Operative Bank Ltd., Bhubaneswar v. Appellate Authority under Payment of Gratuity Act cum Joint Labour Comm
Case Details
IN THE HIGH COURT OF ORISSA, CUTTACK W.P.(C) No.10606 of 2019 (In the matter of an application under Articles 226 & 227 of the Constitution of India) Managing Director, Odisha State Cooperative Bank Ltd, Bhubaneswar ....... Petitioner Managobinda Barik & Ors. ....... Opp. Parties -Versus- Advocate for the parties For Petitioner : Mr. K.P. Nanda, Advocate Assisted by Mr. D. Panigrahi, Advocate For Opp. Parties : Mr. P.K. Bhuyan, Advocate ---------------------------- CORAM: JUSTICE SANJAY KUMAR MISHRA ---------------------------------------------------------------------------- Date of Hearing: 10.10.2025 Date of Judgment: 28.10.2025 ---------------------------------------------------------------------------- S.K. Mishra, J. 1. This writ petition has been preferred by the Petitioner-Bank challenging the order dated 08.02.2019 passed by the Appellate Authority under P.G. Act-cum- Joint Labour Commissioner (O.P. No.2) in P.G. Appeal Case No.4 of 2018/10/2019, vide which the Opposite Party No.2 confirmed the order dated 11.04.2018 passed in P.G. Case No.20 of 2017 by the Controlling Authority under the Payment of Gratuity Act, 1972, shortly, “the P.G. Act”. 2. Though the confirming order passed by the Appellate Authority has been challenged on various grounds, during hearing, relying on a recent order dated 09.09.2025 passed by the coordinate Bench in W.P.(C) No.20586 of 2022 (M.D., Odisha State Co-Operative Bank Ltd., Bhubaneswar Vs. Appellate Authority under Payment of Gratuity Act cum Joint Labour Commr, BBSR & Ors,) learned Counsel for the Petitioner submitted that the Petitioner-Bank would like to challenge the impugned order passed by the Appellate Authority confining it to the rate of interest of 10% awarded by the Controlling Authority, which was also
Legal Reasoning
erroneously confirmed by the Appellate Authority. 3. The said submission of the learned Counsel for the Petitioner was also duly recorded vide order dated W.P.(C) No.10606 of 2019 Page 2 of 29 23.09.2025. Paragraph Nos.3 & 4 of the said order dated 23.09.2025, being relevant, are reproduced below:- for regarding the Petitioner “3. Learned Counsel submits, though impugned is the order dated 08.02.2019 passed in P.G. Appeal Case No.4 of 2018/10/2019, as at Annexure-1, as per the instruction received, he would like to confine the prayer made in the writ petition the quantum of interest awarded by the Controlling Authority under the Payment of Gratuity Act, which was confirmed by the Appellate Authority vide the impugned order. 4. He further submits, in a recent order dated 09.09.2025 the Coordinate Bench in WP(C) No.20586 of 2022, it held that six per cent interest is payable on the gratuity amount.” passed by (Emphasis Supplied) 4. Learned Counsel for the Petitioner, relying on the said order passed in M.D., Odisha State Co- Operative Bank Ltd (Supra), submitted that the impugned order passed by the Appellate Authority, vide which, apart from confirming the direction given by the Controlling Authority for payment of gratuity to the applicant Employee, it was also erroneously confirmed that the rate of interest to be 10%, to be paid on the unpaid gratuity. Hence, the said order deserves interference. W.P.(C) No.10606 of 2019 Page 3 of 29 5. In response to the said submission made by
Legal Reasoning
the learned Counsel for the Petitioner-Bank so also order passed by the coordinate Bench, learned Counsel for the Opposite Party No.1 submitted that in W.P.(C) No.20586 of 2022, the coordinate Bench passed an incorrect order that the concerned employee is entitled to interest at the rate of 6%, even though there is a specific provision under sub section (3A) of section 7 of the P.G. Act to pay interest and the Central Government, exercising its power conferred under sub section (3A) of section 7 of the P.G. Act, has notified since 01.10.1987 to pay interest @ 10%, which is still in vogue. 5.1. Learned Counsel for the Opposite Party No.1 further submitted that the said order in W.P.(C) No.20586 of 2022 has been passed in ignorance of the provisions of the governing statute, so also earlier judgments of this Court as well as the Supreme Court. Hence, such order is rendered per incuriam. To substantiate his submission, learned Counsel for the Opposite Party No.1 relied on the Judgment passed by the Supreme Court in H.Gangahanumane Gowda Vs. Karnataka Agro W.P.(C) No.10606 of 2019 Page 4 of 29 Industries Corporation Ltd, reported in (2003) 3 SCC 40, wherein the Respondent was directed to pay interest @10% per annum on the gratuity amount payable to the Appellant, from the date it became due till the date of actual payment of gratuity. 