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Punjab-Haryana High Court
Paramjit Kaur vs Accountant General And Ors on 19 January, 2026
CWP-11954-2022 (O&M) 1
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
CWP-11954-2022 (O&M)
Reserved on: 20.11.2025
Pronounced on: 19.01.2026
Uploaded on: 19.01.2026
PARAMJIT KAUR -PETITIONER
V/S
ACCOUNTANT GENERAL AND ORS. -RESPONDENTS
CORAM: HON'BLE MR. JUSTICE KULDEEP TIWARI
Present: Mr. Dushyant Saharan, Advocate
for the petitioner.
Mr. Vikas Chatrath, Sr. Advocate, with
Mr. Abhishek Sharma, Advocate
for the respondents No.2 and 3.
Ms. Hemani Sarin, Advocate
for the respondent No.4.
***
KULDEEP TIWARI, J.
1. Through instituting the present writ petition, the petitioner
impugns the demand notice dated 12.04.2021 (Annexure P-2), whereby
the respondent No.2- State Bank of India (hereinafter referred to as the
"S.B.I."), being the pension disbursing authority, has sought to recover
the excess payment of family pension from the petitioner.
2. Assailing the impugned demand notice, the principal
contention advanced by learned counsel for the petitioner is that there was
neither any misrepresentation, fraud, deception, nor concealment of
material facts on the part of the petitioner. It is submitted that the
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petitioner had no role whatsoever in the fixation or calculation of the
family pension payable to her. The excess payment, if any, was solely on
account of an error committed by the S.B.I. and, therefore, recovery of
such excess amount is impermissible in law, particularly when tested on
the anvil of equity.
3. Learned counsel for the petitioner further submits that the
petitioner is solely dependent upon the meagre family pension for her
sustenance and has no other source of income to survive in the twilight
years of her life, especially while grappling with multiple age-related
ailments. To lend vigour to his arguments, learned counsel places reliance
upon the verdict rendered by the Hon'ble Supreme Court in "State of
Punjab and Others Vs. Rafiq Masih (White Washer) and Others",
(2015) 4 SCC 334.
4. Conversely, learned counsel for the S.B.I. submits that the
verdict rendered in Rafiq Masih's case (supra) does not come to the
rescue of the petitioner, inasmuch as the petitioner had furnished an
undertaking authorizing the S.B.I. to recover any excess amount credited
to her account. A copy of the undertaking dated 24.03.2005 has been
annexed as Annexure R-2/1.
5. Placing reliance upon the judgment of the Hon'ble Supreme
Court in "High Court of Punjab and Haryana and Others Vs. Jagdev
Singh", 2016 (4) SCT 286 SC, learned counsel for the S.B.I. contends
that the petitioner was clearly placed on notice that any payment found to
have been made in excess is required to be refunded. It is further argued
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that the petitioner has not challenged the P.P.O. dated 23.06.1999
(Annexure P-1), which explicitly sets out the manner of fixation of
pension and family pension.
6. Continuing his submissions, learned counsel for the S.B.I.
asserts that there exists no employer-employee relationship between the
S.B.I. and the petitioner, rather, the petitioner is merely a customer of the
S.B.I. Consequently, any excess pension paid is liable to be refunded by
the petitioner. In support of his arguments, he lays much emphasis on the
verdict rendered by this Court in LPA No.874 of 2014, titled as "Balbir
Singh Vs. State of Haryana and Others", wherein the action of the bank
in ordering/initiating recovery on account of excess amount having been
paid has been upheld.
7. Before embarking upon the process of gauging the validity of
the impugned demand notice, and penning down a verdict upon the
present writ petition, it is deemed apt to initially capture a concise and
compendious factual backdrop of the case.
8. The husband of the petitioner, late Mr. Kesar Singh, was
serving as Special Secretary of this Court and took voluntary retirement
w.e.f. 04.05.1999. Upon his retirement, his pension was fixed at ₹5,969/-
per month w.e.f. 05.05.1999 vide P.P.O. No. 708559902793 dated
23.06.1999 (Annexure P-1). The P.P.O. stipulated that in the event of
death of the retiree, family pension of ₹5969/- per month may be paid to
Paramjit Kaur (petitioner/spouse of the retiree) from the day following the
date of death till the expiry of 7 years or the completion of 65 years of
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age, had the retiree survived, whichever is earlier, and thereafter at the
reduced rate of ₹4752/- per month. The S.B.I., being the designated
pension disbursing authority, was responsible for disbursement of
pension/family pension. Although the petitioner was entitled to enhanced
family pension only from 04.03.2005 to 17.01.2010, she continued to
receive family pension at the enhanced rate from 18.01.2010 till
28.02.2021, resulting in excess payment amounting to ₹8,03,840/-.
