IN THE HIGH COURT OF JUDICATURE AT MADRAS (Special Original Jurisdiction)

RESERVED ON : 07.04.2025 PRONOUNCED ON : 29.05.2025 PRESENT:

THE HON’BLE DR. JUSTICE A.D. MARIA CLETE W.P. No. 6111 of 2021 and W.M.P. No. 6729 of 2021 The Management, Tamil Nadu State Transport Corporation (Villupuram) Ltd, No.3/137, Saalamedu, Villupuram – 605602 …. Petitioner Vs.

1. The Presiding Officer, Additional Commissioner for Labour, Appellate Authority for Payment of Gratuity Act, DMS Complex, Teynampet, Chennai – 600 006.

2. G.Kesavan, S/o. Govindan, No.6, Milagu Mariamman Koil Street, Ulundurpet Post, Villupuram – 606 107. …..Respondents Prayer in W.P.

To issue a writ of certiorari, or order, or direction in the nature of writ, to call for the records relating to the order dated 26.03.2018 passed in P.G.A.No.125 of 2017 and quash the same on the file of the 1^st respondent and pass such or other orders as this Hon’ble Court may deem fit and proper in the interest of justice in the facts and circumstances of the case Prayer in WMP To stay the operation of the award dated 26/03/2018 passed in P.G.A.No.125 of

2017 on the file of the 1^st respondent, pending disposal of the writ petition.

Appearance of Parties:

For Petitioner : Mr. M. Aswin, Advocate For Respondent 1 : Mr. Kumaravel, AGP For Respondent 2 : Mr.F.W.H.Pithasan, Advocate For K.Arunagiri, Advocate.

J U D G M E N T

Heard.

2.The petitioner is a State-owned Transport Corporation. The present writ petition has been filed challenging the order passed by the 1^st respondent, the Appellate Authority under the Payment of Gratuity Act, 1972 (hereinafter referred to as the “P.G. Act”), wherein interest at the rate of 10% was awarded for the delayed payment of gratuity under Section 7(3A) of the Act.

3.When the matter was taken up on 10.03.2021, this Court, while ordering notice in the writ petition, directed the petitioner–Transport Corporation to deposit a sum of Rs.60,000/- to the credit of P.G. Appeal No. 125 of 2017 on the file of the 1^st respondent. Thereafter, on 21.04.2021, private notice was also directed to be served on the contesting respondent. The contesting respondent has since entered appearance through counsel. When the case was listed on 23.04.2024, it was directed to be posted before the National Lok Adalat scheduled for 08.06.2024. However, as no settlement was reached, the matter has now been placed before this Court for final adjudication.

4.The short question that arises for consideration is whether the first respondent–Appellate Authority was justified in reversing the order of the Controlling Authority passed in P.G. Case No. 122 of 2014 dated 11.08.2016, and in allowing the appeal filed by the second respondent in P.G.A. No. 125 of 2017 dated 26.03.2018 by directing payment of interest at 10% on the delayed gratuity. If such a direction is found to be unjustified, the further issue is what rate of interest ought to have been ordered in the circumstances of the case.

5.The petitioner–Corporation does not seriously dispute the liability to pay interest for the delay in disbursing gratuity. However, its primary grievance is that the rate of interest fixed at 10% is excessive and ought to have been restricted to 6%, as held earlier by a Division Bench of this Court in W.A. No. 655 of 2018 dated 09.07.2018. This contention is specifically raised in paragraphs 6(d) and 6(e) of the writ affidavit, which read as follows:—

“(d)The learned 1^st respondent has failed to consider the dictum laid by the Division Bench of this Hon’ble Court by an order dated 09.07.2018 passed in W.A.No. 655 of 2018 in and by which this Hon’ble Court was graciously pleased to direct the petitioner to disburse the terminal benefit only at a reasonable rate of interest at 6%. P.a.

(e ) In any event the order passed by the learned 1^st respondent has to be modified by reducing the rate of interest in consonance with the judgment passed by this Hon’ble Court by an order dated 09.07.2018 passed in W.A.No.655 of 2018.”

6.The