STATE GOVERNMENT SHOULD PAY INTEREST IN CASE OF DELAY IN SALARY OR PENSION FOR GOVT EMPLOYEE - SC

28th Feb 2021

The Supreme Court bench headed by Justice DY Chandrachud said that the government should pay interest in delaying pensions or salaries of government employees as pensions or salaries are ‘rightful entitlements’ of the government employees.

The Andhra Pradesh High Court allowed a PIL filed by a former District Judge and directed the payment of deferred salary and pension amount for the month of Month - April 2020  with interest at 12% per annum.

Aggrieved by the decision, the State appealed in the Apex court and argued that the delay in payment of salaries and pensions is due to the pandemic - Covid 19. The state also stated that there was no mala fide intention in delaying salaries and pensions of government employees. Hence, there was no reason to saddle it with the liability to pay interest.

While disposing of the case, the Apex Court directed in substitution of the interest of 12% per annum to 6% per annum for the deferred salaries and pensions within 30 days to the state.

Author: Papiha Ghoshal