Madras High Court
Social Security and PensionsEmployment and Labour Law

Delayed retirement benefits warrant 6% annual interest from retirement until actual disbursement.

K.Venugopal vs The Management of

Madras High CourtJUDGMENT: October 07, 20262 MIN READSOURCE JUDGMENT
Delayed retirement benefits warrant 6% annual interest from retirement until actual disbursement.. K.Venugopal vs The Management of. Madras High Court. LawLens
THE ORIGINAL LAWLENS SUMMARY
01

Facts

The petitioner, a Tradesman who retired from the respondent Transport Corporation on 31 March 2025, alleged that his retirement benefits were paid belatedly on 11 March 2026.

Source reference: p. 1–3

The benefits included EPF employees’ contribution, gratuity, leave encashment and commuted pension.

Source reference: p. 1–3

After his representation seeking interest received no response, he filed a writ petition seeking interest at 18% per annum for the delay.

Source reference: p. 1–3

The respondents confirmed that the benefits had been settled on 11 March 2026.

Source reference: p. 3
02

Issues

Whether the petitioner was entitled to interest on retirement benefits paid after his retirement.

Source reference: p. 3–5

If so, what rate of interest and period of payment should apply?

Source reference: p. 3, 5–6
03

Law Applied

Under S.K. Dua v. State of Haryana, (2008) 3 SCC 44, an employee may claim interest on delayed retiral benefits under applicable statutory rules or administrative instructions; even in their absence, such a claim may be founded on Part III of the Constitution, including Articles 14, 19 and 21.

Source reference: p. 4

Following that principle, a Division Bench of the Madras High Court held in W.A.(MD) No. 403 of 2010 and connected matters (common order dated 4 July 2014) that where retirement benefits are delayed, the employer is liable to pay interest, notwithstanding the absence of an express provision in the Pension Fund rules; the rate fixed in that case was 6% per annum.

Source reference: p. 5
04

Reasoning

The Court accepted that the petitioner’s retirement benefits had been paid only on 11 March 2026, after his retirement on 31 March 2025.

Source reference: p. 2–3

Applying S.K. Dua and the Division Bench’s ruling on delayed payment by the Transport Corporation, it held that delayed retirement benefits must be compensated by interest.

Source reference: p. 4–6

It followed the established rate of 6% per annum rather than the 18% claimed.

Source reference: p. 4–6
05

Holding

The Court disposed of the writ petition and directed the respondents to pay interest at 6% per annum on the eligible retirement benefits disbursed belatedly, calculated from the date of retirement until actual disbursement.

Payment was to be made within six months of receipt of a copy of the order.

Source reference: p. 6

No costs were awarded.

Source reference: p. 6
Madras High Court

Original Court PDF

K.VenugopalvsThe Management of

Madras High Court · October 07, 2026

Click to open original judgment

Original judgment, available to read, download and summarize on LawLens.in

Click to open original judgment