Narain Jashanmal Menghrajani v. Senior AO (Pension)
2019-02-04
A.J.SHASTRI
body2019
DigiLaw.ai
JUDGMENT : 1. The present petition is filed under Article 226 of the Constitution of India for seeking the following reliefs including the amended reliefs which read as under : “20(a) Your Lordship be pleased to issue writ of mandamus, or writ of certiorari, or any other writ, order or direction, directing that the communication dated 01.11.2017, 30.01.2018 and 02.02.2018 passed by the respondent is illegal, improper, arbitrary and contrary to the Articles 14 and 16 of the Constitution of India and be further pleased to quash and set aside the same. (b) Pending admission, hearing and final disposal of the petition, Your Lordship be pleased to restrain the respondent authorities from effecting any recovery pursuant to the said communication dated 01.11.2017 and 02.04.2018. (c) Your Lordship be pleased to issue writ of mandamus or any other appropriate writ, order, direction, directing the respondent to repay the amount of illegal recovery made from the Pension along with all arrears and with 18% interest thereon and Your Lordship be further please to direct the respondent to start to pay the regular pension to the petitioner. (d) Your Lordships be pleased to grant such other and further relief as any be deemed fit in the interest of justice.” 2. The case of the petitioner is that the petitioner was working with the respondent right from 14th February, 1957 and the date of the birth of the petitioner is 10.11.1938. After serving at various stages in the employment, lastly the petitioner retired as an Assistant Traffic Manager (Class-I) from the Kandla Port Trust on 30.11.1996. The petitioner was granted benefit, on account of reaching the age of superannuation as stated above throughout without any hindrance. Prior to the post of Assistant Traffic Manager, the petitioner was working as a Traffic Inspector on adhoc basis and from 13.02.1992, the petitioner was regularized in the said post which was undisputedly a Class-III cadre post. The petitioner was then promoted as an Assistant Traffic Manager and worked as such upto 30.11.1996 on adhoc basis and then was made permanent with effect from 02.08.1996. During the adhoc period on the said post of Assistant Traffic Manager, the petitioner was given break of one or two, however, was receiving the salary for the break period of Traffic Inspector cadre i.e. ClassIII.
During the adhoc period on the said post of Assistant Traffic Manager, the petitioner was given break of one or two, however, was receiving the salary for the break period of Traffic Inspector cadre i.e. ClassIII. The pension of the petitioner was fixed as if the petitioner was belonging to the ClassIII cadre i.e. the Traffic Inspector and the details of calculations of the consolidated pension is attached with the petition by indicating that from the date of the retirement, the pension was fixed on the basis of the salary drawn by the petitioner at the time of retirement. The petitioner from November, 1996 i.e. from the date of the retirement was regularly receiving the pension and all of a sudden almost after a period of 21 years without granting any opportunity, without prior intimation and without even notice, a letter came to be issued on 01.11.2017 along with the proposed recovery chart and was conveyed that an excess amount was paid to the petitioner in the total sum receivable by way of pension, which has resulted into a wrong consolidation of the pension to the petitioner. Hence, over payment to the tune of Rs.3,37,725/- was directed to be deposited through the cheque in favour of the Kandla Port Trust Superannuation Scheme and submit the same in pension section, else, the same will be recovered from the dearness amount of the petitioner and it was also informed that till full recovery is effected, the petitioner will be paid minimum pension of Rs.3,900/- per month instead of regular pension. This has been issued for the first time, after a period of 21 years, on 01.11.2017. The petitioner, accordingly submitted a letter on 24.11.2017 and sought certain details and information as the petitioner had retired way back in the year 1996 and is of advanced age of around more than 80 years. According to the petitioner, instead of applying the relevant rules and the detailed information, which have been sought, a further letter was received from the respondent on 30.01.2018 directing the petitioner to make the payment of lump sum amount of Rs.3,37,725/- which was paid in excess from 01.01.1997. The said letter was also responded by the petitioner and again approached the respondent authority by a communication dated 12.03.2018, but the same has not been attended so far.
The said letter was also responded by the petitioner and again approached the respondent authority by a communication dated 12.03.2018, but the same has not been attended so far. It is further the case of the petitioner that despite the fact that a representation has been made by the petitioner, to the utter surprise, another communication came to be received by the petitioner indicating that now a sum of Rs.5,94,534/- is to be recovered from the petitioner with effect from 01.01.1997 to 31.03.2018. By giving details inter se between the petitioner and the respondent authority, ultimately, the petitioner has approached this Court by way of the present petition for challenging the said action. Since there was a specific stand taken by the petitioner on prior recovery being sought, no opportunity was given, no procedure was followed, no information was provided, and after a period of 21 years, step is contemplated. The Court issued notice on 02.05.2018 and considering the age of the petitioner being 82 years, with the concurrence and request of both the learned advocates for the respective parties, the matter is paid urgent attention and today the same is taken by for final disposal. 3. Learned advocate Mr. P.C. Chaudhari appearing on behalf of the petitioner has vehemently contended that the impugned action is initiated after almost a period of 21 years and on that count alone, the same may not be allowed to be precipitated any further. It has been submitted by learned advocate Mr. Chaudhari that the petitioner has been superannuated long back in the month of November, 1996 and for the first time, without granting any opportunity, without prior intimation, and without hearing the petitioner, straightway after a period of 21 years, in November, 2017, the first communication was sent on 01.11.2017, reflecting on page 33 and thereafter without considering the stand of the petitioner, the respondent authority went on insisting upon the recovery and so much so, that unilaterally the recovery is already initiated and in the month of December, 2018, even the total pension was stopped. This autocratic exercise of power by the respondent authority is in flagrant violation of the principles of natural justice and on this count alone, the same be quashed. It has further been submitted by learned advocate Mr.
