Ut Of J&K And Others vs Muzammal Shah And Others
2023 Latest Caselaw 852 j&K

                                                                     Sr. No. 33

        .HIGH COURT OF JAMMU & KASHMIR AND LADAKH
                         AT JAMMU

                                                      WP(C) No. 1806/2022
                                                      CM No. 5058/2022

UT of J&K and others                                       ....Petitioner(s)/Appellant(s)

                    Through :- Mr. R S Jamwal, AAG.

         V/s

Muzammal Shah and others                                             ....Respondent(s)


                    Through :-   Mr. Sheikh Najeeb, Advocate.

Coram: HON'BLE MR. JUSTICE TASHI RABSTAN, JUDGE
          HON'BLE MR. JUSTICE PUNEET GUPTA, JUDGE

                                     ORDER

03.05.2023 TASHI RABSTAN,J:

1. Present writ petition has been filed by the petitioners under Article 226

read with Article 227 of the Constitution of India against the order dated

28.04.2021 passed by the Central Administrative Tribunal, Jammu Bench,

Jammu in T. A. No. 1580/2020 clubbed with O.A. No. 668/2021 whereby the

Tribunal has inter alia directed that the petitioners herein shall not recover the

amount already paid, in the form of higher scales of pay, and in case, any

component was recovered, the same shall be refunded without interest within a

period of three months from the date of receipt of a copy of this order.

2. Relief prayed for in this writ petition is as:

"Issue an appropriate writ quashing the impugned order dated 28.04.2021 passed by the Hon'ble Central Administrative Tribunal, Jammu Bench, Jammu in Transfer Application No.1580/2020 (SWP No.15/2019) clubbed with OA No.668/2021 titled Muzammal Shah and others v. State of J&K and others to the extent whereby it has been directed to return the recovered amount to the respondents herein."

3. The facts of the case in nutshell are:

That the respondents herein were initially engaged in the department

on daily rated basis and thereafter came to be regularized on permanent basis. In

the year 1993, a Circular came to be issued vide No. PHEJ/20094-20013 dated

08.03.1993 which provided for grant of one Higher Pay Grade to those officials

who are working in lower grades of the posts shall be placed in the higher grades

subject to various conditions. On 11.06.1993, another circular No. PHEJ/3417-

37 dated 11.06.1993 whereby it has been provided that all those employees who

have notionally completed at least three years in the lower grade and have

physically worked against the post for at least one year shall be eligible for

promotion to the next higher grade.

It is averred in the petition that in compliance of Government Order

No.277-F dated 06.06.2018, the Chief Engineer PHE Department Jammu had

issued a Circular bearing No. PHEJ/GE/12082-114 dated 10.11.2018 directing

therein not to extend the benefits to those employees who were borne on regular

establishment after 1993 and had further directed that the benefits so extended

are hereby withdrawn with immediate effect and extra salary paid shall be

recovered under rules from the salary of the employees.

Aggrieved of the Government order dated 06.06.2018 (supra) and the

subsequent circular, respondents filed writ petition SWP No.15/2019 which was

transferred by this court to Central Administration Tribunal and renumbered as

TA No.1580/2020. Petitioners are aggrieved of the order passed in the aforesaid

TA which constrained them to file the present writ petition.

4. The impugned order is challenged by the petitioners, inter alia, on the

following grounds:

" a. Because all the respondents herein got regularized w.e.f. "

01.04.1994, as such, were not entitled to the benefit under Circular No.PHEJ/20094-20113 dated 18.03.1993 read with modification issued vide No.PHEJ/3417-37 dated 11.06.1993 on the ground that the said benefit was extendable to those employees only who had been engaged prior to issuance of Circular No.PHEJ/20094-20113 dated 18.03.1993 read with modification issued vide No.PHEJ/ 3417-37 dated 11.06.1993.

b. Because the Chief Engineer PHE Department Jammu had issued a Circular vide No.PHEJ/GE/12082-114 dated 10.11.2018 for not giving the benefits to those employees who were borne on regular establishment after 1993 in furtherance of Government Order No.277-F of 2018 dated 06.06.2018, whereby directed that the benefits so extended are hereby withdrawn with immediate effect and extra salary paid shall be recovered under rules from the salary of the employees. In view of the circular mentioned herein above issued by the Chief Engineer, the benefits extended to the respondents were also subject to withdrawal and accordingly the extra salary paid to the respondents was required to be recovered and as such, the action was initiated.

c. Because the order/judgment impugned dated 28.04.2021 is required to be set aside on the ground that as per the instructions vide Circular No.PHEJ/GE/12082-114 dated 10.11.2018 for not extending the provisions of Circular of 06/1993 of Chief Engineer, PHE Department Jammu for stepping up of grade of any category of the field staff stood repealed with immediate effect, therefore, the benefits so extended to the respondents also stood withdrawn in view of the same. It may not be out of place to mention that the provision of Benefits for Career Progression at present are available under SRO 14 of 1996 dated 15.01.1996, therefore, any other provision for grant of benefit for extra salary had no legal basis, as such the Chief Engineer, PHE, Jammu in compliance to Government Order No.277-F of 2018 dated 06.06.2018 had issued Circular vide No.PHEJ/GE/12082-114 dated 10.11.2018 for withdrawal of benefits so extended with immediate effect."

