# Arun Kumar Srivastava v. Managing Director, Uttar Pradesh Rajkiya Nirman Nigam Ltd., Lucknow

- **Citation:** (2023) 7 ILRA 297
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-07-11
- **Case number:** Writ-A No. 4279 of 2023
- **Bench:** J.J. Munir
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/arun-kumar-srivastava-v-managing-director-uttar-pradesh-rajkiya-nirman-nigam-50421
- **Pages:** 5

## Headnote

A. Service Law - Retiral dues - Arrears of
salary - Gratuity - Pension and gratuity
are no longer any bounty to be distributed
by the Government to its employees on
their retirement but have become valuable
rights and property in their hands and any
culpable
delay
in
settlement
and
disbursement thereof must be visited with
the penalty of payment of interest at the
current market rate till actual payment.
(Para 11)
Delay in payment of post retiral benefits
must carry adequate interest. So far as
delay in payment of salary is concerned, a
heavier obligation lies on the employer to
compensate
the
employee.
In
both
matters, penal interest ought to be
awarded. (Para 11)

Since the date of retirement of every Government
servant is very much known in advance, the process
of collecting the requisite information and issuance
of documents (L.P.C. (Last Pay Certificate) and
N.L.C. (No Liability Certificate)) should be completed
at least a week before the date of retirement so that
the payment of gratuity amount could be made to
the Government servant on the date he retires or
on the following day and pension at the expiry of
the following month. (Para 11)

B. If an employee serves at different stations
and his service book goes to all those
stations, the way every ACR and other
remarks are written, the same way, his
monthly salary and other dues ought also be
posted in at and made available to him on
time. (Para 10)

In the present case, the delay in paying the
petitioner's arrears of salary and post retiral benefits
is absolutely without justification. The fact that the
petitioner had served at different stations, and
therefore, his service records had to be verified on
those stations is an obligation of the Corporation;
not the petitioner's. The petitioner cannot be made
to suffer the blame for this delay, the culpability
whereof squarely lies on the shoulders of the
Corporation. It is unimaginable that salary for a
period of time while the employee was in service
would be paid after his retirement. Likewise,
payment of post retiral benefits have been unduly
delayed and have been paid after ten years. (Para
10)

A mandamus is issued to the Managing Director,
Uttar Pradesh Rajkiya Nirman Nigam Limited,
ordering him to pay interest on the total sum of
money detailed in petition, with simple interest at
the rate of 10% per annum with effect from the
date that each item of unpaid emoluments
mentioned in the petition fell due, worked out until
time when the relative payment was actually made.
(Para 12)
298 INDIAN LAW REPORTS ALLAHABAD SERIES
Writ petition allowed. (E-4)

Precedent followed:

St. of Kerala & ors. Vs M. Padmanabhan Nair,
(1985) 1 SCC 429 (Para 11)

## Text

7 All. Arun Kumar Srivastava Vs. Managing Director, Uttar Prasdesh Rajkiya Nirman Nigam
 Ltd., Lucknow
297
that said requisition suffers from any
illegality or is against the statutory
prescription.

37. In view thereof, I find no error in
the impugned requisition dated 28.5.2022
as it has been sent strictly as per the
mandate of Rule 5(2) of Rules, 2004.

38. Accordingly, I do not find any
substance in Writ-A Nos.3814 of 2022 and
1514 of 2022, which are hereby dismissed,
whereas Writ-A No.1305 of 2022 is
allowed.
----------
(2023) 7 ILRA 297
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 11.07.2023

BEFORE

THE HON'BLE J.J. MUNIR, J.

Writ-A No. 4279 of 2023

Arun Kumar Srivastava ...Petitioner
Versus
Managing Director, Uttar Pradesh Rajkiya
Nirman Nigam Ltd., Lucknow
 ...Respondent

Counsel for the Petitioner:
Sri Sangam Singh, Sri Ankur Jaiswal

Counsel for the Respondent:
Sri Vivek Saran

A. Service Law - Retiral dues - Arrears of
salary - Gratuity - Pension and gratuity
are no longer any bounty to be distributed
by the Government to its employees on
their retirement but have become valuable
rights and property in their hands and any
culpable
delay
in
settlement
and
disbursement thereof must be visited with
the penalty of payment of interest at the
current market rate till actual payment.
(Para 11)
Delay in payment of post retiral benefits
must carry adequate interest. So far as
delay in payment of salary is concerned, a
heavier obligation lies on the employer to
compensate
the
employee.
In
both
matters, penal interest ought to be
awarded. (Para 11)