This autocratic exercise of power by the respondent authority is in flagrant violation of the principles of natural justice and on this count alone, the same be quashed. It has further been submitted by learned advocate Mr. Chaudhari that there was neither any mistake committed by the petitioner nor any misrepresentation was made by the petitioner, and the pension is fixed altogether by different department to which the petitioner was not a party in the said fixation and therefore, for no fault on the part of the petitioner, at this age, the petitioner is being harassed by the authority after a period of 21 years and, therefore, the action on the part of the respondent authority is absolutely unjust and arbitrary, tilted with mala fides, hence, the same be quashed and set aside. 3.1. It has further been submitted by learned advocate Mr. Chaudhari that upon gradual promotion, pay revision was fixed and the petitioner was placed in a revised scale in the year 1992 and at page 29 of the petition compilation, even this has been fixed by the respondent authority itself and it is not the case that this has been prepared by the petitioner. Thus, page nos. 29, 30 and 31 are the figures which are fixed by the respondent authority itself and, therefore, after an unreasonable period of 21 years, even if such mistake might have been committed, the same cannot allow the petitioner to be placed in precarious position and, therefore, no recovery is permissible since throughout the pensionary benefits were made available pursuant to the fixation which has been made by the respondent authority itself. Learned advocate Mr. Chaudhari has further submitted that even while initiating the process, no reasons are assigned independently, and, therefore, without assigning any cogent reason also, no such action can be initiated, In any case, as per the say of learned advocate for the petitioner, the petitioner has reached the age of 82 years, is not keeping good health, may not be allowed to be harassed by the respondent authority after 21 years for which there is no fault on the part of the petitioner. Learned advocate Mr.
Learned advocate Mr. Chaudhari with a view to strengthen his submissions, has relied upon two decisions, firstly in the case of State of Punjab & Ors., v. Rafiq Masih (White Washer) etc., reported in 2015 (1) LLJ 455 (SC) (para 12) and in the case of Dhirubhai Somabhai Patel v. State of Gujarat & Ors., passed by the coordinate bench of this Court dated 21.04.2015 in a group of petitions headed by Special Civil Application No. 10534 of 2008 and, therefore, by referring to this, learned advocate Mr. Chaudhari has submitted that there is no justifiable reason for the authority now to seek recovery. It has been clarified that the undertaking which has been submitted for the first time as required was under the routine undertaking being submitted by every pensioner and, therefore, by utilizing this undertaking, the mistake continued over a period of 21 years cannot be rectified. Resultantly, the said form filled in by the petitioner cannot be construed as an undertaking in strict sense. By submitting this, learned advocate Mr. Chaudhari has requested the Court that the petitioner be placed in a regular pension scale which was made available to him by the respondent authority prior to the impugned communications first in point of time i.e. 01.11.2017 and whatever amount which has been deducted under the guise of such action be refunded to the petitioner with appropriate rate of interest and it has further been submitted that now since the petitioner has reached the age of 82 years, he may not be compelled to drag himself in this age in the Court of law for unreasonable action of the respondent, and some appropriate costs be awarded to the petitioner. Lastly, learned advocate Mr. Chaudhari has submitted that the relief prayed for be granted in the interest of justice. No other submissions have been made. 4. To meet with the stand taken by the learned advocate for the petitioner, Ms. V.D. Nanavati appearing on behalf of the respondent authority has submitted that the petitioner was a literate person, superannuated as Class-I officer, was well aware from the beginning about the difference of actual pension and dearness allowance. According to learned advocate Ms.
4. To meet with the stand taken by the learned advocate for the petitioner, Ms. V.D. Nanavati appearing on behalf of the respondent authority has submitted that the petitioner was a literate person, superannuated as Class-I officer, was well aware from the beginning about the difference of actual pension and dearness allowance. According to learned advocate Ms. Nanavati, dearness allowance rate would be low as compared to Class-II and Class-III employees as compared to ClassI as the same was with the aim to allow the retired person to meet with the accelerated rate of pension and, therefore, this itself was well within the knowledge of the petitioner who retired as Class-I officer. The petitioner was made to know about this anomaly which has been crept in on account of granting dearness allowance difference to the petitioner as that of Class-II and Class-III, though the petitioner was holding Class-I post and then when the third revision took place, this mistake surfaced on record and as such with a view to correct this mistake which has been crept in, the petitioner was given sufficient intimation and opportunity to explain and therefore, it is not a case that suddenly and abruptly any action is initiated against the petitioner. By drawing attention to the relevant papers at page 35 and 36, learned advocate Ms. Nanavati has submitted that there was anomaly in difference of amount of dearness to be payable to the petitioner and when such anomaly is detected after intimating the petitioner, the action is initiated. It was a mere calculation mistake which has been corrected and, hence, the said mistake cannot be allowed to be perpetuated even if some time has been passed in between. Learned advocate Ms. Nanavati has further submitted that from para 14 of the petition itself, it was disputed that the petitioner has been superannuated as Class-I employee and, therefore, the decisions which have been relied upon are not applicable since the petitioner is not belonging to Class-II and Class-III cadre.
