Shabbir Alam, Son Of Late Ramjani, Resident Of Village-korauni, P. O. -asthua, P. S. - singhwara, District-darbhanga v. Bihar State Electricity Board Through Its Chairman
2008-12-19
J.N.SINGH
body2008
DigiLaw.ai
JUDGEMENT J.N.Singh, J. 1. Petitioner has filed this writ application with a prayer for quashing the office order no. 264 dated 10.6.2002 issued vide memo no. 2312 of even date under the signature of General Manager- cum-Chief Engineer, PESU (Annexure-7 to the writ application), whereby while sanctioning a sum of Rs. 1,23,955/- as provisional gratuity of the petitioner, a sum of Rs. 31,818.60 has been deducted from the sanctioned amount on account of alleged excess payment drawn by him. The petitioner has also prayed for quashing of final gratuity payment order no. 347 dated 24.2.2003 issued vide memo no. 784 dated 25.2.2003 under the signature of Deputy Director of Accounts, PESU (Annexure-8 to the writ application) whereby while sanctioning final gratuity amount to the petitioner to the tune of Rs. 2,21,850/-, a sum of Rs. 1,23,955/- sanctioned to him as provisional gratuity has been adjusted from the same. Petitioner has also prayed for a direction that the said amount so illegally recovered while sanctioning his provisional gratuity on account of alleged excess payment be paid to him with suitable interest. 2. The facts of the case are in narrow compass. Petitioner was appointed as skilled Khalasi (Coolie) with Sijua (Jherriah) Electric Supply Company Limited in the year 1962, vide Annexure-1 to the writ application. The said Electric Supply Company Limited was taken over by the Bihar State Electricity Board in 1975. With the takeover of the Company, services of the petitioner was also taken over by the Board and petitioner became a full-fledged employee of the Board. Thereafter, petitioners services were absorbed in the Grade of Fitter Grade-I with effect from 1.8.1988. Later on, he was promoted to the Grade of Cable Jointer by order dated 26.12.1991, vide Annexure-2, and placed in the scale of Rs. 1,500-2,660/-. Petitioner continued as such in the service of the Board till his superannuation with effect from 30.4.2001. Petitioner has annexed his pay fixation as Annexures-3 and 4 to show that pursuant to Annexure-2 his pay was time to time revised and fixed by the authorities of the Board till the date of his superannuation. After his superannuation he obtained no dues certificate vide Annexure-5 and applied for gratuity vide Annexure-6.
Petitioner has annexed his pay fixation as Annexures-3 and 4 to show that pursuant to Annexure-2 his pay was time to time revised and fixed by the authorities of the Board till the date of his superannuation. After his superannuation he obtained no dues certificate vide Annexure-5 and applied for gratuity vide Annexure-6. However, when the petitioner received the order of fixation of his provisional gratuity vide Annexure-7, which was purported to have been issued under the provisions of Gratuity Act, 1972, he found that a sum of Rs. 31,818.60/- had been deducted from the provisional gratuity sanctioned to him. Petitioner has stated that he seriously objected to the same claiming that at no point of time was there any withdrawal from the gratuity by him nor any communication handed over to him with regard to such excess withdrawal nor was he instrumental in payment of such excess amount to him. Petitioner has further stated that he complained about the same to all the authorities and expected that the mistake would be rectified at the time of sanction of final gratuity to him. However, when the order of final gratuity was issued, vide Annexure-8, he found that the said amount still remained deducted from his gratuity. Petitioner has also disputed with regard to calculation of his final gratuity claiming that the amount of final gratuity, as mentioned in Annexure-8, is less by Rs. 10,620/-. Petitioner found that the said amount of Rs. 31,818.60 was wrongly deducted from his gratuity without any allegation of excess payment to him on account of fraud or misrepresentation on his part. However, his request for reconsideration of the matter was completely ignored by the authorities of the Board. Hence, finding no way out, petitioner has preferred this writ application with the aforesaid prayers. 3. Respondents have appeared in the case and have filed a detailed counter affidavit. It is admitted that petitioner came into service of the Board on 18.7.1975. It is also admitted that the petitioner was appointed on the post of Fitter Grade-I with effect from 1.8.1988 and thereafter was appointed on the post of Cable Jointer with effect from 26.12.1991.