5.2. Learned Counsel for the Opposite Party No.1, relying on a recent order of the Supreme Court dated 03.03.2025, passed in SLP(C) No. 4468 of 2022 (Gagan Bihari Prusty Vs. Paradip Port Trust & Ors), submitted that while dealing with a similar issue regarding rate of interest, it is held by the Supreme Court that the direction is given by the Single Judge Bench of this Court to pay interest @ 6% on unpaid gratuity, which was also erroneously confirmed by the Division Bench in Writ Appeal No. 322 of 2019, is not justified. It was further held that an employee is entitled to 10% simple interest per annum on delayed gratuity as an enforceable statutory right and any deviation amounts to gross illegality. Learned Counsel further submitted that, awarding of lesser interest, such as 6%, as ordered by the W.P.(C) No.10606 of 2019 Page 5 of 29 coordinate Bench in W.P.(C) No.20586 of 2022, is legally untenable. 5.3. Learned Counsel for the Opposite Party No.1 further submitted that, earlier also in M.D., Odisha State Co-operative Bank LTD., Bhubaneswar V. Prafulla Chandra Patnaik & Ors., reported in 2025 (I) ILR-CUT-1314, this Court categorically observed that, the Notification dated 01.10.1987 of the Central Government, prescribing 10% simple interest per annum continues to be valid as well as in force. The said judgment passed by this Court was not brought to the notice of the coordinate Bench, which has passed the order in W.P.(C) No.20586 of 2022 . 5.4. Learned Counsel for the Opposite Party No.1 placed reliance on the judgments of this Court in M.D., OSIC Vs. Abhay Kumar Samantray reported in 2022 (III) ILR- CUT- 639, as well as Order dated 31.10.2022 passed in W.P.(C) No.3329 of 2018 (Aska Cooperative Central Bank Ltd., Vs. Controlling Authority under Payment of Gratuity Act-Cum-Assistant Labour Commissioner, Berhampur & Anr.), wherein it was held W.P.(C) No.10606 of 2019 Page 6 of 29 that the Notification dated 01.10.1987, which prescribes payment of 10% simple interest per annum by the employer to his employee, in the event of delayed payment of gratuity, continues to be in force and not being superseded by any fresh notification of the Government of India varying the said rate of interest. 6. At this juncture, it would be apt to reproduce below the provision enshrined under sub-section (3A) of Section 7 of the P.G Act, for ready reference; in sub-section “(3A) If the amount of gratuity payable under sub-section (3) is not paid by the employer within (3), the the period specified employer shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate, not exceeding the rate notified by the Central Government for repayment of long-term deposits, as that Government may, by notification specify:” from time time to (Emphasis Supplied) 7. Admittedly, in view of the said provision enshrined under sub-section 3(A) of section 7 of the P.G. Act, 1972, read with the notification made by the Central Government dated 01.10.1987, the rate of interest payable to an employee, in the case of default in payment W.P.(C) No.10606 of 2019 Page 7 of 29 of gratuity, is to be 10% from the date the gratuity becomes payable till the date of actual payment. 8. The coordinate Bench in Mohan Dakua & ors. Vs. Steel Authority of India Ltd. & ors., reported in 2015 (II) ILR-CUT 178 : 2015 (I) OLR 386 : 120 (2015) CLT 1096, while dealing with a similar issue regarding rate of interest, held as follows:- “5. Reading of Sub-section (3) of Section 7 gives a clear indication for release of the gratuity within a period of thirty days from the date it becomes payable to the person to whom the gratuity is payable. Similarly in Sub-section (3-A) of Section 7, there is a statutory mandate that in case the gratuity is not released within the time framed, the employer is required to pay the simple interest at such rate not exceeding the rate notified in the notification by the Central Government from time to time for repayment of long term deposit as the Government may be certified by such notification. 6. From the pleadings of the parties, it appears that there is no latches on the part of the petitioners in the matter of release of the gratuity. I find force in the submissions of the petitioners which is not only supported by the statutory provisions as at Sub- section (3), (3-A) of Section 7 but also covered by a decision decided by Hon’ble Apex Court in case of H. Gangahanume Gowda Versus Karnataka Agro Industries Corporation Ltd. By deciding similar matter, the Hon’ble Apex Court was pleased to grant interest for the delayed period @ 10% as available in para-9 and 10 of the said decision. The petitioner’s case is squarely covered under the above decision of the Hon’ble Apex Court. W.P.