Gujarat High Court
Chhotalal S/O Laljibhai Kotak vs Rajkot Municipal Corporation on 25 November, 2025
NEUTRAL CITATION
C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 3173 of 2018
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE MAULIK J.SHELAT
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Approved for Reporting Yes No
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CHHOTALAL S/O LALJIBHAI KOTAK
Versus
RAJKOT MUNICIPAL CORPORATION & ANR.
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Appearance:
MR. GAURAV A. GOGIA ON BEHALF OF MS. MUSKAN A. GOGIA WITH
MR. BB GOGIA(5851) for the Petitioner(s) No. 1
MR HS MUNSHAW(495) for the Respondent(s) No. 1,2 - CORPORATION
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CORAM:HONOURABLE MR. JUSTICE MAULIK J.SHELAT
Date : 25/11/2025
ORAL JUDGMENT
1. Rule returnable forthwith. Learned advocate appearing for the respondents waives service of notice of rule on behalf of respondents.
2. Heard Mr. Gaurav A. Gogia, learned counsel appearing on behalf of Ms. Muskan A. Gogia, learned counsel with Mr. B.B. Gogia, learned counsel for the petitioner, and Mr. Kirit Patel, learned advocate appearing on behalf of Mr. H.S. Munshaw, learned counsel for the respondents. With consent of the parties, Page 1 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined the matter is taken up for final hearing.
3. The present writ petition is filed by the present petitioner under Article 226 of the Constitution of India, inter alia, seeking the following reliefs:
"A. YOUR LORDSHIPS may be pleased to admit and allow this petition.
B. YOUR LORDSHIPS be pleased to hold and declare and direct that the Communicated letter dated 12.01.2018 Vide No. Ra Ma Na Paa/Hisabi/JA No. 1716 (Annexure A) is illegal, invalid and contrary to law which may be quashed and set aside. And Respondents be directed to not give effect to recovery of the amount as stated in letter dated12.01.2018 (Annexure-A) from the petitioner and his pension amount.
C. Pending admission, hearing and final disposal of this petition, Respondent may please be restrained from recovering the amount of Rs 3,62,310/ or any other amount as stated in letter dated 12.01.2018 (Annexure A) from the petitioner or the from the amount of pension payble to him every month and from reducing his pay or pension granted by Memo dated 20.05.2013, 13.06.2013, 17.06.2013 (Annexure B,C, D,E).
D. To pass any other Order or Order(s) which may be Page 2 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined deemed to fit in the interest of the justice."
4. SUBMISSIONS ON BEHALF OF PETITIONER:
4.1 At the outset, learned counsel Mr. B.B. Gogia would submit that undisputedly, petitioner was not afforded any opportunity of hearing when the impugned communication dated 12.01.2018 was served upon him by the respondent, whereby recovery of Rs. 3,62,310/- has been sought from him. So, decision of respondent authority would suffers from violation of principles of natural justice then, requires to be quashed and set aside. 4.2 Learned counsel Mr. Gogoi would submit that petitioner was working as a Deputy Executive Engineer with the respondent Corporation, having retired from his service on 30.11.2007 reaching the age of superannuation, and recovery was sought in the year 2018, which is nothing but unauthorized and illegal action on the part of the respondent Corporation.
4.3 Learned counsel Mr. Gogoi would respectfully submit that as per Rule 28-A of the Gujarat Civil Services (Pay) Rules, 2002, the respondent Corporation was not Page 3 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined authorized to recover any amount, that too from the pension of petitioner. It is respectfully submitted that as per the reply and the documents submitted therewith, there was the alleged wrong fixation of pay scale of petitioner by the respondent Corporation resulted into the aforesaid recovery. It is respectfully submitted that as per the settled legal position of law, mere wrong fixation of pay scale would not be a ground for recovery of the amount from the petitioner, who is already retired from service.
4.4 Learned counsel Mr. Gogoi would respectfully submit that as per the recent decision of the Hon'ble Apex Court in the case of Jogeswar Sahoo and Others versus District Judge, Cuttack and Others reported in AIR 2025 SC 2291, more particularly, paragraphs 8 to 10 thereof, when principles of natural justice have been violated by the respondent Corporation and the petitioner is already retired from service, and that too in the year 2007, the impugned communication dated 12.01.2018 is required to be quashed and set aside. It is respectfully submitted that when there is no mala fide/fraud, and/or any misrepresentation by petitioner in getting the benefit Page 4 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined from service, the respondent employer has no right to recover the amount, may be paid on a mistaken decision, i.e., wrong fixation of the pay scale of petitioner. 4.5 Making the above submissions, learned cdvocate Mr. Gogia would request this Court to allow the present writ petition.
5. SUBMISSIONS ON BEHALF OF THE RESPONDENTS:-
5.1 Per contra, Mr. Kirit Patel, learned advocate appearing on behalf of Mr. H.S. Munshaw, learned counsel for the respondents would respectfully submit that the petitioner although retired from service in the year 2007, but the order of pay fixation of petitioner was passed in the year 2013, wherein, later on in audit found that there is some irregularity noted in the fixation of pay scale of petitioner, thereby the respondent Corporation subsequently decided to recover the excess amount, so paid to the petitioner due to wrong fixation of pay. It is respectfully submitted that when there is any wrong benefit granted to the petitioner on the Page 5 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined premise of fixation of the wrong pay scale, the respondent Corporation is well within its right to recover the amount.
