2026:HHC:22014 IN THE HIGH COURT OF HIMACHAL PRADESH SHIMLA CWPOA No.7682 of 2019 Decided on: 05th June, 2026 Uploaded on : 05th June, 2026 Naresh Inder Singh …Petitioner Versus State of H.P. and others …Respondents Coram Hon'ble Mr. Justice Jiya Lal Bhardwaj, Judge Whether approved for reporting? 1 For the petitioner: Mr. Radhey Shyam Gautam, Advocate. For the respondents: Mr. Amandeep Sharma, Additional Advocate General. Jiya Lal Bhardwaj, Judge (Oral) The petitioner by way of present petition has prayed for the following substantive reliefs: “i) That the impugned objection raised by respondent No.5 on the arrears bill of leave encashment (annexure A- 4) to the effect that revised leave encashment is not entitled due to increase of pay, it is settled in one time, may be quashed and set aside. ii) That the respondents may be directed to pay to the applicant the arrears of leave encashment after calculating the same on the basis of enhanced pay on account of grant of benefit of ACP and step up given at par with his juniors. iii) That the respondents may be directed to pay to the 1 Whether reporters of Local Papers may be allowed to see the judgment? 2 applicant interest @9% per annum on the delayed payment of the amount of leave encashment from the date of retirement till actual date of payment.” 2. The facts as emerge from the pleadings are that the petitioner was appointed as Lecturer (Biology) in Government Senior Secondary School, Sunni on tenure basis on 03.09.1989. Later on, his services were regularized as Lecturer w.e.f. 01.04.1994 and was retired from service on attaining the age of superannuation on 30.09.2012. Since, there was anomaly in the pay fixation of the petitioner vis.-a-vis. his juniors, the petitioner had made a representation dated 11.06.2012 (Annexure A-1) to bring him at par with his juniors. Later on his pay was stepped up as per order dated 01.10.2013 at par with his juniors. 3. After retirement of the petitioner, the respondents did not pay the arrears of revised leave encashment and the petitioner made an application on 04.08.2015 (Annexure A-3). Respondent No.4 had informed the petitioner vide letter dated 21.08.2015 that he has already been paid leave encashment of Rs.4,44,620/- after his retirement. After enhancement in the pay on account of the benefit of 2 increments under the new 3 Assured Career Progression Scheme (for short “ACP”) after completion of 9 years and 14 years regular service, revised leave encashment Bill No.14 dated 27.05.2015 amounting to Rs.34920/- was submitted in the District Treasury Office, Solan. However, the District Treasure Officer, Solan had conveyed that the revised leave encashment is not entitled due to increase of pay. It has been averred that the pay of the petitioner was stepped up to Rs.6600/- instead of Rs.6400/- w.e.f. 01.01.1996. Since, his pay has been stepped up, he cannot be penalized due to delay and negligence on the part of the respondents and his enhanced pay deserves to be taken into consideration while calculating the arrears of leave encashment. The objection raised by respondent No.5 on the arrears bill of leave encashment on the ground that the petitioner is not entitled for revised leave encashment due to negligence of pay is wholly unjust, arbitrary and discriminatory. The petitioner is legally entitled for the benefit of ACP after completing the 4-9-14 years services as per the rules and instructions from the date the 4 scales were revised and the benefit of ACP was extended. The delay in allowing the benefit of ACP to the petitioner was on the part of the respondents and thus prayed for direction to release the amount of revised leave encashment. 4. Respondents No.1 to 4 filed reply to the petition and averred that the petitioner has been paid the amount of leave encashment of Rs.4,44,620/- besides other benefits after his retirement. As per clarification dated 13.08.2013, issued by the State Government of Himachal Pradesh, it has been clarified that the benefit of leave encashment is not a part of retirement benefit and the same is regulated under separate set of Rules i.e. CCS (Leave) Rules, 1972 and as such instructions issued by the Finance (Pension) Department dated 12.03.2013 shall not be applied in such cases. Further, in terms of Rule 39(2)(b) of CCS (Leave) Rules, 1972, the leave encashment shall be payable in one lump sum as one time settlement. The District Treasury Officer, Solan, has rightly objected to the bill which was prepared by respondent No.4 as the leave encashment is one time 5 settlement and the petitioner is not entitled for the payment of revised leave encashment. 5. Respondent No.5 filed separate reply and made averments on similar lines. 