Himachal Pradesh High Court
Nitya Nand Sharma vs State Of Himachal Pradesh And ... on 11 October, 2023
Bench: Sandeep Sharma
IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA.
CWP No. 6427 of 2022 with
CWP Nos. 6831, 6810, 7196, 7236 of 2022, 1409, 4739 of 2023,
7046, 7049, 6821, 7330, 7025, 7329, 6751, 7451 of 2022,
CWP No. 3853, 1665, 2172 of 2023,
.
CWP No. 7572, 6787, 7485, 8086, 8186, 7486, 6814, 7214, 6820,
7616, 6562, 7068, 7164, 7262 and 7165 of 2022
Decided on: October 11, 2023
________________________________________________________
1. CWP No. 6427 of 2022
Nitya Nand Sharma ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
2. CWP No. 6831 of 2022
Rukmani Devi ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
3. CWP No. 6810 of 2022
Ram Lal
........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
4. CWP No. 7196 of 2022
Kundan Singh ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
5. CWP No. 7236 of 2022
Saroj Kumari ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
6. CWP No. 1409 of 2023
Kailash Sharma ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
7. CWP No. 4739 of 2023
Sunita Kumari ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
8. CWP No. 7046 of 2022
Purna Devi ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
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9. CWP No. 7049 of 2022
Ram Dassi Kaisth ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
.
10. CWP No. 6821of 2022
Chander Prabha ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
11. CWP No. 7330 of 2022
Yonten Negi ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
12. CWP No. 7025 of 2022
Ramesh Chand Rathore ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
13. CWP No. 7329 of 2022
Radha Chauhan ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
14. CWP No. 6751 of 2022
Tashi Palmo ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
15. CWP No. 7451 of 2022
Lok Pal ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
16. CWP No. 3853 of 2023
Narvada Panta ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
17. CWP No. 1665 of 2023
Meena Kanwar and another ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
18. CWP No. 2172 of 2023
Pratap Singh Sharma ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
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19. CWP No. 7572 of 2022
Ramesh Chand ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
20. CWP No. 6787 of 2022
.
Sunita Devi ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
21. CWP No. 7485 of 2022
Pawan Kumar ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
22. CWP No. 8086 of 2022
Anita Rathore ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
23. CWP No. 8186 of 2022
Narain Singh
r ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
24. CWP No. 7486 of 2022
Ramesh Kumar ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
25. CWP No. 6814 of 2022
Ram Singh Chauhan ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
26. CWP No. 7214 of 2022
Santosh Kumari ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
27. CWP No. 6820 of 2022
Kaushalya Sharma ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
28. CWP No. 7616 of 2022
Gautam Dev Bhardwaj ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
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29. CWP No. 6562 of 2022
Mohan Lal ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
30. CWP No. 7068 of 2022
.
Bhadur Singh ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
31. CWP No. 7164 of 2022
Hari Dass ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
32. CWP No. 7262 of 2022
Shashi Kiran ........... Petitioner(s)
Versus
State of Himachal Pradesh and others .. Respondents
33. CWP No. 7165 of 2022
Jur Dassi ........... Petitioner(s)
r Versus
State of Himachal Pradesh and others .. Respondents
________________________________________________________
Coram:
Hon'ble Mr. Justice Sandeep Sharma, Judge.
Whether approved for reporting? 1 Yes.
For the Petitioners : Mr. Prem Pal Chauhan, Advocate, for
the petitioners in CWP Nos. 6831,
6810, 7236 of 2022, 1409, 4739 of
2023, 7046, 7049, 6821, 7330, 7025,
7329, 6751 of 2022, CWP No. 1665,
2172 of 2023, CWP No. 7572, 6787,
8086, 6814, 7214, 6820, 7616, 6562,
7068, 7262 and 7165 of 2022
Mr. Raman Jamalta, Advocate, for
the petitioners in CWP No. 3853 of
2023
Mr. Ashwani K. Sharma, Advocate,
for the petitioners in CWP Nos. 7164,
7196, 7451, 7485, 7486 and 8186 of
2022.
