Calcutta High Court affirms entitlement to interest on delayed gratuity and provident fund payments; serves as binding authority for government corporations on timely payment of retiral dues.
Summary
| Category | Data |
|---|---|
| Case Name | WPA/19070/2025 of ARUN CHANDRA MANNA Vs STATE OF WEST BENGAL AND ORS. |
| CNR | WBCHCA0383392025 |
| Decision Date | 26-08-2025 |
| Disposal Nature | DISPOSED |
| Judgment Author | Hon’ble Justice Aniruddha Roy |
| Court | Calcutta High Court |
| Bench | Single-Judge Bench |
| Type of Law | Constitutional Writ Jurisdiction |
| Questions of Law | Whether delayed payment of gratuity and provident fund entitles the retiree to interest, and at what rate. |
| Ratio Decidendi |
The High Court held that delayed payment of gratuity and partial provident fund dues attracts interest at 6% per annum from the respective due dates until actual payment. The court directed payment of outstanding provident fund with interest at 6%, and provided that if the principal and interest are not paid within three months, the entire sum will thereafter attract interest at 8% per annum. |
| Facts as Summarised by the Court | The petitioner retired on 31 March 2025 and received gratuity (₹12,67,899) on 01 August 2025 and 20% of provident fund (₹7,16,000) on 29 April 2025. He claimed interest on both delayed payments. |
What’s New / What Lawyers Should Note
- High Court confirms that any delay in payment of gratuity and provident fund dues attracts interest at 6% per annum from the date the amount became due.
- Outstanding provident fund must be paid with interest at 6% within three months; failure invokes penalty interest at 8% per annum on the entire sum.
- The decision underscores the court’s willingness to enforce prompt payment of retiral benefits through writ jurisdiction.
- Service of a “server copy” is sufficient for all parties to act upon the order without waiting for a certified copy.
Summary of Legal Reasoning
- The petitioner proved retirement on 31 March 2025 and delays in payment of gratuity and part of provident fund.
- The court observed that delayed payments caused financial prejudice and that writ jurisdiction permits grant of interest as compensation.
- It calculated interest at 6% per annum from due dates—1 April 2025 for both gratuity and provident fund installments—until their respective payment dates.
- It directed payment of remaining provident fund with interest at 6% by three months from order communication, failing which the entire sum attracts 8% per annum.
- No further relief was claimed or deemed necessary; writ petition disposed accordingly.
Arguments by the Parties
Petitioner
- Claimed that delayed payment of gratuity (₹12,67,899) and part provident fund (₹7,16,000) entitled him to interest from the date they fell due until actual payment.
Factual Background
The petitioner retired from Calcutta State Transport Corporation on 31 March 2025. His gratuity of ₹12,67,899 was paid on 1 August 2025, and 20% of his provident fund (₹7,16,000) was paid on 29 April 2025. He filed a writ petition seeking interest on these delayed payments. The High Court, after hearing, directed interest at 6% per annum on both amounts from the respective due dates until payment, and laid down a penalty interest rate of 8% if the unpaid balance was not cleared within three months.