Branch Manager Allahabad Bank vs Smt. Sangita Mishra
2021 Latest Caselaw 3740 Chatt

                                 1


                                                                AFR

        HIGH COURT OF CHHATTISGARH BILASPUR

                    Writ Appeal No.46 of 2019

Branch Manager, Allahabad Bank, at Branch Office, Tilda Road,
Simga, District Baloda Bazar - Bhatapara, Chhattisgarh
                                                     ---- Appellant
                             Versus
1.   Smt. Sangita Mishra, Widow of Late Shri Baldau Prasad
     Mishra, aged about 55 years, resident of Mahamaya Para,
     Ward No.15, Simga, District Baloda Bazar - Bhatapara,
     Chhattisgarh
2.   State of Chhattisgarh through the Secretary, Department of
     School Education, Mahanadi Bhawan, Mantralaya, New
     Raipur, District Raipur, Chhattisgarh.
                                               ---- Respondents

For Appellant : Mr. Harishankar Patel, Advocate For Respondent No.1 : Mr. Ajay Shrivastava, Advocate For Respondent No.2 : Mr. Ishan Verma, Panel Lawyer

Date of hearing : 17.11.2021 Date of Judgment : 16.12.2021

Hon'ble Shri Arup Kumar Goswami, Chief Justice

Hon'ble Shri Goutam Bhaduri, Judge

C A V Judgment

Per Arup Kumar Goswami, Chief Justice

Heard Mr. Harishankar Patel, learned counsel for the

appellant; Mr. Ajay Shrivastava, learned counsel appearing for

respondent No.1 and Mr. Ishan Verma, learned State counsel

appearing for respondent No.2.

2. This writ appeal is presented against an order dated

25.10.2018 passed by the learned Single Judge in Writ Petition (S)

No.6996 of 2018, whereby the learned Single Judge set aside the

order dated 01.10.2018 and directed the respondent No.1 (appellant

herein) to refund back the amount recovered, if any, forthwith while

reserving liberty to the respondents to make rectification of the

erroneous fixation of pension of the petitioner.

3. For the sake of convenience, respondent No.1 in this appeal

will be referred to as the petitioner and respondent No.2 in the appeal

as respondent No.2.

4. The husband of the petitioner was a Head Master, who retired

on superannuation on 30.06.2010. He died in harness on 12.06.2012

and consequent thereto, the petitioner was granted family pension.

5. The proximate cause for approaching this Court under Article

226 of the Constitution of India is the order dated 01.10.2018, which

came to the challenged in the petition. The order reads as follows :

"SIMGA 01.10.2018 Smt. Sangita Mishra W/o Baldeu Prasad Mishra, Mahamaya Para, Ward No.15 Simga Dist.-Baloda Bazar

Dear Sir/Madam,

RECOVERY IN PENSION ACCOUNT

Please refer to our letter dated 01.10.2018

wherein you have been advised to deposit excess

pension payment amounting to Rs.369486. As

you have not deposited the required amount we

have deducted Rs.15337/- from the pension for

the month of September 2018 and hold

Rs.200000/- in the account No.50060648233 for

remittance of Government in the month of October

2018. For balance amount of Rs.154149, Rs.5600

pm will be deducted wef Nov 2018 Pension till

final recovery.

Please acknowledge receipt.

Your's faithfully

Sd/-

Sr Manager"

6. The learned Single Judge observed that wrong fixation was

made by the respondents, for which the petitioner cannot be blamed in

absence of any allegation of misrepresentation or fraud and in that

circumstance, all that the State can do is to rectify the error. It was held

that the State cannot recover the amount which has already been paid

to the employee. While holding so, the learned Single Judge relied on

a judgment of the Hon'ble Supreme Court in the case of State of

Punjab and Others v. Rafiq Masih (White Washer) etc. , reported in

2015 AIR SCW 501 [(2015) 4 SCC 334].

7. Mr. Harishankar Patel, learned counsel for the appellant-Bank

submits that without affording any opportunity of hearing to the

appellant, order under challenge had been passed and therefore, on

that ground alone, the order of the learned Single Judge is liable to be

set aside and quashed. Placing reliance on a memo dated 21.07.2019

filed in the present proceedings, the learned counsel submits that

excess amount of the pension was paid to the petitioner inadvertently.

As per Pension Payment Order ('PPO'), the petitioner was entitled for

basic pension of Rs.10,385/- up to 15.06.2015 and thereafter from

16.06.2015, the basic pension ought to be reduced to Rs.6,231/-.

