Can recover arrears for withholding retirement benefits: Punjab and Haryana High Court

Saurabh Malik

Chandigarh, October 22

In a significant judgment, the Punjab and Haryana High Court has ruled that a former general manager of Punjab Roadways, who withheld an employee’s gratuity and other retirement benefits after the higher authorities overturned the punishment order passed against him, may end up paying the accrued interest.

“Since the General Manager, Punjab Roadways, had no power to withhold his gratuity after the punishment order was set aside by the higher authorities, the interest payable to the petitioner as directed may be recovered from the officer, after giving him a show-cause notice,” Justice Sanjeev Prakash Sharma of the high court asserted.

The judgment by Justice Sharma is significant as it sets a precedent for upholding the rights of pensioners, while emphasising the need for adherence to legal procedures and directions issued by the higher authorities in matters concerning retirement benefits. Justice Sharma was hearing a petition filed against the state of Punjab and other respondents by the retired employee through counsel Vikas Chatrath and Rajbir Singh. The Bench was told that the petitioner was convicted and sentenced to 10-year rigorous imprisonment in a criminal case, following which the provisional pension granted to him was stopped. The high court subsequently upheld the conviction order, but reduced the imprisonment to four years.

Acting on his appeal against the order of pension stoppage, the Secretary, Transport, restored the same after holding that the punishment stopping the same was not justified. The Bench was told that the petitioner’s provisional pension was restored vide order dated January 3, 2011, following the Secretary’s intervention. But other retirement benefits were withheld “on account of pendency of the writ petition”.

After hearing rival contentions and going through the documents, Justice Sharma also made it clear that the petitioner-employee was entitled to receive all retirement benefits, including gratuity and regular pension. It could not have been withheld under the garb of the writ petition’s pendency before the high court, once the punishment of pension stoppage was set aside in an appeal. In fact, the writ petition would have become infructuous after punishment order was set aside.

Justice Sharma added that the order passed on January 3, 2011, by the General Manager was found to be in error of law. Accordingly, the petitioner’s entire retirement benefits were required to be released.

Pay 9% interest

Since the petitioner attained superannuation in 2004, the gratuity and other retirement benefits, which will be released in his favour now, will also carry interest at the rate of 9% per annum. — Justice Sanjeev Prakash Sharma