5.2 Learned counsel Mr. Patel would respectfully submit that there is no ill-intention on the part of the respondent Corporation seeking recovery from the petitioner, and as such, it is not even a case of petitioner that the pay fixed by the respondent Corporation in the year 2013 was just and proper. It is submitted that after completion of the audit and to resolve the audit query, it was decided to recover the excess amount, so paid to the petitioner by way of the impugned communication dated 12.01.2018, which should not be disturbed by this Court while exercising its discretionary power.
5.3 Making the above submissions, learned AGP Mr. Patel would request this Court to dismiss the present writ petition.
5.4 No other and further submissions are made. Page 6 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025
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6. Heard learned counsels for the respective parties at length. The facts which emerge from the record and the submissions of the respective learned counsels as follow; 6.1 Petitioner got retired from service on 30.11.2007; thereafter, there was a revision of his pay fixed on 20.05.2013 whereby he was granted a higher pay scale. 6.2 The audit query raised some concern about the wrong fixation of pay scale of petitioner in the year 2015; thereby, ultimately, the respondent Corporation decided to recover the excess amount paid to the petitioner from his pension vide the impugned communication dated 12.01.2018.
6.3 Nonetheless, before affecting such recovery, undisputedly, no opportunity of hearing has been afforded to the petitioner. Likewise, it is not even remotely the case of the respondent Corporation that while pay was fixed by the respondent Corporation on 20.05.2013, any fraud or misrepresentation was made by the petitioner to get undue benefit from the respondent Corporation. Page 7 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025
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7. So, keeping the aforesaid facts and circumstances in mind, it would be apt to refer to the recent decision of the Hon'ble Apex Court in the case of Jogeswar Sahoo (supra), wherein after referring its previous decisions, it held thus;
"8. The law in this regard has been settled by this Court in catena of judgments rendered time and again; Sahib Ram vs. State of Haryana, 1995 Supp1 SCC 18 Shyam Babu Verma vs. Union of India, 1994 2 SCC 521 Union of India vs. M. Bhaskar, 1996 4 SCC 416 and V. Gangaram vs. Regional Jt. Director, 1997 6 SCC 139 and in a recent decision in the matter of Thomas Daniel vs. State of Kerala & Ors.,2022 SCCOnlineSC 536.
9. This Court has consistently taken the view that if the excess amount was not paid on account of any misrepresentation or fraud on the part 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 payments of emoluments or allowances are not recoverable. It is held that such relief against the recovery is not because of any right of the employee but in equity, exercising judicial discretion to provide relief to the employee from the hardship that will be caused if the recovery is ordered.
10. In Thomas Daniel (supra), this Court has held thus in paras 10, 11, 12 and 13:
"10. In Sahib Ram v. State of Haryana1 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 Page 8 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined 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 reported in (2006) 11 SCC 709 this Court considered an identical question as under:
"27. The last question to e 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 Page 9 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined 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. 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. Page 10 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025
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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 in-service 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. In Syed Abdul Qadir v. State of Bihar excess payment was sought to be recovered which was made to the appellants-teachers 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 Page 11 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined 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 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."
13. In State of Punjab v. Rafiq Masih (White Washer) wherein this court examined the validity of an order passed by the State to recover the monetary gains wrongly extended to the beneficiary Page 12 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined 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.
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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 Page 13 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined 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.
(emphasis supplied)"
8. Thus, considering the dictum of the aforesaid decision, having apply to the case on hand, it would be clear that the respondent Corporation could not have affected recovery of any excess amount inadvertently paid to the petitioner, that too without affording any opportunity of hearing and from his pension, as the case may be. When it is not proved on record that there is Page 14 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025 NEUTRAL CITATION C/SCA/3173/2018 JUDGMENT DATED: 25/11/2025 undefined any fraud or misrepresentation by petitioner in getting any undue advantage when his pay scale was fixed post- retirement, it is not permissible in law to affect the recovery from his pension.
CONCLUSION:-
9. So, in view of foregoing reasons, the recovery sought for by way of the impugned communication is considered to be an illegal one and hence, it requires to be quashed and set aside by this Court which I do so.
9.1 Consequently, the impugned communication dated 12.01.2018 vide No. Ma Na Paa/Hisabi/JA No.1716 [Annexure-A] passed by the respondent Corporation seeking recovery of Rs. 3,62,310/- from the pension of petitioner is hereby quashed and set aside. 9.2 Nonetheless, it is hereby observed and clarified that if any recovery was actually effected by the respondent Corporation from the petitioner in pursuance to the aforesaid impugned communication dated 12.01.2018, the same shall be re-paid to petitioner within 15 days from the date of receipt of copy of this order.
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10. In view of the foregoing conclusion, the present writ petition deserves to be allowed, which is hereby allowed. Rule is made absolute to the aforesaid extent. No orders as to costs.
(MAULIK J.SHELAT,J) DIWAKAR SHUKLA Page 16 of 16 Uploaded by MR. DIWAKAR SHUKLA(HC01778) on Thu Nov 27 2025 Downloaded on : Thu Nov 27 21:23:59 IST 2025