[Cites 5, Cited by 0]
Madras High Court
L.Peter vs The Management Of on 19 February, 2026
Author: B.Pugalendhi
Bench: B.Pugalendhi
W.P(MD)No.4643 of 2026
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 19.02.2026
CORAM:
THE HONOURABLE MR.JUSTICE B.PUGALENDHI
W.P(MD)No.4643 of 2026
L.Peter ... Petitioner
Vs
The Management of
Tamilnadu State Transport Corporation (Kumbakonam) Ltd.,
Trichy Region,
Rep. by its General Manager,
Trichy. ...Respondent
PRAYER: Writ Petition filed under Article 226 of the Constitution
of India, praying this Court to issue a Writ of Mandamus, directing
the respondent to pay the petitioner interest at the rate of 18 percent
per annum, for the period of delay from 01.07.2024 to 01.12.2025,
in paying the amounts paid towards his terminal benefits namely
EPF Employees Contribution, Gratuity and Encashment of leaves
within a time frame as may be fixed by this Court.
For Petitioner : Mr.S. Arunachalam
For Respondent : Mr.K.Ramaiah
Standing Counsel
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W.P(MD)No.4643 of 2026
ORDER
This writ petition is filed for a Mandamus, directing the
respondent to pay interest to the petitioner at the rate of 18% per
annum, for the period of delay from 01.07.2024 to 01.12.2025 in
paying the terminal benefits, within the time stipulated by this Court.
2. The case of the petitioner is that he joined as a
Tradesman in the respondent Transport Corporation on 01.04.1987
and he retired from service as Technical Level – 6 on 30.06.2024.
However, the retirement benefits, namely, Provident Fund, Gratuity
and encashment of leave were settled to him only on 02.12.2025.
Since the benefits have been settled belatedly, the respondent is
liable to pay interest for the belated payment. Therefore, the
petitioner gave a representation dated 20.01.2026 to the respondent,
however, the same did not evoke any response. Therefore, the
petitioner has filed this writ petition for the above said relief.
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3.Mr.S.C.Herold Singh, learned Standing Counsel takes
notice for the respondent and submits that the terminal benefits have
been settled to this petitioner, however, belatedly.
4. By consent of both the parties, the writ petition is
taken up for final hearing at the admission stage itself.
5. This Court paid its anxious consideration to the rival
submissions made and also perused the materials placed on record.
6. The employer is liable to settle the retirement benefits
to its employees without any delay and in case, if it is settled
belatedly, it has to be compensated by way of interest for the belated
payment. In this regard, the Hon'ble Apex Court in S.K.Dua vs.
State of Haryana reported in 2008 (3) SCC 44, has held as follows:
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“14. In the circumstances, prima facie, we are of
the view that the grievance voiced by the appellant
appears to be well founded that he would be entitled to
interest on such benefits. If there are statutory rules
occupying the field, the appellant could claim payment of
interest relying on such rules. If there are administrative
instructions, guidelines or norms prescribed for the
purpose, the appellant may claim benefit of interest on
that basis. But even in absence of statutory rules,
administrative instructions or guidelines, an employee
can claim interest under Part III of the Constitution
relying on Articles 14, 19 and 21 of the Constitution. The
submission of the learned counsel for the appellant, that
retiral benefits are not in the nature of “bounty” is, in our
opinion well founded and needs no authority in support
thereof. In that view of the matter, in our considered
opinion, the High Court was not right in dismissing the
petition in living even without issuing notice to the
respondents.”
7. Following the same, in a similar issue, a Division
Bench of this Court, in W.A.(MD)No.403 of 2010, etc. batch, vide
common order dated 04.07.2014, has fixed the rate of interest at 6%
per annum and held as under:-
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“5. ..... even though there is no provision in the
Tamil Nadu State Transport Corporation Employees
Pension Fund for payment of interest, cannot stand in the
light of the law laid down by the Supreme Court in
S.K.Dua v. State of Haryana and another, reported in
(2008) 3 SCC 44. As a matter of fact, the Rules do not
contemplate belated payment of retirement benefits. The
Rules contemplate prompt payment. When the Rules
contemplate prompt payment and not bleated payment,
the Rules will not contain a provision for payment of
interest. The Pension Fund which was created as a Trust
by the Corporation was supposed to act in trust for the
employees' benefit. If the Trust could not make payments
within the time stipulated, then, irrespective of whether
there is any provision for payment of interest or not, the
Corporation is obliged to make payment.”
8. Following the dictum laid down on this issue, the
writ petition is disposed of with a direction to the
respondent/Transport Corporation to pay interest for the belated
payment of retirement benefits at the rate of 6% per annum from the
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date of retirement till the date of actual disbursement, within a
period of six months from the date of receipt of a copy of this order.
No costs.
19.02.2026
NCC: Yes/No
Index:Yes/No
Internet:Yes
vrn
To
The Management of
Tamilnadu State Transport Corporation (Kumbakonam) Ltd.,
Trichy Region,
Rep. by its General Manager,
Trichy.
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B.PUGALENDHI, J.
vrn
Order made in
19.02.2026
(4/4)
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