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2014 DIGILAW 911 (BOM)

Kamlakar Dagdu Narkhade v. K. N. Bhise Arts & Commerce College, through Principal Dr. R. R. Patil

2014-04-07

ANOOP V.MOHTA, M.S.SONAK

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Oral Judgment Per M.S. Sonak, J. 1. Rule. By order dated 6.5.2013, the parties were put to notice that the matter would be disposed of finally. 2. Kamlakar Dagdu Narkhade (Kamlakar) retired from the services of K.N.Bishe Arts and Commerce College (college) as Associate Professor on 30.4.2010 after completion of service spread over almost two decades. There is no dispute that the college receives aid from the State and the service of Kamlakar was pensionable. Despite completion of all formalities, for over year Kamlakar was denied pension by the State, which is responsible for such payment. Therefore, Kamlakar preferred the present petition on 21.11.2012, seeking early release of pension. 3. By way of interim relief, this Court directed the State to pay 'provisional pension' to Kamlakar. In partial compliance, an amount of Rs.2,19,718/-was paid by the State to Kamlakar in the month of May 2013. This, according to Kamlakar corresponds to pension / retiral benefits corresponding to a period of hardly six months. The State, without seeking any modification of the interim orders, thereafter stopped payment of such 'provisional pension' to Kamlakar. 4. After several adjournments, the college and State filed their returns in the month of May 2013. It is the case of the college and State that Kamlakar is due and payable to the State/college an amount of Rs.18,72,622/- and unless Kamlakar pays such amount or consents to the recovery thereof, there is no question of payment of any pension or retiral benefits to Kamlakar. The particulars of such amount recoverable from Kamlakar were stated to be as follows: Sr. No Particulars Recovery amount 1 Government share (CPF) with interest up to 28.2.2013 Rs. 3,10,349/- 2 Own share (CPF) with interest up to 28.2.2013 Rs. 3,10,349/- 3 Salary recovery excess amount due to salary fixction date 26.8.1993 to 30.4.2010 Rs. 5,07,796/- 4 Salary amount disallowed by Nagpur A.G. Due to insufficient students 2001-2002 Rs. 7,31,128/- 5 62 books not returned to college library Rs. 13,000/- Total amount for recoveries Rs. 18,72,622/- 5. In the petition as filed, Kamlakar had himself acknowledged that certain amounts were due and payable by him to the State/College. Kamlakar, in the circumstances, had urged that the amount due be determined and adjusted from out of the retiral benefits due and payable to him. Prayer clause (b) of the petition bears out such a plea. 18,72,622/- 5. In the petition as filed, Kamlakar had himself acknowledged that certain amounts were due and payable by him to the State/College. Kamlakar, in the circumstances, had urged that the amount due be determined and adjusted from out of the retiral benefits due and payable to him. Prayer clause (b) of the petition bears out such a plea. Besides, in response to the return filed by the College and State, Kamlakar has filed affidavit-in-rejoinder in July 2013 wherein Kamlakar admitted that he is due and payable a sum of Rs.10,08,660/-to the State/College. This admission is contained in paragraph 27, which reads thus: “I say that the amount of admitted recovery from me according to my calculation under Item No.1 to 3 and 5 are as follows: (i) PG Government Share Rs. 2,43,932/- (ii) PF Own Share Rs. 2,43, 932/- (iii) Salary Recovery Rs. 5,07,796/- (iv) Recovery on account of books Rs. 13,000/- Total Rs. 10,08,660/- I say that out of the said amount, the amount of Rs.7,00,000/- payable to me towards DRCG can be adjusted and the balance amount of Rs.3,08,660/- can be deducted from the pension payable to me. I say my last pay without (DA) amounts to Rs.57,550/- and half of the same being the pension amount is Rs.28775/-. I have not received the pension since 1.5.2010 except provisional pension of six months. I have no objection if the above said amount of Rs.3,08,660/- is deducted from the final pension payable to me.” 6. From the aforesaid, it is clear that the dispute between Kamlakar on one hand and the State/College on other, is primarily with regard to proposed recovery of the following amounts: (i) An amount of Rs.1,32,834/- which represents interest upto 28.2.2013 upon the share of the State and Kamlakar upon the Central PF amount of Rs. 6,20,698/-; and (ii) An amount of Rs.7,31,128/- towards the salary amount disallowed by Nagpur A.G. on account of fall in the strength of students during academic year 2001-2002. 7. Kamlakar in the present petition contends that there has been unreasonable delay on the part of the State/College in working out and releasing pension and other retiral benefits to him. In such circumstances, it is neither fair nor proper that the State/College insist upon recovery of an amount of Rs. 1,32,834/- towards interest on the CPF amounts. 7. Kamlakar in the present petition contends that there has been unreasonable delay on the part of the State/College in working out and releasing pension and other retiral benefits to him. In such circumstances, it is neither fair nor proper that the State/College insist upon recovery of an amount of Rs. 1,32,834/- towards interest on the CPF amounts. The amounts much in excess of those proposed to be recovered, continue to lie with the State/College. If no interest is being offered for delayed settlement of pensionary and retiral benefits, it would be ex-facie, illegal and arbitrary on the part of the State / College to insist upon recovery of any interest from him, particularly when he had throughout offered to pay or consented to the adjustment of such amount. 