Madras High Court
The Commissioner vs R.Thirupathi on 27 November, 2023
Author: S.M.Subramaniam
Bench: S.M.Subramaniam
W.A.(MD) No.892 of 2020
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED : 27.11.2023
CORAM:
THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAM
and
THE HONOURABLE MR.JUSTICE V.LAKSHMINARAYANAN
W.A.(MD) No.892 of 2020
and
C.M.P.(MD) No.4869 of 2020
The Commissioner
Kodaikanal Municipality
Kodaikanal
Dindigul District ... Appellant
-vs-
1.R.Thirupathi
2.N.Kaliya Perumal
3.U.Nagaraj
4.K.Sounthar Rajan
5.P.S.Anthony Doss
6.S.Raja
7.P.Parthiban
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W.A.(MD) No.892 of 2020
8.C.Rajasekar
9.A.Elangumaran
10.Leo Marsileno
11.C.Subramani
12.S.Sahayaraj
13.P.Shanmugavel
14.K.Velmurugan
15.N.Vadivel
16.M.Velmurugan
17.M.Uthaya Suriyan
18.P.Krishnamoorthy
19.K.Pommiappa Jaikanthan
20.S.N.Kasthuri Rengaraj
21.P.Harikrishnan
22.A.John Arokiya Doss
23.C.Pandi
24.Vijayakumar
25.R.Essikiammal
26.M.Tharsis
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W.A.(MD) No.892 of 2020
27.A.Siva
28.M.Murugeshwari
29.The Additional Chief Secretary to Government
Municipal Administration & Water Supply Department
Chennai-600 009
30.The Principal Secretary to Government
Finance (Pay Cell) Department
Chennai-600 009
31.The Director of Municipal Administration
Chepauk, Chennai-600 009
32.The Director of Local Fund Audit
Chennai-600 108 ... Respondents
Writ Appeal filed under Clause 15 of Letters Patent to set aside the
order, dated 24.02.2020, passed in W.P.(MD) No.11357 of 2015, on the file of
this Court.
For Appellant : Mr.L.P.Maurya
For Respondents : Mr.S.C.Herold Singh for R1 to R24
Mr.S.P.Maharajan
Special Government Pleader for R29 to R32
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W.A.(MD) No.892 of 2020
JUDGMENT
[Judgment of the Court was made by S.M.SUBRAMANIAM, J.]
The appellant is the Commissioner of the Kodaikanal Municipality
questioning the order passed in W.P.(MD) No.11357 of 2015, dated
24.02.2020, filed by the respondents 1 to 28 challenging the order of recovery
issued by the appellant-Municipality and for a consequential direction to
refund the amount already recovered within a time frame.
2. The learned Writ Court allowed the writ petition primarily on
the ground that the excess payment made to the writ petitioners, who are
Class-IV employees on account of wrong fixation of their salary and benefits
cannot be recovered in the light of the decision of the Honourable Supreme
Court in the case of State of Punjab and others vs. Rafiq Masih (White
Washer) and others, (2015) 4 SCC 334. After giving relief from recovery to
the writ petitioners, certain other consequential directions also been issued.
The question which falls for consideration in this appeal is whether the
decision in the case of Rafiq Masih (White Washer) (supra) can have an
universal application to all cases of recovery made by the various Departments
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of the Government after having deducted that excess financial benefits which
is not intended to be paid to the employee has been paid.
3. Learned counsel appearing for the respondents 1 to 24 / writ
petitioners pointed out that the Government of Tamil Nadu has accepted the
decision in the case of Rafiq Masih (White Washer) and issued G.O.Ms.No.
286, dated 28.08.2018. Further it is pointed out that the appellant-
Municipality had contended that an undertaking has been given by the writ
petitioners agreeing for recovery and such undertaking will not be binding and
cannot be enforced and to support such preposition, reliance was placed on
the decision of the Honourable Division Bench in the case of Tamil Nadu
Civil Supplies Corporation and another v. R.Ganesha Rao, in W.A.No.207
of 2019, dated 24.01.2019.
4. Further it is pointed out that in the case of the Executive
Engineer, Public Works Department (Machinery Sub-Division) Chennai-5
and another v. K.Karuppaiah, the Division Bench had applied the decision
of Rafiq Masih (White Washer) and dismissed the appeal filed by the
Department by judgment dated 12.03.2018 in W.A(MD).No.638 of 2012.
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Therefore, it is submitted that it will be most inequitable to effect recovery
from Class-IV employees, especially, when the amount to be recovered is
almost Rupees Two lakhs from each of the writ petitioners.
