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Jammu, Oct 02: In O.A. No. 712/2021 titled Bal Krishan Khajuria Versus UT of Jammu & Kashmir Through Commissioner Secretary to Government, Finance Department, J&K Government & ors after hearing Advocate F.A.Natnoo for the applicants (RAJINDER SINGH DOGRA) MEMBER (J) ordered as:-
1. The brief facts of the case in a nutshell are that the applicants herein after having entered into government service as teachers and serving in various capacities have retired from services on their superannuation from Education Department of UT of Jammu & Kashmir.
The applicants admittedly during their service tenure with the respondents have contributed to the G.P. Fund maintained by the respondents. According to the applicants they were entitled to interest on the G.P. Fund amounts up to the date when the amount is finally credited to their accounts but allegedly have been deprived of the same by restricting payment of interest on the G.P. Fund amount up to the dates of their retirement on superannuation.
2. The facts of case in nutshell are that the Rule 7 of the G.P. Fund Rules under which as per the contention of the applicants, they were entitled to interest on G. P. Fund amount subscribed by them up to the end of the month preceding the month in which the G.P. Fund was made to the applicants. Note 1 of Rule 7 of the rules (Supra) which is being referred by the applicants reads as under:-
“Note 1- Before the amount at an officer credit in the fund is finally paid under rules his account shall be credited with interest up to the end of the month preceding that in which the payment is made, or up to the end of the six months after the end of the month he quit the service or die whichever of these periods is less.”
3. The applicants on the strength of the aforesaid rule position have claimed to have been deprived of the amount of interest calculated by the applicants for the periods as detailed below: Name Period Amount of interest Bal Krishan Khajuria April 2018-Jan 2020 Rs. 2,26,391/- Manohar Lal Aug 2019-Feb ,2020 Rs. 85427/- Razor Singh Apr 2019–May 2020 Rs. 2,42,090/- Tara Chand Oct 2019-April 2020 Rs. 22099/- Bodh Raj Sharma Feb 2018-January 2020 Rs. 4,29,912/- Sukh Raj Febr 2018- May 2020 Rs. 1,69,549/- Parkash Chand Feb 2020-April 2020 Rs. 15669/- Chaman Lal Aug 2018-June 2020 Rs. 95,081/-
4. During the course of the submissions the learned counsel for the applicants contended that the applicants are entitled to the interest on G.P Fund amount subscribed in view of the rule position as well the interpretation to the said rules placed by the Hon’ble Division Benches of the Hon’ble High Court of Jammu & Kashmir passed in (1) LPASW No. 37/2010 titled Kulbhushan Sharma Vs State & Ors and other connected matters, vide judgement dated 21-08-2017,(copy placed as Annexure-A11 of the OA), (2) State of Jammu & Kashmir Vs Sudershan Kumar Khajuria , reported as 2015 (2) JKJ (HC) page 772, wherein according to the learned counsel the Hon’ble Division Bench while dealing with a similar controversies , have held entitled the appellants therein i.e. similarly situated employees to the applicants in the instant petition, for the amount of interest on G.P. Fund subscription up to the end of the month when the payment was made to them.
5. The respondents have filed their reply, wherein while giving details about date of release of amount of interest in favor of each applicant have vehemently resisted the claim of the applicants with the plea that the applicants are not entitled to the interest on G.P. Fund amount beyond the date of retirement. 6. Mr. Dewakar Sharma, ld DAG for respondents has vehemently contended that there is no ground to claim interest on the G.P. Fund amount beyond the date of retirement, payment whereof according the learned DAG has rightly been restricted up to the date of retirement.
7. Heard Mr F A Natnoo Advocate for the applicants and Mr. Dewakar Sharma Ld. DAG for respondents and perused the records.
8. It is an indisputable fact that the applicants herein are retired government servants who during their service tenure have subscribed towards G.P. Fund subscription but have been restricted their claim of payment of interest up to the dates of their retirement and not up to the end of the month when the amount was released in their favor.
The question to be decided by this Tribunal in the instant petition is thus as to whether the action of the respondents in restricting payment of interest to their G.P. Fund subscription up to the date of retirement and not allowing the interest up to the month proceedings the month when the amount was actually credited to their accounts is legally sustainable and permissible in law or not.
9. The legal position on the aforesaid issue as brought out by the learned counsel for the applicants is no more res-integra and continues to be settled that an employee having contributed towards the G.P. Fund is entitled to the interest on the said amount up to the end of the month preceding that in which the payment is made, more so when no action has been taken by the authorities in terms of Rule 20 of the Rules (Supra).