5. Mr. R. S. Jamwal, learned AAG appearing for the petitioners submits

that the Tribunal has not appreciated the facts of the case in its true perspective,

which has resulted in passing of the order impugned, which cannot be sustained

in the eye of law inasmuch as the Chief Engineer PHE Department Jammu had

issued a Circular vide No. PHEJ/GE/12082-114 dated 10.11.2018 for not giving

the benefits to those employees who were borne on regular establishment after

1993 in furtherance of Government Order No.277-F of 2018 dated 06.06.2018. It

is further the contention of the learned AAG that since the respondents got

regularized in the year 1994, therefore, they are not entitled to the benefit under

Circular No.PHEJ/20094-20113 dated 18.03.1993 read with modification issued

vide No.PHEJ/3417-37 dated 11.06.1993 for the reason that the said benefit was

extendable to those employees only who had been engaged prior to issuance of

aforesaid circular and its subsequent modification.

6. On the other hand, Mr. Sheikh Najeeb, learned counsel appearing for

the respondents has supported the order passed by the Tribunal. In support of his

case, learned counsel has placed reliance on the judgment passed by the Supreme

Court in the case Thomas Daniel v. State of Kerala & Ors reported at AIR

2022 SC 2153.

7. Heard learned counsel for the parties and perused the impugned order.

8. The issue of recovery from Class-IV employees is no longer res

integra.

9. This Court in a catena of decisions has consistently held that if the

excess amount was not paid on account of any misrepresentation or fraud of the

employee or if such excess payment was made by the employer by applying a

wrong principle for calculating the pay/allowance or on the basis of a particular

interpretation of rule/order which is subsequently found to be erroneous, such

excess payment of emoluments or allowances are not recoverable. This relief

against the recovery is granted not because of any right of the employees but in

equity, exercising judicial discretion to provide relief to the employees from the

hardship that will be caused if the recovery is ordered. This Court has further

held that if in a given case, it is proved that an employee had knowledge that the

payment received was in excess of what was due or wrongly paid, or in cases

where error is detected or corrected within a short time of wrong payment, the

matter being in the realm of judicial discretion, the courts may on the facts and

circumstances of any particular case order for recovery of amount paid in excess.

10. In Sahib Ram v. State of Haryana and Others, 1995 Supp(1)

SCC 18, this Court restrained recovery of payment which was given under the

upgraded pay scale on account of wrong construction of relevant order by the

authority concerned, without any misrepresentation on part of the employees. It

was held thus:

"5. Admittedly the appellant does not possess the required educational qualifications. Under the circumstances the appellant would not be entitled to the relaxation. The Principal erred in granting him the relaxation. Since the date of relaxation, the appellant had been paid his salary on the revised scale. However, it is not on account of any misrepresentation made by the appellant that the benefit of the higher pay scale was given to him but by wrong construction made by the Principal for which the appellant cannot be held to be at fault. Under the circumstances the amount paid till date may not be recovered from the appellant. The principle of equal pay for equal work would not apply to the scales prescribed by the University Grants Commission. The appeal is allowed partly without any order as to costs."

11. In Col. B.J. Akkara (Retd.) v. Government of India and

Others, 2006 (11) SCC 709, this Court considered an identical question as

under:

"27. The last question to be considered is whether relief should be granted against the recovery of the excess payments made on account of the wrong interpretation/understanding of the circular dated 7.6. 1999. This Court has consistently granted relief against recovery of excess wrong payment of emoluments/allowances from an employee, if the following conditions are fulfilled (vide Sahib Ram v. State of Haryana [1995 Supp (1) SCC 18 : 1995 SCC (L&S) 248], Shyam Babu Verma v. Union of India [(1994) 2 SCC 521 : 1994 SCC (L&S) 683 : (1994) 27 ATC 121] , Union of India v. M. Bhaskar [(1996) 4 SCC 416 : 1996 SCC (L&S) 967] and V. Gangaram v. Regional Jt. Director [(1997) 6 SCC 139 : 1997 SCC (L&S) 1652] ):

(a) The excess payment was not made on account of any misrepresentation or fraud on the part of the employee.

(b) Such excess payment was made by the employer by applying a wrong principle for calculating the pay/allowance or on the basis of a particular interpretation of rule/order, which is subsequently found to be erroneous.

