Delayed gratuity payments can trigger a statutory right to simple interest for the period of default.

Delayed payment of gratuity attracts simple interest under the statutory scheme when gratuity is not released within the prescribed period after retirement. The text states that once default in timely payment is established, the employee becomes entitled to interest for the period of delay, regardless of the reasons advanced for late disbursement. It further notes that the interest rate applied was 7% per annum on the delayed gratuity amount, limited to the period of default.

---

---

Issues: Entitlement to interest on delayed payment of gratuity under the statutory scheme.

Analysis: The gratuity amount became payable after the statutory period following retirement, but the actual payment was made much later. The governing provision required payment of gratuity within the prescribed time and, on default, payment of simple interest for the delayed period. The Court found that the delay in releasing gratuity was established and that the petitioner was entitled to interest for the period of default.

Conclusion: The petitioner was held entitled to simple interest at 7% per annum on the delayed gratuity amount for the relevant period.

Final Conclusion: The writ petition was disposed of by granting monetary relief limited to interest on delayed gratuity, with no order as to costs.

Ratio Decidendi: Where gratuity is not paid within the statutory period, the employee acquires a right to simple interest for the period of delay, irrespective of the reasons advanced for late payment.

---