6. The petitioner filed rejoinder to the replies of respondents No.1 to 5 respectively and placed on record office memorandum dated 25.04.2023 7. I have heard the learned counsel for the parties and also perused the record carefully. 8. The issue with respect to the grant of revised leave encashment is no more res-integra in view of the law laid down by this Court in CWP No.7359 of 2021, titled, Amita Gupta vs. State of Himachal Pradesh and others, wherein the Hon’ble Division Bench of this Court has succinctly dealt with the same very issue. After considering the office memorandum dated 13.08.2013 as well as the provision of Rule 39 of CCS (Leave) Rules, 1972, came to the categorical conclusion that the leave encashment payable only in one lump sum as one time 6 settlement is misconceived and based upon misinterpretation of applicable rules. The relevant paras of the judgment are reproduced hereinbelow: “4(iv) (b) Respondents’ argument that under Rule 39(2) (b) of CCS (Leave) Rules 1972, the leave encashment is payable only in one lump sum as one time settlement and, therefore, revised leave encashment cannot be paid to the petitioner, is clearly misconceived and based upon misinterpretation of applicable Rules. The office memorandum issued by the Finance Department on 13.08.2013 to the extent it pertains to leave encashment is not in consonance with law and Rules. Amount of leave encashment by necessary implication becomes payable in one lump sum at the time of retirement. However, Rule 39(2) (b) cannot be interpreted to mean that Government servants who have been paid leave encashment in one lump sum at the time of retirement cannot be paid more leave encashment amount even if there is any increase in their pay/dearness allowance etc., post retirement. Here is a case where pay of the petitioner was re-fixed in higher pay scale after her retirement. The pay re-fixation order and the notification on the basis of which pay was re-fixed clearly provided that petitioner was to be granted notional benefit of re-fixation of pay upto a particular date and actual monetary benefits were to be released to her w.e.f. 14.10.2014. The petitioner was granted actual monetary benefit from a retrospective date (w.e.f. 14.10.2014) after her superannuation on 30.09.2020. The actual monetary benefits (arrears) on the basis of revised pay fixation order had already been released in favour of the petitioner. She was definitely entitled to the revised leave encashment worked out on the basis of her 7 re-fixed pay structure. Though in this case the petitioner after her superannuation was granted actual monetary benefits on account of re-fixation of her pay, however, even if she had not been granted the actual monetary benefits or had received only notional benefits, still the fact remains that her pay had been re- fixed after her retirement. Under Rule 39 of the CCS (Leave) Rules 1972, it is the pay and dearness allowance ‘admissible’ to the petitioner at the time of her retirement that are to be taken into consideration for computing her leave encashment. In case the pay and dearness allowance admissible to the petitioner at the time of retirement had undergone change post her date of retirement, then definitely the leave encashment amount was required to be re-worked out and to be paid accordingly. It will also be beneficial to refer to a clarification issued under G.I.D.P. & A.R., O.M. No. P.14028/11/81-Estt (L), dated the 8th March, 1982. This clarification was issued as number of references were received in the Dept. of Per. & A.R., as to whether any increase in DA/ADA sanctioned by the Government with retrospective effect will be admissible to those Government servants, who had already been paid leave salary in one lumpsum as one-time settlement at the time of their retirement. Whether the words “payable in one lump sum as one time settlement” occurring in the Rules should or need not be taken to mean that if any increase in DA/installment of ADA is allowed after the final settlement, but with retrospective effect, it should be denied to the employee who was in service on the date from which such increase was made applicable. The clarification to these references was that if any increase in DA/ADA is sanctioned by the Government with retrospective effect and the Government servant concerned was eligible for the same on the date of his retirement/quitting service, 8 then the difference between the leave salary already paid and leave salary payable according to the new rates will be admissible to the Government servant concerned, notwithstanding the fact that one-time settlement had already been made prior to the date of issue of orders regarding the increase in DA/ADA, etc. Relevant portion of clarification is extracted herewith :- DA/ADA increase with retrospective effect also admissible.