Learned advocate Ms. Nanavati has further submitted that from para 14 of the petition itself, it was disputed that the petitioner has been superannuated as Class-I employee and, therefore, the decisions which have been relied upon are not applicable since the petitioner is not belonging to Class-II and Class-III cadre. It has further been submitted that by virtue provisions contained in Section 120 of the Major Port Trusts Act, 1963 Act (the “Act” for short), that before initiating litigation against the respondent authority, the petitioner was required to give one months' notice and here the petitioner has approached the Court straightway without complying the requirement of Section 120 of the Act and this Section 120 of the Act has been upheld by the Apex Court in the case of V.M. Salgaocar & Bros.. v. Board of Trustees of Port of Mormugao & Anr. reported in (2005) 4 SCC 613 . 4.1. Learned advocate Ms. Nanavati has further submitted that there was a clear undertaking given by the petitioner while giving certificate of living and in that certificate itself there was clause that if any excess payment is received by the petitioner, the same shall be permitted to be recovered and therefore, once an undertaking having been given, the petitioner cannot resile from it. It has further been submitted that even the definition of term “Pension” includes merely gratuity amount and not the dearness allowance and, therefore, looking to the meaning of dearness, the same can be recovered unlike pension of a retired person and, therefore, it is always open for the respondent authority to correct the mistake, the moment it has been detected. To support the submissions, learned advocate Ms. Nanavati has relied upon few decisions which are reported in the case of State of Haryana and Ors. v. O.P. Sharma reported in AIR 1993 SC 1903 ; in the case of P.V. Sundara Rajan & Ors., v. Union of India (UOI) and Ors., reported in AIR 2000 SC 3387 ; in the case of V.M. Salgaocar & Bros., v. Board of Trustees of Port of Mormugao & Ors., reported in (2005) 4 SCC 613 and in the case of K. Anbazhagan & Ors., v. The Registrar General, High Court of Madras & Ors., reported in 2018 (9) SCC 293 .
for the purpose of submitting that the dearness amount is not a part of pension and excess amount can always be recovered. Therefore, the proposition which has been relied upon by the learned advocate for the respondent that supports the decision, the action cannot be said to be unjust and arbitrary in any form. It has further been agitated that the prayer has been amended in para 20(c), but if that prayer in the said form if allowed to be granted, it would travel beyond the main relief which has been sought in the petition and such amendment cannot granted. Hence, no relief in terms of para 20(c) be considered at all by this Court. By referring to the aforesaid submissions, and the proposition, learned advocate Ms. Nanavati has vehemently opposed the petition and requested to dismiss the same as meritless. No other submissions have been made. 5. Having heard the learned advocates for the respective parties and having gone through the material on record, the following circumstance are material to the core issue involved in the petition of recovery after a period of 21 years and as such before taking an ultimate decision, these circumstances are not possible to be unnoticed by this Court. 6. First of all it appears from the record that the Chairman of the Kandla Port Trust has promoted some of the officers on adhoc basis in which the petitioner also came to be appointed vide office order dated 16.12.1994 as Assistant Traffic Manager, initially on adhoc basis in the traffic department in the payscale of Rs.2350-4230/-. The said adhoc order was then continued even for a further period and vide office order dated 13.06.1996 and later on in the month of August, 1996, it appears that the petitioner has been placed in a regular status. The office order dated 01.08.1996 issued by the Secretary, Kandla Port Trust reflects that in the payscale of Rs.4350-175-7500/- the petitioner came to be regularly posted on promotional post. Even it appears that pay fixation has also been done by the department and which is reflecting on page 29 of the petition compilation. This document undisputedly is dealing with pay fixation of Class-II officials promoted to the officers cadre on or after 01.01.1992 but prior to 01.01.1993.
Even it appears that pay fixation has also been done by the department and which is reflecting on page 29 of the petition compilation. This document undisputedly is dealing with pay fixation of Class-II officials promoted to the officers cadre on or after 01.01.1992 but prior to 01.01.1993. Now this fixation has been done by the respondent authority based upon the available service record and the revised scale which has been mentioned is also Rs.7500/- and by giving figures of relevant slot, the petitioner's pay has been fixed which is reflecting from the documents at page 29,30 and 31 of the petition compilation. Now this has been after considering the period from December, 1992 onwards which can be seen from the documents and it has been signed by the competent authority. This fixation has been allowed throughout as can be seen from the record. 7. The petitioner came to be superannuated way back on 30.11.1996 and received the retirement dues etc., on the basis of fixation which has already been done as stated above and the pension has also been determined and fixed which has been paid throughout from 01.12.1996 till 01.11.2017 uninterruptedly despite the fact that in between even for two times pay revision has taken place. 8. It is not in dispute that prior to the impugned communications there was no correspondence which took place between the petitioner and the respondent authority nor it has been an issue generated throughout for 21 years and it is for the first time on 01.11.2017 the Senior A.O. (Pension) of the respondent authority is informing the petitioner that through oversite the pension consolidation was done in excess and over payment has been made to the petitioner to the extent of Rs.3,37,725/- and directed the petitioner to deposit straightway through cheque in the name of Kandla Port Superannuated Scheme in the pension section, failing which excess payment will be recovered from the dearness relief. This document is indicating that the mistake occurred in applying formula applicable for Class-III and Class-IV employees to the petitioner instead of Class-I and Class-II officer in the year 1997.
