Court Says Retiree has Right to Receive Retiral Benefits within 3 Months

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July 10, 2018

Case name: Paramjit Singh v. State of Punjab & Ors.

Date of Judgment: July 02, 2018

In this recent case, the High Court of Punjab & Haryana while recognizing the right of a retired person to receive retiral within a reasonable period of three months directed the State to compensate the petitioner by way of interest @9% per annum.

In the case, the Petitioner who retired from services on March 31, 2016 and received retiral benefits are stated to have been paid in the month of December 2016 and that of, arrears of DA in the Month of May 2017. The Petitioner has alleged that the retiral benefits i.e. gratuity, GPF, leave encashment and GIS were disbursed but after an inordinate delay for which no interest has been paid by the Respondent.

The Petitioner contended that as per the instructions issued by the State of Punjab, retiree was entitled to the interest, if the retiral benefits have not been disbursed to him/her within a period of three months from the date of his/her retirement.

The High Court of Punjab & Haryana in the case while recognizing the rights of retiree made the following observations on the case:

  • That the petitioner is entitled to be compensated by way of grant of interest on account of delayed payments of the retiral benefits.
  • That there is no plausible reason or explanation about the inordinate delay caused in disbursement of retiral benefit to the Petitioner.
  • That a retiree has right to get the retiral benefits on the date of his/her retirement or within reasonable period of three months and the procedure for the disbursement of benefits is required to be initiated by the employer six months prior to his/her retirement.

With reference to the facts of the present case, the High Court held that the respondent-State is obliged to compensate the petitioner by way of interest @ 9% per annum.

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