Case Note & Summary
The petitioner, C. Ilangovan, was a retired Checking Inspector of the Tamil Nadu State Transport Corporation (Kumbakonam) Ltd., Karaikudi Region. He retired from service on 31 January 2023. Prior to retirement, he had surrendered 135 days of earned leave for encashment, but the surrender leave salary was not disbursed by the respondent management despite his retirement. On 3 January 2025, the petitioner made a representation to the respondent seeking payment of the leave encashment, but it was not considered. Consequently, the petitioner filed a writ petition under Article 226 of the Constitution of India before the Madurai Bench of the Madras High Court, seeking a writ of mandamus directing the respondent to pay the encashment amount of 135 days earned leave together with 18% interest per annum, either based on his monthly wages at the time of each leave surrender or based on the wages payable at the time of retirement, within a time frame to be fixed by the court. The central legal issue was whether a retired employee is entitled to receive surrender leave salary and at what rate of interest for the delayed payment. The respondent management appeared through counsel, but no specific counter-arguments were recorded in the order. After hearing both sides and perusing the materials on record, the court found that the petitioner's retirement had occurred and the leave salary remained unpaid despite representation. Directing the release of the eligible surrender leave salary, the court ordered the respondent to pay the amount with interest at the rate of 6% per annum from the due date until the date of actual disbursement. The payment was to be made within twelve weeks from the date of receipt of a copy of the order. The writ petition was disposed of with these directions, and no order as to costs was made. Thus, the court upheld the right of a retired employee to timely encashment of surrendered earned leave, and fixed a reasonable interest rate to compensate for the delay.
Headnote
A) Service Law - Leave Encashment - Entitlement on Retirement - Constitution of India, 1950, Article 226 - Petitioner, a retired Checking Inspector, sought encashment of 135 days earned leave surrendered prior to retirement - Held that the respondent was directed to release the eligible surrender leave salary with interest at 6% p.a. from the due date within twelve weeks, despite no specific statutory provision cited, under Article 226 mandamus (Paras 1-5).
Issue of Consideration
Whether the writ petitioner, a retired employee, is entitled to encashment of 135 days earned leave surrendered prior to retirement, and if so, the rate of interest payable on delayed disbursement.
Final Decision
Writ petition disposed of. Respondent directed to release eligible surrender leave salary with interest at 6% per annum from due date till disbursement, within twelve weeks from receipt of order. No costs.
Law Points
- Entitlement to surrender leave salary
- mandamus to compel payment
- interest on delayed payment
