Retired TN Transport Employee To Get 6% Interest On Delayed Retirement Benefits, Except Earned-Leave Salary: Madras HC

The petitioner, a retired Senior Tradesman of the Tamil Nadu State Transport Corporation, retired on 30 June 2024. His retirement benefits were disbursed on 2 December 2025.

After his representation seeking interest for the delay received no response, he filed a writ petition seeking interest at 6% per annum on delayed retirement benefits, including earned-leave salary.

The respondents stated that the benefits had been paid and opposed interest on earned-leave salary.

In S.K. Dua v. State of Haryana, (2008) 3 SCC 44, the Supreme Court recognised that an employee may claim interest on delayed retiral benefits under applicable rules or administrative instructions, and, even in their absence, may invoke Articles 14, 19 and 21 of the Constitution; retiral benefits are not a bounty.

The High Court also relied on the Division Bench’s common order in W.A.(MD) No. 403 of 2010 and connected matters, which held that the absence of an express interest provision in the Transport Corporation Employees Pension Fund Rules does not excuse delayed payment and fixed interest at 6% per annum.

The Court found that the retirement benefits had been paid belatedly and applied the principle that employees must be compensated by interest when retiral benefits are not settled promptly.

Following the Supreme Court and Division Bench authorities, it fixed interest at 6% per annum on eligible retirement benefits.

It excluded earned-leave salary from the interest direction, consistent with the respondents’ position.

Payment was ordered within three months of receipt of a copy of the order; no costs were awarded.