For the respondents : Mr. Anoop Rattan, Advocate General
with Mr. Rajan Kahol, Mr. Vishal
Panwar and Mr. B.C. Verma,
1
Whether the reporters of the local papers may be allowed to see the judgment?
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5
Additional Advocates General & Mr.
Ravi Chauhan and Ms. Sunaina,
Deputy Advocates General.
________________________________________________________
Sandeep Sharma, Judge (oral):
.
Since the petitioners are aggrieved by same and similar action
of the respondents, on account of issuance of communication dated
7.1.2022, by the Department of Health, Himachal Pradesh, all the
petitions were clubbed together and now are being disposed of vide
this common order. However, for the sake of clarity, facts and
annexures of CWP No. 6427 of 2022, titled Nitya Nand Sharma v.
State of Himachal Pradesh and others are being taken note herein
below.
2. For having birds' eye view of the matter, facts, which are almost
common in all the cases are that the petitioners herein were initially
appointed as Male/Female Health Workers in the Health Department
in the pay scale of Rs.950-1800 (pre-revised scale of Rs.400-600).
3. Since, persons appointed prior to the petitioners were in receipt
of higher pay scale i.e. 510-940 (revised to 1365-2410 with effect from
1.1.19986 and again revised to Rs.4400-7000 with effect from
1.1.1996), petitioner herein approached this Court by way of CWP(T)
No. 14085 of 2008 titled Suresh Rana v. State of Himachal Pradesh
alongwith other petitions, which ultimately came to be decided vide
judgment dated 20.4.2010 (Annexure P-2), whereby this court allowed
the aforesaid petitions and struck down the cut-off date of 23.7.1990
being violative of Arts. 14 and 16 and directed respondents to release
the pay scale of Rs. 1356-2410 from initial date of appointment and
pay scale of Rs.4400-7000 with effect from 1.1.1996 alongwith interest
at the rate of 9% per annum.
4. Though, being aggrieved and dissatisfied with the judgment
.
passed by Hon'ble Single Judge of this court, respondent-State filed an
LPA before the Division Bench, but the same was dismissed. After
dismissal of the LPA, respondent-State filed SLP(C) No.12544 of 2013
titled State of Himachal Pradesh and others v. Ravinder Kumar &
Ors, which came to be decided vide order dated 1.5.2017 (Annexure
P-3), whereby Hon'ble Apex Court held that impugned order of High
Court in SLP(C) No. 12544 of 2013, dated 18.9.2012 in Jaya Devi Vs.
State of Himachal Pradesh & Ors. in CWP No. 5754 of 2010, will apply
to other cases also. In light of the aforesaid order passed by Hon'ble
Apex Court, though judgment dated 20.4.2010 passed by Hon'ble
Single Judge in Suresh Rana's case remained intact, save and except
the arrears, which were ordered to be restricted to three years prior to
the date of filing of the petition.
5. After passing of aforesaid order by Hon'ble Apex Court,
Department by way of various orders passed in the year 2017, refixed
the pay of the petitioners in the pay scale of Rs.1365-2410 as was
actually received by their predecessors
6. Now, pursuant to directions issued by Government of Himachal
Pradesh vide order dated 7.1.2022, (Annexure R-7), respondent
Department again revised the pay of the petitioners from Rs. 1365 to
1350 (Annexure P-1).
7. Consequent upon aforesaid re-fixation, now the petitioners
apprehend that the Department may initiate proceedings for recovering
the amount allegedly received in excess by the petitioner pursuant to
pay fixation done in his case vide order dated 22.8.2017 (Annexure P-
4).
.
