- 1 - NC: 2025:KHC:5372 WP No. 42228 of 2014 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 5TH DAY OF FEBRUARY, 2025 BEFORE THE HON'BLE MR JUSTICE ANANT RAMANATH HEGDE WRIT PETITION NO. 42228 OF 2014 (L-KSRTC) BETWEEN: ABDUL SALIM, S/O ABDUL WAHAB SAB, AGED ABOUT 67 YEARS, SENIOR CITIZEN, R/AT 13TH CROSS, P.H.COLONY, B.B.ROAD, TUMKUR-572101, (SENIOR CITIZEN BENEFIT NOT CLAIMED). …PETITIONER (BY SRI LAKSHMAN RAO, ADVOCATE) AND: 1. THE DIVISIONAL CONTROLLER, K.S.R.T.C, CENTRAL DIVISION OFFICE, K.H.ROAD, SHANTHINAGAR, BANGALORE-560027. 2. THE ASSSITANT LABOUR COMMISSIONER & CONTROLLING AUTHORITY, UNDER THE PAYMENT OF GRATUITY ACT 1972, DIVISION-4, KARMIKA BHAVAN, BANNERUGHATTA ROAD, BANGALORE-560029. 3. THE DEPUTY LABOUR COMISSIONER & APPELLATE AUTHORITY UNDER THE PAYMENT OF GRATUITY ACT 1972, REGION-2, KARMIKABHAVAN, BANGALORE-560029. …RESPONDENTS (BY SMT H R RENUKA, ADVOCATE FOR R1, SMT RASHMI RAO, HCGP FOR R2 AND R3) Digitally signed by BELUR RANGADHAMA NANDINI Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC:5372 WP No. 42228 of 2014 THIS WRIT PETITION IS FILED UNDER ARTICLES 226 AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO ISSUE A WRIT OF CERTIORARI OR APPROPRIATE WRIT OR ORDER TO MODIFY THE IMPUGNED ORDERS PASSED BY THE R-2 AND R-3 DATED 7.7.2010 AND DATED 23.1.2013 VIDE ANN-A AND B RESPECTIVELY AND TO CALCULATE GRATUITY PER BINDING SETTLEMENT DATED 17.7.1989 VIDE ANN-C AND ETC. THIS PETITION, COMING ON FOR HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE ANANT RAMANATH HEGDE ORAL ORDER This petition is filed assailing the order dated 07.07.2010 passed by the Controlling Authority as well as the order dated 23.01.2013 passed by the Appellate Authority under the Payment of Gratuity Act, 1972 (for short 'Act of 1972'). 2. The petitioner is a retired employee of the respondent-Corporation. He raised a grievance before the Controlling Authority on the premise that his gratuity amount has been deducted without there being any authority to deduct the said amount. Thus, he made a claim for payment of Rs.1,66,394/- and he also claimed interest at the rate of 10% on the said amount. - 3 - NC: 2025:KHC:5372 WP No. 42228 of 2014 3. The respondent-Corporation resisted the claim. The respondent-Corporation took a contention that the petitioner has authorised deduction of the gratuity amount towards payment of loan availed by the petitioner. The Controlling Authority on considering the materials on record has held that the deduction is justified and accordingly passed an order to pay a sum of Rs.31,512/- to the petitioner along with 10% interest. 4. Aggrieved by the aforementioned order passed by the Controlling Authority, the respondent-Corporation filed an appeal before the Appellate Authority. In terms of order dated 23.01.2013, the Appellate Authority allowed the appeal in part and reduced the interest from 10% to 6%. The Appellate Authority referred to the judgment of the Division Bench of this Court in the case of Management of KSRTC vs Krishna Reddy1 to reduce the interest from 10% to 6%. 5. Aggrieved by the order reducing interest from 10% to 6% and also the order passed by the Controlling 1 Civil Appeal No.4637/2006 - 4 - NC: 2025:KHC:5372 WP No. 42228 of 2014 Authority partially rejecting the claim petition, the petitioner is before this Court. 6. Learned counsel for the petitioner would contend that the respondent-Corporation erred in deducting the amount from the gratuity account as there is a prohibition under Section 13 of the Act of 1972. It is also his further contention that the Appellate Authority could not have reduced the interest from 10% to 6% awarded by the Controlling Authority. 7. Learned counsel appearing for the respondent- Corporation would contend that the petitioner cannot question the order of the Controlling Authority as he has not filed appeal before the Appellate Authority. Having accepted the order of the Controlling Authority, the petitioner can only urge a contention relating to reduction of interest reduced by the Appellate Authority. 8. This Court has considered the contentions raised at the bar and perused the records. - 5 - NC: 2025:KHC:5372 WP No. 42228 of 2014 9. The following points arise for consideration: (a) Whether the petition challenging the order of the Controlling Authority is maintainable when the petitioner has not assailed the correctness of the said order before the Appellate Authority? (b) Whether the Appellate Authority is justified in reducing rate of interest from 10% to 6%? 10. There is no dispute that the petitioner has not assailed the order of the Controlling Authority partially rejecting his claim. The petitioner made a claim for recovery of Rs.1,66,394/-. However, appreciating the contention of the respondent-Corporation the Controlling Authority passed order for payment of Rs.31,512/- and also awarded interest. 11. If at all the petitioner is to take a contention that the decision of the Controlling Authority upholding the respondent-Corporation's contention relating to authority to deduct the gratuity amount towards payment of dues of the petitioner is erroneous, he ought to have questioned the said order by filing an appeal. He has not filed any appeal. On the - 6 - NC: 2025:KHC:5372 WP No. 42228 of 2014 other hand, he has accepted the said order. This order has attained finality as against the petitioner. Hence, the present petition challenging the order of the Controlling Authority is not maintainable. However, the respondent-Corporation filed an appeal against the said order. That appeal is allowed and interest is reduced from 10% to 6%. 12. As far as the contention relating to reduction of interest rate, learned counsel for the petitioner is justified in urging that the interest cannot be reduced from 10% to 6%. The reliance placed by the Appellate Authority on the Division Bench judgment of this Court to reduce interest is untenable and the said judgment does not apply to the facts of the present case. 13. It can be noticed from section 7(3)(a) of the Act of 1972 that in case of delayed payment of gratuity amount, the employer is liable to pay interest at the rate of 10% per annum. This being the position, the Appellate Authority could not have reduced the interest from 10% to 6%. 14. Hence, the following: - 7 - NC: 2025:KHC:5372 WP No. 42228 of 2014 ORDER (i) The Writ Petition is allowed in-part. (ii) The impugned order dated 23.01.2013 marked at Annexure-B reducing the interest from 10% to 6% is quashed. (iii) The petitioner is entitled to interest at the rate of 10% per annum on Rs.31,512/- from 30 days after the date retirement i.e., 31.03.2004, till the date of payment. Sd/- (ANANT RAMANATH HEGDE) JUDGE GVP List No.: 1 Sl No.: 29