Delayed payment of terminal benefits warrants 6% annual interest from retirement until disbursement.

The petitioners’ father, R. Baburajan, retired from the respondent Transport Corporation on 31 December 2023 and died on 29 April 2024.

His terminal benefits were paid on 11 September 2025.

The petitioners sought interest for the delay, stating that their representation dated 30 March 2026 had received no response.

The respondent confirmed that the benefits had been settled on 11 September 2025.

Whether the petitioners were entitled to interest on their deceased father’s terminal benefits because of delayed payment.

If so, what rate and period of interest should apply.

The Court relied on S.K. Dua v. State of Haryana, (2008) 3 SCC 44, which recognises that an employee may claim interest on delayed retiral benefits under applicable rules or administrative instructions and, even in their absence, may invoke Articles 14, 19 and 21 of the Constitution.

It also followed the Division Bench’s decision in W.A.(MD) No. 403 of 2010 and connected matters, which held that the absence of an express interest provision does not excuse delayed payment of retirement benefits and fixed interest at 6% per annum.

The Court found that the respondent had paid the terminal benefits only on 11 September 2025, after the employee’s retirement on 31 December 2023.

Applying S.K. Dua and the Division Bench’s ruling, it held that delayed retirement benefits should be compensated by interest and that the absence of a specific provision for interest did not prevent such relief.

It accordingly applied the 6% rate established by the Division Bench.

Payment was ordered within six months of receipt of a copy of the order; no costs were awarded.