8. Pursuant to notices issued in the instant proceedings,
respondents have filed reply, wherein facts, as have been noticed
herein above, have not been disputed rather stand admitted. It has
been stated by the respondents that pursuant to directions passed by
this court, pay of petitioners, who were appointees of the year 1991
was to be fixed at Rs.1350 i.e. initial of revised pay scale of Rs. 1350-
2410 corresponding pre-revised pay scale of Rs. 510-940 in the year
1991, with further subsequent benefits allowed from time to time
including higher pay scale of Rs.1365-2410 as on 1.1.1993 and further
revised from time to time, however, respondent No.4 Chief Medical
Officer, while making re-fixation of pay with effect from the year 1991,
vide communication dated 22.8.2017, Annexure P-4 erroneously fixed
pay of the petitioner at Rs.1410, over and above the admissible pay of
Rs.1350/-. As a result thereof, petitioners are in receipt of higher
inadmissible pay, which is required to be recovered from them. It has
been further stated by respondents that wrong and erroneous re-
fixation of pay came to their notice in the year 2020 when case of pay
anomaly of Devi Singh and Bimla Devi, Health Educators, at par with
other counterparts working as Multi Purpose Health Worker, was
received in the office of respondents.
9. Having heard learned counsel for the parties and perused the
material available on record, this court finds that there is no dispute
that pursuant to judgment dated 20.4.2010, passed in Suresh Rana's
case and others alongwith other similar cases, petitioners were
required to be granted pay scale of Rs.1365-2410 with effect from their
initial date of appointment and pay scale of Rs.4400-7000 with effect
.
from 1.1.1996 but inadvertently the authority concerned, while refixing
the pay with effect from 1991, erroneously fixed petitioners at higher
pay of Rs.1410/-, over and above the due and admissible pay of
Rs.1350/-
10. Though, Mr. Prem P. Chauhan, Mr. Raman Jamlta and Mr.
Ashwani K. Sharma, learned counsel appearing for the respective
petitioners, vehemently
argued that pay fixation
communication dated 22.8.2017, Annexure P-4 is strictly in terms of
r done
judgment passed by this court on 20.4.2010, which has attained finality
vide
upto Hon'ble Apex Court but having perused the aforesaid judgment in
its entirety, there appear to be merit in the contention of Mr. Anoop
Rattan, learned Advocate General that actually, in terms of judgment
taken note herein above, pay of the petitioners, was required to be
refixed at Rs.1350 and not Rs.1410.
11. On account of wrong pay fixation done vide communication
dated 22.8.2017, admittedly petitioners are in receipt of higher
inadmissible pay and as such, no illegality can be said to have been
committed by the respondents, while ordering refixation of the same in
the cases of all the petitioners in terms of instructions dated 7.1.2022,
pursuant to which various office orders refixing the pay of the
petitioners, came to be issued.
12. Next question which needs determination in cases at hand is
that, "whether the amount received in excess on account of wrong pay
re-fixation can be permitted to be recovered by the respondents after
five years of such wrong pay fixation.
13. Mr. Anoop Rattan, learned Advocate General, while justifying
.
the impugned action of the respondents, vehemently argued that once,
it is not in dispute that vide office order dated 22.8.2017, pay of the
petitioners was wrongly refixed at higher level of Rs.1410/- and such
fact came to the notice of the respondents in the year 2020, no illegality
can be said to be committed by them, while ordering pay refixation. He
submitted that though at this juncture there is nothing to suggest that
the Department is contemplating to recover the amount but even
otherwise, respondents are well within their right to recover the same,
because, if same is permitted to be retained by the petitioners, that
would amount to unjust enrichment. He further submitted that there is
sufficient material available on record suggestive of the fact that while
granting benefit of pay refixation vide order dated 22.8.2017, all the
petitioners were put to caveat that in case subsequently, audit
objection is raised or amount is found to be paid in excess, the same
shall be recovered from them.
