Delhi High Court Directs CAT to Establish Uniform Interest Rates for Delayed Retiral Benefits by MCD

The Delhi High Court has recently addressed inconsistencies in the interest rates awarded by the Central Administrative Tribunal (CAT) concerning delayed payment of retiral benefits by the Municipal Corporation of Delhi (MCD). A division bench comprising Justice C. Hari Shankar and Justice Ajay Digpaul observed that while some CAT orders have granted interest at General Provident Fund (GPF) rates, others have awarded varying rates, including 12% per annum, for similar delays by the MCD.

The case in question involved a petitioner challenging a CAT order that awarded interest on delayed retiral benefits at GPF rates. The petitioner contended that there should be consistency in the interest rates awarded, especially in cases where circumstances are comparable. The High Court concurred, emphasizing the necessity for uniformity in the interest rates granted to individuals in similar situations.

To address this disparity, the High Court directed that the matter be placed before the Chairman of the CAT. The Chairman has been requested to constitute an appropriate bench to deliberate on the issue, ensuring that there is no inconsistency in the interest rates awarded for delayed retiral benefits where the MCD is responsible for the delay.

In its directive, the Court stated: "In view of the nature of the order we are passing today, and as it involves an issue of uniformity in judicial orders passed by the Tribunal in respect of rate of interest to be awarded on delayed payment of retiral benefits, we direct that this matter be placed before the Hon'ble Chairman of the Tribunal, who is respectfully requested to constitute an appropriate Bench to take call on the matter, so that there is no lack of uniformity in the matter of rate of interest paid on retiral benefits, where the MCD has been found responsible for delayed disbursal."

Consequently, the High Court set aside the impugned CAT order to the extent that it awarded interest at GPF rates and remanded the matter back to the Tribunal. The CAT has been instructed to re-examine the appropriate rate of interest to be awarded to the petitioner, ensuring consistency with other similar cases.

This decision underscores the judiciary's commitment to ensuring fairness and uniformity in the adjudication of retiral benefits, particularly in cases involving delayed payments by municipal authorities. It also highlights the importance of establishing clear guidelines to prevent discrepancies in judicial orders, thereby promoting equitable treatment of retirees awaiting their due benefits.