- Reference is invited to Rules 39, 39-A and 39-B of the CCS (Leave) Rules, 1972, wherein it has been provided that the cash equivalent of leave salary which becomes payable on retirement at the time of finally quitting the service is to be paid in one lumpsum as one-time settlement. 2. A number of references have been received in the Dept. of Per.& A.R., seeking clarification as to whether any increase in DA/ADA sanctioned by the Government with retrospective effect will be admissible to those Government servants, who have already been paid leave salary in one lumpsum as one-time settlement. The words “payable in one lumpsum as one-time settlement” occurring in the Rules should or need not be taken to mean that if any increase in Dearness Allowance/installment of ADA is allowed after the final settlement, but with retrospective effect, it should be denied to the employee who was in service on the date from which such increase was made applicable. It is hereby clarified that if any increase in DA/ADA is sanctioned by the Government with retrospective effect and the Government servant concerned was eligible for the same on the date of his 9 retirement/quitting service, then the difference between the leave salary already paid and leave salary payable according to the new rates will be admissible to the Government servant concerned, notwithstanding the fact that one-time settlement had already been made prior to the date of issue of orders regarding the increase in DA/ADA, etc. [G.I., D.P.& A.R., O.M. No. P. 14028/11/81-Estt. (L), dated the 8th March, 1982] Thus, once the revised DA/ADA is to be taken into consideration for revising the payable leave encashment at the time of retirement, then certainly revised pay of an employee re- fixed from a retrospective date prior to his retirement is also to be taken into consideration for revising leave encashment. 5. Conclusion Viewing from any angle, the stand taken by the respondents in denying payment of revised leave encashment to the petitioner cannot be countenanced. For all the aforesaid reasons, the petition is therefore, allowed. Respondents are directed to implement the Office Order dated 10.02.2021 (Annexure P-4). The balance amount of leave encashment due to the petitioner in terms of office order dated 10.02.2021 be paid to her within a period of four weeks from today. The petitioner shall also be entitled to costs of Rs. 25,000/- to be paid to her by the respondents alongwith the due balance leave encashment amount within the aforesaid period. We also clarify that in case this amount is not paid within a period of four weeks, the same shall also carry interest @ 5% per annum from the due date.” 9. A perusal of the aforementioned paras clearly 10 reveals that the Court while allowing the writ petition had also allowed the writ petition with costs of Rs.25,000/- to be paid by the respondents to the petitioner Amita Gupta along with the due balance leave encashment amount within a period of four weeks. Further, the Court had held that in case the amount is not paid within a period of four weeks’, the same shall also carry interest @5% per annum from due date. 10. Once, the petitioner had placed on record the office memorandum dated 25.04.2023, which finds mention of judgment in Amita Gupta’s case, the respondents ought to have defrayed the amount of revised leave encashment to the petitioner, especially when respondent No.4 had calculated the same. However, instead of releasing the payment of the revised leave encashment, the respondents are still agitating the matter. 11. Once, this Court has already adjudicated the issue in detail, it does not behove to the respondents to unnecessarily contest the petition when the law on the point is clear. Therefore, the present petition deserves to be allowed and as 11 such is allowed. 12. Resultantly, the impugned objection dated 08.06.2015 raised by respondent No.5 to withhold the revised leave encashment is quashed and set-aside with the directions to the respondents to pay the amount of leave encashment of Rs.34,920/- to the petitioner within a period of two months from today, failing which, the respondents shall pay interest on the said amount @6% per annum from the due date. It is made clear that the amount of interest shall be recovered from the erring officers/officials. The petition is accordingly disposed of. No orders as to cost. 13. Pending miscellaneous application(s) if any, also stand disposed of accordingly. 05 th June, 2026 ( Jiya Lal Bhardwaj ) (ankit) Judge