(C) No.10606 of 2019 Page 8 of 29 recorded 7. Further, the petitioners have also referred to to the statutory provisions as hereinabove and they are entitled to interest for delayed payment of Gratuity under the statute also. 8. Under the circumstances, I allow the writ petition directing the opposite party (S.A.I.L.) to calculate the interest @ 10% to be paid to each of as petitioners directed be made within a period of four weeks from the date of communication of the order and payment as calculated be released in favour of each of the petitioner within a period of two weeks thereafter”. independently. Calculation (Emphasis Supplied) 9. In General Manager (P & EEL), Mahanadi Coalfields Ltd. Vs. Asim Kumar Chatterjee, reported in 122 (2016) CLT 260: 2016 LabIC 2302 : 2016 (149) FLR 497: 2016 (II) CLR 212, referring to Mohan Dakua (supra), this Court upheld the orders passed by the Controlling Authority as well as confirmed order passed by the Appellate Authority for payment of gratuity along with 10% interest per annum. Paragraph Nos.1 and 8 to 13 of the said judgment, being relevant, are extracted below:- “1. The (P/EEL), General Manager Mohanadi Coal Fields Limited, Burla, Sambalpur, being the petitioner, has filed this petition seeking to quash the order dated the Controlling 23.04.2015 passed by Authority under the Payment of Gratuity Act, W.P.(C) No.10606 of 2019 Page 9 of 29 1972 and Regional Labour Commission (Central), Rourkela in Application No. 36(2)/2014-RKL-R vide Annexure-8 by which direction has been given to the petitioner to pay the gratuity amount of Rs. 10,00,000/- along with interest @ 10% per annum calculated at Rs. 3,22,192/- within a period of 30 days from the date of receipt of the order.” “8. In Mohan Dakua (Supra) referred to by the learned counsel for opposite party No. 1, this Court has held that payment of gratuity is to be released within a period of 30 days from the date it becomes payable and as such, for the delay in payment of gratuity since no latches having been found on the part of the employer and the employer having not obtained prior permission from the controlling authority for such delayed payment, it is liable to pay interest @ 10%. 9. In H. Gangahanume Gowda(supra), the apex Court has held that in view of the clear mandate under the provisions of Section 7 to employer for payment of gratuity within time and to pay interest on the delayed payment of gratuity and there is also provision to recover the amount of gratuity with compounded interest in case the amount of gratuity payable was not paid by the employer in terms of Section-8 of the Act, since the employer did not satisfy the mandatory requirements of the proviso to Section 7(3- A), no discretion was left to deny interest to the employee on belated payment of gratuity and directed to pay interest @10%. 10. Similarly in Kerala State Cashew (supra) the apex Court has held that in case the employer has obtained permission in W.P.(C) No.10606 of 2019 Page 10 of 29
Decision
writing from the Controlling Authority for delayed payment in that case no interest shall be payable to the employee. In the present case such permission having not been obtained, the employer is liable to pay interest on the gratuity amount. 11. In Y.K. Singla (supra) the apex Court has held that Sub-section (3-A) of section 7 of the Act, 1972 is a most relevant provision for determination of interest to the employee and perusal of Sub-section (3-A) of section 7 of the Act, 1972 leaves no room for any doubt that in case gratuity is not released to an employee within 30 days from the date it becomes payable under Sub-section (3) of Section 7, the employee would be entitled to simple interest at such rate not exceeding the rate notified by the Central Government from time to time for repayment of long term loans, as the Government may, by notification specify. 12. In D.D. Tewari (D) Thr. LRs. (supra) the apex Court has held that if pensionary benefits on gratuity amount is erroneously withheld by the employer, the employee is entitled the date of entitlement till the date of actual payment. in Similar view has also been Rajnagar Textile Mills(supra). 13. For the forgoing reasons and keeping in view the judgments cited above, it is no more res integra that the opposite party No. 1 is entitled to get interest on the gratuity amount payable to him and therefore, the impugned order dated 23.04.2015 by opposite party No. 2 is wholly and fully justified”. in Annexure-8 interest passed taken from to (Emphasis Supplied) W.P.