The Allahabad High Court has granted interest on the delayed payment of post-retiral dues to a former Nagar Palika employee, emphasizing that employees should not be retired while disciplinary proceedings are still pending unless there are very compelling reasons.
In its ruling, the court imposed a fine of Rs. 10,000 on the Executive Officer of Nagar Palika Parishad, Seohara, Bijnor, for delaying the payment of the employee’s retiral dues despite there being no conclusive charges against him.
Justice J.J. Munir, in his judgment, stated, “No employee should be allowed to retire with disciplinary proceedings pending against him unless these are initiated on the eve of his retirement for very compelling reasons, or the charges are so serious and the facts so complicated that the inquiry would extend beyond the employee’s retirement.”
The court noted that the delay in disbursing the post-retiral benefits was as long as two years, which it described as a “long period of time in man’s short life.” The court criticized the Executive Officer and the Commissioner for not considering the distress caused to the petitioner by the delay, as they were not personally affected.
The petitioner, born on June 1, 1959, served as a Revenue Moharir in Nagar Palika Parishad, Seohara, Bijnor. He was appointed as Naib Moharir on a temporary basis in 1977 and was later regularized in 1982. A complaint was filed against him, alleging he had been appointed before reaching the legal age of majority. An inquiry in 2018 confirmed that he was 17 years and 8 months old at the time of his first appointment. As a result, he was suspended.
Although the inquiry report was submitted in January 2019, the petitioner, who was set to retire in May 2019, requested the Executive Officer to conclude the disciplinary proceedings. After his retirement, the petitioner approached the authorities to release his post-retiral dues but received no response.
Despite a writ court order directing the disbursal of dues based on the outcome of the disciplinary proceedings, the authorities failed to comply. The petitioner filed a contempt application, and although some amounts were released, the remaining dues were still pending. After further complaints, including through the Chief Minister’s Jansunwai portal, the petitioner was informed that the delay was due to departmental overload.
When the petitioner’s application for interest on the delayed dues was rejected, he approached the High Court. The court ruled that once an employee is suspended and nearing retirement, it is the employer’s responsibility to complete the disciplinary process before retirement. The court noted that the suspension was lifted only after the petitioner retired, severing the employer-employee relationship.
The court observed that once the decision was made to pay the full retiral dues, it implied that the petitioner had been exonerated of the charges. However, the inquiry report exonerating or holding the petitioner guilty was not presented to the court. The court criticized the insensitive stance of the Commissioner and the Deputy Director of the Local Fund Accounts Department in their affidavits.
The court also pointed out that the delay in the disciplinary proceedings, which extended well beyond the petitioner’s retirement, was avoidable. It took the intervention of the court to expedite the inquiry and release the dues. The court expressed frustration that the authorities had failed to act swiftly, causing unnecessary hardship to the petitioner.
The court noted that the statutory authority responsible for disbursing the dues was the Commissioner, not the District Magistrate, and sending the file to the District Magistrate further delayed the process. With a delay of up to three years in disbursing all retiral dues, the petitioner was entitled to interest on the delayed payment.
The court referred to previous rulings, including State of Kerala v. M. Padmanabhan Nair and Smt. Nazma Khatoon v. State of U.P., where the courts upheld the imposition of interest on delayed payment of retiral dues. The court emphasized that interest is a necessary consequence of withholding money that belongs to another person.
In conclusion, the court imposed a cost of Rs. 10,000 on the Executive Officer, Nagar Palika Parishad, Seohara, Bijnor, and directed the payment of 6% simple interest on the delayed payment of the petitioner’s post-retiral dues, starting from 2019.
