceded by the learned counsel for the appellant even during the arguments. Learned State counsel has not been able to rebut the fact that the payment for which the respondent-plaintiff was entitled for after his reti

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