3. Respondents have appeared in the case and have filed a detailed counter affidavit. It is admitted that petitioner came into service of the Board on 18.7.1975. It is also admitted that the petitioner was appointed on the post of Fitter Grade-I with effect from 1.8.1988 and thereafter was appointed on the post of Cable Jointer with effect from 26.12.1991. However, it is asserted in the counter affidavit that during the course of checking of the pay fixation of petitioner before his superannuation, it was discovered that at the time of appointment of the petitioner as Cable Jointer treating the post wrongly as promotional post from the Grade of Fitter Grade-I, 12% of promotional benefits was given to him. Therefore, the same was rectified at the time of fixation of his retiral benefits and excess paid to him on the post of Cable Jointer was recovered from his gratuity. The respondent-Board has annexed certain orders and letters with calculation to show that this matter was detected before the superannuation of the petitioner and approval was sought for from the competent authorities of the Board, and after approval of the order, the said amount was calculated and deducted from the sanctioned provisional gratuity of the petitioner. 4. When the matter was taken up by a Bench of this Court on 4.2.2005, this Court found that a large number of writ petitions were coming up before the Court in which question arose as to whether the money benefits granted to an employee while in service could be recovered from him or not after appreciable length of time and particularly from his post retirement benefits. Therefore, this Court, vide order dated 4.2.2005 while noticing the different circumstances under which such recovery was sought to be made, and also noticing the conflicting views in judicial pronouncements in the matter, expressed the view that the issues formulated by the Court were required to be considered for an authoritative pronouncement by a five Judges or three Judges Bench. Accordingly, the case was ordered to be put up before the Hon ble Chief Justice for appropriate orders. It appears that many other cases of Electricity Board had also been referred to a larger Bench led by C.W.J.C. No. 12181 of 2003. Therefore, the present case was also tagged alongwith the said C.W.J.C. and other cases.
Accordingly, the case was ordered to be put up before the Hon ble Chief Justice for appropriate orders. It appears that many other cases of Electricity Board had also been referred to a larger Bench led by C.W.J.C. No. 12181 of 2003. Therefore, the present case was also tagged alongwith the said C.W.J.C. and other cases. Ultimately the said batch of cases was heard by a Full Bench of this Court of three Judges and authoritative pronouncement was rendered by the Bench by judgment and order dated 4.7.2007 reported in 2007(3) PLJR 398 (Full Bench). In the said judgment of the Full Bench after considering various judicial pronouncements of this Court as well as of Hon ble Supreme Court, law was laid down and thereafter, individual cases were remitted back to concerned Benches for decision in the light of law laid down by this Court. 5. Thus this matter was listed before a Bench of learned Single Judge of this Court and was finally heard by this Bench. 6. In course of hearing, learned counsel for the petitioner as well as learned counsel for the Board have referred to many judgments of this Court as well as the Hon ble Supreme Court on the issue of right of an employer to recover excess amount paid to an employee while he was in service after his superannuation. As in the impugned order (Annexure-7) reference was made to Gratuity Act, 1972, learned counsel for the petitioner also cited some judgments of this Court with regard to applicability of Gratuity Act, 1972 to the Board. Learned counsel for the petitioner for this purpose also placed reliance on Section 13 of the Gratuity Act, 1972 to contend that the Board had no authority under the Gratuity Act to recover any excess paid to him during the service, from his gratuity. Learned counsel for the petitioner also asserted violation of principles of natural justice in the matter. 7. In reply, learned counsel for the Board submitted that in view of this Courts judgment reported in 2004(1) PLJR 635 (DB) the Gratuity Act, 1972 was not applicable to the Board as State Government had issued a notification, after the judgment of the Full Bench reported in 1986 PLJR 1181, exempting the Board from the operation of the Gratuity Act, 1972. 8.