This document is indicating that the mistake occurred in applying formula applicable for Class-III and Class-IV employees to the petitioner instead of Class-I and Class-II officer in the year 1997. Hence, the decision of recovery is indicated for the first time to the petitioner after a period of 21 years i.e. in November, 2017 and for which undisputedly no prior intimation, no opportunity of explanation, no material is supplied nor any opportunity of hearing is extended to the petitioner. 9. It further appears that with a view to understand the step initiated against the petitioner, a request was made to supply certain documents and solicited certain clarifications vide communication dated 24.11.2017 reflecting on page 38 of the petition compilation. It further appears that instead of responding to the said letter of the petitioner, it has been informed that the calculation of revised pension sheet since initial pension fixation is received by the petitioner from the Kandla Port Trust was already personally handed over and has informed that as per the relevant clause of CCC (Pension) Rules, 1972 any outstanding dues is to be adjusted from the dearness relief and without referring to any specific provisions or pension rules, and without supplying the details which has been asked for by the petitioner it was informed that a choice is given to the petitioner to make a lump sum deposit of Rs.3,37,725/- and, therefore, without supplying of some material, the authority has chosen to stick to its earlier stand which can be seen from page 40 of the petition compilation. 10. It further appears that this has resulted into a detailed explanation by the petitioner vide communication dated 10.01.2018 highlighted by the petitioner that the act of liability is limited to three years and it is highly objectionable by the authorized pension officer to make recoveries from the hard earned monthly overall pension of a senior citizen without supply of the sufficient documents and the information and also once again requested to supply the relevant clause of pension rules which is sought to be relied upon and so for the second time as well, it has been demanded by the petitioner to supply such material in response to the action against the petitioner.
Thereafter again the pension section replies to the petitioner on 30.01.2018 about the formula of rate of dearness relief which has again construe the petitioner to represent vide communication dated 12.03.2018. In a communication dated 12.03.2018 reflecting on page 44 it was categorically mentioned by the petitioner that since this recovery is sought after 21 years the petitioner would like to represent personally to the office and requested to allow the petitioner to represent and examine this case personally from its inception. It was categorically mentioned that upto September, 2017 the petitioner was drawing pension of Rs.27,960/- per month i.e. basic plus dearness relief rate and suddenly, stopping of dearness relief rate Rs.16,474/- abruptly from the pension at the age of 80 years the petitioner has been placed in a precarious position as several circumstance are being faced by the petitioner about the medical details of the petitioner as well as spouse in his head of dearness allowance and once again requested to resolve the matter at the earliest. It appears that thereafter, except correspondence there appears to be nothing consistently took place by the respondent either by supplying the material or opportunity to represent or giving material which has been sought for and the action of recovery is implemented to some extent. This background of facts is convincing the Court that the action on the part of the respondent authority is absolutely arbitrary, contrary to the basic element of granting an opportunity of hearing and explanation to the petitioner. It appears that non supply of material has also violated the basic principle of fair play against the petitioner. 11. It also appears that the petitioner had not committed the mistake neither has misrepresented the authority and fixation has been done much prior to his superannuation and that was done by the office of the respondent authority and not by the petitioner and therefore, to get it corrected after 21 years and more is nothing but allowing the respondent authority to take premium for their own mistake.
Had there been a case that there was some misrepresentation on the part of the petitioner, or some mischief of anything in nature, then the authority might have been justified in recovering, but simply because some inadvertence of some officer has taken place, which allowed to be continued throughout a period of more than 21 years, cannot be allowed to be rectified particularly, when twice the pay revision took place in between and this has been deducted at the third stage of pay revision. Since the petitioner is not at fault, the Court is of the considered opinion that the stand taken by the respondent authority is clearly arbitrary. 12. Now in the light of the aforesaid factual matrix, the decisions which have been brought to the notice of this Court by the learned advocate for the petitioner is to be considered and the following proposition laid down by the Apex Court cannot be unnoticed. In the case of State of Punjab (supra), the Apex Court, after considering the various decisions, in para 5, 6, 11 and 12 has observed as under. Of Course, the Apex Court was dealing with the employees who have served as Class-III and Class-IV category but the overall reading of the said decision at length convince the Court not to overlook the proposition. “5. Merely on account of the fact, that the release of these monetary benefits was based on a mistaken belief at the hands of the employer, and further, because the employees had no role in the determination of the employer, could it be legally feasible, for the private respondents to assert, that they should be exempted from refunding the excess amount received by them? Insofar as the above issue is concerned, it is necessary to keep in mind, that the following reference was made by a Division Bench of two Judges of this Court, for consideration by a larger Bench: "In view of an apparent difference of views expressed on the one hand in Shyam Babu Verma and Ors. v. Union of India and Ors. (1994) 2 SCC 521 and Sahib Ram Verma v. State of Haryana (1995) Supp. 1 SCC 18 : (1995 AIR SCW 1780); and on the other hand in Chandi Prasad Uniyal and Ors. v. State of Uttarakhand and Ors.