5. Upon hearing the learned counsel appearing for the appellant
and going through the facts of the case before us, we find that the decision in
Rafiq Masih (White Washer) or in the case of Ganesha Rao or
K.Karuppaiah cannot be applied to the case of the writ petitioners. This is
because of more than one reason. Firstly, the nature of undertaking given by
the writ petitioners is after issuance of show cause notice for recovery and at
that stage, the respondents having accepted the fact that unintended benefit
was given to the writ petitioners, who are working in a non-technical post
agreed for revision of the pay and benefits and sought for permission to effect
recovery in convenient installments. Therefore, the nature of undertaking
which was referred to and considered in the case of Rafiq Masih (White
Washer) as well as in the case of Ganesha Rao is entirely different. This is so
because, the respondents-writ petitioners rightly understood that the excess
financial benefit which was accorded to them, cannot be accorded to them
under law. The decision in the case of K.Karuppaiah also cannot be applied
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in the case on hand as it was the case where the Writ Court found that the
order of recovery was in violation of principles of natural justice and the
amount sought to be recovered was about Rs.20,000/- and therefore, the
Division Bench held that the peculiar facts and circumstances of the case does
not warrant interference of the order passed in the writ petition.
6. As rightly pointed out by the learned counsel appearing for the
appellant, the Honourable Supreme Court had clarified the effect of the
decision in Rafiq Masih (White Washer) in the case of High Court of Punjab
and Haryana and Others v. Jagdev Singh, 2016 (14) SCC 267. In the said
case, the writ petition filed by an employee was allowed by the High Court of
Punjab and Haryana, wherein, a challenge was made to the orders of the State
Accountant General for recovery of an excess payment to the salary. In the
said case, the record of proceedings shows that the employee opted for revised
pay scale and he furnished an undertaking to the effect that he will be liable
to refund any excess payment made to him. The Honourable Supreme Court
held that the undertaking is binding. Therefore, the decision in Ganesha Rao
stands impliedly overruled.
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7. Further, the Court took note of the decision in Rafiq Masih
(White Washer) and held that the principle enunciated in paragraph No.10 of
the judgment in Rafiq Masih (White Washer) cannot be applied to the
situation, such as the case dealt with by the Honourable Supreme Court and
undertaking will be binding on the employee. Therefore, the writ petitioners
cannot rest the case solely based on the decision in the case of Rafiq Masih
(White Washer).
8. The following decisions would also support the stand taken by
the appellant-Municipality in effecting the orders of recovery.
(i) The Hon'ble Supreme Court in the case of Chandi Prasad
Uniyaland Others v. State of Uttarakhand & Ors., (2012) 8 SCC 417, in
paragraph No.14, has held as follows:
"14. We are 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. We fail to see why the concept of fraud or
misrepresentation is being brought in such situations.
Question to be asked is whether excess money has
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been paid or not may be due to a bona fide mistake.
Possibly, effecting excess payment of public money by
Government officers, may be due to various reasons
like negligence, carelessness, collusion, favouritism
etc. because money in such situation does not belong
to the payer or the payee. Situations may also arise
where both the payer and the payee are at fault, then
the mistake is mutual. Payments are being effected in
many situations without any authority of law and
payments have been received by the recipients also
without any authority of law. 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. "
(ii) The Hon'ble Supreme Court in the case of Union Territory,
Chandigarh and others v. Gurcharan Singh and another, (2014) 13 SCC
595, in paragraph No.13, has held as follows:
"13.Though a submission had been made on
behalf of the respondent that no amount should be
recovered from the salary paid to the respondent, the
said submission can not be accepted because if any
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amount had been paid due to mistake, the mistake
must be rectified and the amount so paid in pursuance
of the mistake must be recovered. It might also happen
that the employer might have to pay some amount to
the respondent as a result of some mistake and in
such an event, even the appellant might have to pay to
the respondent. Be that as it may, upon settlement of
the account, whatever amount has to be paid to the
respondent employee or to the appellant employer
shall be paid and the account shall be adjusted
accordingly."
(iii) A Division Bench of this Court in the case of The District
Treasury Officer, (District Treasury), Perambalur vs. D.Susairaj and
another, 2017 SCC Online Mad 35571, in paragraph No.4, has held as
follows:
"4.Our attention has been drawn to the decision
in the White Washer's case wherein it has been held
that such a recovery is impersmissible. But, the case
on hand, in its facts and circumstances, stand on a
different footing for more than one reason. Firstly,
when the mistake in calculation of the pension was
found out during the month of August 2011 and
recovery was started from October 2011 till June
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2013 based on the consent given by the writ
petitioner, the writ petition has been filed in the year
2014. In the case relied upon by the writ petitioner, he
had moved the court in time, but, in the case on hand,
the writ petitioner has not moved this court in time
and further, he had submitted himself for recovery of
the amount paid in excess in monthly instalments as
per the consent letter dated 28.11.2011 and
subsequently, the entire amount as claimed in the
audit objection also seems to have been recovered
but, only thereafter, he has filed the writ petition for
return of the recovered amount. Therefore, in the facts
and circumstances of the case, the judgment cited
supra, relied upon by the writ petitioner will not come
to his rescue. In that view of the matter, we uphold the
contentions of the learned Additional Government
Pleader. "
(iv) A Division Bench of this Court in the case of T.M.Madav
Yadav v. Principal Secretary to the Government, Government of Tamil
Nadu, Fort St.George, Chennai and another, (2018) 6 MLJ 7163, in
paragraph Nos.23 to 25, has held as follows:
"23.It is to be pointed out that the ingredients of
Sections 68 to 72 of the Indian Contract Act, 1872
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speak of the principles of 'Unjust Enrichment', as per
decision Nallaya Gounder V. Ramaswami Gounder
reported in (1958) 2 Mad LJ 86. The aspect of 'Unjust
Enrichment' is rested on the principle that the
concerned individual was enriched by reaping the
benefits. Further, he should have been enriched at
another's expense. Besides these, it would be
unjust/unwise to permit him to retain the benefits.
