P&H HC | Financial constraints of employer cannot be a ground for withholding pensionary benefits from employee

Punjab and Haryana High Court: Harsimran Singh Sethi, J. heard a civil writ petition stating that financial difficulty cannot be a ground to withhold pensionary benefits.

The grievance which was raised by the petitioner was that she retired on attaining the age of superannuation while working as an Inspector from Municipal Council. All the benefits for which she was entitled upon her retirement, were not released immediately and the same were delayed by the respondents without any valid justification and the last amount paid Rs 4,00,000 was paid to the petitioner on March 2016, which is the petitioner was approximately 5 years after her retirement. As the amount of  Rs 6,76,000 was released to her but the remaining amount under the heading of gratuity and leave encashment was not paid to her immediately, she approached this Court by filing a writ petition whereby the Court directed respondents to release the benefits for which the petitioner was entitled.

In pursuance to the direction given by this Court, respondents passed an order on 12-01-2016 admitting that due to the paucity of the funds, all the benefits could not be released. Also mentioned in the order was that the gratuity amount was released to the petitioner on two occasions i.e. Rs 1,00,000 on 21-11-2012 and  Rs 3,00,000 on 08-07-2014 and still a balance of Rs 1,65,719 was due to be paid to the petitioner.

In the present case, the counsel for the petitioner argued that all the dues were paid approximately after a period of 5 years of her retirement and, therefore petitioner was entitled to interest on the said delayed payments. The counsel for respondents argued that due to the financial instability, the payments could not be made to the petitioner after her retirement.

The Court relied on the decision of A.S. Randhawa v. State of Punjab, 1997 SCC OnLine P&H 712 to rule that there was no valid justification to withhold the pensionary benefits and the employee would be entitled to interest. The Court, therefore, held that financial constraint was not a valid justification to withhold pensionary benefits, and thus, ordered that the petitioner would be entitled to interest at 9 per cent per annum from the date the amount was due. Hence, the petition was allowed.[Vinod Kumari Sharma v. State of Punjab, 2019 SCC OnLine P&H 866, decided on 28-05-2019]

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