8. In so far as the proposed recovery of the amount of Rs.7,31,128/-, as aforesaid is concerned, Kamlakar contends that in fact, no such excess payment has ever been made to him. For the period between 2002 till 2013, Kamlakar submits, that he was never informed that any such excess payment has been made to him and that the same is liable to be recovered from him. Such demand has been made for the first time in the return filed in May 2013 in response to his petition. There has been no compliance with the principles of natural justice and fair play prior to seeking such recoveries after lapse of almost eleven years. Kamlakar has further contended that there is no material on basis of which it could be said that there was dip in the student strength for the year 2001-2002. In any case, he was a permanent teacher and notwithstanding a dip in the student strength, the State/College was duty bound to offer pay protection. At the highest, he could have been declared as surplus and absorbed in some other aided Colleges. Under no circumstances, could the State/College have denied him salary/pay protection. Kamlakar has placed reliance upon the State circulars/decisions in this regard. In the circumstances, Kamlakar contends that the amount of Rs.7,31,128/-, is not at all recoverable from him. 9. In the alternate Kamlakar has also contended that so called excess payment made during the academic year 2001-02 was not on account of misrepresentation or fraud attributable to him. At this length of time therefore, it is harsh and inequitable to insist upon recovery. 9. In the alternate Kamlakar has also contended that so called excess payment made during the academic year 2001-02 was not on account of misrepresentation or fraud attributable to him. At this length of time therefore, it is harsh and inequitable to insist upon recovery. Such recovery is barred under the dictum of the Supreme Court of India in the case of SayedAbdul Qadir v. State of Bihar – (2009) 3 SCC 475 and the dictum of this Court in the case of Association of College and University of Superannuated Teachers (Maharashtra) vs. The State of Maharashtra in Writ Petition No.9054 of 2010 decided on 22.8.2011. 10. Ms. S.S. Bhende, learned AGP for the State reiterated the submissions set out in the return of the State. In addition, learned AGP placed reliance upon communication dated 30.9.2013 addressed by the Indian Audit and Accounts Department to Regional Joint Director, (Higher Education) Solapur Region, Solapur, which sets out the following three objections, on account of which the State has been unable to process Kamlakar's pension papers: (A) For employee/ official joined prior to 1.10.1982, an option for pension has to be exercised by the official as per GR dated 21.7.1983. If the same has not been exercised by the official, the same has to be certified by the competent authority. (B) Also, a certificate to the effect that sanctioning pension as per GR dated 10.8.1994 in the absence of exercise of option as per GR dated 21.7.1983 to be furnished by the competent authority stating clearly that the official has not exercised option as per GR dated 21.7.1983. (C) Consent from the official for recovering the amount may be furnished duly countersigned as the recovery is a very huge amount. Also mode of recovery may be informed duly countersigned by the competent authority. 11. The rival contentions now fall for our determination. 12. In so far as objection at clauses 'A' & 'B' of paragraph 10' of this judgment and order is concerned, the same clearly relates to procedural compliances. From the averments in the petition, it is clear that there is substantial compliance. Assuming that there is anything lacking, it is for the College with the cooperation of Kamlakar to report compliances. In so far as objection at clauses 'A' & 'B' of paragraph 10' of this judgment and order is concerned, the same clearly relates to procedural compliances. From the averments in the petition, it is clear that there is substantial compliance. Assuming that there is anything lacking, it is for the College with the cooperation of Kamlakar to report compliances. In the circumstances, directions are liable to issue to the College for ensuring that the procedural compliances set out at clauses 'A' & 'B' above are concluded within a maximum period of four weeks from the date of this judgment and order. Needless to state that, if any cooperation is necessary from Kamalakar, Kamlakar in his own interest will extend the same at the earliest. The College is therefore, directed to act accordingly in matter of procedural compliances at clauses 'A' & 'B' above. 13. In so far as the objections at clause 'C' of paragraph 10 of this judgment and order is concerned, the same obviously relates to proposed recovery of the interest amount of Rs. 1,32,834/- and the alleged excess salary amount of Rs. 7,31,128/-. Apart from the said two amounts, Kamlakar has himself admitted that an amount of Rs.10,08,660/- is liable to be recovered from him by the State/College. The statement in paragraph 27 of the affidavit-in-rejoinder is therefore, liable to be regarded as Kamlakar's consent for the recovery of amount of Rs.10,08,660/- by the State/College from out of the pensionary and other retiral benefits due and payable to him. In any case, it is so ordered accordingly. 