14. Mr. Prem P. Chauhan, Mr. Raman Jamalta and Mr. Ashwani K.
Sharma, learned counsel for the petitioners, argued that that at the
time of grant of benefit of re-fixation vide communication dated
22.8.2017, petitioners were put to caveat that the amount paid in
excess can be recovered but only in the circumstance, where audit
objection is raised or recovery is effected within a period of five years.
He submitted that there is nothing on record or in the reply that audit
objection, if any, ever came to be raised by Audit party/office of
Accountant General, Himachal Pradesh, with regard to excess
payment, if any, made to the petitioners. Learned counsel for the
petitioners further submitted that there is nothing on record to show
.
that the amount in excess was paid on account of any mis-
representation on the part of the petitioners rather the same was
received pursuant to order dated 22.8.2017 passed by respondents in
compliance of judgment passed by this court, which has attained
finality upto the Hon'ble Apex Court
15. While inviting attention of this court to judgment passed by
Hon'ble Apex Court in State of Punjab and others v. Rafiq Masih,
(2015) 4 SCC 334,, learned counsel for the petitioners argued that
recovery, if any, from class III and IV employees is totally impermissible
in law, as such, respondents are restrained from effecting recovery on
account of excess payment. He also invited attention of this court to
judgment passed by Division Bench of this court in S.S. Chaudhary v.
State of H.P. & Others, decided on 24.3.2022, wherein, Division
Bench of this Court, having taken note of various judgments rendered
from time to time, including Rafiq Masih, laid down certain
parameters, whereby recovery by an employer would be impermissible
from the employees. He submitted that in Rafiq Masih, Hon'ble Apex
Court has held that the recovery on the basis of undertaking from the
employee is to be confined to Class I and II (Group A and Group B) but
definitely it cannot be effected from Class III and IV (Group C and D)
employees.
16. Mr. Anoop Rattan, learned Advocate General, while refuting
submissions made on behalf of learned counsel for the petitioners,
invited attention to judgment of Hon'ble Apex Court in Chandi Prasad
Uniyal & Ors. v. State of Uttarakhand, Civil Appeal No. 5899 of 2012,
decided on 17.8.2012 to state that any amount paid /received without
.
authority of law, can be recovered, barring few exceptions of extreme
hardships, but not as a matter of right. He submitted that since, in the
cases at hand, it stands established that the petitioners were not
entitled to the amount, which they erroneously received on account of
re-fixation of pay, as such, they are liable to refund the amount.
17. To explore the answer to the question formulated herein above,
in Rafiq Masih supra
r to
it would be apt to take note of judgment passed by Hon'ble Apex Court
"10. In view of the afore-stated constitutional mandate, equity and
good conscience, in the matter of livelihood of the people of this country,
has to be the basis of all governmental actions. 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. Or in
other words, till such time as the recovery would have a harsh and
arbitrary effect on the employee, it would be permissible in law. Orders
passed in given situations repeatedly, even in exercise of the power
vested in this Court under Article 142 of the Constitution of India, will
disclose the parameters of the realm of an action of recovery (of an
excess amount paid to an employee) which would breach the obligations
of the State, to citizens of this country, and render the action arbitrary,
and therefore, violative of the mandate contained in Article 14 of the
Constitution of India.
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.
12. Reference may first of all be made to the decision in Syed Abdul
Qadir v. State of Bihar, (2009) 3 SCC 475, 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. (1) SCC
18, 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, Col. B.J. Akkara (Retd.) v.
Govt. of India, (2006) 11 SCC 709, Purshottam Lal Das v. State of
Bihar, (2006) 11 SCC 492, Punjab National Bank v. Manjeet
Singh, (2006) 8 SCC 647 and Bihar SEB v. Bijay Bahadur, (2000)
10 SCC 99."(emphasis is ours)
13. 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. 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.
14. 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 pay-
scale 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 pay-scale 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.
