Paramesh Sarma vs The State Of Assam And 5 Ors
2025 Latest Caselaw 5537 Gua

Gauhati High Court

Paramesh Sarma vs The State Of Assam And 5 Ors on 19 June, 2025

Author: Devashis Baruah

Bench: Devashis Baruah

                                                                 Page No.# 1/14

GAHC010002342024




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                      THE GAUHATI HIGH COURT
  (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

                        Case No. : WP(C)/304/2024

         PARAMESH SARMA
         S/O LATE SATISH CH. SARMA, R/O RAMNAGAR, GUWAHATI, P.O.-
         NOONMATI, P.S.-NOONMATI, DIST- KAMRUP, DIST- KAMRUP (M), ASSAM,
         PIN-781020



         VERSUS

         THE STATE OF ASSAM AND 5 ORS
         JUDICIAL DEPARTMENT, GOVERNMENT OF ASSAM

         2:THE OFFICE OF THE DESIGNATED JUDGE
          KAMRUP (M)
          GUWAHATI-781001

         3:THE OFFICE OF THE PRINCIPAL ACCOUNTANT GENERAL (A AND E)
         ASSAM
          MAIDAMGAON
          BELTOLA
          GUWAHATI-781029

         4:THE SENIOR ACCOUNTS OFFICER
         ACCOUNTANT GENERAL (A AND E)
         ASSAM
          MAIDAMGAON
          BELTOLA
          GUWAHATI-781029

         5:THE TREAUSRY OFFICER
          KAMRUP (METRO)
         ASSA
                                                                 Page No.# 2/14

Advocate for the Petitioner   : Mr. R. Sarma, Advocate

Advocate for the Respondents: Mr. T. R. Gogoi, Govt. Advocate
                              Mr. H. K. Das, SC, GHC
                              Mr. B. Chakraborty, SC, AG
                              Mr. A. Chaliha, Advocate

                                BEFORE
          HONOURABLE MR. JUSTICE DEVASHIS BARUAH

                       Date of Hearing      : 19.06.2025

                       Date of Judgment      :19.06.2025
                       JUDGMENT AND ORDER (ORAL)

Heard Mr. R. Sarma, the learned counsel appearing on behalf of the petitioner. Mr. T. R. Gogoi, the learned Government Advocate appears on behalf of the respondent No.1; Mr. H. K. Das, the learned counsel appears on behalf of the respondent No.2; Mr. B. Chakraborty, the learned counsel appears on behalf of the respondent Nos.3 & 4 and Mr. A. Chaliha, the learned counsel appears on behalf of the respondent No.5.

2. The petitioner herein has approached this Court challenging the recovery of an amount of Rs.1,83,583/- from the petitioner and submitted that the said recovery so made from the petitioner was contrary to the law laid down by the Supreme Court in the case of State of Punjab and Others vs. Rafiq Masih (White Washer) and Others ,

reported in (2015) 4 SCC 334 wherein the parameters were laid Page No.# 3/14

down by the Supreme Court as to when recovery would not be permissible under law.

3. For ascertaining the said dispute, this Court finds it relevant to take note of the brief facts which led to the filing of the present proceedings.

4. On the basis of an order dated 14.11.1991, the petitioner was appointed as a Lower Division Assistant in the scale of pay of Rs.1065-20-1225-30-1345-ED-40-1635-50-2035-60-2095/- with other allowances as admissible under the Rules. Subsequent thereto, the petitioner was promoted to the post of Upper Division Assistant on the basis of an order dated 08.04.2004. The petitioner continued to render his service as an Upper Division Assistant till he retired on 31.12.2021.

5. The respondent No.4 had issued a letter on 10.04.2023 informing the respondent No.2 that in pursuance to the letter dated 09.03.2023, the application of the petitioner was forwarded for final withdrawal of the sums to the credit of the petitioner's GPF Account No.ORS/4986 and an amount of Rs.8,39,732/- representing the entire/available/residual deposit with interested calculated up to June, 2022.

6. In the meantime, there was another communication issued by the respondent No.4 dated 02.12.2022 to the respondent No.5 that the Government of Assam had issued a letter dated 07.11.2022 Page No.# 4/14

thereby sanctioning an amount of Rs.7,27,922/- being the commuted value of Rs.7,403/- out of the pension of Rs.22,210/- per month in respect to the petitioner being the retired Upper Division Assistant and holder of the Pension Paying Order No.919111295296. It was also mentioned that a reduced pension of Rs.14,807/- per month consequent on first commutation be paid to the petitioner from the date of receipt of the CVP by the petitioner or three months from the issue of the authority whichever is earlier. It was mentioned that the pension shall restore after 14 years (in the case of Assam Government Pensioners)/15 years in case of AIS Pensioners and Higher Judicial Pensioners of the Assam Government from the date of commencement of the reduced pension.

7. The respondent No.4 also informed the respondent No.5 to arrange payment of Rs.8,72,655/- to the petitioner after recovery of an amount of Rs.1,83,583/- which is to be recovered from the arrear and future relief.

