Kailash Bhushan Tiwari vs The State Of Bihar
2021 Latest Caselaw 861 Patna

          IN THE HIGH COURT OF JUDICATURE AT PATNA
                     Civil Writ Jurisdiction Case No.7961 of 2020
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Kailash Bhushan Tiwari, Son of Late Tarkeshwar Tiwari, Resident of Village - Ori Kothi, Station Road, Musafirganj, Ward No. 10, P.S. and District- Buxar.

... ... Petitioner/s Versus

1. The State of Bihar through the Secretary, Energy Department, Govt. of Bihar, Patna.

2. The C.M.D., Bihar State Power (Holding) Company Ltd. Vidyut Bhawan, Bailey Road, Patna.

3. The Deputy General Manager (Finance and Accounts), Bihar State Power (Holding) Company Ltd. Vidyut Bhawan, Bailey Road, Patna.

4. The Account Officer, Pension, Bihar State Power (Holding) Company Ltd.

Vidyut Bhawan, Bailey Road, Patna.

... ... Respondent/s ====================================================== Appearance :

For the Petitioner/s : Mr.Rakesh Kumar Sharma, Adv.

     For the State          :      Mr.Y.P. Sinha, AAG-7
     For the Board          :      Mr.Vinay Kirti Singh, Sr. Adv.

====================================================== CORAM: HONOURABLE MR. JUSTICE CHAKRADHARI SHARAN SINGH ORAL JUDGMENT Date : 12-02-2021

Essential facts relevant for adjudication of the present

case are not at all in dispute.

2. On attaining the age of superannuation, the petitioner

retired as Junior Electrical Engineer, Electric Supply Division,

Buxar under the erstwhile Bihar State Electricity Board with

effect from 31.07.2002. The Bihar State Power (Holding)

Company Limited (hereinafter referred to as 'the Company') is

the successor body of the establishment from where the petitioner

demitted his office on his retirement. His monthly pension was Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

fixed at the rate of Rs. 6,480/- on the basis of his pay admissible

to him as on the date of his retirement under the 5th Pay Revision.

His monthly pension was revised with effect from 01.04.2007 at

Rs. 14,645/- under 6th Pay Revision and a Pension Payment Order

was accordingly issued on 04.11.2011. He, however, received

monthly pension at the rate of Rs. 16,465/- per month instead

because of a wrong entry. On introduction of 7th Pay Revision, the

petitioner's monthly pension was revised treating his pension at

the rate of Rs. 16,465/- per month instead of Rs. 14,645/- per

month. This led to payment of pension to the petitioner in excess

of what he was legally entitled to receive.

3. The Respondent-Company has taken steps to recover

the amount from the petitioner's pension on monthly installment

till the excess amount paid to the petitioner is fully recovered. It

appears from the pleadings on record that the petitioner was

getting pension of Rs. 46,572/- per month. It is his case that

without any prior intimation, in the month of December 2019, a

sum of Rs. 22,940/- was deposited in his pension account. It is his

case that he learnt about the decision of the Respondent-Company

to recover excess amount paid to the petitioner, because of which

less amount of monthly pension was deposited in his account in

December 2019, on the basis of information furnished to him by Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

the Company under the Right to Information Act, 2005. The said

action of the respondents to recover the amount paid to the

petitioner in excess as monthly pension has been impugned in the

present writ application.

4. I have heard Mr. Rakesh Kumar Sharma, learned

counsel appearing on behalf of the petitioner and Mr. Vinay Kirti

Singh, learned Senior Counsel representing the Respondent-

Company.

5. Mr. Sharma, learned counsel appearing on behalf of the

petitioner has placed reliance on Supreme Court's decision in

case of State of Punjab and others vs. Rafiq Masih(White

Washer) and others reported in (2015) 4 SCC 334 [apparently

incorrect citation of the case has been mentioned in paragraph-16

of the writ application as (2014) 8 SCC 883], in support of his

contention that as the excess payment has been made for a period

in excess of five years, recovery is impermissible in view of the

directions issued in paragraph-18 thereof. He has argued that

evidently the decision to recover the amount has been taken

without giving the petitioner any opportunity of hearing, and,

therefore, such action is in breach of the principles of natural

justice. It is his contention that the petitioner did not play any role

in payment of excess pension, over and above, what was Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

sanctioned by the respondents and in the absence of any fraud or

misrepresentation alleged against the petitioner, decision to

recover the amount from the petitioner's pension is arbitrary,

illegal, unreasonable and iniquitous.

