An employer is legally obligated to pay interest for the delay in the settlement of terminal benefits to retired employees, and the court may quantify this interest at a reasonable rate based on submission/settlement between parties.

PRAYER: The Writ Petition is filed under Article 226 of the Constitution of India seeking issuance of a Writ of Mandamus directing the respondents to pay interest at the rate of 12 percentage per annum on the belated payment of terminal benefits viz., Provident Fund, Gratuity, and Surrender Leave Salary amounting to Rs.26,76,587/- for the period from 30.06.2025 to 11.03.2026.

For Petitioner(s): Mr. K.Balakrishnan For Respondent(s): M/s.S.Pavithra, Standing Counsel

ORDER

The present Writ Petition has been filed seeking the issuance of a Writ of Mandamus directing the respondents to pay interest at the rate of 12 percentage per annum on the belated payment of terminal benefits viz., Provident Fund, Gratuity, and Surrender Leave Salary amounting to Rs.26,76,587/- for the period from 30.06.2025 to 11.03.2026.

2. It is the case of the petitioner that he joined the services of the respondent Corporation on 28.07.1997 and retired from service holding the post of Special Grade Conducotr on 30.06.2025, The terminal benefits were, however, delayed by about ten months and only settled on 11.03.2026. Therefore, the petitioner claimed interest at the rate of 12% on the belated payment of terminal benefits and he has also made a representation dated 12.03.2026 to the respondents to pay interest for the belated payment of terminal benefits, which has not been evoked any response so far. Hence, the petitioner is before this Court.

3. The learned Standing Counsel for the respondent would fairly submit that they are willing to pay the interest at the rate of 6% per annum for the belated payment of the eligible and admissible amount.

4. Heard the learned counsels appearing on either side and perused the materials available on record.

5. In view of the above submission of the learned Standing Counsel, this Court deems it appropriate to direct the respondent to pay interest at the rate of 6% per annum for the belated payment of admissible terminal benefits from the date of retirement till the date of actual disbursal of the terminal benefits of the petitioner, within a period of six (6) weeks from the date of receipt of a copy of this order.

6. Accordingly, this Writ Petition is disposed of. There shall be no order as to costs. 03-06-2026 Asi To