Madras High Court
Social Security and PensionsEmployment and Labour Law

Employers must pay 6% interest on belated retirement benefits, even absent an express provision.

P.Murugesan vs The Government of Tamil Nadu

Madras High CourtJUDGMENT: October 06, 20262 MIN READSOURCE JUDGMENT
Employers must pay 6% interest on belated retirement benefits, even absent an express provision.. P.Murugesan vs The Government of Tamil Nadu. Madras High Court. LawLens
THE ORIGINAL LAWLENS SUMMARY
01

Facts

The petitioner, a retired Special Grade Conductor of the Tamil Nadu State Transport Corporation, retired on 30 November 2024.

Source reference: pp. 2–3, paras. 1–2

His retirement benefits were paid on 11 March 2026.

Source reference: pp. 2–3, paras. 1–2

After his representation seeking interest for the delay received no response, he filed this petition under Article 226 seeking interest at 6% per annum on the delayed retirement benefits.

Source reference: pp. 2–3, paras. 1–2

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

Source reference: p. 3, para. 4
02

Issues

Whether the petitioner was entitled to interest on retirement benefits paid belatedly, despite the absence of a specific provision for interest in the applicable pension-fund rules.

Source reference: pp. 3–5, paras. 7–8

If so, what rate and period of interest should be directed.

Source reference: p. 5, para. 9
03

Law Applied

In S.K. Dua v. State of Haryana, (2008) 3 SCC 44, the Supreme Court held that 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 Articles 14, 19 and 21 of the Constitution, as retiral benefits are not a bounty.

Source reference: pp. 3–4, para. 7

Applying that principle, a Division Bench of the Madras High Court in W.A.(MD) No. 403 of 2010 and connected matters (common order dated 4 July 2014) held that the absence of an express interest provision in the Transport Corporation Employees Pension Fund rules does not absolve the Corporation of liability for delayed payment, and fixed interest at 6% per annum.

Source reference: pp. 4–5, para. 8
04

Reasoning

The Court found that the petitioner’s retirement benefits had been settled only on 11 March 2026, although he retired on 30 November 2024.

Source reference: pp. 2–3, paras. 2, 4

Applying S.K. Dua and the Division Bench ruling, it held that retirement benefits must be paid promptly and that delay must be compensated by interest, notwithstanding the absence of a specific interest provision in the pension-fund rules.

Source reference: pp. 3–5, paras. 7–8

It therefore applied the 6% rate established in the Division Bench decision to the petitioner’s eligible benefits.

Source reference: p. 5, para. 9
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 1 December 2024 until actual disbursement.

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

Source reference: p. 5, para. 9

No costs were awarded.

Source reference: p. 5, para. 9
Madras High Court

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P.MurugesanvsThe Government of Tamil Nadu

Madras High Court · October 06, 2026

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