Where No Liability Fixed On Employee, Writ Jurisdiction Can Be Invoked To Seek Interest On Delayed Payment Of Retiral Benefits: Kerala High Court

An employee of the Kerala Water Authority had approached the High Court in a writ appeal seeking interest on the delayed payment of his retirement benefits.

The Division Bench comprising Justice Anu Sivaraman and Justice C. Pratheep Kumar stated that the writ petition of the appellant should not have been rejected by directing the appellant to approach other authorities or to file a suit for realisation of interest on delayed payment through a Civil Court.

The appellant had initially approached the High Court seeking interest on delayed payment of DCRG. The writ petition was dismissed by the single judge stating that interest should have been claimed in appropriate proceedings before the Civil Court and not in a writ proceeding. Aggrieved by the judgment, the appellant has preferred a writ appeal.

The Counsel for the appellants Advocates Varun C Vijay and Divya Chandran relied upon the Apex Court decision in S. K. Dua v. State of Haryana and another (2008) to state that the question of interest of retirement benefits has to be considered by the High Court itself. It was argued that an employee could claim interest on delayed payment of retirement benefits even in the absence of statutory rules, administrative instruction or guidelines by relying upon Articles 14, 19 and 21 of the Constitution.

On the other hand, the respondents relied upon a decision of the Kerala High Court in Vijayakumaran Nair v. SBT (2005) wherein it was held that the High Court need not exercise its extraordinary original jurisdiction under Article 226 of the Constitution for adjudicating a claim of money for delayed interest. In that judgment, it was also stated that the High Court need not consider disputed claims for interest since such dispute can be decided by the civil court.

Considering the Apex Court decision in S K Dua (supra), the Court held that the decision in Vijayakumaran Nair (supra), is no longer applicable. It said: “Having considered the contentions advanced, we notice that the Apex Court having decided the question of payment of interest and the question with regard to consideration of the claim for interest by the High Court exercising jurisdiction under Article 226 of the Constitution of India, the decision in Vijayakumaran Nair v. SBT no longer holds the field. The decision of the Apex Court in S. K. Dua v. State of Haryana and another was rendered in a case where the claim raised was specifically for interest on delayed payment of retiral benefits alone.”

The Court also noted that there was no liability fixed against the appellant for the denial of his retirement benefits. It added: “In view of the specific facts of the instant case, where there is no allegation that any liability had been fixed with notice to the appellant within the time provided under Note 3 to Rule 3 of Part III KSR, the claim for interest was liable to be considered by the learned Single Judge in the writ petition itself.”

Accordingly, the Court directed the respondents to pay the interest on the delayed payment of DCRG. It also stated that the Water Authority could recover interest so paid from the officers who were responsible for the delayed payment of the DCRG.

Counsel for respondents: Senior Government Pleader Saigy Jacob Palatty, Advocate Georgie Johny

Citation: 2024 LiveLaw (Ker) 173

Case title: P V Nandakumar v State of Kerala

Case number: WA NO.1860 OF 2023

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