IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD (Special Original Jurisdiction) MONDAY, THE EIGHTEENTH DAY OF AUGUST TWO THOUSAND AND EIGHT PRESENT THE HON'BLE SRI JUSTICE L.NARASIMHA REDDY WRIT PETITION No. 7698 of 2007 Between: P.Bheemaiah S/o Late P. Ramaiah R/o H. No. 11-3-664/280, Sanjeevapuram, Parsigutta, Secunderabad. ..... PETITIONER AND 1 The Works Manager, Zonal Work Shop Uppal, APSRTC., Ranga Reddy District. 2 The Secretary, APSRTC., Staff Retirement Benfit Scheme, Bus Bhavan Musheera bad, Hyderabad. 3 The Managing Director, APSRTC, Bus Bhavan Musheerabad Hyderabad .....RESPONDENTS Petition under Article 226 of the constitution of India praying that in the circumstances stated in the Aﬃdavit ﬁled herein the High Court will be pleased to issue a Writ or order or directions, more so a Writ in the nature of Mandamus holding, that the action of the respondents 1 to 3 in deducting the excess monthly salary attachment is illegal, arbitrary against article 14, 19 and 21 of the Constitution of India and consequently direct the respondents 1 to 3 stay the monthly salary attachment ofthe petitioner forth with and to pass such other or further order or orders Counsel for the Petitioner: MR.A.USHI REDDY Counsel for the Respondents: MR.V.T.M.PRASAD The Court made the following ORDEER: The petitioner joined the A.P.S.R.T.C. as a Kalashi in the year 1969. Thereafter, he was promoted as Mechanic. He retired from service on 31.03.2008, on attaining the age of superannuation. The Corporation evolved the Staﬀ Retirement Beneﬁt Scheme. From out of the corpus provided by the Corporation, the fund operates in such a way that the loans are advanced to the employees and the resultant profits are made over to the retired employees. The petitioner submitted an application to the second respondent for sanction of housing loan. An amount of Rs.1,08,000/- was sanctioned in the year 1997. The amount was paid to the vendor of the petitioner. The loan amount and interest, was divided into 108 equalized monthly instalments of Rs.1,863/-. The petitioner states that as against his obligation to repay a sum of Rs.2,04,000/-, the respondents have recovered a sum of Rs.2,63,980/- and are proposing to take steps to make further deductions. He also complains that his retirement benefits have not been extended to him so far. The respondents ﬁled a counter-aﬃdavit. They admit that the petitioner was sanctioned the loan of Rs.1,08,000/- for housing purpose. They plead that the equalized monthly instalments were determined by calculating the interest at the rate of 14% per annum and the agreement itself provides for levy of penal interest, in case its conditions are violated. According to them, the petitioner failed to deposit title deeds within the stipulated time and thereby, he became liable to pay the penal interest. The facts and ﬁgures furnished by the respondents indicate that, up to March, 2007, a sum of Rs.2,44,906/- was recovered from the petitioner and still he is due a sum of Rs.1,04,291/-. Reference is also made to various clauses and conditions. Heard the learned counsel for the petitioner and the learned Standing Counsel for the respondents. The Corporation evolved a Scheme for the beneﬁt of its employees, whether in service, or retired. While those in service are extended the loans at a relatively lower rate of interest, the retired employees are extended the beneﬁt, in a diﬀerent form. The petitioner was sanctioned a sum of Rs.1,08,000/- as housing loan, with interest at the rate of 14%, per annum. The amount comprising principal and interest was divided into 108 equalized monthly instalments of Rs.1,863/-. The liability of the petitioner comes to Rs.2,01,204/-. Being the employer, the Corporation was deducting the instalments without any diﬃculty. Further, the petitioner had adequate left over service before his retirement, for payment of instalments. Though the petitioner pleaded that a sum of Rs.3,09,545/- was deducted from his salary, so far; the respondents stated in their counter-aﬃdavit that Rs.2,44,906/- was deducted. Even this is in excess of their entitlement. The justiﬁcation pleaded by the respondents for eﬀecting excessive deductions from the salary of the petitioner is that penal interest was levied on account of default on the part of the petitioner. The counter- aﬃdavit is silent as to whether the petitioner was put on notice before the penal clause was invoked. Even according to them, the amount was paid to the vendor of the petitioner through cheques. At no point of time, the respondents have informed the petitioner that they propose to levy penal interest, much less, did they indicate the reasons therefor. A perusal of the counter-aﬃdavit discloses that respondents 1 and 2 have acted in a worse manner, than a professional private moneylender. Taking advantage of the fact that the salary of the petitioner is in their hands, indiscriminate, excessive and arbitrary deductions were made. Levy of 14% interest itself was excessive. The amount to be repaid by the petitioner, without any penal interest, was twice, the amount borrowed by him. As though the illegal deductions made so far are not adequate, the respondents have come forward with the plea that the petitioner is liable to pay a sum of Rs.1,04,000/-. This Court is of the view that the respondents are indulging in money lending business of an objectionable nature, in the name of operating a beneﬁcial scheme. If one goes into minute details thereof, there is every likelihood of their being prosecuted by the respective agencies. The respondents have not only made excessive deductions from the petitioner, but also have withheld the retirement benefits. This is a serious violation on the part of an agency, which is expected to be a model employer. Hence, the writ petition is disposed of directing that (a) the respondents shall not be entitled to levy any penal interest on the petitioner; (b) they shall refund the amount collected in excess of 108 equalized monthly instalments of Rs.1863/-, within a period of one month from the date of receipt of a copy of this order; (c) they shall forthwith release the retirement beneﬁts to the petitioner within a period of four (4) weeks from today, and (d) any delay in complying with the directions in the above clauses would make the respondents, liable, to pay interest at the rate of 12% per annum with eﬀect from the date on which the respective amounts became due. There shall be no order as to costs. __________________ L.NARASIMHA REDDY,J Dt:18.08.2008 Note: L.R. copy to be marked. kdl