14. The moot issue which arises is whether the State/ College is entitled to recovery of an amount of Rs.1,32,834/- towards interest as aforesaid and Rs.7,31,128/-towards excess salary paid to Kamalakar in the academic year 2001-2002 when allegedly, there was a dip in the strength of students. 15. In so far as the interest amount of Rs.1,32,834/-is concerned, in our opinion, there is absolutely no justification on the part of State/College to insist upon recovery of the same from out of the pension and other retiral benefits due and payable to Kamlakar. It needs to be noted that Kamlakar time and again had offered for adjustment of the said amount from out of the pensionary and other retiral benefit due to him. It needs to be noted that Kamlakar time and again had offered for adjustment of the said amount from out of the pensionary and other retiral benefit due to him. In any case, it was the duty of the State/College to release at least the balance pension and other retiral benefits to Kamlakar soon after or at least within a reasonable time from his retirement which was on 30.4.2010. The State/College, mostly for bureaucratic reasons have failed to make such payments to Kamlakar. Normally, the State/College would be liable to pay interest upon the balance amount so withheld by them without any real or reasonable cause. The rate at which such interest has been levied is unclear, but the same appears to be excessive. Therefore, considering the totality of circumstances and by setting off equities, we are of the opinion that the State/College is not entitled to recover an amount of Rs. 1,32,834/- towards interest upon contribution towards CPF. 16. In so far as recovery of an amount of Rs.7,31,128/-towards alleged excess salary paid to Kamlakar during academic year 2001-02 when there was allegedly a dip in the strength of students, we are again of the opinion, that there is neither any basis for such recovery nor would such recovery be justified at this length of time. 17. In the aforesaid regard, it needs to be noted that there is absolutely no material placed on record either by the State or the College to justify the position that for the academic year 2001-02 there was indeed any dip in the strength of students beyond the minimum prescribed under the rules or executive instructions then in force. That apart, Kamlakar has placed reliance upon circulars and executive instructions issued by the State which suggest that the services of permanent teachers could never have been done away with, even in situation, where there is a dip in the strength of the students. At the highest, such permanent teachers could have been declared as surplus and then reabsorbed in some other State aided Colleges or institutions without disturbing their pay and other emoluments. Despite opportunity, the State/College has placed no material on record to rebut this position. At the highest, such permanent teachers could have been declared as surplus and then reabsorbed in some other State aided Colleges or institutions without disturbing their pay and other emoluments. Despite opportunity, the State/College has placed no material on record to rebut this position. It is reasonable to proceed on the basis that such was the correct position, because from the year 2002 until the year 2013, when the State/ College filed their return in response to Kamlakar's petition, no such issue of any alleged excess payment was ever raised either by the State or College. To raise such an issue almost after eleven years and that too at a stage when Kamlakar has already retired from service, does appear to be harsh and inequitable. 18. It is also not the case of the State/College that so called excess payment made to Kamlakar in the year 2001-02 was on account of any fraud or misrepresentation attributable to Kamlakar. In the case of SyedAbdul Qadir (supra) , the Supreme Court even after record of conclusion that undoubtedly excess amounts had been paid to the teachers, ruled that such excess payment could not be recovered because it was not on account of any fraud or misrepresentation on the part of the teachers, who in fact, were not even aware that the amount which was being paid to them was more than what they were entitled to. In paragraph 27, the Supreme Court made reference to a catena of decisions in which relief came to be granted against recovery of excess payment of emolument/allowances where such excess payment was not made on account of any misrepresentation or fraud on the part of employees. Paragraphs 27 and 28 read thus:- “27. This Court, in a catena of decisions, has granted relief against recovery of excess payment of emoluments/allowances if (a) the excess amount was not paid on account of any misrepresentation or fraud on the part of the employee and (b) if such excess payment was made by the employer by applying a wrong principle for calculating the pay/allowance or on the basis of a particular interpretation of rule/order, which is subsequently found to be erroneous. The relief against recovery is granted by courts not because of any right in the employees, but in equity, exercising judicial discretion to relieve the employees from the hardship that will be caused if recovery is ordered. The relief against recovery is granted by courts not because of any right in the employees, but in equity, exercising judicial discretion to relieve the employees from the hardship that will be caused if recovery is ordered. But, if in a given case, it is proved that the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or in cases where the error is detected or corrected within a short time of wrong payment, the matter being in the realm of judicial discretion, courts may, on the facts and circumstances of any particular case, order for recovery of the amount paid in excess. See Sahib Ram vs. State of Haryana, 1995 Supp. (1) SCC 18, ShyamBabu Verma vs. Union of India, [1994] 2 SCC 521; Union of India vs. M. Bhaskar, [1996] 4 SCC 416; V. Ganga Ram vs. Regional Jt., Director, [1997] 6 SCC 139; Col. B.J. Akkara [Retd.] vs. Government of India & Ors. (2006) 11 SCC 709 ; Purshottam Lal Das & Ors., vs. State of Bihar, [2006] 11 SCC 492; Punjab National Bank & Ors. Vs. Manjeet Singh & Anr., [2006] 8 SCC 647; and Bihar State Electricity Board & Anr. Vs. Bijay Bahadur & Anr., [2000] 10 SCC 99. 