Interest is payable on delayed retiral benefits subject to the final outcome of pending higher litigation.

The applicant, a retired Chief Medical Officer (SAG), filed an Original Application under Section 19 of the Administrative Tribunals Act, 1985, seeking the release of various retiral benefits.

These included Gratuity (Rs. 20,00,000/-), Commutation of Pension (Rs. 42,61,330/-), Leave Encashment arrears, 7th CPC arrears, and DA arrears.

During the pendency of the proceedings, the applicant received the principal amounts of all retiral dues.

Consequently, the litigation was narrowed down to the claim for interest on account of the delay in the disbursement of said benefits.

1. Whether the applicant is entitled to interest on the delayed payment of retiral dues as per the prevailing legal precedents.

2. Whether such interest can be granted during the pendency of a challenge to the governing Full Bench decision before the High Court.

The Tribunal primarily applied the principles regarding the timely payment of retiral benefits under the Administrative Tribunals Act, 1985.

It specifically relied on the Full Bench decision of the Central Administrative Tribunal dated 30.10.2025 in Rajbir Singh v. MCD & Anr. (OA No. 2821/2023), which established the liability of the respondent to pay interest on delayed retiral dues.

This rule is currently subject to the judicial scrutiny of the Hon’ble Delhi High Court in W.P.(C) 401/2025 & CM APPL. 2064/2025.

The Tribunal observed that the core grievance regarding the principal retiral amounts had been settled by the respondents during the litigation.

On the remaining issue of interest, the respondents conceded to the payment of interest provided it followed the ruling in Rajbir Singh v. MCD.

The Tribunal linked the applicant’s right to interest to the duration of the delay, calculating from the date the dues were originally payable until the actual date of payment.

To balance the equities while the Rajbir Singh precedent is being challenged in the Delhi High Court, the Tribunal mandated that the payment of interest be conditional upon the execution of an indemnity bond by the applicant.

This ensures restitution should the High Court eventually reverse the Full Bench decision.

The interest must be calculated from the due date until the date of actual payment, in accordance with the decision in Rajbir Singh v. MCD.

The respondents were ordered to complete this exercise within eight weeks of receiving the order, subject to the applicant furnishing an indemnity bond and the final outcome of W.P.(C) 401/2025 in the Delhi High Court.

No order as to costs was made.