dofp2024_00827 — An official in receipt of provisional pension is not entitled to any additional payment in the form of penal interest for delayed payment of pension or other retirement benefits like commutation, etc., in the absence of any specific rule or statutory provision that supports grant of penal interest

An official in receipt of provisional pension is not entitled to any additional payment in the form of penal interest for delayed payment of pension or other retirement benefits like commutation, etc., in the absence of any specific rule or statutory provision that supports grant of penal interest — The context pertains to a court case where an applicant sought penal interest and compensation due to delayed retirement benefits, which was attributed to a belief that a vigilance inquiry was still ... — Facts: The Applicant was regularly appointed as a Divisional Accountant on 28-9-1973 and served in various divisions of the PWD / Irrigation Department under the cadre control of Respondent and retired on 31-10-2012 as a Senior Divisional Accounts Officer. Even though no pending disciplinary or judicial proceedings were pending against him at the time of his retirement, the Respondents paid provisional pension after a delay of four months and gratuity and pension commutation were paid only on 31-7-2017. The Applicant’s repeated representations seeking payment of retirement benefits were ignored by the Respondents citing baseless vigilance inquiry. The Applicant contended that the delay in payment of retirement benefits violated Rule 68 of the CCS (Pension) Rules, 1972 and also relevant Government circulars mandating timely disbursal of retiral benefits. The Counsel for the Applicant contended that Rule 68 of the CCS (Pension) Rules, 1972 mandated prompt payment of retirement benefits and that the delay in payment of the Applicant’s gratuity, allowances and pensionary benefits was grossly unreasonable and unjustified especially in the absence of any disciplinary or judicial proceedings pending against him at the time of retirement, as required under Rule 9 of the CCS (Pension) Rules. The Counsel for the Applicant further stressed that retiral dues are not a bounty but a statutory right as held by the Hon’ble Supreme Court in the case of Haryana (2013) and several other judgments. The Applicant therefore sought payment of penal interest and compensation for financial loss and mental distress caused by the Respondents’ arbitrary and unjust actions. The Counsel for the Applicant further relied on the judgment of the Hon’ble Supreme Court in Union of India v. Tarmen Singh (2008) to contend that any unjustified delay in payment of retiral dues warrants grant of penal interest to compensate the retiree. The Applicant therefore sought penal interest and compensation for financial and emotional hardship suffered by him. The Respondents contended that the delay in processing the retirement benefits of the Applicant was due to a genuine belief that a vigilance inquiry was pending. Once it was confirmed that no further action was being taken, the issue of interest on delayed gratuity under Rule 68 of the CCS (Pension) Rules, 1972 was addressed and interest of ₹ 3,51,325 for the period 1-2-2013 to 31-8-2017 was approved and authorized for payment on 28-5-2019. The Respondents further submitted that interest is payable only on delayed payment of retirement benefits such as commutation or regular pension. Since the Applicant had already received all his retirement benefits with applicable interest on gratuity, the Original Application has become infructuous and is liable to be dismissed.