PUNJAB STATE CIVIL SUPPLIES CORPORATION LTD. Vs. CONTROLLING AUTHORITY UNDER THE PAYMENT OF GRATUITY ACT, 1972 AND ANOTHER

JUDGEMENT

(1.) Sunita Rani (2nd respondent) retired on attaining the age of superannuation on 31/5/2013 from the service of PUNSUP. There was a charge-sheet pending against her, which was finalized after retirement on 5/7/2013 in which the charges were dropped. Since she was not paid her gratuity, she made a complaint before the Controlling Authority under the Payment of Gratuity Act, 1972. The Assistant Labour Commissioner, Ferozepur exercising powers of Controlling Authority dismissed the application, as during the pendency of the proceedings PUNSUP paid up an amount of '8,34,051/- to the 2nd respondent towards gratuity by cheque dtd. 24/4/2015. While doing so, the Controlling Authority also declined the request for payment of interest on delayed payment on the ground that gratuity was not withheld by PUNSUP intentionally or unreasonably.

(2.) Aggrieved by the order of the Controlling Authority on the point of grant of interest, Sunita Rani carried an appeal to the Appellate Authority. The appeal has been allowed by the impugned order dtd. 13/8/2018. The Appellate Authority has relied on Sec. 7 (3A) of the Act to allow the appeal. Sec. 7 (3A) provides for payment of interest from the date on which the gratuity becomes payable till the date on which it is paid, simple rate of interest which is notified by the Central Government on fixed deposits from time to time. Sec. 7(3A) of the Act is reproduced hereunder:

(3.) By virtue of operation of this law, the Appellate Authority has set aside that part of the order of the Controlling Authority which has denied interest on delayed payment and awarded interest at the rate of 10% p.a. with effect from 1/7/2013 till payment by modifying the order of the Controlling Authority. No fault can be attributed to the employee for late payment.