9. Upon detecting the excess payment, the S.B.I. issued the
impugned demand notice seeking recovery of the excess pension amount
and also afforded the petitioner an opportunity of personal hearing.
Instead of availing the said opportunity, the petitioner approached this
Court by filing the present writ petition. Prior to the grant of interim stay
qua recovery by this Court on 30.05.2022, the S.B.I. had already
recovered an amount of ₹1,52,010/- from the petitioner, details whereof,
as mentioned in the reply dated 13.12.2022, are extracted hereunder:-
Total recovery ₹ 8,03,840/-
Recovery effected w.e.f. ₹ 1,52,010/-
April, 2021 to Feb., 2022 (₹10,587 x 11)
March, 2022 to May, 2022 (₹11,851 x 3)
Recoverable amount ₹ 6,51,830/-
10. The core issue that arises for consideration is "whether, in
the presence of the specific undertaking (Annexure R-2/1) and the
express terms of the P.P.O. (Annexure P-1), the impugned demand
notice is legally sustainable".
11. A bare perusal of the P.P.O. (Annexure P-1) makes it
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abundantly clear that the petitioner was entitled to enhanced family
pension of ₹5,969/- per month only from 04.03.2005 to 17.01.2010, and
thereafter, to family pension at the reduced rate of ₹4,752/- per month
w.e.f. 18.01.2010. Admittedly, the petitioner continued to receive family
pension at the enhanced rate until 28.02.2021. There is no wrangle to the
fact that there was no misrepresentation, fraud, concealment of any
material information on the part of the petitioner, rather it was solely on
account of an error on the part of the S.B.I., which resulted in the
petitioner enjoying family pension at enhanced rate of ₹5969/- instead of
the reduced rate of ₹4752/-.
12. In the above factual scenario, it is deemed imperative to
advert to some significant judicial pronouncements governing recovery of
excess payments. The Hon'ble Supreme Court has, in a catena of
judgments, restrained employer from recovering excess amount paid to
employee by applying a wrong principle for calculating the
pay/allowances or on the basis of particular interpretation of rule/order,
which is subsequently found to be erroneous, by applying the principle of
equity. Moreover, it has been specifically held that though an employee
does not have any right, the employer was, in equity, restrained to recover
the amount.
13. In "Col. B.J. Akkara (Retd.) Vs. Government of India and
Others", (2006) 11 SCC 709, the Hon'ble Supreme Court has delineated
the principles governing relief against recovery of excess wrong payment
from an employee. It has been held that such restraint is not founded upon
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any vested right of the employee but is rooted in equity and judicial
discretion to relieve the employees from the hardship that will be caused
if recovery is implemented. It has been further held that 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. The relevant observations are
extracted hereunder:-
"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 vs. State of Haryana [1995 Suppl.1 SCC 18], Shyam
Babu Verma vs. Union of India [1994 (2) SCC 521], Union of
India vs. M. Bhaskar [1996 (4) SCC 416], and V. Gangaram vs.
Regional Joint Director [AIR 1997 SC 2776] :
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 recovery back 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
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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 in-service
employees. Any attempt to recover excess wrong payment would
cause undue hardship to them. The petitioners are not guilty of
any misrepresentation or fraud in regard to the excess payment.
NPA was added to minimum pay, for purposes of stepping up, due
to a wrong understanding by the implementing departments. We
are therefore of the view that Respondents shall not recover any
excess payments made towards pension in pursuance of circular
dated 7.6.1999 till the issue of the clarificatory circular dated
11.9.2001. In so far 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."
14. Similarly, in Rafiq Masih's case (supra), the Hon'ble
Supreme Court has carved out specific categories of cases where recovery
would result in grave hardship and would thus be impermissible. The
relevant paragraph is extracted hereinafter:-
"18. It is not possible to postulate all situations of hardship,
which would govern employees on the issue of recovery, where
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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."
15. In Jagdev Singh's case (supra), the Supreme Court has
diluted its earlier stand and held that where the officer to whom the
payment was made in the first instance was clearly placed on notice that
any payment found to have been made in excess would be required to be
refunded, in that eventuality, the principle enunciated in proposition (ii) of
the hereinabove extracted paragraph 18 of Rafiq Masih's case would not
apply. The relevant observations embodied in Jagdev Singh's case read as
under:-
"10. In State of Punjab & Ors etc. vs. Rafiq Masih (White
Washer) etc. this Court held that while it is not possible to
postulate all situations of hardship where payments have
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mistakenly been made by an employer, in the following situations,
a 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." (emphasis supplied).
11. The principle enunciated in proposition (ii) above cannot
apply to a situation such as in the present case. In the present
case, the officer to whom the payment was made in the first
instance was clearly placed on notice that any payment found to
have been made in excess would be required to be refunded. The
officer furnished an undertaking while opting for the revised pay
scale. He is bound by the undertaking."