(C) No.10606 of 2019 Page 11 of 29 10. In Manager Director, Odisha Small Industries Corporation Ltd. Vs. Abhay Kumar Samantray, reported in 2022 (III) ILR-CUT 639, this Court held as follows:- “20. So far as awarding 10% simple interest on the determined amount, it may not be out of place to mention that the Central Government, in exercise of the powers conferred by Sub-Section (3-A) of Section 7 of the P.G. Act, 1972, vide Notification dated 01.10.1987, notified as follows: "TO BE PUBLISHED IN PART II, SECTION 3, SUB-SECTION (II) OF THE GAZETTE OF INDIA- EXTRAORINARY) PUBLISED ON 01.10.1987 New Delhi, the 1st October, 87 NOTIFICATION S.O. 874(E), In exercise of the powers conferred by sub-section (3A) of section 7 of the Payment of Gratuity Act, 1972 (39 of 1972), the Central hereby specifies ten percent per annum as the rate of simple interest payable for the time being by the employer to his employee in cases where the gratuity is not paid within the specified period. 2. This notification shall come into force on the date of its publication in the Official Gazette." (No. S-70012/6/87.SS-II) (A.K. Bhattarai) Under Secretary" 21. Admittedly, the said Notification dated 01.10.1987 is still in force not being superseded by any fresh Notification varying the rate of W.P.(C) No.10606 of 2019 Page 12 of 29 interest as was notified by the Government of India on 01.10.1987. P.G. under Authority 22. Hence, this Court is of the view that the Act- Controlling CumDivisional Labour Commissioner, Cuttack, was justified to take into consideration the total period of service of the Opposite Party from the date of his initial engagement (14.11.1991) till the date of his superannuation (31.03.2018), so also award 10% simple interest on the awarded amount for the delayed period, so also ordering to pay further simple interest @ 10% per annum till the payment is made, if the Petitioner Corporation fails to deposit the said ordered amount within 30 days from the date of pronouncement of the judgment”. (Emphasis Supplied) 11. In M.D., Odisha State Co-operative Bank Ltd. (supra), referring to various judgments of this Court so also Supreme Court, this Court held as follows:- “23. Law is well settled that any judgment or order passed contrary to the statute is a nullity. That apart, law is also well settled that any judgment passed without taking note of the earlier judgment of the same Court so also Supreme Court is per incurium.” “25. This Court is also of the view that order dated 01.05.2019 passed in W.P.(C) No. 23834 of 2013, so also the confirmed order passed by the division Bench in W.A. No. 322 of 2019, are hit by the principle of per incuriam as the Bench has passed such an order contrary to the statute so also without taking note of its own judgment in Mahanadi Coal fields Ltd. (supra) so also the earlier judgment passed by this Court in Mohan Dakua (Supra) and judgment passed W.P.(C) No.10606 of 2019 Page 13 of 29 by the Supreme Court in H. Gangahanume Gowda (Supra) so also in Director (Trisul Project) DRDO (Supra) pertaining to the said issue regarding interest payable to an employee under the P.G. Act, 1972. 26. Following the aforesaid principles, this Court is constrained to hold that the order passed by the coordinate Bench so also the confirming order passed by the Division Bench, having been rendered per incurium, cannot be accepted, as a precedent to decide the controversy regarding the rate of interest in this case and wait till disposal of SLP(C) No.4468 of 2022. Hence, this Court is of the view that the oral prayer made by the learned Counsel for the Petitioner to dispose of the Writ Petition directing the Controlling Authority to release the principal amount giving liberty to the parties to move before this Court for release of interest after disposal of SLP(C) No. 4468 of 2022 needs no consideration.” (Emphasis supplied) 12. The Supreme Court in H. Gangahanume Gowda Vs. Kanataka Agro Industries Corpn. Ltd., reported in (2003)3 SCC 40: AIR 2003 SC 1526, held as follows:- “7. It is evident from Section 7(2) that as soon as gratuity becomes payable, the employer, whether any application has been made or not, is obliged to determine the amount of gratuity and give notice in writing to the person to whom the gratuity is payable and also to the controlling authority specifying the amount of gratuity. Under Section 7(3), the employer shall arrange to pay the amount of gratuity within 30 days from the date it becomes payable. Under sub-section (3-A) of Section 7, if the amount of gratuity is not paid by W.P.