6. Mr. Vinay Kirti Singh, learned Senior Counsel

appearing on behalf of the Respondent-Company, on the other

hand, has referred to Rule 202 of the Bihar Pension Rules, 1950

(hereinafter referred to as 'the Rules') which indisputably governs

payment of pension to the petitioner and other employees of the

Board/ Company to submit that in case the amount of pension

granted to an employee is found to be in excess of that to which

he is entitled under the Rules, he has to be called upon to refund

such excess. Referring to the counter affidavit filed on behalf of

the respondents, it has been argued that it was a mere clerical

error that a sum of Rs. 16,465/- per month was being deposited in

the petitioner's pension account in place of 14,645/- and it was

well within the knowledge of the petitioner that the amount,

which was being deposited in the petitioner's pension account,

was more than what was sanctioned to him. Referring to letter

No. 5718 dated 04.11.2011 (Annexure-A to the counter affidavit)

whereby petitioner's pension was revised from Rs. 6,480/- to

14,645/-, he has submitted that a copy of the said letter was Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

communicated to the petitioner also. He, however, continued

receiving more amount of pension than what he was entitled to

and he thus knowingly received a total sum of Rs. 4,60,632/- in

excess of what he was entitled to under the Rules. He has further

submitted that in accordance with requirement of Rule 202 of the

Rules the petitioner was given a notice through letter dated

27.11.2019 asking him to refund the said excess amount. As the

petitioner failed to refund the amount, in tune with the provisions

under Rule 202 of the Rules, the Respondent-Company ordered

that excess payment shall be adjusted by short payment of

pension in installments. According to him, the Supreme Court's

decision in case of Rafiq Masih (supra) has no application in the

facts and circumstances of the present case where the petitioner

knowingly received more amount than what was authorised to be

paid to him against pension, taking advantage of a minor

typographical error. He has also submitted with reference to the

averments made in the counter affidavit that the petitioner had

given a clear undertaking at the time of initial sanction of pension

that if payment was found to be in excess of that to which he was

entitled under the Rules he would refund the amount paid to him

in excess.

7. In reply to the aforementioned submission, learned Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

counsel for the petitioner has submitted that the said undertaking

was given by the petitioner at the time when the pension was

initially sanctioned to the petitioner at the rate of Rs. 6,480/- per

month after his superannuation. He has argued that at the time of

subsequent revision with issuance of Memo No. 5718 dated

04.11.2011, no such undertaking was given by the petitioner, and,

therefore, the undertaking given by him in 2001 cannot be made

the basis for recovery of the excess payment. He has reiterated his

submission that the petitioner's case is squarely covered by 3 rd

situation enumerated in paragraph 18 of the Supreme Court's

decision in case of Rafiq Masih (supra) wherein it has been laid

down that recoveries by employers, would be impermissible in

law "(iii) ------when excess payment has been made for a period

in excess of five years, before the order of recovery is issued".

8. To appreciate the rival contentions on behalf of the

parties, it would be apt to reproduce Rule 202(1) of the Rules, to

begin with, which reads as under :-

202.(1) Should the amount of pension granted to a Government servant be afterwards found to be in excess of that to which he is entitled under the rules, he shall be called upon to refund such excess. [For this purpose the Government servant concerned shall be served with a notice by the pension sanctioning authority, requiring him to Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

refund the excess payments within a period of two months from the date of receipt by him of the notice. On his failure to comply with the notice the pension sanctioning authority shall order that such excess payments shall be adjusted by short payments of pension in future, in one or more instalments, as the authority may order.]"

9. In place of the expression 'Government Servant'

occurring in Rule 202 of the Rules, expression 'employee' is

being mentioned hereinafter since the Rules framed for the

'Government Servants' in the State of Bihar has been admittedly

made applicable to the employees of the Company.

10. A note below Rule 202(1) prescribes that for the

purpose of the said Rule, a declaration in the Form appended as

Annexure-A shall be obtained from the retiring employee by the

authorities sanctioning payment, before pension is sanctioned.

Annexure-A, inter alia, requires giving an undertaking in the

nature of promise to refund amount paid to a pensioner in excess

of that to which he may be eventually found entitled. Rule 202, in

the Court's opinion, applies when the pension granted to an

employee is found to be in excess of that to which he is entitled to

under the Rules. The undertaking in Form appended as Annexure-

A requires a declaration that the pension granted is subject to Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

refund if the same is found to be in excess of that to which an

employee is entitled to under the Rules. Rule 202(1) contemplates

a situation where because of wrong fixation of pension more

pension is granted to an employee than what he is entitled to

under the Rules. If, afterwards, it is found by the employer

sanctioning pension that the grant of pension was more than what

is permissible under the Rules, a pensioner cannot raise any

objection to refund of pension in view of the undertaking given in

the Form appended as Annexure-A to Rule 202(1) of the Rules.

There is further undertaking required to be given by the retiring

employees in the nature of promise to refund the amount paid to

him in excess of that to which he might be eventually found

entitled.