Since the date of retirement of every Government
servant is very much known in advance, the process
of collecting the requisite information and issuance
of documents (L.P.C. (Last Pay Certificate) and
N.L.C. (No Liability Certificate)) should be completed
at least a week before the date of retirement so that
the payment of gratuity amount could be made to
the Government servant on the date he retires or
on the following day and pension at the expiry of
the following month. (Para 11)

B. If an employee serves at different stations
and his service book goes to all those
stations, the way every ACR and other
remarks are written, the same way, his
monthly salary and other dues ought also be
posted in at and made available to him on
time. (Para 10)

In the present case, the delay in paying the
petitioner's arrears of salary and post retiral benefits
is absolutely without justification. The fact that the
petitioner had served at different stations, and
therefore, his service records had to be verified on
those stations is an obligation of the Corporation;
not the petitioner's. The petitioner cannot be made
to suffer the blame for this delay, the culpability
whereof squarely lies on the shoulders of the
Corporation. It is unimaginable that salary for a
period of time while the employee was in service
would be paid after his retirement. Likewise,
payment of post retiral benefits have been unduly
delayed and have been paid after ten years. (Para
10)

A mandamus is issued to the Managing Director,
Uttar Pradesh Rajkiya Nirman Nigam Limited,
ordering him to pay interest on the total sum of
money detailed in petition, with simple interest at
the rate of 10% per annum with effect from the
date that each item of unpaid emoluments
mentioned in the petition fell due, worked out until
time when the relative payment was actually made.
(Para 12)
298 INDIAN LAW REPORTS ALLAHABAD SERIES
Writ petition allowed. (E-4)

Precedent followed:

St. of Kerala & ors. Vs M. Padmanabhan Nair,
(1985) 1 SCC 429 (Para 11)

(Delivered by Hon'ble J.J. Munir, J.)

Parties have exchanged affidavits.

2. Admit.

3. Heard forthwith.

4. Heard Mr. Sangam Singh, learned
Counsel for the petitioner and Mr. Vivek
Saran, learned Counsel appearing on behalf
of the sole respondent.

5. The petitioner is an ex employee of
the Uttar Pradesh Rajkiya Nirman Nigam
Limited1. He was initially appointed as a
Sub-Engineer (Civil) in the service of the
Corporation. He was posted at different
stations throughout the State during the
tenure of his employment. The petitioner
retired from the post of Sub Engineer on
31.08.2009, upon attaining the age of
superannuation. Admittedly, there were
no disciplinary proceedings against him
or any kind of a claim that the employers
had to set-off against his post retiral dues.
It is also not in dispute that prior of the
petitioner's
retirement,
a
No
Dues
Certificate was issued by the Office of
the
Corporation
at
New
Delhi
on
04.06.2009, that being the petitioner's last
place of posting. The petitioner had an
early grievance to make. Post retirement,
his retiral dues as well as outstanding of
arrears of salary due on the date of
retirement were not paid. This led the
petitioner to institute Writ - A No. 5590
of 2019, which, by a very usual order of
this Court, was summarily parted with on
03.02.2010, in terms of the following
order :

Heard learned counsel for the
petitioner and learned Standing Counsel.

The petitioner has not been
released his post retiral benefits after
having
retired
on
31.8.2009.
The
respondent
No.2
shall
proceed
to
examine the claim of the petitioner and
pass an appropriate order within 3
months. In the event the petitioner is
found entitled for release of any amount,
the same shall be released forthwith
without any further delay.

With the aforesaid observations,
the writ petition is disposed of.

6. After the order dated 03.02.2010
was passed and presumably received by
the petitioner in the form of a certified
copy, with no communication thereof
through any official channel to the
Corporation remained uncomplied with,
leading
the
petitioner
to
prefer
representations
dated
08.03.2010,
18.05.2010 and 12.06.2010, virtually
seeking
to
draw
the
Corporation's
attention to the order of this Court dated
03.02.2010, earlier mentioned.