v. Union of India and Ors. (1994) 2 SCC 521 and Sahib Ram Verma v. State of Haryana (1995) Supp. 1 SCC 18 : (1995 AIR SCW 1780); and on the other hand in Chandi Prasad Uniyal and Ors. v. State of Uttarakhand and Ors. (2012) 8 SCC 417 : ( AIR 2012 SC 2951 ), we are of the view that the remaining special leave petitions should be placed before a Bench of Three Judges. The Registry is accordingly directed to place the file of the remaining special leave petitions before the Hon'ble the Chief Justice of India for taking instructions for the constitution of a Bench of three Judges, to adjudicate upon the present controversy." (emphasis is ours) The aforesaid reference was answered by a Division Bench of three Judges on 8.7.2014. While disposing of the reference, the three Judge Division Bench, recorded the following observations in paragraph 7: "7. In our considered view, the observations made by the Court not to recover the excess amount paid to the appellant therein were in exercise of its extraordinary powers under Article 142 of the Constitution of India which vest the power in this Court to pass equitable orders in the ends of justice." (emphasis is ours) Having recorded the above observations, the reference was answered as under: "12. Therefore, in our opinion, the decisions of the Court based on different scales of Article 136 and Article 142 of the Constitution of India cannot be best weighed on the same grounds of reasoning and thus in view of the aforesaid discussion, there is no conflict in the views expressed in the first two judgments and the latter judgment . 13. In that view of the above, we are of the considered opinion that reference was unnecessary. Therefore, without answering the reference, we send back the matters to the Division Bench for its appropriate disposal.” (emphasis is ours) 6. In view of the conclusions extracted hereinabove, it will be our endeavour, to lay down the parameters of fact situations, wherein employees, who are beneficiaries of wrongful monetary gains at the hands of the employer, may not be compelled to refund the same.
In view of the conclusions extracted hereinabove, it will be our endeavour, to lay down the parameters of fact situations, wherein employees, who are beneficiaries of wrongful monetary gains at the hands of the employer, may not be compelled to refund the same. In our considered view, the instant benefit cannot extend to an employee merely on account of the fact, that he was not an accessory to the mistake committed by the employer; or merely because the employee did not furnish any factually incorrect information, on the basis whereof the employer committed the mistake of paying the employee more than what was rightfully due to him; or for that matter, merely because the excessive payment was made to the employee, in absence of any fraud or misrepresentation at the behest of the employee. 11. For the above determination, we shall refer to some precedents of this Court wherein the question of recovery of the excess amount paid to employees, came up for consideration, and this Court disallowed the same. These are situations, in which High Courts all over the country, repeatedly and regularly set aside orders of recovery made on the expressed parameters. (i). Reference may first of all be made to the decision in Syed Abdul Qadir v. State of Bihar (2009) 3 SCC 475 : (2009 AIR SCW 1871), wherein this Court recorded the following observation in paragraph 58: "58. 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 v. State of Haryana, 1995 Supp.
See Sahib Ram v. State of Haryana, 1995 Supp. (1) SCC 18 : (1995 AIR SCW 1780), Shyam Babu Verma v. Union of India (1994) 2 SCC 521 , Union of India v. M. Bhaskar (1996) 4 SCC 416 , V. Ganga Ram v. Director (1997) 6 SCC 139 : ( AIR 1997 SC 2776 ), Col. B.J. Akkara (Retd.) v. Govt. of India (2006) 11 SCC 709 : (2006 AIR SCW 5252), Purshottam Lal Das v. State of Bihar (2006) 11 SCC 492 : (2006 AIR SCW 5325), Punjab National Bank v. Manjeet Singh (2006) 8 SCC 647 : ( AIR 2007 SC 262 ) and Bihar SEB v. Bijay Bahadur (2000) 10 SCC 99 ." (emphasis is ours) First and foremost, it is pertinent to note, that this Court in its judgment in Syed Abdul Qadir's case (supra) recognized, that the issue of recovery revolved on the action being iniquitous. Dealing with the subject of the action being iniquitous, it was sought to be concluded, that when the excess unauthorised payment is detected within a short period of time, it would be open for the employer to recover the same. Conversely, if the payment had been made for a long duration of time, it would be iniquitous to make any recovery. Interference because an action is iniquitous, must really be perceived as, interference because the action is arbitrary. All arbitrary actions are truly, actions in violation of Article 14 of the Constitution of India. The logic of the action in the instant situation, is iniquitous, or arbitrary, or violative of Article 14 of the Constitution of India, because it would be almost impossible for an employee to bear the financial burden, of a refund of payment received wrongfully for a long span of time. It is apparent, that a government employee is primarily dependent on his wages, and if a deduction is to be made from his/her wages, it should not be a deduction which would make it difficult for the employee to provide for the needs of his family. Besides food, clothing and shelter, an employee has to cater, not only to the education needs of those dependent upon him, but also their medical requirements, and a variety of sundry expenses.