11. In the present case, the situation is entirely different.

The amount of pension granted to the petitioner was not in excess

of that to which he was entitled under the Rules. He was granted

monthly pension at the rate of Rs. 14,645/- with effect from

01.04.2007 with the issuance of Pension Payment Order dated

04.11.2011. Payments were made, however, in his pension

account at the rate of Rs. 16,465/- per month because of an

incorrect entry. It was clearly within the knowledge of the

petitioner that a sum of Rs. 14,645/- was granted as monthly Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

pension by virtue of Pension Payment Order dated 04.11.2011. It

was clearly within his knowledge that the amount of monthly

pension, which was being deposited in his account, was more

than the pension granted to him. At the cost of repetition, it is

recorded that it is not a case of wrong fixation of pay or pension

because of which the petitioner received more amount than what

he was legally entitled to. It is a case of more amount being

deposited in the employees' pension account by mistake, despite

his pension having been rightly fixed and granted. The question

arises as to whether this Court exercising power of judicial

review under Article 226 of the Constitution of India should

interfere with the decision of the Company which is State within

the meaning of Article 12 of the Constitution of India, to recover

the amount wrongfully credited in the petitioner's pension

account, in excess of the amount of pension granted to him ?

12. In case of Rafiq Masih (supra) (paragraph-6), the

Supreme Court had proceeded to lay down parameters of fact

situations, wherein employees, who are beneficiaries of wrongful

monetary gains at the hands of the employer, may not be

compelled to refund the same. The Supreme Court in case of

Rafiq Masih (supra) ruled in no uncertain terms in paragraph 6

that such benefits cannot be extended to an employee merely on Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

account of the fact that he was not an accessory to the mistake

committed by the employer, or merely because the employee did

not furnish any factually incorrect information, on the basis

whereof the employer committed the mistake of paying employee

more than what was rightly due to him; or for that matter, merely

because of excessive payment was made to the employee in

absence of any fraud or misrepresentation at the behest of the

employee. The Supreme Court held in paragraph 7 in case of

Rafiq Masih (supra) that orders passed by the employer seeking

recovery of monetary benefits wrongfully extended to the

employee can only be interfered with, in cases 'where such

recovery would result in a hardship of a nature', which would far

outweigh, the equitable balance of the employer's right to

recover. The Supreme Court went on to clarify and hold that such

interference would be called for only in such cases where it

would be iniquitous to recover the payment made. It can be easily

culled out from paragraph 11 of the Supreme Court's decision in

case of Rafiq Masih (supra) that the employees in the batch of

cases before the Supreme Court were 'given monetary benefits

which were in excess of their entitlements'. It is further evident

that the monetary benefits had flown to them consequent upon a

mistake committed by the competent authority concerned in Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

'determining the emoluments payable to them'. The mistake, the

Supreme Court noted in case of Rafiq Masih (supra), could have

occurred on account of variety of reasons including :

(i) Grant of status, which the employee

concerned was not entitled to.

(ii) Payment of salary in a higher pay-scale than

in consonance with the right concerned.

(iii) Because of wrongful fixation of salary of

the employee, consequent upon pay revision of

pay scales.

(iv) Having granted allowance for which the

employee concerned was not authorised.

13. The aforesaid category of mistakes set forth by the

Supreme Court are apparently not exhaustive and are inclusive.

The Supreme Court noticed the broad aspect of the matter of the

cases where government servants were beneficiaries of the

mistake committed by the employer and on account of said

unintentional mistake, the employees were in receipt of monetary

benefits beyond their due.

14. In my opinion, in the nature of dispute, which has

emerged in the present writ application, the case of the petitioner

cannot be said to be squarely covered by the Supreme Court's Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

decision in case of Rafiq Masih (supra) for the reason that the

present case does not involve wrongful fixation or grant of

emoluments or benefits. The fixation was rightly done. The

petitioner was fully aware of the amount of monthly pension

granted in his favour upon revision with the issuance of Pension

Payment Order dated 04.11.2011. However, the amount credited

in his pension account was more than the amount of pension

granted to him.

15. It is noteworthy that the Supreme Court in case of

Shyam Babu Verma vs. Union of India reported in (1994) 2 SCC

521 had noticed that the petitioners of the said case were paid

their salaries in higher pay-scale than they were actually entitled

to with effect from 01.01.1973. The discrepancy was noticed in

1984 and accordingly the scale was reduced with effect from

01.01.1973. In such given case, the Supreme Court restrained the

respondents of that case from recovering any excess amount

already paid to them. Considering the decision in case of Shyam

Babu Verma (supra), the Supreme Court held in paragraph 14 in

case of Rafiq Masih (supra) that recovery of excess payment

discovered after five years would be iniquitous and arbitrary and,

therefore, violative of Article 14 of the Constitution of India. The

case situation in case of Shyam Babu Verma (supra) was that Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

fixation of salary was found incorrect and payments were made to

the employees who had received payments on the basis of

incorrect fixation and mistake in fixation of pay/ salary was

discovered after 11 years.