7. Since no action in compliance was
taken, the petitioner had to move this
Court, invoking our contempt jurisdiction
vide Contempt Application (Civil) No.
3433 of 2010. Notice in the contempt
matter was issued to the Corporation or the
officer, so to speak, answerable on behalf
of the Corporation, to carry out the orders
of this Court. Pending rule issued in the
contempt matter, the Corporation paid post
retiral benefits to the petitioner under
various heads, that include arrears of
salary, gratuity and leave encashment. The
arrears of salary were paid for various
7 All. Arun Kumar Srivastava Vs. Managing Director, Uttar Prasdesh Rajkiya Nirman Nigam
 Ltd., Lucknow
299
periods of time that they had remained
unpaid and all details of these periods are
set out in tabular form by the petitioner in
paragraph 14 of the writ petition. A perusal
of this table shows that arrears of salary
were paid for ten different periods of time
that these had remained unpaid, apart from
various heads, as already said, under which
post retiral benefits were due to the
petitioner.

8. The petitioner says that though the
various sums of money indicated in para 14
have been paid to him, the payment has
been made with an unexplained and
culpable delay of ten years. The petitioner
has, therefore, now come up claiming
interest on this sum of money, which has
been withheld. The petitioner attempted to
enforce his claim for interest on account of
the delayed payment of his post retiral dues
as also unpaid arrears of salary, that ought
to have been paid while in service, by
representing the matter to the Corporation
once again. The Corporation again, not
heeding to the petitioner's plea for the
payment of interest on his dues, paid much
beyond the time of entitlement. Aggrieved,
the
petitioner
invoked
the
contempt
jurisdiction of this Court vide Contempt
Application (Civil) No. 2435 of 2022.
Pending
the
said
application,
the
Corporation took a stand before the Court
hearing the later contempt application that
all dues, the petitioner was entitled to, have
been paid to him. This Court, in the
contempt matter, on occasion, was of
opinion that the order on the writ side did
not award any interest and, therefore, no
case
for
contempt
was
made
out.
Accordingly, the contempt application was
rejected vide order dated 11.11.2022.
Nevertheless, before that happened, on
31.12.2021, by the order impugned, the
Corporation rejected the petitioner's claim,
saying that they have paid all dues of the
petitioner's unpaid salary that was in arrears
in lieu of his service at different stations of
the Corporation.

9. Notice in this case was issued to
the
Corporation
vide
order
dated
17.05.2023, requiring them to file a return.
In the counter affidavit filed on behalf of
the Corporation by Mr. Vivek Saran,
Advocate, it is stated in answer to
paragraph 14 of the writ petition that during
the period of service, the petitioner was
posted at ten different units of the
Corporation, and after retirement, his
salary/arrears have been paid. It is further
on said in paragraph 14 of the counter
affidavit that since the service book of the
petitioner was incomplete, time was spent
to gather records and complete it. The
delay, therefore, in settling the petitioner's
salary overdues and post retiral benefits is
said to have been occasioned on that
account. This, in sum and substance, is the
defence which the Corporation takes to
justify the impugned order declining to
grant interest. The Corporation, in the order
impugned,
hardly
says
anything
in
justification for declining to pay interest on
the petitioner's dues, that have been paid
after much delay.

10. Upon hearing learned Counsel for
parties, this Court is of opinion that the
delay in paying the petitioner's arrears of
salary and post retiral benefits is absolutely
without justification. The fact that the
petitioner had served at different stations,
and therefore, his service records had to be
verified on those stations is an obligation of
the Corporation; not the petitioner's. The
petitioner cannot be made to suffer the
blame for this delay, the culpability
whereof squarely lies on the shoulders of
the Corporation. If an employee serves at
300 INDIAN LAW REPORTS ALLAHABAD SERIES
different stations and his service book goes
to all those stations, the way every ACR
and other remarks are written, the same
way, his monthly salary and other dues
ought also be posted in at and made
available to him on time. It is unimaginable
that salary for a period of time while the
employee was in service would be paid
after his retirement. Presumably, the delay
suffered by the petitioner in the matter of
receipt of his salary at different stations is
the hallmark of public employment, where
the employer is more than an employer. In
public employment like the Corporation's
in this case, it is not just that the employer
stands in the relationship of a master or an
ordinary employer to a servant. Public
employers behave like authorities, whom
employees do not wish to annoy in any
manner, while in service. Matters can go
that far that even if salary is not paid to an
employee for long spells of time, the
employee believes that discretion is the
better part of valour and he ought not to ask
for his salary, lest he invite the wrath of
authority, which the public employers are.
Invariably, these Corporations are headed
by administrative officers of the State, who
find it difficult to distinguish their role
from civil administrators into employers
functioning in Corporations undertaking
commercial business, where employees'
welfare has to be looked after in a different
way. In any event, even if it is pure State
employment, it is not open to any employer
to behave in this fashion and withhold an
employee's salary, only to be paid after his
retirement. This is precisely the case here.
The petitioner has received his salary for
different periods of time while he was
posted at ten different stations, much after
he has retired from service. This Court will
not say that it is unfortunate. This Court
will say that it is culpable and ought to
invite penalty. Likewise, payment of post
retiral benefits have been unduly delayed
and have been paid after ten years.

