Madras High Court Employment and Labour Law Administrative and Public Law

Retired Transport Worker Paid Benefits 11 Months Late; Madras HC Orders 6% Interest, Except On Earned Leave Salary

S.Antony Xavierv.The Government of Tamilnadu

By LawLens Team · Editorial and Research TeamDecided October 30, 2026Published 4 November 2026 at 5:58 pm IST2 min read

The LawLens card for this judgment

In brief

The question

Whether the petitioner was entitled to interest on retirement benefits paid after a delay, and, if so, at what rate and for what period

The court held

The Court disposed of the writ petition and directed the respondents to pay interest at 6% per annum on eligible retirement benefits, excluding earned leave salary, from the date of retirement until actual disbursement.

It also directed

Payment was to be made within three months of receipt of the order.

No costs were awarded.

01Facts

The petitioner, a retired Senior Tradesman of the Tamil Nadu State Transport Corporation, retired on 31 December 2024.

p. 2

His retirement benefits were paid on 2 December 2025.

p. 2

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

pp. 2–3

The respondents confirmed that the benefits had been paid, but disputed his claim to interest on earned leave salary.

p. 3

02Issues

i.Whether the petitioner was entitled to interest on retirement benefits paid after a delay, and, if so, at what rate and for what period

pp. 2–5

ii.Whether interest was payable on delayed earned leave salary

p. 3, 6

03Law Applied

Relying on S.K. Dua v. State of Haryana, (2008) 3 SCC 44, the Court noted 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.

pp. 4–5

The Court also followed the Division Bench decision in W.A.(MD) No. 403 of 2010 and connected matters, which held that a Transport Corporation’s obligation to make prompt payment of retirement benefits may require payment of interest for delay even where the applicable rules do not expressly provide for it, and fixed interest at 6% per annum.

p. 5

04Reasoning

The retirement benefits were paid only on 2 December 2025, after the petitioner’s retirement on 31 December 2024.

p. 2

Applying S.K. Dua and the Division Bench ruling, the Court held that delayed payment of eligible retirement benefits warranted compensation by way of interest, notwithstanding the absence of an express interest provision.

pp. 4–5

It excluded earned leave salary from the interest award.

p. 6