THE DIRECTOR KERALA STATE INSTITUTE OF ENCYCLOPAEDIC PUBLICATION (SIEP) G.P.O LANE Vs. J. REGHU AND OTHERS

JUDGEMENT

(1.) This appeal is preferred by the 2nd respondent in W.P(C) No.28174/2015 on being aggrieved by the judgment passed thereon by the learned Single Judge, on 8.2.2018. Essentially this appeal by the Director, Kerala State Institute of Encyclopaedic Publication (SIEP) is against the direction of the learned Single Judge directing for payment of interest for the amount of pensionary benefits payable to the writ petitioner and withheld by the appellant. A succinct narration of the following facts are relevant for proper disposal of this appeal:- The writ petitioner/first respondent herein was an Assistant Editor Grade I under the appellant. He retired from service on 30.4.2015. As per Ext.P3 an amount of Rs. 12,77,000/- was fixed as his liability. It is challenging Ext.P3 that he filed the said writ petition. In the counter affidavit filed on behalf of the appellant and the first respondent it is stated that the 1st respondent/writ petitioner stood as a surety to two loans availed by the employees working under the appellant. That apart the writ petitioner himself had also availed a loan. Based on the agreement executed between the writ petitioner and the 3rd respondent Society recovery of amount due towards the aforesaid loan could be effected from the salary and also from the pensionary benefits of the borrower as also the sureties. In the said circumstances, taking into account the dues under the aforesaid loan transactions an amount of Rs. 12,77,000/- was fixed as his liability under Ext.P3. When the writ petition came up for consideration on 7.3.2017 an interim order was passed by the learned Single Judge. Going by the same the respondents including the appellant herein were directed to pay full pension to the writ petitioner from 1.4.2007 onwards and to pay the arrears of pension for the period from 1.5.2015. It is now submitted before us by both the sides that subsequent to the said order all terminal pensionary benefits were released to the writ petitioner/first respondent. Therefore, the dispute is only with respect to the liability or otherwise to pay interest for the delayed payment of such benefits. Hence we need to consider only the said issue.

(2.) The contention of the appellant is that on receiving a requisition from the 3rd respondent Society the appellant had retained the pensionary benefits payable to the first respondent herein, in terms of the provisions under Section 37 of the Kerala Co-operative Societies Act (for short 'the Act'). The deduction from salary to meet society's claims in certain cases is permissible in terms of Section 37 of the Act. At the same time going by the same, such deduction is possible and permissible only from the salary or wages, subject to execution of an agreement in favour of the Society concerned by the concerned employee.

(3.) A Division Bench of this Court in Surendran v. Mavelikkara Primary Co-op. Agri. and RD Bank Ltd. (2005(4) KLT 619 ) held that salary or wages referred to in Section 37 of the Act would not include DCRG. The contention of the appellant is that in terms of Ruling 1 of Rule 3 of Part III of the Kerala Service Rules (for short 'KSR' only) amount due from the government employee or pensioner to Government Companies, Local Bodies, Co-operative Societies, etc., though not treated as Government dues, may be recovered from the death-cumretirement gratuity payable to him with his consent in writing. To contend that even under the said provision withholding of the other pensionary benefits are impermissible the 1st respondent/writ petitioner relied on Note 2 to Rule 3 of Part III KSR, wherein it is made clear that the word 'pension' used in the Rule does not include death-cum-retirement gratuity. In other words, going by the provision the pensionary benefits would not include death-cum amount payable towards death cumretirement gratuity. In short, the contention of the writ petitioner was that even going by Ruling No.1 to Rule 3 of Part III KSR there was absolutely no justification for withholding of the pensionary benefits. Certainly, after his retirement there was no question of effecting deduction from his salary or wages. Be that as it may, the fact is that pursuant to the order dated 7.3.2017 all the benefits due to the 1st respondent/writ petitioner were disbursed and as noticed herein the short question is whether or not those amount the first respondent is entitled to get interest.