However, the pension amount was being paid @ Rs.10,385/- up to

31.08.2018 and this fact was first time detected at the time of fixation

of pension as per new salary revision of the State. It is submitted that

excess payment made to the pensioner was not questioned by the

State authorities and when the excess payment was detected,

recourse was taken for recovery of the amount as per the circular

dated 17.03.2016 issued by the Reserve Bank of India, which

permitted recovery of over payment / excess payment made to

pensioner. He has submitted that the learned Single Judge committed

error in law in relying on the decision of Hon'ble Supreme Court in the

case of Rafiq Masih (supra) inasmuch as the petitioner had

undertaken to refund or make good any excess amount paid at the

time of applying for family pension. It is also contended by him that the

petitioner also knew that she was being paid excess payment and

therefore, it cannot be said that the Bank alone was responsible for

excess payment. In support of his contention, the learned counsel

relies on the decision of the Hon'ble Supreme Court in Chandi Prasad

Uniyal and Others v. State of Uttarakhand and Others , reported in

(2012) 8 SCC 417 as well as in the case of High Court of Punjab &

Haryana and Others v. Jagdev Singh, reported in (2016) 14 SCC 267.

8. Per contra, Mr. Ajay Shrivastava, learned counsel for the

petitioner, while supporting the impugned order of the learned Single

Judge, has contended that the petitioner is an illiterate lady and she

knew only how to sign and that the Bank had taken number of

signatures to release the pension and it is on the basis thereof, a so-

called letter of undertaking was also signed. He submits that the

original undertaking is not readable and no reference of PPO was

given, the relevant portion having been kept blank and therefore, no

action can be taken on the basis of such an undertaking. In this

connection, he has referred to the undertaking brought on record by

the appellant at page-34 of the appeal papers, which is original as well

as to the one at page-40 of the appeal papers, which is a photocopy,

wherein the PPO number is recorded. Apparently, PPO number was

inserted therein, later on, he submits. It is contended that in the

attending facts and circumstances, the basic issue raised in the writ

petition being a legal question, when opportunity is granted by this

Court in the writ appeal, the appeal may not be allowed only the

ground that the notice was not issued to the appellant herein at the

time of disposal of the writ petition.

9. We have considered the submissions of learned counsel

appearing for the parties and have perused the materials on record.

10. The writ petition was filed on 08.10.2018 and the same came

to be disposed of on 25.10.2018. Perusal of the order dated

25.10.2018 goes to show that names of the counsel for the petitioner

as well as for the State counsel are only recorded. Evidently, the

appellant, which was respondent No.2 in the writ petition, was not

heard at the time of passing of the order.

11. Though appellant was not heard before the learned Single

Judge, since as rightly submitted by learned counsel for the petitioner

that this Court is basically confronted with a legal question as to

whether recovery can be effected in the present fact situation, we are

of the considered opinion that on the ground of violation of principles of

natural justice, the order of the learned Single Judge need not to be

interfered with as the appellant is granted full opportunity of hearing in

the writ appeal.

12. Relevant portion of circular dated 17.03.2016 issued by the

Reserve Bank of India is extracted hereinbelow :

           "Recovery        of   excess      payments   made   to

           pensioners


                        *        *       *    *


                        *        *       *    *

a) As soon as the excess/wrong payment made

to a pensioner comes to the notice of the

paying branch, the branch should adjust the

same against the amount standing to the credit

of the pensioner's account to the extent

possible including lumpsum arrears payment.

b) If the entire amount of over payment cannot

be adjusted from the account, the pensioner

may be asked to pay forthwith the balance

amount of over payment.

c) In case the pensioner expresses his inability

to pay the amount, the same may be adjusted

from the future pension payments to be made

to the pensioners. For recovering the over-

payment made to the pensioner from his future

pension payment in installments 1/3rd of net

(pension + relief) payable each month may be

recovered unless the pensioner concerned

gives consent in writing to pay a higher

installment amount.

d) If the over payment cannot be recovered

from the pensioner due to his death or

discontinuance of pension then action has to be

taken as per the letter of undertaking given by

the pensioner under the scheme.

e) The pensioner may also be advised about

the details of overpayment/wrong payment and

mode of its recovery."

13. In Chandi Prasad Uniyal (supra), Hon'ble Supreme Court

observed that it has not laid down as a principle of law that only if there

is misrepresentation or fraud on the part of the recipients of the money

in getting the excess pay, the amount paid due to such irregular /

wrong fixation of pay can be recovered. The Hon'ble Supreme Court

further observed that any amount received by the recipient without the

authority of law can always be recovered barring a few exceptions of

extreme hardships but not as a matter of right and taking note of the

facts of the case, as presented, it was held that the case of the

appellants therein did not fall in any of the exceptional categories and

that apart, there was a stipulation in the fixation order that in case of

irregular / wrong pay fixation, the institution in which the appellant were

working would be responsible for recovery of the amount received in

excess from the salary / pension.