28. Such relief, restraining back recovery of excess payment, is granted by courts not because of any right in the employees, but in equity, in exercise of judicial discretion to relieve the employees from the hardship that will be caused if recovery is implemented. A government servant, particularly one in the lower rungs of service would spend whatever emoluments he receives for the upkeep of his family. If he receives an excess payment for a long period, he would spend it, genuinely believing that he is entitled to it. As any subsequent action to recover the excess payment will cause undue hardship to him, relief is granted in that behalf. But where the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or where the error is detected or

corrected within a short time of wrong payment, courts will not grant relief against recovery. The matter being in the realm of judicial discretion, courts may on the facts and circumstances of any particular case refuse to grant such relief against recovery.

29. On the same principle, pensioners can also seek a direction that wrong payments should not be recovered, as pensioners are in a more disadvantageous position when compared to inservice employees. Any attempt to recover excess wrong payment would cause undue hardship to them. The petitioners are not guilty of any misrepresentation or fraud in regard to the excess payment. NPA was added to minimum pay, for purposes of stepping up, due to a wrong understanding by the implementing departments. We are therefore of the view that the respondents shall not recover any excess payments made towards pension in pursuance of the circular dated 7.6.1999 till the issue of the clarificatory circular dated 11.9.2001. Insofar as any excess payment made after the circular dated 11.9.2001, obviously the Union of India will be entitled to recover the excess as the validity of the said circular has been upheld and as pensioners have been put on notice in regard to the wrong calculations earlier made."

12. In Syed Abdul Qadir and Others v. State of Bihar and Others,

2009 (3) SCC 475, 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 to them was more than what they were entitled to. It would not be out of place to mention here that the Finance Department had, in its counteraffidavit, admitted that it was a bona fide mistake on their part. The excess payment made was the result of wrong interpretation of the Rule that was applicable to them, for which the appellants cannot be held responsible. Rather, the whole confusion was because of inaction, negligence and carelessness of the officials concerned of the Government of Bihar. Learned counsel appearing on behalf of the appellant teachers submitted that majority of the beneficiaries have either retired or are on the verge of it. Keeping in view the peculiar facts and circumstances of the case at hand and to avoid any hardship to the appellant teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellant teachers should be made."

13 In State of Punjab and Others v. Rafiq Masih (White Washer)

and Others, 2015 (4) SCC 334 wherein this court examined the validity of an

order passed by the State to recover the monetary gains wrongly extended to the

beneficiary employees in excess of their entitlements without any fault or

misrepresentation at the behest of the recipient. This Court considered situations

of hardship caused to an employee, if recovery is directed to reimburse the

employer and disallowed the same, exempting the beneficiary employees from

such recovery. It was held thus:

"8. As between two parties, if a determination is rendered in favour of the party, which is the weaker of the two, without any serious detriment to the other (which is truly a welfare State), the issue resolved would be in consonance with the concept of justice, which is assured to the citizens of India, even in the Preamble of the Constitution of India. The right to recover being pursued by the employer, will have to be compared, with the effect of the recovery on the employee concerned. If the effect of the recovery from the employee concerned would be, more unfair, more wrongful, more improper, and more unwarranted, than the corresponding right of the employer to recover the amount, then it would be iniquitous and arbitrary, to effect the recovery. In such a situation, the employee's right would outbalance, and therefore eclipse, the right of the employer to recover.

xxx xxx xxx

18. It is not possible to postulate all situations of hardship which would govern employees on the issue of recovery, where payments have mistakenly been made by the employer, in excess of their entitlement. Be that as it may, based on the decisions referred to hereinabove, we may, as a ready reference, summarise the following few situations, wherein recoveries by the employers, would be impermissible in law:

(i) Recovery from the employees belonging to Class III and Class IV service (or Group C and Group D service).

(ii) Recovery from the retired employees, or the employees who are due to retire within one year, of the order of recovery.

(iii) Recovery from the employees, when the excess payment has been made for a period in excess of five years, before the order of recovery is issued.

(iv) Recovery in cases where an employee has wrongfully been required to discharge duties of a higher post, and has been paid accordingly, even though he should have rightfully been required to work against an inferior post.

(v) In any other case, where the court arrives at the conclusion, that recovery if made from the employee, would be iniquitous or harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer's right to recover."

14. In view of the aforesaid enunciation of law and in the facts and

circumstances of the case, we are of the view that an attempt by the petitioners to

recover the benefits with regard to grade pay extended to the respondents (Class-

IV employees) is unjustified, therefore, no illegality can be found in the order

impugned passed by the Tribunal as the same is in consonance with law. The

writ petition is bereft of any merits and is accordingly dismissed.

15. There shall be no order as to costs.

                                  (Puneet Gupta)       )         (Tashi Rabstan)
                                       Judge                         Judge
Jammu:
03.05.2023
Raj Kumar
                           Whether the order is speaking?        Yes
                           Whether the order is reportable?      Yes