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2025 DIGILAW 1764 (KAR)

Jayashree S, W/o. Shivanada v. State Of Karnataka

2025-12-10

M.NAGAPRASANNA

body2025
ORDER : (PER: THE HON'BLE MR. JUSTICE M.NAGAPRASANNA) 1. Heard the learned counsel Sri. Rajashekhar Burji appearing for the petitioners, learned AGA and learned counsels Sri. K.L. Patil and Sri. Iranagouda K. Kabbur representing respondents. 2. The petitioners are before this Court seeking the following reliefs: “a) Quash the Order dated 08.05.2025 issued by the 5 th Respondent bearing No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 40, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 30, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 36, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 155, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 167, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 99, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 157, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 169, No.Ka.Vi.Vi / Ha.Vi / Vetana / 2024-25 / 51, produced at Annexure – L to L8, respectively. b) Consequently Direct the Respondent No.4 and 5 to reimburse / repay the amount deducted from the salary of the Petitioners respectively. c) Pass such other order or direction, this Hon’ble Court deems fit in the circumstance of the case.” 3. The petitioners are in the cadre of Professors in respondent No.4 University. The issue in the lis does not relate to the service of the petitioners in the University or the incidental conditions thereon. The petitioners in terms of law, on 24.12.2009 are granted the benefit of the recommendation of sixth pay commission, whereby the pay was increased. The petitioners take the said benefit and come to the age of superannuation in the year 2025 and few of them have already retired. At the fag end of service or after retirement, the University is said to have realised on the strength of certain audit objections that said to have been realised that the petitioners were not entitled to the benefit of the sixth pay commission and they were erroneously granted the said benefit on 24.12.2009. 4. In that light, the University now passes the impugned orders directing recovery of the excess pay that was paid to these petitioners on and from 24.12.2009. The challenge is to those recovery orders. 5. 4. In that light, the University now passes the impugned orders directing recovery of the excess pay that was paid to these petitioners on and from 24.12.2009. The challenge is to those recovery orders. 5. The learned counsel appearing for the petitioners submits that the petitioners did not represent before the authorities that they were entitled to the sixth pay commission, but on the strength of law, they were granted the benefit of sixth pay commission and the pay was accordingly fixed. The pay of the petitioners cannot be varied or recovery cannot be done. He would submit that the issue in the lis stands completely unsolved by the judgment of the Apex Court in the case of State of Punjab and others vs. Rafiq Masih (White Washer) and others , (2015) 4 SCC 334 . 6. The afore-narrated facts are not in dispute. If the recovery orders that are called in question are noticed, it is undoubtedly an order of recovery that directs recovery for a pay scale that was granted on 24.12.2009, the sixth pay scale and on 16.03.2019, the seventh pay scale, both of which are now sought to be recovered. The issue whether recovery can be made on an erroneous pay that was paid to the petitioners is completely answered by the Apex Court in the aforesaid judgment (supra), wherein at paragraph 18, the same reads as under: “18. 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 herein above, 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. (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.” (emphasis supplied) 7. The Apex Court lays down five postulates of recovery in the aforesaid paragraph. One postulate that bars recovery is the persons who have retired from service or are on the verge of retirement from service. If the pay that is fixed to them is in error, it was for the employer to wake up immediately and pass orders. The said judgment in the case of State of Punjab and others vs. Rafiq Masih is followed by the Apex Court subsequently in Thomas Daniel vs. State of Kerala and others , 2022 SCC OnLine SC 536. 9. This Court in a catena of decisions has consistently held that if the excess amount was not paid on account of any misrepresentation or fraud of the employee or 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, such excess payment of emoluments or allowances are not recoverable. This relief against the recovery is granted not because of any right of the employees but in equity, exercising judicial discretion to provide relief to the employees from the hardship that will be caused if the recovery is ordered. This Court has further held that if in a given case, it is proved that an employee had knowledge that the payment received was in excess of what was due or wrongly paid, or in cases where error is detected or corrected within a short time of wrong payment, the matter being in the realm of judicial discretion, the courts may on the facts and circumstances of any particular case order for recovery of amount paid in excess. 10. 10. In Sahib Ram v. State of Haryana and Others this Court restrained recovery of payment which was given under the upgraded pay scale on account of wrong construction of relevant order by the authority concerned, without any misrepresentation on part of the employees. It was held thus: "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." 11. In Col. B.J. Akkara (Retd.) v. Government of India and Others this Court considered an identical question as under: "27. The last question to be considered is whether relief should be granted against the recovery of the excess payments made on account of the wrong interpretation/understanding of the circular dated 7-6-1999. This Court has consistently granted relief against recovery of excess wrong payment of emoluments/allowances from an employee, if the following conditions are fulfilled (vide Sahib Ram v. State of Haryana [1995 Supp (1) SCC 18 : 1995 SCC (L&S) 248], Shyam Babu Verma v. Union of India [ (1994) 2 SCC 521 : 1994 SCC (L&S) 683 : (1994) 27 ATC 121] , Union of India v. M. Bhaskar [ (1996) 4 SCC 416 : 1996 SCC (L&S) 967] and V. Gangaram v. Regional Jt. Director [ (1997) 6 SCC 139 : 1997 SCC (L&S) 1652] ): (a) The excess payment was not made on account of any misrepresentation or fraud on the part of the employee. (b) 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. 28. (b) 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. 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. 