15. Examining a similar proposition, this Court in Col. B.J. Akkara v.
Government of India, (2006) 11 SCC 709, 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. We are therefore satisfied in concluding, that such recovery
from employees belonging to the lower rungs (i.e., Class-III and Class-IV
- 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.
16. 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.
17. Last of all, reference may be made to the decision in Sahib Ram
Verma v. Union of India, (1995) Supp. 1 SCC 18, 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. 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. 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.
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.
18. Careful perusal of aforesaid judgment clearly reveals that the
judgment detailed herein above, came to be passed after passing of
judgment dated 8.7.2013 by a three Judge Bench of Hon'ble Apex
Court, wherein three judge bench, having taken note of divergent
views/findings given by other Benches of Hon'ble Apex Court, in
Shyam Babu Verma v. Union of India, (1994) 2 SCC 521, Sahib Ram
v. State of Haryana, 1995 Supp(1) SCC 18 and Chandi Prasad
Uniyal & Ors. v. State of Uttarakhand, Civil Appeal No. 5899 of 2012,
decided on 17.8.2012 , ... SCC 417, held that the observations made
by this court in Rafiq Masih supra, not to recover excess amount paid
to appellants in exercise of extraordinary jurisdiction under Art. 142 of
the Constitution of India, which vests power in this court to pass
equitable orders in the ends of justice."
19. After answering aforesaid reference by three Judge Bench
subsequent judgment dated 18.12.2014, in Rafiq Masih came to be
passed, wherein Hon'ble Apex Court having taken note of all the
aforesaid judgments including answer given by three Judge Bench
summarized certain situations, wherein recovery by employer would be
impermissible in law, which have been already reproduced above.
20. No doubt, in Chandi Prasad Uniyal supra, on which heavy
.
reliance was placed by learned Advocate General, held as under:
"14. We may point out that in Syed Abdul Qadir case such a
direction was given keeping in view of the peculiar facts and
circumstances of that case since the beneficiaries had either retired or
were on the verge of retirement and so as to avoid any hardship to them.
15. We are not convinced that this Court in various judgments
referred to hereinbefore has laid down any proposition of law that only if
the State or its officials establish that there was misrepresentation or fraud
on the part of the recipients of the excess pay, then only the amount paid
could be recovered. On the other hand, most of the cases referred to
hereinbefore turned on the peculiar facts and circumstances of those
cases either because the recipients had retired or on the verge of
retirement or were occupying lower posts in the administrative hierarchy.
21. In the aforesaid judgment, Hon'ble Apex Court categorically held
that court is concerned with the excess payment of public money which
is often described as "tax payers money" which belongs neither to the
officers who have effected over-payment nor that of the recipients.
Hon'ble Apex Court expressed their concern as to why the concept of
fraud or misrepresentation as being brought in such situations. In
nutshell in the aforesaid judgment, Hon'ble Apex Court held that in
many situations without any authority of law, payments have been
received by the recipients. Any amount paid/received without authority
of law can always be recovered barring few exceptions of extreme
hardships but not as a matter of right, in such situations law implies an
obligation on the payee to repay the money, otherwise it would amount
to unjust enrichment.
22. True it is that in terms of aforesaid judgment passed by Hon'ble
.
Apex Court, any amount paid/received without authority of law can
always be recovered but not in all situations rather in cases of extreme
hardships, employer can be restrained from effecting recovery.
23. Having taken note of Chandi Prasad Uniyal supra, Hon'ble
Apex Court in its subsequent judgment dated 18.12.2014, passed in
Rafiq Masih supra, detailed certain situations, wherein recovery would
be impermissible in law. Having perused aforesaid situations detailed
in para-18 of Rafiq Masih supra, this court is persuaded to agree with
learned counsel for the petitioners that after passing judgment in
Chandi Prasad Uniyal supra, Hon'ble Apex Court, culled out certain
principles to determine extreme hardships and thereafter categorically
formulated certain situations, wherein recoveries cannot be effected at
all.
