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2017 DIGILAW 766 (KAR)

SHIVANANJAPPA S/O. LATE NANJAPPA v. CHAIRMAN & MANAGING DIRECTOR ITI LIMITED

2017-04-19

A.N.VENUGOPALA GOWDA

body2017
ORDER : The petitioner rendered service in ITI Ltd., Bengaluru – 560 016 with effect from 26.11.1975 till 30.11.2003 i.e., the date on which he was relieved by accepting the offer of voluntary retirement from service. As Rs. 2,68,000/- payable as retirement benefit was not paid, W.P.No.11817/2006 was filed asking for a mandamus against the respondents to pay the said amount with interest. A submission having been made that the retirement benefit was withheld on account of the pendency of O.S. No.8307/2003 in the City Civil Court and that the suit having been subsequently disposed of, the claim made for release of the retirement benefit would be considered, the petition was disposed of directing the respondents to process the release within 6 weeks’ period. CCC No.727/2007 was filed alleging non compliance of the direction issued in W.P.No.11817/2006. By an Order dated 13.12.2007, finding that VRS benefits payable has been paid, but there is some amount of delay and as the order did not specifically direct payment of interest, the petition was closed with an observation that if the petitioner wants to have the relief of interest, he should work out the remedy separately. W.P. No. 8231/2008 was filed asking for a mandamus against the respondents to release interest on the delayed payment of retirement benefit of Rs. 2,68,000/- with effect from December 2003 to November 2006, totally amounting to Rs. 1,44,720/-. Finding that a representation submitted by the petitioner for payment of interest for the delayed period on the retirement benefits is pending, by an Order dated 20.03.2009, the petition was allowed and the respondents directed to consider the representation in the light of the decision of the Apex Court in VIJAY L. MEHROTRA Vs. STATE OF U.P., (2001) 9 SCC 687 . The respondents having notified the petitioner on 17.04.2009, that he is not entitled for the benefit of the payment of interest, as an amount of Rs. 2,52,200/- out of the terminal benefit payable was held up due to the order passed in O.S. No.8307/2003 by the City Civil Court, this petition was filed to quash the said communication, produced as Annexure-M along with the writ petition and asking for a mandamus against the respondents for payment of Rs. 1,44,720/- being the interest at 18% p.a. on the delayed payment of retirement benefits. 2. 1,44,720/- being the interest at 18% p.a. on the delayed payment of retirement benefits. 2. Sri H. Mohan Kumar, learned advocate contended that the respondents ought to have released the retirement benefits in favour of the petitioner as on the date of retirement itself and there being no justification for withholding of Rs. 2,52,200/-, interest at 18% p.a. for the delay period is liable to be paid. He submitted that the pensionary benefits if had been received and invested in fixed deposit, would have earned interest. He submitted that despite submission of repeated representations and filing of writ petitions, the respondents failed to act diligently and thus made the petitioner to suffer. He contended that the decision of the respondents as at Annexure-M is arbitrary. 3. Sri S.G. Hegde, learned advocate on the other hand contended that a third party Smt. Shantha C. had filed O.S. No. 8307/2003 in the City Civil Court not only against the petitioner but also the respondents and sought for passing a decree of declaration not to disburse the terminal benefits to the petitioner. He submitted that the said suit having been dismissed, Smt. Shantha C. instituted O.S. No.1803/2005 in the City Civil Court against the petitioner and also the respondents for passing a decree for recovery of Rs. 2,52,200/-, out of the terminal benefits of the petitioner. He submitted that an ad interim order was passed in the said suit on 09.03.2005 directing the Chairman and Managing Director of ITI Ltd., to maintain statusquo with regard to the service benefits of the 1st defendant i.e., the petitioner herein and the said order was in operation up to 07.04.2006. He submitted that soon after the said adinterim order was vacated, the amount payable to the petitioner was released. He further submitted that by keeping in view the order passed in W.P. No. 8231/2008, representation was considered and the petitioner notified of the outcome vide Annexure–M. He submitted that there being no wilful delay in the matter of payment of balance retirement benefits, which had remained undisbursed only on account of the litigation in the City Civil Court, the respondents are justified in declining to accede to the request for payment of interest. 4. Perused the record and considered the rival contentions. 4. Perused the record and considered the rival contentions. Point for consideration is, whether there was any justification for the respondents in not releasing the entire retirement benefits to the petitioner, soon after his retirement from service? 5. Petitioner demitted service of the respondents on 30.11.2003. The terminal benefits payable was to the tune of Rs. 5,92,818.92. Smt. Shantha C. filed O.S. No.8307/2003 in the City Civil Court against the petitioner and ITI Ltd., for passing a decree of injunction against the Management of ITI Ltd., not to disburse the retiral benefits to the petitioner. The suit having been dismissed, Smt. Shantha C. filed O.S. No.1803/2005 on 05.03.2005 against the petitioner and the Management of ITI Ltd., for passing a decree for recovery of Rs. 2,52,200/- out of the terminal benefits payable by the respondents to the petitioner. By an ad interim order dated 09.03.2005, Management of ITI Ltd., was directed to maintain statusquo with regard to the service benefits of the petitioner. The said order was vacated on 07.04.2006. 6. The petitioner was paid on 15.01.2005, Rs. 3,40,000/-, out of Rs. 5,18,818.92 and Rs. 2,52,200/- was held up because of the order passed on 09.03.2005 in O.S. No.1803/2005. The said amount could not be paid to the petitioner, as the respondents were restrained by the City Civil Court from disbursement. Though the petitioner was the 1st defendant in the said two suits, he did not seek for vacating the ad interim order. Within a reasonable period from the date O.S. No.1803/2005 was dismissed, balance terminal benefits was paid to the petitioner. 7. In the ordinary course, retirement benefits should be paid to the employee within a reasonable period from the date of retirement, if not on the date of retirement. There would be liability to pay interest in case there is delay of more than six months or failure to show justification for nonpayment within a reasonable period. 8. 7. In the ordinary course, retirement benefits should be paid to the employee within a reasonable period from the date of retirement, if not on the date of retirement. There would be liability to pay interest in case there is delay of more than six months or failure to show justification for nonpayment within a reasonable period. 8. In the present case, there was justification for the delay in payment of the retiral benefits on account of the suits instituted by Smt. Shantha C. against the petitioner as well as the respondents and the ad interim order passed by the City Civil Court against the management of ITI Ltd. On account of the litigation against the petitioner in the Civil Court and restraint order passed against the respondents from releasing the terminal benefits, there is justification for not making the payment within a reasonable period from the date of demitting the service by the petitioner. The delay in making the payment, having regard to the facts and circumstances noticed supra, cannot be attributed to the respondents. It is on account of the civil litigation between Smt. Shantha C. and the petitioner, wherein the Management of ITI Ltd., was arrayed as 2nd defendant and the restraint order passed, the terminal benefits was not paid. From the date of termination of civil litigation, there is no undue delay in the matter of payment of balance terminal benefits to the petitioner. For the foregoing discussion, the petitioner is not entitled to the relief sought for. In the result, the petition is dismissed, with no order as to costs.