14. In Rafiq Masih (supra) at paragraphs-6 & 7, the Hon'ble

Supreme Court observed as follows :

"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 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.

7. Having examined a number of judgments

rendered by this Court, we are of the view, that

orders passed by the employer seeking recovery

of monetary benefits wrongly extended to

employees, can only be interfered with, in cases

where such recovery would result in a hardship of

a nature, which would far outweigh, the equitable

balance of the employer's right to recover. In other

words, interference would be called for, only in

such cases where, it would be iniquitous to

recover the payment made. In order to ascertain

the parameters of the above consideration, and

the test to be applied, reference needs to be

made to situations when this Court exempted

employees from such recovery, even in exercise

of its jurisdiction under Article 142 of the

Constitution of India. Repeated exercise of such

power, "for doing complete justice in any cause"

would establish that the recovery being effected

was iniquitous, and therefore, arbitrary. And

accordingly, the interference at the hands of this

Court."

15. It was further held in Rafiq Masih (supra) that an action of the

State, ordering a recovery from an employee, would be in order, so

long as it is not rendered iniquitous to the extent, that the action of

recovery would be more unfair, more wrongful, more improper, and

more unwarranted, than the corresponding right of the employer, to

recover the amount. It is also held that recovery from employees in

lower rung of service, would result in extreme hardship to them as it is

considered that the 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.

16. After a detailed analysis of the case law on the subject,

Hon'ble Supreme Court in Rafiq Masih (supra) at paragraph-18

observed as follows :

"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.

(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."

17. In Jagdev Singh (supra), recovery was sought to be effected

from a Civil Judge, Junior Division, who was placed under suspension

and who was eventually compulsorily retired. The Hon'ble Supreme

Court took note of the fact that when the Civil Judge had opted for the

revised pay scale, he furnished an undertaking as required under the

relevant Rules to the effect that he would be liable to refund any

excess payment made to him. In view of the above position, the

Hon'ble Supreme Court in Jagdev Singh (supra) held that proposition

(ii) of Rafiq Masih (supra) would not apply as the person to whom the

payment was made in the first instance was clearly placed on notice

that any payment found to have been made in excess would be

required to be refunded and as the officer had furnished an

undertaking while opting for the revised pay scale.

18. The undertaking at page-34 of the appeal papers produced by

the appellant is not readable. While in the said document, PPO

number is not reflected, in the letter of undertaking at page-40 of the

appeal papers, PPO number is incorporated. While page-34 appears

to be original, page-40 is, decidedly, a photocopy. If the Bank wants to

rely on an undertaking given by the pensioner, least to be expected is

that the same is readable and comprehensible. We are of the

considered opinion that even though the petitioner acknowledges her

signature in the said document, on the basis of such a document,

appellant cannot act upon for the purpose of recovery of any excess

amount.

19. No doubt, there is a guideline issued by the Reserve Bank of

India dated 17.03.2016, but such guideline has to be considered in the

light of the judgments pronounced by the Hon'ble Supreme Court with

regard to the permissibility or otherwise of recovery of amount from the

employees.

20. Perusal of the PPO indicates that from 16.06.2015, amount of

pension is reduced to Rs.6,231/-. It is on the basis thereof, the

contention is advanced by the learned counsel for the appellant that

the petitioner is also aware that she is being paid pension beyond what

is her entitlement. When the petitioner, as noted earlier, is an illiterate

lady, we are of the considered opinion that such a stipulation in the

PPO may not lead to the conclusion that in spite of being aware of the

factual situation, the petitioner did not inform the Bank about the

excess payment being made to her.

21. The basic question that arises is whether in terms of the

judgments as noted above, recovery was at all permissible in respect

of the petitioner.

22. Assuming that the undertaking given by the petitioner is

applicable, then also, in our considered opinion, as her husband

indisputably belonged to Class-III service, recovery from the petitioner

is not permissible in terms of proposition No. (i) in paragraph 18 of the

judgment rendered in Rafiq Masih (supra). It is also to be recorded that

in Jagdev Singh (supra), in the context of an undertaking given by an

employee, the proposition No. (ii) was only held to be not applicable.

23. In that view of the matter, we find no good ground to interfere

with the order of the learned Single Judge and accordingly, the writ

appeal is dismissed. No costs.

                       Sd/-                                   Sd/-
            (Arup Kumar Goswami)                       (Goutam Bhaduri)
                  Chief Justice                             Judge

Anu