8. Taking into account that the petitioner's pension and the other pensionary benefits would be withheld, the petitioner was compelled to deposit an amount of Rs.1,62,648/- in Kamrup Treasury on the alleged ground that there was an overpayment of pay and allowances.

9. It is the specific case of the petitioner that there was no fraud Page No.# 5/14

or misrepresentation committed by the petitioner which had resulted in an overdrawal of Rs,1,83,583/- which is sought to be recovered from the petitioner.

10. Being aggrieved by the action on the part of the respondent authorities to recover the amount of Rs.1,83,583/- out of which Rs.1,62,648/- the petitioner had to pay under compulsion, the present petition has been filed challenging the recovery which is being sought to be done, that too after the petitioner had retired from his service.

11. It is relevant to take note of that vide an order dated 22.01.2024, notice was issued upon the respondents. The respondent Nos.3 & 4 have filed an affidavit-in-opposition wherein it was mentioned that the DDO, i.e. the respondent No.2 while forwarding the pension papers of the petitioner had enclosed the Form-19 wherein it was specifically mentioned that there was an overpayment of pay and allowances to the tune of Rs.1,45,358/- and Rs.17,290/- being the leave salary and overdrawn of gratuity respectively. It was mentioned that the petitioner had already deposited an amount of Rs.1,62,648/-. It was further mentioned that in addition to the deposit so made by the petitioner being Rs.1,62,648/-, an amount of Rs.20,935/- remained as the excess provisional DCRG which was required to be recovered.

12. This Court finds it relevant to take note of the communication Page No.# 6/14

which was issued by the respondent No.2 to the respondent No.3 which is enclosed as Annexure R4-I wherein it has been mentioned that there was an overpayment of pay and allowances including leave salary of Rs.1,45,358/- and leave salary of Rs.17,290/-. It was further mentioned that there was an overdrawn of gratuity of Rs.25,935/- and the total amount comes to Rs.1,88,583/-. The said communication however do not mention as to during which period there was overpayment of pay and allowances or leave salary or overdrawn of the gratuity.

13. This Court now finds it relevant to take note of that there is no allegations made by the respondents by filing any affidavit before this Court inspite of due opportunity being granted that the overdrawn of pay, leave salary as well as the gratuity was on account of any fraud or misrepresentation committed by the petitioner.

14. This Court further finds it relevant to take note of a recent judgment of the Supreme Court in the case of Jogeswar Sahoo and Others vs. District Judge, Cuttak and Others , reported in 2025 SCC

OnLine SC 724 wherein the Supreme Court after dealing with the law

in respect to recovery of overdrawn amount had held the circumstances in which recovery was not permissible. Paragraph Nos.8 to 11 of the said judgment being relevant is reproduced herein under:-

Page No.# 7/14

"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 Haryana1, Shyam Babu Verma vs. Union of India, Union of India vs. M. Bhaskar and V. Gangaram vs. Regional Jt. Director and in a recent decision in the matter of Thomas Daniel vs. State of Kerala & Ors.

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 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 Page No.# 8/14

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 India2 this Court considered an identical question as under:

"27. The last question to be considered is whether relief should be granted against 7 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 Page No.# 9/14

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 8 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 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 Page No.# 10/14

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 9 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 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 Page No.# 11/14

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 10 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 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 Page No.# 12/14

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, 11 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. xxxxxxxxx

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 Page No.# 13/14

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."

15. This Court finds it very pertinent to take note of that the Supreme Court in the case of Jogeswar Sahoo and Others (supra) had duly taken note of the judgment of the Supreme Court in the case of Rafiq Masih (White Washer) and Others (supra) wherein the Supreme Court categorically observed the five circumstances when it shall be impermissible for the purpose of making any recovery. Amongst the five situations, the first situation is in respect of recovery from employees belonging to Class III and Class IV services (or Group C and Group D services) and the second situation being recovery from retired employee or employees who are due to retire within one year of the order of recovery.

16. In the instant case, it is an admitted fact that the recovery was sought to be made from the petitioner who was a Group C/Class III employee and further, the petitioner had already retired as far back as on 31.12.2021. Under such circumstances, the recovery which has been sought to be made from the petitioner was contrary to the law laid down by the Supreme Court in the Page No.# 14/14

case of Rafiq Masih (White Washer) and Others (supra) as well as the judgment in the case of Jogeswar Sahoo and Others (supra). In that view of the matter, this Court therefore interferes with the actions of recovery of the respondents from the petitioner on the basis of the communication issued by the respondent No.2 to the respondent No.3 enclosed as Annexure R4-I.

17. This Court further taking into account that under compulsion the petitioner had to deposit the amount of Rs.1,62,648/- directs the respondent Nos.2, 3 & 4 to take appropriate steps so that the said amount of Rs.1,62,648/- be refunded to the petitioner at the earliest and not later than 30 days from the date a certified copy of this order is served upon the respondent No.2. This Court further observes that there shall be no recovery from the petitioner on the basis of Annexure R4-I.

18. With the above observations and directions, the instant petition stands disposed of.

JUDGE

Comparing Assistant