24. In Rafiq Masih supra, recovery from class III and IV employees
have been held to be impermissible which in any situation cannot be
effected.
25. Though Mr. Anoop Rattan, Advocate General argued that since
undertaking was given by petitioners, at the time of refixation of their
pay, that in the event of detection of excess amount ,they shall be
liable to repay the same, judgment in Rafiq Masih, shall not apply in
their case, but having perused para-18 of the judgment in Rafiq Masih,
this court is not persuaded to agree with Mr.Anoop Rattan, learned
Advocate General on two counts, firstly, recovery from Class III and IV
employees is totally impermissible and secondly, recovery if any of
excess amount cannot be made after five years.
26. In the cases at hand, admittedly refixation of pay in terms of
.
judgment was done in the year 2017, whereas, order to correct the
mistake which allegedly occurred in 2017 came to be passed in the
year 2020 as a result whereof, sword is hanging over heads of
petitioners of recovery.
27. Recently, Division Bench of this court, in S.S. Chaudhary supra,
having taken note of various judgments passed by Hon'ble Apex Court
including in Rafiq Masih, laid down certain situations, recovery would
be impermissible from the employees. It would be apt to take note of
following para of S.S. Chaudhary supra:
"35. In view of the aforesaid discussion, as held by Hon'ble Supreme
Court in Rafiq Masih's case (supra), it is not possible to postulate all
situations of hardship, where payments have mistakenly been made
by the employer, yet in the following situations, recovery by the
employer 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.
(vi) Recovery on the basis of undertaking from the employees
essentially has to be confined to Class I/Group-A and Class-
II/Group-B, but even then, the Court may be required to see
whether the recovery would be iniquitous, harsh or arbitrary to
such an extent, as would far overweigh the equitable balance
of the employer's right to recover.
(vii) Recovery from the employees belonging to Class-III and
Class-IV even on the basis of undertaking is impermissible.
(viii) The aforesaid categories of cases are by way of illustration
and it may not be possible to lay down any precise, clearly
defined, sufficiently channelised and inflexible guidelines or
rigid formula and to give any exhaustive list of myriad kinds of
cases. Therefore, each of such cases would be required to be
.
decided on its own merit."
28. In the aforesaid judgment Division Bench has clarified that
recovery on the basis of undertaking from employees, essentially is to
be confined to Class I and II employees (Group A and B) meaning
thereby recovery is otherwise totally impermissible from Class III and
IV employees. In the aforesaid Division Bench has decided that
recovery though is permissible from employees of Class I and II (Group
A and B) on account of undertaking but in case court comes to
conclusion that same is iniquitous, harsh and arbitrary, it may
intervene.
29. Hon'ble Apex Court in Thomas Daniel v. State of Kerala
reported in [2022 SCC Online SC 536], taking note of Rafiq Masih,
held the recovery from employees therein to be bad as the same was
not due to any mis-representation or fraud by them, rather was the
result of misinterpretation of the service rules and came to the notice of
the employer on being pointed out by the office of Accountant General.
Hon'ble Apex Court held as under:
"(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.".
30. Since in the cases at hand, all the petitioners are Class III
employees and recovery is sought to be effected from of amount which
was erroneously paid to them five years back, hence, this court is
.
justified in exercising power under Art. 226 of the Constitution of India
to interfere.
31. This court finds sufficient merit in all the petitions and the same
are disposed of with the following directions:
(i) Though the orders of re-fixation of pay of the petitioners
in the year 2022, thereby fixing the pay in the pay scale of
1350-2410, are upheld, but the respondents are directed
not to make any recovery from the petitioners, on the
basis of same.
(ii)
Amount, if any recovered from the petitioner(s), shall be
paid back to them forthwith, within four weeks from today.
32. All the petitions stand disposed of in the afore terms, alongwith
all pending applications.
(Sandeep Sharma)
Judge
October 11, 2023
Vikrant