Besides food, clothing and shelter, an employee has to cater, not only to the education needs of those dependent upon him, but also their medical requirements, and a variety of sundry expenses. Based on the above consideration, we are of the view, that if the mistake of making a wrongful payment is detected within five years, it would be open to the employer to recover the same. However, if the payment is made for a period in excess of five years, even though it would be open to the employer to correct the mistake, it would be extremely iniquitous and arbitrary to seek a refund of the payments mistakenly made to the employee. In this context, reference may also be made to the decision rendered by this Court in Shyam Babu Verma v. Union of India (1994) 2 SCC 521 , wherein this Court observed as under: "11. Although we have held that the petitioners were entitled only to the pay scale of Rs. 330-480 in terms of the recommendations of the Third Pay Commission w.e.f. January 1, 1973 and only after the period of 10 years, they became entitled to the pay scale of Rs 330-560 but as they have received the scale of Rs 330-560 since 1973 due to no fault of theirs and that scale is being reduced in the year 1984 with effect from January 1, 1973, it shall only be just and proper not to recover any excess amount which has already been paid to them. Accordingly, we direct that no steps should be taken to recover or to adjust any excess amount paid to the petitioners due to the fault of the respondents, the petitioners being in no way responsible for the same." (emphasis is ours) It is apparent, that in Shyam Babu Verma's case (supra), the higher payscale commenced to be paid erroneously in 1973. The same was sought to be recovered in 1984, i.e., after a period of 11 years. In the aforesaid circumstances, this Court felt that the recovery after several years of the implementation of the payscale would not be just and proper. We therefore hereby hold, recovery of excess payments discovered after five years would be iniquitous and arbitrary, and as such, violative of Article 14 of the Constitution of India. (ii). Examining a similar proposition, this Court in Col.
We therefore hereby hold, recovery of excess payments discovered after five years would be iniquitous and arbitrary, and as such, violative of Article 14 of the Constitution of India. (ii). Examining a similar proposition, this Court in Col. B.J. Akkara v. Government of India, (2006) 11 SCC 709 : (2006 AIR SCW 5252), observed as under: "28. Such relief, restraining back recovery of excess payment, is granted by courts not because of any right in the employees, but in equity, in exercise of judicial discretion to relieve the employees from the hardship that will be caused if recovery is implemented. A government servant, particularly one in the lower rungs of service would spend whatever emoluments he receives for the upkeep of his family. If he receives an excess payment for a long period, he would spend it, genuinely believing that he is entitled to it . As any subsequent action to recover the excess payment will cause undue hardship to him, relief is granted in that behalf. But where the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or where the error is detected or corrected within a short time of wrong payment, courts will not grant relief against recovery. The matter being in the realm of judicial discretion, courts may on the facts and circumstances of any particular case refuse to grant such relief against recovery." (emphasis is ours) A perusal of the aforesaid observations made by this Court in Col. B.J. Akkara's case (supra) reveals a reiteration of the legal position recorded in the earlier judgments rendered by this Court, inasmuch as, it was again affirmed, that the right to recover would be sustainable so long as the same was not iniquitous or arbitrary. In the observation extracted above, this Court also recorded, that recovery from employees in lower rung of service, would result in extreme hardship to them. The apparent explanation for the aforesaid conclusion is, that employees in lower rung of service would spend their entire earnings in the upkeep and welfare of their family, and if such excess payment is allowed to be recovered from them, it would cause them far more hardship, than the reciprocal gains to the employer.
The apparent explanation for the aforesaid conclusion is, that employees in lower rung of service would spend their entire earnings in the upkeep and welfare of their family, and if such excess payment is allowed to be recovered from them, it would cause them far more hardship, than the reciprocal gains to the employer. We are therefore satisfied in concluding, that such recovery from employees belonging to the lower rungs (i.e., ClassIII and ClassIV sometimes denoted as Group 'C' and Group 'D') of service, should not be subjected to the ordeal of any recovery, even though they were beneficiaries of receiving higher emoluments, than were due to them. Such recovery would be iniquitous and arbitrary and therefore would also breach the mandate contained in Article 14 of the Constitution of India. (iii). This Court in Syed Abdul Qadir v. State of Bihar (supra) held as follows: "59. Undoubtedly, the excess amount that has been paid to the appellant 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 appellant 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 appellant teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellant teachers should be made ." (emphasis is ours) Premised on the legal proposition considered above, namely, whether on the touchstone of equity and arbitrariness, the extract of the judgment reproduced above, culls out yet another consideration, which would make the process of recovery iniquitous and arbitrary.
It is apparent from the conclusions drawn in Syed Abdul Qadir's case (supra), that recovery of excess payments, made from employees who have retired from service, or are close to their retirement, would entail extremely harsh consequences outweighing the monetary gains by the employer. It cannot be forgotten, that a retired employee or an employee about to retire, is a class apart from those who have sufficient service to their credit, before their retirement. Needless to mention, that at retirement, an employee is past his youth, his needs are far in excess of what they were when he was younger. Despite that, his earnings have substantially dwindled (or would substantially be reduced on his retirement). Keeping the aforesaid circumstances in mind, we are satisfied that recovery would be iniquitous and arbitrary, if it is sought to be made after the date of retirement, or soon before retirement. A period within one year from the date of superannuation, in our considered view, should be accepted as the period during which the recovery should be treated as iniquitous. Therefore, it would be justified to treat an order of recovery, on account of wrongful payment made to an employee, as arbitrary, if the recovery is sought to be made after the employee's retirement, or within one year of the date of his retirement on superannuation. (iv) Last of all, reference may be made to the decision in Sahib Ram Verma v. Union of India (1995) Supp 1 SCC 18 : (1995 AIR SCW 1780), wherein it was concluded as under: "4. Mr. Prem Malhotra, learned counsel for the appellant, contended that the previous scale of Rs. 220-550 to which the appellant was entitled became Rs. 700-1600 since the appellant had been granted that scale of pay in relaxation of the educational qualification. The High Court was, therefore, not right in dismissing the writ petition. We do not find any force in this contention. It is seen that the Government in consultation with the University Grants Commission had revised the pay scale of a Librarian working in the colleges to Rs. 700-1600 but they insisted upon the minimum educational qualification of first or second class M.A., M.Sc., M.Com. plus a first or second class B.Lib. Science or a Diploma in Library Science.
