Please note the following:
a) The employee has completed his one year of employment on 07-10-2018. Therefore, he was eligible to get his performance bonus on 08-10-2018. He submitted his resignation four days letter. Therefore, his resignation should not have any bearing on the disbursement of the performance pay.
b) While designing the salary structure, you divided it into two components. One was fixed portion and another was variable. Payment of this variable portion was deferred till completion of new year. Now the since the employee has completed the year's time, he is eligible to receive the variable portion. Denying him would be transgression of the terms of the employment which your company had designed it.
c) Probably your concern is why company should be paying performance pay to an employee who is already on the notice period. It would be "liability" to the company. In what sense you used this word that I cannot say, but then your company is liable for the variable pay. Matter closes there.
13th November 2018 From India, Bangalore