H. K. CHINDAIAH v. STATE OF KARNATAKA — 1978 DIGILAW 25 (KAR)

( 1 ) THE petitioner in this writ petition was an officer of the State Govt in the cadre of Joint Registrar of Co-operative Societies. The petitioner was sent on deputation' to serve as Managing Director of the Karnataka state Co-operative Apex Bank Ltd. , Bangalore (hereinafter referred as 'the Apex Bank') on 11-12-1972. According to the Govt Order the petitioner was entitled to get foreign service allowance in addition to the pay and allowances to which he was entitled to in the post held by him in the foreign department. According to the respondents, the foreign service allowance to which the petitioner was entitled was Rs. 100 per month. The petitioner commenced to draw his salary and allowances in terms of the Govt Order after he joined duty as Managing Director of the Apex Bank. On 9-8-1973 the Board of Directors of the Apex Bank passed a resolution fixing his pay at Rs. 1,625 per month by adding 25% to the basic pay of the petitioner and paid him the salary and allowances on that basis with effect from 9-1-1973. The Apex Bank wrote to the govt seeking approval to the resolution, but the Govt was silent and no order approving the resolution of the Apex Bank was communicated. However, as stated earlier, the Apex Bank paid the salary and allowances to the petitioner in terms of the resolution from the date he reported for duty as Managing Director of the Apex Bank. The petitioner retired from service on 12-8-1977. The State Govt has failed to settle his pension in accordance with the rules. In these circumstances, the petitioner has presented the above petition praying for the issue of a writ of mandamus or any order of that nature to the respondents to release and pay forthwith the pensionary benefits due to him. ( 2 ) RESISTING the claim of the petitioner, statement of objection is filed on behalf of respondents 1 to 4. In the statement of objection, the reason given for not finalising the pension due to the petitioner is that the Apex Bank suffered a loss to the extent, of Rs. 27,364. 88 p. on account of higher rate of pay given by them to the petitioner contrary to -the terms of deputation. In the statement of objection, the reason given for not finalising the pension due to the petitioner is that the Apex Bank suffered a loss to the extent, of Rs. 27,364. 88 p. on account of higher rate of pay given by them to the petitioner contrary to -the terms of deputation. As to the source of the power to with-hold the pension due to the petitioner for the recovery of the alleged excess payment made by the Apex Bank reference is made to Rules 214 and 215 of the Karnataka Civil Service Rules. The stand of respondents 1 to 4, in view of the said, rules is that they are entitled to effect recovery of the aforesaid sum from the pension due to the petitioner. Therefore, the question for consideration in this case is whether the aforesaid rules authorise the State Govt to with-hold the pension of the petitioner assuming that excess payment was made by the foreign employer. The relevant portion of Rule 214 reads as follows :" Govt further reserve to themselves the right of withholding or withdrawing a pension or any part of it, whether permanently or lor a specified period and the right of ordering the recovery from a pension of the whole or part of any pecuniary loss caused to Govt if, in departmental or judicial proceeding the pensioner is found guilty of grave misconduct or negligence during the period of his service, including service rendered upon re-employment after retirement. "as can be seen from the above rule, what the above rule authorises the state Govt is to recover from the pension of a civil servant any pecuniary loss caused to the Govt. In the present case, no such loss is caused to the Govt. As stated earlier, the Board of Directors of the Apex Bank voluntarily resolved to give higher salary to the petitioner with effect from the date he took charge on deputation as Managing Director of the apex Bank. Pursuant to the said resolution they paid higher salary. The amount of Rs. 27,364. 88 p. is the excess amount paid by the Apex bank over and above the rate fixed by the Govt in the order of deputation. But the fact remains that the amount was paid by the Apex Bank and not by the Govt and, therefore, it cannot be considered as any pecuniary loss caused to the Gcvt. 27,364. 88 p. is the excess amount paid by the Apex bank over and above the rate fixed by the Govt in the order of deputation. But the fact remains that the amount was paid by the Apex Bank and not by the Govt and, therefore, it cannot be considered as any pecuniary loss caused to the Gcvt. Therefore Rule 214 of the Rules is not attracted. ( 3 ) THE next rule referred to in the statement of objection as the source of power of the Govt is Rule 215 of the rules, which reads as folllows :" 215. In cases not governed by the provisions of Rule 214, the following rules shall govern the recoveries from pension and compassionate allowances : - (1) A claim may become known and the question of recovery may arise- (A) When the calculation of pension is being made and before the pension is actually sanctioned ; or (B) After the pension has been sanctioned. (2) The claim and the recovery may be one or other of the following: (a) Recovery as a punitive measure in order to make good the loss caused to Govt as a result of negligence or fraud on the part of the person concerned while he was in service. (b) Recovery of other Govt dues such as over-issues of pay, allowance, or leave salary, or admitted and obvious dues such as house rent, life insurance premia, outstanding motor car, house building, travelling and other advances. (c) Recovery of non-Govt dues. (3) In cases falling under clause (1) (A) above, none of the recoveries mentioned in clause (2) (a) to (c) above may be effected by a reduction of the pension about to be sanctioned except in the following circumstances :- (a) When the service of a Govt servant can be held to have been not thoroughly satisfactory, a reduction in the amount of pension may be made under Rule 212 by a competent authority although no direct penal recovery from pension is permissible. (b) When the pensioner by request made or consent given has agreed that the recovery may be made provided such recovery is restricted to the amount of pension which has already become payable on the date of the agreement or consent. If such request is not made or consent is not given by the pensioner, even sums admittedly due to govt such as advances, etc. If such request is not made or consent is not given by the pensioner, even sums admittedly due to govt such as advances, etc. , may not be recovered from pension. In such cases, however, the executive authorities concerned would have to consider whether they should not try to effect the recovery otherwise than from pension, for example, by going to a Court of law, if necessary. (4) In cases falling under clause (1) (B) above, none of the recoveries mentioned in clause (2) (a) to (c) above may be effected by deduction from the pension already sanctioned except at the request or with the express consent of the pensioner : provided such recovery is restricted to the amount of pension which has already become payable on the date of such agreement or consent. In cases where the pensioner does not agree to recovery being made even of sums admittedly due to Govt, action as indicated in the last sentence of clause (3) may be taken. "in this case it is not disputed that the case of the petitioner falls under rule 215 (1) (A) because this is a case in which pension has not yet been sanctioned. Rule 215 (2) (c) authorises recovery of non-Govt dues. Sub-rule (3) of Rule 215 clearly states the circumstances under which the recovery failing under Rule 215 (2) (a) (b) and (c) could be effected. As can be seen from Rule 215, these circumstances are specified in Rule 215 (3) (a) and (b) of the Rules. According to the aforesaid rules, the recoveries can be effected only in the following two ways : (1) Under Rule 212 of the Rules if the service of the civil servant concerned is not thoroughly satisfactory; and (2) If the pensioner gives his consent. Rule 215 (3) (b) makes it clear in cases where the amount is due and the concerned official refused to give consent, then the executive authorities should consider whether the recovery should be made otherwise than from pension by going to a court of law, if necessary. 3. The substance of Rule 215 therefore is recovery of non-Govt dues could be effected only if the petitioner gives his consent and if no such consent is given, the only alternative open is to take action by going to a Court of law under the ordinary law of the land. 3. The substance of Rule 215 therefore is recovery of non-Govt dues could be effected only if the petitioner gives his consent and if no such consent is given, the only alternative open is to take action by going to a Court of law under the ordinary law of the land. No other rule or source of power is pointed out which authorises the State Govt to recover the alleged excess amount of Rs. 27,364. 88 p. by the Apex Bank from the amounts of pension and gratuity due to the petitioner. It is well settled that the amount of pension and gratuity to which a civil servant is entitled under the provisions of the Rules governing the conditions of service is his right to property under Arts. 31 and 19 (1) (f) of the Constitution. The Govt has no power to with-hold any part of the said amount due to the petitioner unless it is expressly authorised by the Rules regulating the conditions of service. As pointed out earlier, Rules 214 and 215 on which reliance is placed by the Govt as the source of their power to recover the amount in question do not confer such power. ( 4 ) IN fact the Secretary to the Govt of the concerned Department had taken the right stand in his letter dated 10-8-1977 (Ext. 'g' ). The said letter was addressed to the Manging Director of the Apex Bank and in the said letter he made it clear that if there has been excess payments during the period when the petitioner was on deputation as Managing director by the Apxe Bank, it is for the Apex Bank to take action for recovery of the excess amount. ( 5 ) FROM the facts stated above, it is clear that the alleged amount of excess payment made to the petitioner was a voluntary payment made by the Apex Bank pursuant to the resolution passed by the Board of directors. If the Apex Bank takes the view that the said payment was not in accordance with law, it is for the Apex Bank to take proper action for recovery if such course is open to them under the law. If the Apex Bank takes the view that the said payment was not in accordance with law, it is for the Apex Bank to take proper action for recovery if such course is open to them under the law. But, however, as far as the State Govt is concerned, they have no power under the rules relied on to recover the aforesaid amount as it is not Govt dues and as petitioner has not given his consent for the recovery. ( 6 ) FOR the reasons stated above, the rule is made absolute and a writ in the nature of mandamus shall issue to the 1st respondent to settle the pension and other retirement benefits due to the petitioner in accordance with the rates fixed in the Karnataka Civil Service Rules within two months from the date of receipt of the order. It is however made clear that any provisional payment already made to the petitioner has to be deducted in the amounts due to the petitioner. No costs. --- *** --- .