29. On the same principle, pensioners can also seek a direction that wrong payments should not be recovered, as pensioners are in a more disadvantageous position when compared to inservice employees. Any attempt to recover excess wrong payment would cause undue hardship to them. The petitioners are not guilty of any misrepresentation or fraud in regard to the excess payment. NPA was added to minimum pay, for purposes of stepping up, due to a wrong understanding by the implementing departments. We are therefore of the view that the respondents shall not recover any excess payments made towards pension in pursuance of the circular dated 7-6-1999 till the issue of the clarificatory circular dated 11-9-2001. Insofar as any excess payment made after the circular dated 11-9-2001, obviously the Union of India will be entitled to recover the excess as the validity of the said circular has been upheld and as pensioners have been put on notice in regard to the wrong calculations earlier made." 12. Insofar as any excess payment made after the circular dated 11-9-2001, obviously the Union of India will be entitled to recover the excess as the validity of the said circular has been upheld and as pensioners have been put on notice in regard to the wrong calculations earlier made." 12. In Syed Abdul Qadir and Others v. State of Bihar and Others excess payment was sought to be recovered which was made to the appellant steachers on account of mistake and wrong interpretation of prevailing Bihar Nationalised Secondary School (Service Conditions) Rules, 1983. The appellants therein contended that even if it were to be held that the appellants were not entitled to the benefit of additional increment on promotion, the excess amount should not be recovered from them, it having been paid without any misrepresentation or fraud on their part. The Court held that the appellants cannot be held responsible in such a situation and recovery of the excess payment should not be ordered, especially when the employee has subsequently retired. The court observed that in general parlance, recovery is prohibited by courts where there exists no misrepresentation or fraud on the part of the employee and when the excess payment has been made by applying a wrong interpretation/understanding of a Rule or Order. It was held thus: "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 counteraffidavit, 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. 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." 13. In State of Punjab and Others v. Rafiq Masih (White Washer) and Others wherein this court examined the validity of an order passed by the State to recover the monetary gains wrongly extended to the beneficiary employees in excess of their entitlements without any fault or misrepresentation at the behest of the recipient. This Court considered situations of hardship caused to an employee, if recovery is directed to reimburse the employer and disallowed the same, exempting the beneficiary employees from such recovery. It was held thus: "8. As between two parties, if a determination is rendered in favour of the party, which is the weaker of the two, without any serious detriment to the other (which is truly a welfare State), the issue resolved would be in consonance with the concept of justice, which is assured to the citizens of India, even in the Preamble of the Constitution of India. The right to recover being pursued by the employer, will have to be compared, with the effect of the recovery on the employee concerned. If the effect of the recovery from the employee concerned would be, more unfair, more wrongful, more improper, and more unwarranted, than the corresponding right of the employer to recover the amount, then it would be iniquitous and arbitrary, to effect the recovery. In such a situation, the employee's right would outbalance, and therefore eclipse, the right of the employer to recover. xxx xxx xxx 18. 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. In such a situation, the employee's right would outbalance, and therefore eclipse, the right of the employer to recover. xxx xxx xxx 18. 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 the employees belonging to Class III and Class IV service (or Group C and Group D service). (ii) Recovery from the retired employees, or the employees who are due to retire within one year, of the order of recovery. (iii) Recovery from the 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." 14. Coming to the facts of the present case, it is not contended before us that on account of the misrepresentation or fraud played by the appellant, the excess amounts have been paid. The appellant has retired on 31.03.1999. In fact, the case of the respondents is that excess payment was made due to a mistake in interpreting Kerala Service Rules which was subsequently pointed out by the Accountant General. 15. Having regard to the above, we are of the view that an attempt to recover the said increments after passage of ten years of his retirement is unjustified.” 8. Learned counsel Sri Irannagouda K. Kabbur, appearing for the petitioners, would contend that the issue in the lis is not covered by the judgment of the Apex Court in Rafiq Masih (White Washer) . He submits that the subsequent judgment in High Court of Punjab & Haryana & Ors. Learned counsel Sri Irannagouda K. Kabbur, appearing for the petitioners, would contend that the issue in the lis is not covered by the judgment of the Apex Court in Rafiq Masih (White Washer) . He submits that the subsequent judgment in High Court of Punjab & Haryana & Ors. v. Jagdev Singh , (2016) 14 SCC 267 has distinguished the earlier judgment of the Apex Court in State of Punjab & Ors. v. Rafiq Masih (White Washer), (2015) 4 SCC 334 . 9. Learned counsel further submits that the Apex Court, in a later judgment in Thomas Daniel v. State of Kerala & Ors. , (2022) SCC OnLine SC 536 has considered Rafiq Masih (White Washer) and has reiterated that recovery from retired employees is impermissible in law. 10. In that light, the submission of the learned counsel for the University, Sri Irannagouda K. Kabbur, relying on the judgment in Jagdev Singh , cannot be countenanced. 11. Since the recovery sought to be made from retired employees is impermissible in law, the petition deserves to succeed. However, this Court is not considering the issue of re-fixation of pay or pension. The consideration is confined only to the question of recovery. 12. In the light of the aforesaid circumstances, and the issue having been completely answered by the Apex Court in Rafiq Masih (White Washer) , as followed in Thomas Daniel , the petitions deserve to succeed. Accordingly, the following: ORDER i. The Writ petitions arWe allowed. ii. In W.P.No.105791/2025, the impugned order dated 08.05.2025 issued by respondent No.5 stands quashed. iii. In W.P.No.104056/2025, the impugned order dated 08.05.2025 issued by respondent No.4 stands quashed. iv. In W.P.No.105055/2025, the impugned order dated 08.05.2025 issued by respondent No.4 stands quashed. v. In W.P.No.106354/2025, the impugned order dated 08.05.2025 issued by respondent No.4 stands quashed. vi. If any amount has been recovered from the petitioners from their pension, the same shall be refunded to them within an outer limit of 12 weeks from the date of receipt of a copy of this order. vii. Failing which, the refunded amount shall carry interest at the rate of 10% per annum.