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2007 Supreme(All) 890

IN THE HIGH COURT OF ALLAHABAD
MR. JUSTICE D.P. SINGH
Mohd. Rais Khan
Versus
U.P. State Road Transport Corporation and Others
C.M.W.P. No. 69724/2006
Decided on : April 4, 2007

Advocates appeared
For Petitioner: W.H. Khan, J.H. Khan
For Respondents: Sameer Sharma

Entitlement to interest on delayed payment of gratuity in accordance with Section 7(3-A) of the Payment of Gratuity Act, 1972.

Headnote:

Mandamus - Payment of Gratuity - Section 7(3-A) of the Payment of Gratuity Act, 1972 - Summary: The court directed the respondents to pay 12% simple interest to the petitioner on the delayed payment of gratuity from one month after his retirement till the amounts were actually paid, in accordance with Section 7(3-A) of the Act.

Fact of the Case:

The petitioner, a senior Clerk, retired and sought a writ of mandamus to compel the respondent-Corporation to pay all retiral dues, including gratuity and interest for delayed payment.

Finding of the Court:

The court found that the petitioner was entitled to interest on the delayed payment of gratuity, as the entire gratuity had not been paid and there was no occasion for the petitioner to have claimed payment of interest earlier.

Issues: Delayed payment of gratuity, claim for interest, application of principles of res-judicata.

Ratio Decidendi: The court held that the petitioner was entitled to interest on the delayed payment of gratuity in accordance with Section 7(3-A) of the Payment of Gratuity Act, 1972, as there was no occasion for the petitioner to have claimed payment of interest earlier.

Final Decision: The petition succeeded, and the respondents were directed to pay 12% simple interest to the petitioner on the delayed payment of gratuity from one month after his retirement till the amounts were actually paid, with the possibility of compound interest if the amounts were not paid within six weeks.

Judgment

Per D.P. SINGH, J.

Heard counsel for the petitioner and Sri Sameer Sharma for the contesting respondent. The following substantial relief for a writ of mandamus has been sought through this petition.

"issue a writ, order or direction in the nature of mandamus commanding the respondents to pay interest on the amount of gratuity in accordance with Section 7(3-A) of the Payment of Gratuity Act, 1972 on an amount of Rs. 1,42,407/- for a period of one year i.e. from the date of retirement i.e. January 31, 1991 to December, 1991 when an amount of Rs. 51,392.31 were paid and thereafter on an amount of Rs. 91,015.33 for a period of up to June 23, 2001 when another amount of Rs. 51,392.30 was paid through cheque No. 8995 dated June 23, 2001 at the rate of 12% per annum which approximately comes to Rs. 27,000/- with further interest at the rate of 24% per annum till the payment is made."

2. The petitioner was working as a senior Clerk in the Central Workshop of the respondent-Corporation when he retired on January 31, 1999 on attaining the age of superannuation. Certain amounts .were paid to him but all retiral dues including gratuity was not paid, forcing him to prefer the writ petition No. 55594 of 2000 seeking a mandate to the respondent to pay all the retiral dues. The said writ petition was disposed off vide order dated. January 2, 2001 with a direction to the respondent-Corporation to decide the claim of1 the petitioner within two months and to pay him the dues found to be outstanding. The petitioner made his representation for the retiral dues claiming interest thereon for delayed payment also. The respondent-Corporation by the order dated February 28, 2001 refused grant of interest on the ground of bad financial condition of the Corporation and also did not pay the admitted dues forcing the petitioner to prefer: contempt petition No. 805 of 2001 and upon issuance of notice, the second instalment of gratuity amounting to Rs. 51,399/- was paid through cheque dated June 23, 200 I and the last instalment of gratuity amounting to Rs.: 39,623/- was paid alonowith other dues through cheque dated June 26, 200 I but no interest was paid. When the petitioner pressed for payment of interest before the Contempt Court, it refused stating that there is no direction of the writ Court for payment of interest and as such it discharged the notices as otherwise the dues had been paid. In these circumstances, the present petition claiming interest has been filed.

3. The facts relating to the delayed payment of gratuity have not been denied by, the respondents. However, it is contended that the claim for payment of interest is barred by principles of constructive res-judicata because no claim, for interest was made by the petitioner when the earlier writ petition was filed and therefore he is estopped from claiming it now. In support thereof he has relied upon a decision of the Apex Court in the case of Commissioner of Income Tax. Bombayv. T.P. Kumaran (1996) 10 SCC 561 : 1997-I-LLJ-117 and a Division Bench of this Court in the case of Rakesh Kumar Agrawal v. State Bank of India 2003 (3) ESC 133.

4. It is trite that where a relief could have been sought on a set facts in the earlier proceedings, claim of that relief on those very facts in successive proceedings would be hit by principles of res-judicata, as enshrined in Explanation IV to Section 11 and Order 11, Rule 2 C.P.C. But, it is also correct that if there was no occasion to seek a relief in the earlier proceedings the petitioner cannot be estopped or deprived of the relief in the subsequent proceedings when the facts defer and the claim is turned down. The ratio of the Apex Court in Kumarans case and so also of the Division Bench of this Court in Rakesh Kumar Agrawals case (supra) cannot be disputed, but the question is whether they would apply in the present set of facts?

5. The only relief claimed in this petition is for payment of interest on delayed payment of gratuity in accorda



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