10. In the case LPASW No. 37/2010 titled Kulbhushan Sharma Vs State & ors and other connected matters, vide judgement dated 21-08-2017, the Hon’ble Division Bench has the occasion to deal with the issue in detail. the Hon’ble Division Bench with reference to various provisions of the J&K G.P. Fund Rules and Manual and also the earlier views of the court has thus under paras 7,8,9,10 and 11 of the judgment observed as under:-
“We have considered the submissions made by learned counsel for the parties and have perused the record. Before proceeding further, it is opposite to take note of the relevant statutory provisions. Rule 7 of the General provident Fund Rules, 1977reads as under:-
Compound interest at 5 1⁄2 percent annum will be allowed in the case of such subscribers to the fund has joined it before Ist Baisakh, 1983 and 3 1⁄2 percent per annum to those who joined the Fund thereafter. The Government, however, reserves the right of reducing the rate of interest at any time, for officers who became subscribers to the Fund on or after Ist Baisakh, 1983. The reduction from 4 percent to 3 1⁄2 percent will come into force from Baisakh 2000. Note 1- Before the amount at an officer’s credit in the fund is finally paid under rules his account shall be credited with interest up to the end of the month preceding that in which the payment is made, or up to the end of the six months after the end of the month he quit the service or die whichever of these periods is less.”
11. Rule 20 of the aforesaid Rules reads asunder: “20. Unclaimed deposits : Sums remaining unclaimed for a period exceeding 6 moths should be transferred to deposits at the end of each year and be dealt with under the ordinary rules relating to deposits.”
12. Thus, from conjoint reading of Rule 7, note (1) read with Rule 20 of the Rules, it is evident that if the amount remains in the employee’s general provident fund up to the end of six months, the same has to be transferred to deposits at the end of each year and be dealt with under the ordinary rules relating to deposits.
13. Note1 appended to Rule 7 was amended vide Notification namely SRO 313 dated 08-06-1978 which read as under : “Note 1- Before the amount at an officer’s credit in the Fund is finally paid under rules, his account shall be credited with interest up to the end of the month preceding that in which the payment is made. However, Rule 20 of the Rules was amended by a Notification dated 02- 0902008 and the figure six months’ on Rule 20wassubstituted by the word and figure “two years”.
14. From communication dated 12-05-2000 sent by Director (Codes), Finance Department to Senior Deputy Accountant General (A&E),Shakti Nagar, Jammu, it has been clarified when the final refund of GPF takes place, the interest up to the end of the month preceding that in when the payment is made is to be calculated and paid as per Note 1 below Rule 7 of the Rules, clause 13.12 of the Jammu and Kashmir Financial Code also provides that unclaimed amounts standing at the credit of the subscribers in provident fund under the control of the government are transferred to this head and these deposits should thereafter be dealt with in accordance with the rules governing them.
15. Thus, from conjoint reading of aforesaid rules as well as Financial Code and compendium, it is evident that it does not contain any provision that an employee has to withdraw the amount of general provident fund within a period of six months.
On the other hand, the rules cast a duty under Rule 20 of the Rules on the respondents that in case if the amount due under the provident fund is not claimed for a period exceeding two years, the same should be transferred to the deposits at the end of each year and be dealt with under the ordinary rules relating to deposits.
16. Hon’ble High Court in case reported as 2015 (2) JKJ {HC} 772 State of Jammu & Kashmir and others Vs Sudershan Kumar Khajuria, , which has been duly relied upon by the Hon’ble Division Bench in the aforesaid judgment in Kulbushan Sharma’ case (supra) and wherein the earlier Hon’ble Division Bench relying upon the provisions of the J&K G.P. Fund Rules and various judgment of the Hon’ble Supreme Court as is reflected under paras 8 and 9 of the said judgement, has allowed the relief in favor of the aggrieved person therein.
17. In view of the aforesaid pronouncement of the Hon’ble Division Bench of the Hon’ble High Court on the issue and the rule position as detailed above , it is clear that the action of the respondents in restricting the payment of interest on G.P. Fund subscription of the applicants only up to the date of their retirement and not beyond that i.e. up to the end of the moth preceding that in which the payment is made, more so in absence of any action taken in terms of Rule 20(Supra) and as envisaged under rules and thus depriving the applicants of their legitimate amount, is grossly arbitrary and illegal and also suffers from the voice of non-adherence to the statutory rules and law laid down on the subject , hence the same cannot sustain in law.
18. In view of the above discussions, facts and circumstances of the case, the TA is disposed of with direction to respondents to release interest on the amount of GP fund for the period as mentioned in para-3 of the instant order. It has been purportedly withheld till the date of payment made to the applicants.
19. The exercise shall be completed within a period of two months from the date of receipt of certified copy of this order. 20. No order as to costs. (RAJINDER SINGH DOGRA) MEMBER (J)
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