8. In this writ application petitioner has confined his prayer for quashing of Annexures-7 and 8 to the extent to which his final gratuity has been sanctioned by effecting a deduction of Rs. 31,818.60 and for a direction to the respondents to pay the said amount to him. The respondents have also confined their contest to the prayer of the writ petitioner to the extent that they were legally justified in making deduction of the amount from his gratuity on account of excess paid to him on account of grant of wrong pay scale to the petitioner at the time of his appointment/promotion to the rank of Cable Jointer. Although the respondents have asserted that the provisions of Gratuity Act, 1972 are not applicable to the Board, they have not withdrawn the order sanctioning gratuity to the petitioner in reference to the said Act. Thus the entitlement of the petitioner to gratuity as such, either under the provisions of Gratuity Act, 1972 or under the provisions of Bihar Pension Rules is not in dispute. During the hearing of the case, learned counsel for the petitioner also did not challenge the decision of the Board with regard to correction of his pay scale in the grade of Cable Jointer and his entire submissions were confined to challenge to the powers of the Board to recover the alleged excess amount paid to him from his gratuity. Thus the dispute in this case gets confined only to the legality of deduction of the said amount of Rs. 31,818.60 from the sanctioned gratuity of the petitioner. It is not in dispute that rest of the amount of gratuity has been actually paid to the petitioner. 9. Hence, the only question which arises in the case for consideration by this Court is the powers of the respondent authorities of the Board to deduct the said amount of Rs. 31,818.60 from the gratuity of the petitioner claiming the same as excess paid to the petitioner during his service period. Many judgments have been cited from either side on this issue.
31,818.60 from the gratuity of the petitioner claiming the same as excess paid to the petitioner during his service period. Many judgments have been cited from either side on this issue. However, taking note of the fact that this case was also referred to the Full Bench and was heard alongwith the main case, namely C.W.J.C. No. 12181 of 2003, in which the authoriiative pronouncement by Full Bench has been rendered on the matter, it is not necessary to refer to the judgments cited by either party on the issue rendered by this Court or by the Hon ble Supreme Court prior to the said authoritative pronouncement by the Full Bench. After deciding the issue authoritatively the Full Bench has remitted this matter for consideration and decision by an appropriate Bench in the light of law laid down therein. Hence, the law laid down by the Full Bench has to be applied in this case to decide the issue raised by the parties. 10. Now coming to judgment rendered by the said Full Bench, this Court finds that, after considering the various judgments of this Court as well as of Hon ble Supreme Court, the Full Bench in paragraph 26 has laid down the law as such: "The relevant provisions of the Indian Contract Act, particularly Section 72 cover cases of mistake of fact as well as law and provide for recovery. The principle of restitution in case of unjust enrichment is also an accepted principle for ensuring justice in appropriate case. Hence, in law, the position appears to be clear that there is no legal bar in ordering for recovery from retired employees where they have received money benefits on account of mistake at the ministerial level in the matter of fixation of pay, grant of increments or time bound promotion when the conditions precedent for such promotions were clearly non est. However, it has been correctly submitted on behalf of the petitioners that the theory of simple mistake or error to justify recovery will not hold good where the grant did not suffer from patent illegality or perversity so as to attract the Wednesbury Principle or the vice of mala fide in law.
However, it has been correctly submitted on behalf of the petitioners that the theory of simple mistake or error to justify recovery will not hold good where the grant did not suffer from patent illegality or perversity so as to attract the Wednesbury Principle or the vice of mala fide in law. For example, where two interpretations of a provision were possible and one was consciously approved and adopted by the competent authority meant to be applied generally to all concerned, any error in such decision of the competent authority if corrected at a later stage may be ordered to apply only prospectively. Moreso, if the decision has been followed for many years. In other words, if on reinterpretation or adjudication the earlier view permitting the grant of monetary benefits is found to be by a competent authority and bona fide but wrong, mistaken or erroneous, then ordinarily no recovery should be made unless the excess payment already made is covered by the two exceptions pointed out in the case of Madan Mohan Prasad (supra) . But if the grant was by way of undue favour, arbitrary, mala fide, ultra vires and/or void ab initio, recovery of public money should be the normal course. In such cases of clear disobedience of policy or rules by ministerial action or clear dishonest decision causing undue loss to public money, action against the concerned authority may also be justified to prevent and discourage plunder of public money by sheer disregard of clear law. The constitutional schemes of rule of law and fairness in public action support recovery in such cases unless law of limitation or waiver etc. are successfully invoked to show that they prevent such a course in the facts of any particular case." 11. From the view expressed by the Full Bench as quoted above, it appears that recovery of alleged excess paid to an employee is permissible only if the money benefit was paid to the employee on account of mistake at the ministerial level in the matter of fixation of pay, grant of increments or time bound promotion when the conditions precedent for such promotions were clearly non est.
