Madras HC Orders 6% Interest For Retired Transport Conductor After Benefits Were Paid Over Two Years Late

The petitioner, a Selection Grade Conductor employed by the respondent Transport Corporation, voluntarily retired on 31 January 2024 after 17 years of service. His retirement benefits were paid on 11 March 2026. After his representation seeking interest for the delay received no response, he filed this writ petition under Article 226 seeking interest at 6% per annum on the delayed payment of his retirement benefits

The respondents reported that the benefits had been paid, and the petition was heard for final disposal by consent

In S.K. Dua v. State of Haryana, (2008) 3 SCC 44, the Supreme Court held that an employee may claim interest on retiral benefits under applicable statutory rules or administrative instructions and, even in their absence, may rely on Articles 14, 19 and 21 of the Constitution

The Court also relied on the Division Bench decision in W.A.(MD) No. 403 of 2010 and connected matters, which held that the absence of a rule expressly providing for interest does not excuse delayed payment where retirement rules contemplate prompt payment, and fixed interest at 6% per annum

The petitioner’s retirement benefits were not paid until more than two years after his retirement. Applying S.K. Dua and the Division Bench’s ruling, the Court held that retirement benefits are not a bounty and that delayed payment must be compensated by interest, even where the governing rules do not expressly provide for it.

It applied the Division Bench’s 6% rate to the eligible benefits paid belatedly

Payment must be made within six months from receipt of a copy of the order. No costs were awarded