24.One has to bear in mind the principle 'Nemo
debet locupletari ex aliena jactura', i.e., no man should
grow rich out of another person's loss. Further, a
person who was unjustly enriched at the expense of
another is required to make restitution to another [vide
American Restatement of the Law of Restitution,
Quasi-Contracts and Constructive Trusts, 1937, S I.]
25.In Law, 'Perpetration' of an error is no Legal
Heroism'. If an error comes to light or the same is
unearthed or brought to the fore, the same is to be
rectified by the concerned authority. Viewed in that
perspective, the recovery of 'overpayment' is very
much necessitated and the same is in order. If
recovery is not effected, it will be an 'Unjust
Enrichment' resulting in Loss to the 'Exchequer'.
Hence, the impugned proceedings of the 2nd
Respondent/Office of the Accountant General,
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Chennai dated 11.01.2016 is free from any Legal
flaw. Consequently, the Writ Petition fails."
(v) A Division Bench of this Court in the case of B.Usha v. Principal
Labour Judge and others, 2019 SCC Online Mad 16765, in paragraph No.
26, has held as follows:
"26. So also the above said provision is very clear
that the ascertainable Government dues includes
''Over payment of Pay and Allowances''. Accordingly,
the First Respondent is having the power to recover
the ''Over payment''. Further, the said excess payment
was recovered, only at the time of giving the Pension
benefits to the Petitioner. Hence, it cannot be said that
the recovery order was made after a long gap of time.
More than that, as indicated by the Third Respondent,
in the Service Register maintained by the officer of the
employer, pertaining to the Petitioner, it was clearly
held that the Petitioner gave an undertaking in respect
to the recovery of over payment. After, giving
assurance for recovering the over payment, now, the
Petitioner filed the present Writ Petition and prayed for
allowing the same, in order to waive the over payment,
which was received nearly for the past 10 years. So
also, the prayer sought for by the Petitioner in this
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Writ Petition is not based on any sound legal
principle."
9. Considering the fact that the pay fixation was only in respect of
persons manning technical posts with ITI qualification and the benefit was
granted by the Government which was implemented by the appellant-
Municipality, by virtue of which, the revised scale of pay was given notionally
with effect from 01.01.2006 with monetary effect from 01.08.2010 and
admittedly, the respondents-writ petitioners were not holding any technical
posts, they were Tank Watchman, Tank Cleaner, Park Watchman and Bus
stand Watchman etc., which are all admittedly non-technical posts and the
respondents-writ petitioners cannot be heard to say that despite not
possessing ITI qualification, they will be entitled to revised scale of pay.
Therefore, even though the recovery may cause financial difficulties to the
respondents-writ petitioners, taking note of the fact that more than fifty
percent of the amount had already been recovered from the respondents-writ
petitioners, that too in installments, as per the request made by the
respondents-writ petitioners, we find that the orders of recovery ought not to
have been interfered by the learned Writ Court.
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10. The Municipality is operating the public funds and tax-payers
money. They discharging Constitutional obligation cast upon them and they
are bound to render services to all citizens without any discrimination.
Therefore, to state that the Municipality should absolve the loss can never be
accepted. There can be no universal application of the principle that every
wrong payment though deducted later can never be recovered from the person
who enjoyed the unintended benefit, as rightly pointed out by the learned
counsel appearing for the appellant that it would set a very bad precedent.
Apart from that the Municipality can never recover the amount and it will be
always shown as outstanding and this will have other cascading effect which
would not be in public interest.
11. Thus, for all the above reasons, we are of the clear view that
the learned Writ Court committed an error in interfering with the order of
recovery.
12. In the result, the writ appeal is allowed and the writ petition
are dismissed and the order impugned in the writ petition is held to be valid.
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The consequential revision of pay and pensionary benefits due to the retired
employees are directed to be settled within a period of twelve weeks from the
date of receipt of a copy of this Judgment. No costs. Consequently, connected
miscellaneous petition is closed.
[S.M.S., J.] [V.L.N., J.]
27.11.2023
NCC : Yes / No
Index : Yes / No
Internet : Yes / No
krk
To:
1.The Additional Chief Secretary to Government,
Municipal Administration & Water Supply Department,
Chennai-600 009.
2.The Principal Secretary to Government,
Finance (Pay Cell) Department,
Chennai-600 009.
3.The Director of Municipal Administration,
Chepauk, Chennai-600 009.
4.The Director of Local Fund Audit,
Chennai-600 108.
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S.M.SUBRAMANIAM, J.
and
V.LAKSHMINARAYANAN, J.
krk
and
27.11.2023
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