16. In the present case, on the other hand, it was well

within the knowledge of the petitioner that the amount, which he

was receiving, was more than the amount of pension which was

granted to him.

17. It would be beneficial to notice the case of B.J.

Akkara vs. Government of India reported in (2006) 11 SCC 709,

wherein the Supreme Court has clearly viewed that the nature of

relief restraining back recovery of excess payment is granted by

Courts not because of any right of 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. If an

employee receives an excess payment for a long period, he would

spend it, genuinely believing that he is entitled to it. In such

circumstances, any subsequent action to recover excess payment

shall cause undue hardship and, therefore, relief is granted in that

behalf, the Supreme Court observed in case of B.J. Akkara

(supra). Paragraph 28 of the said judgment can be usefully

reproduced hereinbelow, which reads as under :- Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

"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."

18. Referring to the enunciation of law in case of B.J.

Akkara (supra), the Supreme Court in case of Rafiq Masih

(supra) has noted in paragraph 15 that the right to recover would

be sustainable so long as the same was not iniquitous or arbitrary.

The Supreme Court, accordingly, held in paragraph 15 in case of Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

Rafiq Masih (supra) that recovery from employees belonging to

lower rung of service should not be subjected to ordeal of any

recovery even though they were beneficiaries of receiving higher

emoluments.

19. In case of Syed Abdul Qadir vs. State of Bihar

reported in (2009) 3 SCC 475, the Supreme Court noticing

excess payment made as a result of wrong interpretation of

statutory Rule for which the government servants could not be

held responsible, rather since whole confusion was found to have

been created because of inaction, negligence, carelessness of the

officials concerned. The Supreme Court keeping in mind the

peculiar facts and circumstances of that case had restrained the

respondents from recovery of amount that had been paid in

excess to the appellant teachers. Noticing the said directive issued

in case of Syed Abdul Qadir (supra), the Supreme Court in case

of Rafiq Masih (supra) held in paragraph 16 that 'recovery

would be iniquitous and arbitrary, if it is sought to be made after

the date of retirement or soon before retirement'.

20. One needs to bear in mind that the Supreme Court

decided to lay down the parameters where recoveries could be

held to be impermissible, by referring to the various situations

when the Supreme Court in various cases had exempted the Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

employees from such recoveries, even in exercise of its

jurisdiction under Article 142 of the Constitution of India. The

Supreme Court observed that repeated exercise of such power

under Article 142 of the Constitution of India 'for doing complete

justice in any case' would establish that the recovery being

effected was iniquitous and, therefore, arbitrary. This is precisely

the background in which the Supreme Court has set out the

parameters in paragraph 18 which reads as under :-

"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 Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

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."

21. Facts of the present case, in the Court's opinion, are

different. The fixation of the petitioner's pension in 6 th Pay

Revision with effect from 01.04.2007 with the issuance of

Pension Payment Order dated 04.11.2011 at the rate of Rs.

14,645/- was correct. The order granting pension at the rate of Rs.

14,645/- was communicated to the petitioner. He, however,

received more pension than that was granted to him which was

erroneously credited in his account at the rate of Rs. 16,465/- per

month. He was apparently aware of the fact that more amount

was being credited in his pension account than that was

sanctioned to him. Merely on account of fact that the petitioner

was not an 'accessory to the mistake committed by the employer'

leading to payment of more amount than the petitioner was

rightfully entitled to; action of the respondents to recover excess

amount credited in the petitioner's account shall not require this Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

Court's interference. It is only when the Court reaches a

conclusion that recovery would result in a hardship of a nature

'which would far outweigh, the equitable balance of employer's

right to recover', that an interference with the action of the

employer seeking recovery of excess monetary benefits

wrongfully extended to the petitioner can be interfered with [see

Rafiq Masih (supra) paragraph-7]. An action of the State within

the meaning of Article 12 of the Constitution of India ordering

recovery from an employee, would be in order, so long as it is not

rendered iniquitous to the extent that the action of the recovery

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

unwarranted than the corresponding right of the employer, to

recover the amount. [see Rafiq Masih (supra) paragraph-10].

22. The petitioner, in all fairness, ought to have brought

to the notice of the employer or the banker that the amount, which

was being deposited in his pension account, was more than the

rate of pension granted in his favour with the issuance of Pension

Payment Order dated 04.11.2011. He, instead, cleverly and

silently kept on receiving the amount knowing well that the same

was more than his actual entitlement.

23. In such circumstance, the decision of the respondents

to recover the amount cannot be termed as iniquitous requiring Patna High Court CWJC No.7961 of 2020 dt.12-02-2021

this Court's interference.

24. I accordingly do not find any merit in this application.

This application is dismissed.

(Chakradhari Sharan Singh, J) Rajesh/-

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Uploading Date          12.02.2021
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