28. Undoubtedly, the excess amount that has been paid to the appellants - teachers was not because of any misrepresentation or fraud on their part and the appellants also had no knowledge that the amount that was being paid to them was more than what they were entitled to. It would not be out of place to mention here that the Finance Department had, in its counter affidavit, admitted that it was a bona fide mistake on their part. The excess payment made was the result of wrong interpretation of the rule that was applicable to them, for which the appellants cannot be held responsible. Rather, the whole confusion was because of inaction, negligence and carelessness of the officials concerned of the Government of Bihar. Learned counsel appearing on behalf of the appellants-teachers submitted that majority of the beneficiaries have either retired or are on the verge of it. Rather, the whole confusion was because of inaction, negligence and carelessness of the officials concerned of the Government of Bihar. Learned counsel appearing on behalf of the appellants-teachers submitted that majority of the beneficiaries have either retired or are on the verge of it. Keeping in view the peculiar facts and circumstances of the case at hand and to avoid any hardship to the appellants-teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellants-teachers should be made.” 19. The Division Bench of this Court in the case of Association of College and University Superannuated Teachers (Maharashtra) (supra) applied the aforesaid principles, when the State sought to recover from the salary/pension of teachers stagnation allowance, which such teachers were not entitled to. The relevant observations are contained in paragraphs 4 and 5, which read thus: “4. By now, it is a settled position of law that recovery from the salary/pension of an employee cannot be made, if the amount in excess was paid to such an employee for the reasons not attributed to such an employee. It is not the case of the respondents that the stagnation amount was paid to the members of the petitioner-association on account of any misrepresentation made by such members. 5. In that view of the matter, in view of the law laid down by the Apex Court in Syed Abdul Qadir and ors. Vs. State of Bihar and ors. 2009 reported in (2009) 3 Supreme Court Cases 475, both the Petitions deserve to be allowed.” 20. The Supreme Court of India declined to entertain Special Leave Petition against the judgment and order dated 22.8.2011 in the case of Association of College and University Superannuated Teachers (Maharashtra) (supra). 21. It is not the case of the State or the College that so called excess payment made to Kamlakar for the academic year 2001-02 was on account of any misrepresentation or fraud attributable to Kamlakar. The circumstance that no issue in regard such alleged excess payment was ever raised for the period between 2002 to 2010 when Kamlakar was in service and even for a period of three years thereafter, does indicate that neither Kamlakar nor the State/College authorities were even aware that the salary paid to the Kamlakar during the academic year 2001-02 was indeed 'in excess'. In such circumstances, the principle in the case of SyedAbdul Qadir (supra), which had been followed by the Division bench of this Court in the case of Association of College and University Superannuated Teachers (Maharashtra) (supra) is clearly attracted. 22. For this reason also, the State/College cannot be permitted to effect recovery of alleged excess payment at this belated stage from out of the pensionary and retiral benefits due and payable to Kamlakar. 23. In the result, we pass following the order: (A) The respondents are jointly and severally directed to release balance of arrears of pension and other retiral benefits due and payable to the Petitioner (Kamlakar) upon adjustment of the amount of Rs.10,08,660/- due and payable by the petitioner to the respondents within a period of eight weeks from the date of this judgment and order and thereafter to continue to pay the petitioner's pension and other benefits, as admissible under the law regularly; (B) In case, there is non-compliance with the directions contained in clause (A) above within a period of eight weeks from today, then apart from any other action which the petitioner shall be at liberty to initiate against the respondents, the respondents jointly and severally shall be liable to pay interest at the rate of 9% per annum upon the arrears of pension and retiral benefits, as aforesaid. Such interest shall be calculated from 21.11.2012, i.e., the date of filing of the petition, until effective payment; (C) Rule is made absolute to the aforesaid extent; (D) There shall be, however, no order as to costs.