Case Law Details
Payment of interest on amount of gratuity is statutory compulsion under Payment of Gratuity Act.
Keeping in view the statutory provisions contained in sub-section (3A) of Section 7 of the Act of 1972 and applying the law laid-down by their Lordships of the Supreme Court in the matter of H. Gangahanume Gowda (supra), I do not have any slightest hesitation in my mind to hold that failure of the petitioner to make payment of amount of gratuity within 30 days from the date it becomes payable to the employee, sub-section (3A) of Section 7 of the Act of 1972 is squarely attracted and payment of interest being statutory and mandatory in nature and thereby the petitioner is liable to make payment of interest on the said amount which the Appellate Authority has rightly been awarded to respondent No. 2.
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1. Respondent No. 2 herein was appointed as Boiler Operator in the petitioner’s company on 1.7.2002. His last drawn wages as per salary slip for the month of November, 2011 was ` 7860/- (Basic `5895+DA `1965) . Thereafter, from 10.12.2011 respondent No. 2 remained unauthorizedly absent from his duty leading to issuance of show-cause notice dated 10.12.2011. Respondent No. 2 did not respond to the show-cause notice and tendered his resignation on 14.1.2012, which was accepted by the petitioner with immediate effect i.e.14.1.2012. Respondent No.2 filed an application under Section 7(4) of the Payment of Gratuity Act, 1972 (hereinafter called as “the Act of 1972”) claiming gratuity amount from the petitioner. The Controlling Authority by its order dated 18.6.2013 granted `45,346/- (without interest) as gratuity taking last drawn wages as `7860/- indicated in the salary slip of the month of November, 2011.
2. Feeling aggrieved and dissatisfied with the order of the Controlling Authority, respondent No.2 preferred an appeal under Section 7(7) of the Act of 1972 before the Appellate Authority. The Appellate Authority by its order dated 3.3.2014 held that respondent No.2 is entitled for gratuity to the tune of ` 71,311/- along with 10% interest.
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Sir,
Please clarify whether interest received on delayed payment of Gratuity is taxable under Income Tax Act .
I got superannuated from services on 31-03-2020. Till date I have not got my Gratuity. Will I get interest for delay in payment of Gratuity.
I was retired on 31/01/2017 on superannuation but my gratuity and leave encashment was withheld due to disciplinary action. Now the case was decided on 15/02/2021 the disciplinary authority imposed a penalty of Rs. 5000/- and treated my suspension period on duty.
Please enlighten me whether I am entitle to receive interest on delayed payment of gratuity as the amount of gratuity not yet paid by the employer.
Once gratuity is released and delayed due to procedure compliance should not be taken as fault of employee. The case is free from circumstances of Gratuity forfeiture hence interest on delay should be payable. I request legal expert to kindly see and put legality on the above views, if eligible. Regards.
Delay in gratuity payment interest rate ..how much
My friend retired on 3-6-2007 and his gratuity was withheld for the reason of pending disciplinary action. It was finalised in March this year and levied a token penalty of cut in pension at 10% for two years. However gratuity is allowed to be drawn in full since there were no other dues to be recovered.
Please enlighten me whether he would be entitled to receive interest on such with held gratuity?