(C) No.10606 of 2019 Page 14 of 29 from in writing the employer within the period specified in sub-section (3), he shall pay, from the date on which the gratuity becomes payable to the date on which it is paid, simple interest at such rate not exceeding the rate notified by the Central Government from time to time for repayment of long- term deposits; provided that no such interest shall be payable if the delay in the payment is due to the fault of the employee and the employer has obtained permission the controlling authority for the delayed payment on that ground. From the provisions made in Section 7, a clear command can be seen mandating the employer to pay the gratuity within the specified time and to pay interest on the delayed payment of gratuity. No discretion is available to exempt or relieve the employer from payment of gratuity with or without interest as the case may be. However, under the proviso to Section 7(3-A), no interest shall be payable if delay in payment of gratuity is due to the fault of the employee and further condition that the employer has obtained permission the controlling authority for the delayed payment on that ground. Under Section 8, provision is made for recovery of gratuity payable under the Act, if not paid by the employer within the prescribed time. The Collector shall recover the amount of gratuity with compound interest thereon as arrears of land revenue and pay the same to the person entitled. A penal provision is also made in Section 9 for non- payment of gratuity. Payment of gratuity with or without interest, as the case may be, does not lie in the domain of discretion but it is a statutory compulsion. Specific benefits expressly given in a social beneficial legislation cannot be ordinarily denied. Employees on retirement have valuable rights to get gratuity and any culpable delay in payment of gratuity must be visited with the penalty of payment of interest was the view taken in State of Kerala v. M. Padmanabhan Nair. Earlier there was no provision for payment of interest on the delayed payment of gratuity. Sub-section (3- to Section 7 by an A) was added in writing from W.P.(C) No.10606 of 2019 Page 15 of 29 amendment, which came into force with effect from 1-10-1987. In the case of Charan Singh v. Birla Textiles this aspect was noticed in the following words. That provision "4. There was no provision in the Act for payment of interest when the same was quantified by the controlling authority and before the Collector was approached for its realization. In fact, it is on the acceptance of the position that there was a lacuna in the law that Act 22 of 1987 brought about the incorporation of sub-section (3-A) in Section has 7. prospective application”. 9. It is clear from what is extracted above from the order of the learned Single Judge that interest on delayed payment of gratuity was denied only on the ground that there was doubt whether the appellant was entitled to gratuity, cash equivalent to leave etc., in view of divergent opinion of the courts during the pendency of enquiry. The learned Single Judge having held that the appellant was entitled to payment of gratuity was not right in denying the interest on the delayed payment of gratuity having due regard to Section 7(3-A) of the Act. It was not the case of the respondent that the delay in the payment of gratuity was due to the fault of the employee and that it had obtained permission in writing from the controlling authority for that the delayed payment on ground. As noticed above, there is a clear mandate in the provisions of Section 7 to the employer for payment of gratuity within time and to pay interest on the delayed payment of gratuity. There is also provision to recover the amount of gratuity with compound interest in case the amount of gratuity payable was not paid by the employer in terms of Section 8 of W.P.(C) No.10606 of 2019 Page 16 of 29 ground the claim of the Act. Since the employer did not satisfy the mandatory requirements of the proviso to Section 7(3-A), no discretion was left to deny the interest to the appellant on belated payment of gratuity. Unfortunately, the Division Bench of the High Court, having found that the appellant was entitled to interest, declined to interfere with the order of the learned Single Judge as regards interest on delayed payment of gratuity only on the the discretion exercised by the learned Single Judge could not be said to be arbitrary. In the first place in the light of what is stated above, the learned Single Judge could not interest exercising discretion as against the mandatory provisions contained in Section 7 of the Act. The Division Bench, in our opinion, committed an error in assuming that the learned Single Judge the discretion in the matter of awarding interest and that such a discretion exercised was not arbitrary”. could exercise the grant of refuse that 10. In the light of the facts stated and for the reasons aforementioned, the impugned order cannot be sustained. Consequently, it is set aside. The respondent is directed to pay interest @ 10% on the amount of gratuity to which the appellant is entitled from the date it became payable till the date of payment of the gratuity amount. The appeal is allowed accordingly with cost quantified at Rs. 10,000/-.” (Emphasis Supplied) 13. The Supreme Court in Director (Thrisul Project) DRDO, Andhra Pradesh Vs. P.B. Varalakshmi W.P.