It is seen that the Government in consultation with the University Grants Commission had revised the pay scale of a Librarian working in the colleges to Rs. 700-1600 but they insisted upon the minimum educational qualification of first or second class M.A., M.Sc., M.Com. plus a first or second class B.Lib. Science or a Diploma in Library Science. The relaxation given was only as regards obtaining first or second class in the prescribed educational qualification but not relaxation in the educational qualification itself. 5. Admittedly the appellant does not possess the required educational qualifications. Under the circumstances the appellant would not be entitled to the relaxation. The Principal erred in granting him the relaxation. Since the date of relaxation the appellant had been paid his salary on the revised scale. However, it is not on account of any misrepresentation made by the appellant that the benefit of the higher pay scale was given to him but by wrong construction made by the Principal for which the appellant cannot be held to be at fault . Under the circumstances the amount paid till date may not be recovered from the appellant. The principle of equal pay for equal work would not apply to the scales prescribed by the University Grants Commission. The appeal is allowed partly without any order as to costs." (emphasis is ours) It would be pertinent to mention, that Librarians were equated with Lecturers, for the grant of the pay scale of Rs.700-1600. The above pay parity would extend to Librarians, subject to the condition that they possessed the prescribed minimum educational qualification (first or second class M.A., M.Sc., M.Com. plus a first or second class B.Lib. Science or a Diploma in Library Science, the degree of M.Lib. Science being a preferential qualification). For those Librarians appointed prior to 3.12.1972, the educational qualifications were relaxed. In Sahib Ram Verma's case (supra), a mistake was committed by wrongly extending to the appellants the revised pay scale, by relaxing the prescribed educational qualifications, even though the concerned appellants were ineligible for the same. The concerned appellants were held not eligible for the higher scale, by applying the principle of "equal pay for equal work". This Court, in the above circumstances, did not allow the recovery of the excess payment.
The concerned appellants were held not eligible for the higher scale, by applying the principle of "equal pay for equal work". This Court, in the above circumstances, did not allow the recovery of the excess payment. This was apparently done because this Court felt that the employees were entitled to wages, for the post against which they had discharged their duties. In the above view of the matter, we are of the opinion, that it would be iniquitous and arbitrary for an employer to require an employee to refund the wages of a higher post, against which he had wrongfully been permitted to work, though he should have rightfully been required to work against an inferior post. 12. It is not possible to postulate all situations of hardship, which would govern employees on the issue of recovery, where payments have mistakenly been made by the employer, in excess of their entitlement. Be that as it may, based on the decisions referred to hereinabove, we may, as a ready reference, summarise the following few situations, wherein recoveries by the employers, would be impermissible in law: (i) Recovery from employees belonging to Class-III and Class-IV service (or Group 'C' and Group 'D' service). (ii) Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery. (iii) Recovery from employees, when the excess payment has been made for a period in excess of five years, before the order of recovery is issued. (iv) Recovery in cases where an employee has wrongfully been required to discharge duties of a higher post, and has been paid accordingly, even though he should have rightfully been required to work against an inferior post. (v) In any other case, where the Court arrives at the conclusion, that recovery if made from the employee, would be iniquitous or harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer's right to recover.” 13.
(v) In any other case, where the Court arrives at the conclusion, that recovery if made from the employee, would be iniquitous or harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer's right to recover.” 13. Yet another decision which has been pressed into service by the learned advocate for the petitioner is the decision dated 21.04.2015 passed in a group of petitions headed by Special Civil Application No. 10543 of 2008 in which after taking into consideration the decision of the Apex Court, referred to above, the Court held that immense hardship has rightly taken place, the action impugned was set aside by this Court and whatever amount recovered was ordered to be repaid with interest at the rate of 8% from the date of the recoveries till the actual payment to be made within a period of eight weeks from the date of the receipt of a copy of the order. Of course, the said decision was dealing with the cadre of Shirestadar under respondent no. 4 authority and as such the factual services referred might be different from what is on hand. Nonetheless the principle which has been evolved deserves consideration. Since the said decision of the coordinate Bench is again heavily relied upon the decisions of the Apex Court in the case of State of Punjab (surpa), detailed paragraphs consisting observations have been incorporated in the present order, but the sum and substance is that the petitioner now aged about 82 years would be put to a immense hardships by deducting a seizable amount from the pension made available to the petitioner and, therefore, the action taken after 21 years is found to be arbitrary, violative of Article 14 of the Constitution of India and, therefore, much reliance can be placed on the aforesaid decisions. 14. Now as against this, the learned advocate for the respondent – authority has made an attempt to consider the issue slightly differently.
