Interest Payable on Delayed Pensionary Benefits and Retiral Dues, Including 7th CPC Arrears.

The applicant, Mahinder Pal, joined the Municipal Corporation of Delhi (MCD) on September 26, 1990, and retired on October 31, 2021.

At the time of his superannuation, he was not facing any criminal or disciplinary proceedings.

Although a Pension Payment Order (PPO) was issued on October 31, 2021, the respondents delayed the release of his retirement benefits.

The respondents admitted liability for pension and salary arrears due to the implementation of 7th CPC recommendations in their counter-affidavit.

The applicant sought directions for the full implementation of his PPO, release of Rs. 9,11,695 towards gratuity, 18% p.a. interest on the delayed gratuity from November 1, 2021, and the recalculation of his pension and other retiral dues with 18% p.a. interest for delayed payments after incorporating the 7th CPC benefits.

Whether the respondents should be directed to fully implement the Pension Payment Order dated October 31, 2021, by releasing the gratuity amount of Rs.9,11,695?

Whether the applicant is entitled to interest at 18% p.a. on the delayed gratuity and other retiral dues from the due date until the date of payment?

Whether the applicant's pension should be recalculated and fixed by adding the benefit of higher grade pay after the implementation of the 7th CPC?

Whether the applicant is entitled to interest on all retiral dues/outstandings for the delayed period?

The Tribunal applied Section 19 of the Administrative Tribunals Act, 1985, which grants it jurisdiction to hear and decide applications seeking relief against actions of authorities.

It relied on the principle established in Rajbir Singh v. MCD and ors., OA No.2821/2023, decided on October 30, 2025 (Full Bench decision), which held that an employee is entitled to interest at the applicable GPF rate, calculated on a compound basis, for delayed payment of various retirement dues like gratuity.

The Tribunal also acknowledged the common knowledge that 7th CPC recommendations have been implemented for government employees, including those of MCD, leading to enhanced pay.

The Tribunal noted that the respondents admitted their liability regarding pension and other arrears, and the counter-affidavit was silent on the payment of 7th CPC arrears.

The applicant's counsel highlighted that the 7th CPC recommendations would change the applicant's last drawn pay, necessitating a revised PPO and entitlement to corresponding revised pension and pay arrears.

The Tribunal underscored that the 7th CPC recommendations have been implemented by various governmental bodies, including MCD, implying that MCD employees are entitled to benefits under these recommendations.

The respondents' counsel fairly conceded entitlement to retirement benefits and acknowledged that interest on account of delay had not been released.

Applying the precedent from Rajbir Singh (supra), the Tribunal concluded that the applicant was entitled to interest on delayed retirement benefits.

The respondents were directed to recalculate the applicant's last pay drawn incorporating the 7th CPC recommendations and issue a revised PPO.

They were further directed to release arrears of pay and pension based on this recalculation.

Additionally, the respondents were ordered to pay interest on delayed payment of various retirement dues, including gratuity and arrears of pension, at applicable GPF rates calculated on a compound basis, as per the Rajbir Singh decision (supra).

For arrears of pay, simple interest at applicable GPF rates was to be paid.

This exercise was to be completed within 8 weeks from the date of receipt of the certified copy of the order.

No order was made as to costs, and pending MAs were disposed of.