(C) No.10606 of 2019 Page 17 of 29 and Others, reported in (2015) 15 SCC 398 directed as follows:- “2. The learned Additional Solicitor General submits that in terms of the Rules the amount can be disbursed only to the nominee, who is the widow. Now that the inter se dispute between the wife and the daughter has been settled, we dispose of this appeal with the direction to the appellant to disburse the eligible benefits to the widow nominee who shall distribute the benefits in terms of the compromise between her and her daughter. The dues shall be disbursed with interest @ 10% which is the statutory rate fixed under the Payment of Gratuity Act, 1972”. (Emphasis Supplied) 14. In a recent order in Gagan Bihari Prusty (Supra), which was preferred against the order dated 18.11.2021 passed in W.A No.322 of 2019, vide which the division Bench of this Court upheld the order of the coordinate Bench granting 6% interest on delayed payment of gratuity, instead of 10%, the Supreme Court held as follows:- “1. Challenging judgment dated the 18.11.2021 passed by the High Court of Orissa in Writ Appeal No. 322 of 2019 maintaining the order of the learned single Judge granting interest on the delayed payment of gratuity @ 6% per annum in place of 10%, the petitioner is before this Court.” “4. In our view, the said argument is of no in particular where an substances, W.P.(C) No.10606 of 2019 Page 18 of 29 employee retires and he has to receive the gratuity belatedly, the interest would be payable as per the notifications issued by the Central Government without having any excuse .Therefore, the direction of the Single Judge maintained by the Division Bench for payment of gratuity with interest @ 6% per annum is not justified. The petitioner would be entitled to get interest @ 10% per annum on the amount of gratuity. The differential amount of interest shall be paid by the respondent within a period of four weeks from today.” (Emphasis Supplied) 15. Since the learned Counsel for the Petitioner relied on the order passed by the coordinate Bench in W.P.(C) No. 20586 of 2022 to substantiate his stand that the rate of interest on delayed payment of gratuity should be 6%, instead of 10%, Paragraph Nos.10.2 and 10.3 of the said order, being relevant, are extracted below: “10.2. Therefore, this Court is not inclined to interfere with the impugned order so far as it relates to the direction on the Petitioner Bank to release the gratuity amount of Rs.10,00,000/-. However, with regard to the award of interest @ 10%, it is the view of this Court that award of interest @ 10% basing on a letter issued by the Govt. of India on 01.10.1987, cannot be made applicable to the present claim taking into account the simple interest rate available in the year 2020 and allowed by different Public Sector Banks. 10.3. Therefore, this Court in view of the rate of simple interest allowed by Public Sector Bank in the year 2020, is of the view that award of W.P.(C) No.10606 of 2019 Page 19 of 29 interest @ 10% requires interference of this Court. While interfering with the same, this Court held the Petitioner entitled to get interest @ 6% per annum on the gratuity amount of Rs.10,00,000/-. This Court accordingly while disposing the writ petition, directs Opp. Party No. 2 to release the balance amount in favour of Opp. Party No. 3 by calculating the interest @ 6% on the total gratuity amount of Rs.10,00,000/-, within a period of four (4) weeks from the date of receipt of this order. Residue amount, if any, be returned back to the Petitioner-Bank within the aforesaid time period also.” (Emphasis Supplied) 16. Admittedly, so far as payment of interest to the beneficiary for the period of delayed payment of gratuity, there is a specific provision under Section 7(3-A) of the P.G. Act, 1972, read with the Notification dated 1st October, 1987, made by the Central Government in the said regard. However, the coordinate Bench, while passing the order dated 09.09.2025 in W.P.(C) No.20586 of 2022, did not take note of the said legal provisions enshrined under Sub-Section (3-A) of Section 7 of the P.G. Act, 1972, which authorizes the Central Government to notify the rate of interest payable under the P.G. Act,1972. That apart, it has been incorrectly indicated in the said order that awarding interest @ 10%, basing on a letter issued by the Govt. of India on 01.10.1987, cannot W.P.(C) No.10606 of 2019 Page 20 of 29 be made applicable, even though the same is a notification made by the Government of India in terms of Section-7(3-A) of the P.G. Act. 17. Further, the said order has been passed in ignorance of the previous judgments of this Court in Mohan Dakua (supra), General Manager (P & EEL), Mahanadi Coalfield Ltd. (Supra), M.D., Odisha State Co-Operative Bank Ltd., Bhubaneswar Vs. Prafulla Chandra Patnaik & ors. (supra) and Cuttack Central Co-operative Bank Ltd. (Supra), so also the judgments of the Supreme Court in H. Gangahanume Gowda (supra), Director (Thrisul Project) (supra) and the recent order dated 03.03.2025 passed in SLP(C) No. 4468 of 2022, relevant paragraphs of which have already been reproduced in the forgoing paragraphs. 