14. Now as against this, the learned advocate for the respondent – authority has made an attempt to consider the issue slightly differently. It has been suggested that the pension is consisting of gratuity only and the dearness allowance cannot be consisted as a part of the pension and, therefore, essentially, what has been recovered and sought to be recovered is from the dearness allowance and not from the pension and for that the learned advocate for the respondent has relied upon the definition of 'Pension' defined under Section 3(o) of CCS (Rules) 1972. The learned advocate for the respondent has then referred to a decision first in line in the case of State of Haryana v. O.P. Sharma (supra). The said decision in which the Government of Haryana passed an order in June, 1972 for the grant of first and second installments of adhoc relief to its employees at varying rates on account of rise in the costs of living. Now that grant of adhoc is pure and simple and the amount of excess additional dearness allowance was to be recovered by treating the same as inadvertence and in that context, the Apex Court has dealt with an issue and held that adjustments cannot be a ruled as unfair, arbitrarily and in violative of law. The facts contained in para 2 are quite distinct then what is on hand. Resultantly, since the amount of installments paid by way of additional dearness allowance were sought to be recovered, in that context only, the proposition is laid down and formulated by the Apex Court and, therefore, though the said principles cannot be disputed but is not possible to be stretched to the case on hand in a different set of circumstance where the factual details are altogether distinct and, therefore, reference of the above decision, it appears to be of no avail to the authority. 15. Yet another decision which has been brought to the notice is in the case of P.V. Sundara Rajan & Ors., (supra), in which the issue in question is relating to commutation of pension of an employee and the case was as to whether pensioners who had commuted 1/3rd pension were at par with other central government pensioners or not and in that context, the Apex Court held that they were entitled to post commutation reliefs and other attendants reliefs.
It is quite well recognized principle by now that the ratio laid down by the Apex Court in its decision cannot be stretched and thrust upon if the facts are different. While applying the ratio, the Court has to look to a factual background before straightway applying the principle. The Apex Court in the said decision was confronted with a different facts altogether and therefore, in that set of circumstance, if the proposition is laid down, the same is not possible to be straightway apply to the present case on hand. While going through the decisions which have been cited before the Court, the Court is not satisfied with the defence which has been taken by the respondent authority to justify the action which is not in accordance with law. 16. The another case which has been cited by the learned advocate for the respondent in the case of V.M. Salgaocar & Bros. (supra), in which the Apex Court was dealing with the issue as to whether the suit filed by the original plaintiff was maintainable for want of notice under Section 120 of the Major Port Trust Act, 1963 (the “Act” for short) and in that context, the issue was examined by the Court. Hence, essentially, the original proceedings which were initiated by the plaintiff were whether submitted after complying Section 120 of the Act requirement or not. That was the issue in question and the suit proceedings were dealt with visavis the period of limitation which was prescribed under Section 120 of the Act and as such the issue of controversy in the said decision is altogether different. The Court cannot mechanically apply and accept the submissions made by the learned advocate for the respondent. The decision last in line which has been cited before the Court is a recent decision in the case of K. Anbazhagan & Ors. (supra) where the question was with regard to appointment of Fast Track Court Judges and their pension entitlement, but then this decision is relied upon only with a view to clarify that the pension does not include dearness allowance and only to justify that issue, this decision is cited before the Court. Hence, the overall reading of the situation would lead to a situation that no circumstance is possible to be digested that action of recovery is sustainable in the eye of law. 17.
Hence, the overall reading of the situation would lead to a situation that no circumstance is possible to be digested that action of recovery is sustainable in the eye of law. 17. To summarize the background, the Court is of the considered opinion that the fixation took place by the respondent authority, in which it is not the case of the authority that any misrepresentation or mistake is committed by the petitioner. It is also not in dispute that the petitioner has retired long back in the month of November, 1996 and at present aged about 82 years and undisputedly, has again received all dues and benefits of pension as per the original fixation made by the respondent authority itself and continued the same throughout till November, 2017 over a period of 21 years. A further fact also cannot be unnoticed is that the for the first time, unilaterally, a notice and decision is communicated on 01.11.2017 and recovery is sought without giving any opportunity to the petitioner neither had prior intimated about the proposed action and, therefore, the communications which are under challenge are absolutely found to be not in conformity with the principles of natural justice and further the action of recovery after 21 years is also found to be arbitrary for no fault on the part of the petitioner. Hence on the basis of the equitable consideration as well, the action under challenge is not possible to be certified as just and proper and in accordance with law. 18. In view of the wake of the aforesaid factual details, in corelation with the proposition laid down by the various decisions discussed above, the Court is of the considered opinion that a case is made out by the petitioner. Hence, the impugned communications dated 01.11.2017, 30.01.2018 and 02.04.2018 are hereby quashed and set aside, by further directing to forthwith put the petitioner on the usual pension scale payable to him prior to 01.07.2017 and continue to pay the same regularly without any default. Since the action is apparently not sustainable in view of this peculiar set of circumstance, the amount which has been recovered from the petitioner unilaterally also deserves to be refunded and the same shall be refunded within a period of eight weeks from the date of receipt of writ of this Court with 6% interest till actual payment from its deduction.
The Court has also observed while parting that the present order is passed on peculiar set of circumstance available on record. Hence, the principle is restricted to the background of the present facts situation. 19. With this observations and clarification, the petition stands allowed. Rule is made absolute with no order as to cost. 20. Since the main matter is disposed of, the civil application will not survive and the same stands disposed of accordingly.