Full Bench has also held that recovery is also permissible in case of two exceptions as laid down in the case of Madan Mohan Prasad, namely, when the payment was made making it expressly conditional to approval of the competent authority which was later on refused, and secondly if the same was made on account of fraud or misrepresentation on the part of the employee. On the other hand the Full Bench has held that if the grant did not suffer from patent illegality or perversity and was on account of possible interpretation of provision of law made bona fide by a competent authority, recovery on account of such wrong interpretation of the said provision of law could not be ordered and the decision correcting the monetary benefit on account of corrected interpretation of the provision of law will apply only prospectively. 12. Coming to the present case, it is clear that the respondents have not alleged any fraud or misrepresentation on the part of the petitioner. Except a vague statement in the counter affidavit that the final authority for pay fixation in the Board was the Financial Controller (Audit). They have also not claimed that the grant of scale and monetary benefits to the petitioner on account of his appointment/promotion to the rank of Cable Operator was expressly made conditional to approval of the same by any higher authority or competent authority. On the other hand if we come to the order granting promotion/regularization to the petitioner in the rank of Cable Jointer, as contained in Annexure- 2, it will be apparent that the same was passed by a Deputy Chief Engineer of the Board. The order also expressly mentions that it had approval of the competent authority. The respondents have not challenged the said expression made in Annexure-2 as error of record. They have also not pleaded that the said order was a result of an act or decision made at the ministerial level only. 13. In the circumstance, considering the contents of Annexure-2 and considering the pleading of the respondents in the counter affidavit as noticed above, it is clear that the order deducting the amount of Rs.
They have also not pleaded that the said order was a result of an act or decision made at the ministerial level only. 13. In the circumstance, considering the contents of Annexure-2 and considering the pleading of the respondents in the counter affidavit as noticed above, it is clear that the order deducting the amount of Rs. 31,818.60 from the gratuity of the petitioner neither falls within the two exceptions laid down in the case of Madan Mohan Prasad as referred to by the Full Bench, nor falls within the permissible scope laid down by the Full Bench making an employer entitled to recover the amount of alleged excess paid to an employee. The wording mentioned in Annexure-2 that the order had approval of competent authority, and no challenge to this expression in the counter affidavit, clearly makes the order of deduction without jurisdiction and beyond the scope of power of the Board by holding the payments made to the petitioner on that basis of Annexure-2 as excess paid to the petitioner and recoverable from his gratuity. Since the petitioner has not challenged the downward revision in his pay scale by the respondents upon his appointment/promotion in the rank of Cable Operator, this Court need not go into the question and has confined its consideration only to the question of powers of respondents to recover the amount of Rs. 31,818.60 from his gratuity. 14. In the circumstance, in view of the discussions above, it is held that the respondents had no authority to recover the amount of Rs. 31,818.60 from the gratuity of the petitioner while sanctioning the provisional gratuity by Annexure-7 and accepting the same as correct while sanctioning final gratuity of the petitioner by Annexure-8. 15. In the result, Annexures-7 and 8 are quashed to the extent the amount of Rs. 31,818.60 has been deducted from the gratuity of the petitioner and the respondents are directed to pay the said amount to the petitioner within a period of three months from the date of receipt/ production of a copy of this order.
15. In the result, Annexures-7 and 8 are quashed to the extent the amount of Rs. 31,818.60 has been deducted from the gratuity of the petitioner and the respondents are directed to pay the said amount to the petitioner within a period of three months from the date of receipt/ production of a copy of this order. So far as prayer of petitioner for interest on the amount is concerned, this Court is unable to allow the same as the respondents, on the basis of some pronouncements of this Court with all bona fide, claimed themselves empowered to deduct the excess paid to an employee, and in view of some conflicting judgments, the matter had to be decided by a Full Bench which delayed decision in the matter. So far as short payment to the tune of Rs. 10,620/- is concerned, the petitioner shall be at liberty to file a representation before the competent authority of the Board with a request for recalculation who shall consider and dispose it of without any unnecessary delay. 16. This writ application is thus allowed with aforesaid observations and directions.