18. All the aforementioned judgments are much prior to the order dated 09.09.2025 passed by the coordinate Bench in W.P.(C) No. 20586 of 2022. So far as the Petitioner-Bank, in M.D., Odisha State Co-Operative Bank Ltd. Vs. Prafulla Chandra Patnaik & ors. (supra), an identical issue was raised in the said case W.P.(C) No.10606 of 2019 Page 21 of 29 pertaining to the selfsame Employer, i.e., Odisha State Co-Operative Bank Ltd. This Court rendered a detailed and reasoned judgment pertaining to the issue regarding awarding of 10% interest on delayed payment of gratuity taking note of the legal provisions enshrined under the P.G. Act, 1972, notification made by the Central Government under Sub-Section (3-A) of Section 7 of the P.G. Act, 1972 and the judgments of this Court as well as Supreme Court in the said regard. 19. During hearing of the present writ petition, it has come to the notice of this Court that the learned Counsel for the Petitioner-Bank in the present Writ Petition was also the Counsel for the Petitioner-Bank in the earlier writ petition, i.e., W.P.(C) No. 350 of 2017 in M.D., Odisha State Co-Operative Bank Ltd. Vs. Prafulla Chandra Patnaik & others, which stood dismissed vide a detailed Judgment dated 24.12.2024. It has also come to the notice of this Court that learned Counsel for the writ petitioner, was also the conducting Counsel for the selfsame Petitioner-Bank in W.P.(C) No. 20586 of 2022, wherein a contrary order has been passed W.P.(C) No.10606 of 2019 Page 22 of 29 by the coordinate Bench, without reference to the statute so also in ignorance of the previous judgments of this Court as well as Supreme Court. It is not the case of the Petitioner-Bank that being aggrieved by the said Judgment, it has preferred an Intra Court Appeal and the same is pending before this Court, or the said Appeal has been allowed, thereby setting aside the Judgment of this Court in M.D., Odisha State Co-Operative Bank Ltd. (Supra). 20. During hearing of this case, being asked as to whether the said judgment passed in W.P.(C) No.350 of 2017 was brought to the notice of the concerned Court, Mr. Nanda, learned Counsel for the Petitioner-Bank submitted that though it was brought to the notice of the coordinate Bench, it distinguished the said judgment while passing the order dated 09.09.2025 in W.P.(C) No. 20586 of 2022. But, it is revealed from the said order passed by the coordinate Bench in W.P.(C) No. 20586 of 2022 that there is no reference to the judgment passed by this Court in W.P.(C) No. 350 of 2017, which is pertaining to the self-same bank and self-same issue and W.P.(C) No.10606 of 2019 Page 23 of 29 was passed taking note of all the earlier judgments of this Court as well as Supreme Court. Hence, the submission made by learned Counsel for the Petitioner seems to be incorrect. 21. Professional ethics of lawyers are guided by a set of principles and rules that governs their conduct and behaviour. These ethics are designed to ensure that lawyers maintain the highest standards of integrity, honesty and professionalism in their dealings with clients, Courts and other stakeholders. By upholding these ethics, lawyers can maintain the trust and confidence of their clients, the public and the justice system. A lawyer should be fair enough while arguing a matter before any Court, including Constitutional Courts, and should not suppress any fact as well as law and/or mislead a Court. Once a lawyer loses the trust of the Court in view of his wrongdoing or unfairness, which includes suppression of fact, though normally it should not be, such impression of the Court towards a particular lawyer may affect the fate of his other clients, who are having a fair chance of succeeding in the litigations. That W.P.(C) No.10606 of 2019 Page 24 of 29 apart, such conducts also amount to professional misconducts. 22. So far as binding effect of the order dated 09.09.2025 passed in W.P.(C) No. 20586 of 2022, though uniformity and consistency are core of judicial discipline, since such decision is rendered per incuriam, cannot be accepted as a precedent to annul the impugned order passed by the Appellate Authority under the P.G. Act, 1972, so far as the rate of interest awarded in favour of the private Opposite Party. 