11. Gratuity, it is settled in State of
Kerala and others v. M. Padmanabhan
Nair is to be paid on the day following the
retirement. It has been settled by the
Supreme Court in a catena of decisions and
also, by various High Courts across the
country that delay in payment of post retiral
benefits must carry adequate interest. So far
as delay in payment of salary is concerned,
a heavier obligation lies on the employer to
compensate the employee. In both matters,
penal interest ought to be awarded. In
connection with the award of interest and
penal interest, in the matter of late payment
of post retiral benefits, it was held in M.
Padmanabhan Nair (supra) thus :

1. Pension and gratuity are no
longer any bounty to be distributed by the
Government to its employees on their
retirement but have become, under the
decisions of this Court, valuable rights and
property in their hands and any culpable
delay in settlement and disbursement
thereof must be visited with the penalty of
payment of interest at the current market
rate till actual payment.

2. Usually the delay occurs by
reason of non-production of the L.P.C. (last
pay certificate) and the N.L.C. (no liability
certificate)
from
the
concerned
Departments but both these documents
pertain to matters, records whereof would
be
with
the
concerned
Government
Departments. Since the date of retirement
of every Government servant is very much
known in advance we fail to appreciate why
the process of collecting the requisite
information and issuance of these two
documents should not be completed at least
a week before the date of retirement so that
the payment of gratuity amount could be
7 All. Union of India & Anr. Vs. Manoj Pal & Anr.
301
made to the Government servant on the
date he retires or on the following day and
pension at the expiry of the following
month. The necessity for prompt payment of
the retirement dues to a Government
servant immediately after his retirement
cannot be over-emphasised and it would
not be unreasonable to direct that the
liability to pay penal interest on these dues
at
the
current
market
rate
should
commence at the expiry of two months from
the date of retirement.

12. In the circumstances, this writ
petition succeeds and stands allowed. A
mandamus is issued to the Managing
Director, Uttar Pradesh Rajkiya Nirman
Nigam Limited, ordering him to pay
interest on the total sum of money
detailed in paragraph 14, with simple
interest at the rate of 10% per annum with
effect from the date that each item of
unpaid emoluments mentioned in the
table in paragraph 14 fell due, worked out
until time when the relative payment was
actually made.

13. Since working out the interest
on 25 different items of payments that
have been delayed over varying periods
of time is involved, let this matter be
placed before the Registrar General of
this Court, before whom both parties
shall appear and workout the accounts.
The Registrar General, in accordance
with the orders of this Court, shall certify
the total amount payable, and the said
amount, subject to any objection which
parties may wish to make before the
Court, shall be the final amount payable
by the Corporation to the petitioners
within a period of two months.

14. Let a copy of this order be
communicated to the Managing Director,
Uttar Pradesh Rajkiya Nirman Nigam
Limited and the Registrar General for strict
compliance.
----------
(2023) 7 ILRA 301
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 24.04.2023 &
25.05.2023

BEFORE

THE HON'BLE SUNEET KUMAR, J.
THE HON'BLE RAJENDRA KUMAR - IV, J.

Writ-A No. 4654 of 2023

Union of India & Anr. ...Petitioners
Versus
Manoj Pal & Anr. ...Respondents

Counsel for the Petitioners:
Sri Anupam Kumar

Counsel for the Respondents:
Sri Pawnesh Tiwari, Dr. D.K. Tiwari

A.
Service
Law
-
Suspension
-
Interpretation of statute - Central
Civil Services (Classification, Control
and Appeal) Rules, 1965 - Rule 10(6);
Industrial
Disputes
Act,
1947
-
Section 17 -Companies Act, 1956 -
Section 108 - The tests for finding out
a provision is mandatory or directory.
The principles for which the provision
has
been
made,
its
nature,
the
intention of the legislature in making
the provision and the language of the
provision are to be considered. While
interpreting the word 'shall' or 'may', is
whether mandatory or directory, court
would have to ascertain the real intention
of the legislature by carefully attending to
the whole scope of the statute. (Para 16,
18)

The question that arises for consideration is, as
to whether, the word 'shall' in Sub-rule (6)
is mandatory or directory, read with Subrule (7) of Rule 10. (Para 15)