23. Law is well settled that a decision is given per incuriam when the Court has acted in ignorance of a previous decision of its own or of a Court of coordinate jurisdiction which covered the case before it, in which case it must decide which case to follow. Law is also well settled that when a judgment is rendered by ignoring the provisions of the governing statute, such decision is rendered per incuriam. The rule of per incuriam can be applied where a Court omits to consider a binding precedent of the same Court or the Superior Court W.P.(C) No.10606 of 2019 Page 25 of 29 rendered on the same issue or where a Court omits to consider any statute while deciding that issue. 24. That apart, Article 141 of the Constitution of India unequivocally indicates that the law declared by the Supreme Court shall be binding on all Courts within the territory of India. The aforesaid Article empowers the Supreme Court to declare the law. It is, therefore, an essential duty of all the subordinate Courts, including the High Courts, across the Country to follow the law laid down by the Superior Court. When the Supreme Court decides a principle, it would be the duty of the High Court or a subordinate Court to follow the said decision. A judgment or an order of the High Court, which refuses to follow the decision and directions of the Supreme Court or seeks to revive a decision of the High Court, which had been set aside by the Supreme Court, is a nullity. 25. The aforesaid views of this Court get supported with the judgments of the Supreme Court in State of U.P. & ors. Vs. Synthetic & Chemicals Ltd. & ors., reported in (1991)4 SCC 139, V. Kishan Rao Vs. W.P.(C) No.10606 of 2019 Page 26 of 29 Nikhil Super Speciality Hospital & anr., reported in (2010)5 SCC 513, Siddharam Satlingappa Mhetre Vs. State of Maharashtra & ors, reported in (2011) 1 SCC 694, Hyder Consulting (UK) Ltd. Vs. Governor, State of Orissa, reported in (2015) 2 SCC 189 and Director of Settlements, A.P. Vs. M.R. Apparao, (2002) 4 SCC 638. 26. Admittedly, the order dated 09.09.2025 passed by the coordinate Bench in W.P.(C) No. 20586 of 2022 was without referring to the relevant statute, i.e., Sub- Section (3-A) of Section 7 of the P.G. Act, 1972, in terms of which Notification dated 01.10.1987 was made by the Central Government. That apart, such an order has been passed in ignorance of the previous judgments of this Court as well as Supreme Court. 27. In view of the submissions made by the learned Counsel for the parties, legal provisions so also the settled position of law and the reasons detailed above, this Court is of the view that order dated 09.09.2025 passed in W.P.(C) No. 20586 of 2022 is hit by the principle of per incuriam, as the coordinate Bench has passed such an order contrary to the statute so also W.P.(C) No.10606 of 2019 Page 27 of 29 without taking note of the Judgments of this Court in Mahanadi Coal fields Ltd. (supra), in Mohan Dakua (Supra) so also in M.D., Odisha State Co-Operative Bank Ltd.,Bhubaneswar Vs. Prafulla Chandra Patnaik & ors (supra) and judgments passed by the Supreme Court in H. Gangahanume Gowda (supra), in Director (Trisul Project) DRDO (supra) and the order dated 03.03.2025 passed in SLP(C) No.4468 of 2022 in Gagan Bihari Prusty (supra) pertaining to the selfsame issue regarding interest payable to an employee under the P.G. Act, 1972 for delayed payment. 28. Consequently, in the absence of any infirmity, the Order dated 08.02.2019 passed by the Appellate Authority in P.G. Appeal Case No. 04 of 2018/10/2019, thereby confirming the order dated 11.04.2018 passed by the Controlling Authority in P.G. Case No. 20 of 2017, is hereby upheld. 29. Before parting, it would be appropriate to mention here that in view of the reasons detailed above, including the judgment of this Court in M.D., Odisha State Co-operative Bank LTD., Bhubaneswar V. W.P.(C) No.10606 of 2019 Page 28 of 29 Prafulla Chandra Patnaik & Ors., reported in 2025 (I) ILR-CUT-1314, to save the judicial time, parties were sent for mediation to resolve the issue amicably. However, to the reasons best known to the Petitioner- Bank, the mediation failed and this Court had to re- adjudicate the issue regarding rate of interest payable to the Opposite Party No.1, even though law is well settled on the said issue. 30. Hence, the writ petition stands dismissed with costs of Rs.20,000/-(Rupees twenty thousand) only to be paid to the Opposite Party No.1 within six weeks hence, for wasting the judicial time of this Court so also to compensate the hardship caused to a retired employee, who had to fight out a long legal battle to get his legitimate admissible dues of gratuity. …….….………………… S.K. MISHRA, J. Orissa High Court, Cuttack The 28th October, 2025/Prasant W.P.(C) No.10606 of 2019 Signature Not Verified Digitally Signed Signed by: PRASANT KUMAR PRADHAN Designation: Secretary Reason: Authentication Location: High Court of Orissa, Cuttack. Date: 29-Oct-2025 16:11:59 Page 29 of 29