16. The Division Bench of this Court in Balbir Singh's case
(supra) has held that excess payment made to a retired employee due to
clerical error is recoverable even after retirement by applying the doctrine
of unjust enrichment. The apposite paragraphs embodying such
observations are reproduced hereunder:-
"6. The appellant is not challenging the fixation of his pension.
He also does not dispute that after re-fixation of his pension by
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the authorities, less payment was to be made, but due to
inadvertent clerical error on the part of the bank authorities,
excess amount was credited in his pension account, which he was
not entitled to. In these circumstances, notice was issued to the
appellant to refund the excess payment received by him. In our
opinion, the said excess payment, which was made to the
appellant due to clerical error on the part of the bank, is duly
recoverable. The aforesaid judgments, relied upon by learned
counsel for the appellant, are not applicable in the wake of the
situation as sketched out above. The principle laid down in these
judgments is that where the Government consciously makes
excess payment to an employee considering that it was validly
being given to him, but later on it is found that such employee was
not actually entitled to receive the said amount, in that situation,
if the excess payment was made under bonafide act of the State,
and without any misrepresentation or fraud by the employee,
recovery of such excess payment cannot be effected from the
employee after his retirement. This principle enunciated in the
aforesaid judgments does not apply to the facts of the present
case. Here, due to clerical error on the part of the bank, excess
amount was credited in the pension account of the appellant, for
which he was not entitled to either at that time or subsequently.
Therefore, such amount has to be refunded by the appellant to the
authorities, which has been received by him in excess. The
principle of unjust enrichment will be applicable in the present
case and when the appellant is approaching this Court under
Article 226 of the Constitution of India, he cannot be granted an
inequitable benefit, by relying upon the aforesaid judgments. The
necessary relief has already been granted to the appellant by the
learned Single Judge, which in our opinion is more than the
relief, which he deserves. We do not find any illegality in the
order passed by the learned Single Judge."
17. The ratio laid down in Balbir Singh's case (supra) has been
consistently followed by Co-ordinate Benches of this Court in
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"Surinderjit Singh Vs. State of Punjab and Others", CWP-8511-2020;
"Makhan Singh Vs. State of Punjab and Others", CWP-18161-2021;
"Parkash Singh Vs. State Bank of India", CWP-18089-2019; and
"Shinderpal Kaur Vs. State of Punjab and Others", CWP-19783-2014.
18. In the case at hand, the petitioner is the widow of the retiree
Kesar Singh, who took voluntary retirement w.e.f. 04.05.1999 and was
issued the P.P.O. (Annexure P-1), containing a clear stipulation regarding
his entitlement to pension and the entitlement of his spouse/petitioner to
family pension in the event of his death. As per the P.P.O. (Annexure P-
1), the petitioner ought to have been disbursed family pension at the
reduced rate of ₹4,752/- instead of the enhanced rate of ₹5,969/- w.e.f.
18.01.2010. However, the S.B.I. continued to disburse family pension at
the enhanced rate, which it now seeks to recover from the petitioner.
Although there is no dispute regarding the legal entitlement of the S.B.I.
to recover the excess pension amount paid, in view of the undertaking
(Annexure R-2/1) furnished by the petitioner, this Court is nevertheless
required to assess the hardship that the petitioner would face if such
recovery is permitted to be effected.
19. In "Thomas Daniel Vs. State of Kerala and Others", Civil
Appeal No.7115 of 2010, Decided on: 02.05.2022, the Hon'ble Supreme
Court has examined a similar issue at length and following the principles
laid down in Rafiq Masih's case (supra) and also by applying the
principle of equity, restrained the employer from recovering any amount.
20. One of the situations of hardship, as recognized in Rafiq
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Masih's case (supra) and extracted hereinabove, which would govern
employees on the issue of recovery, is that 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. It is undisputed that no employer-employee relationship
exists between the S.B.I. and the petitioner, and that the S.B.I. acts merely
as a disbursing agent. It is also not in dispute that the disbursal of family
pension at the enhanced rate was the result of a mistake on the part of the
S.B.I., which remained undetected for over a decade. Hence, seeking
recovery from a widow, who is in the twilight years of her life and is
solely dependent upon the meagre family pension, would be manifestly
harsh and inequitable. The recovery of ₹10,587/- per month, as already
effected by the S.B.I. w.e.f. April, 2021 to February, 2022, and thereafter
₹11,851/- per month w.e.f. March, 2022 to May, 2022, from the family
pension paid to the petitioner, would leave her with a very meagre amount
or virtually no amount at all for her sustenance in the dusk of her life,
especially when she has no other source of income. This Court is of the
view that, if recovery is permitted to be effected from the petitioner, it
would certainly cause hardship of such magnitude as would far outweigh
the equitable balance of the S.B.I.'s right to recover.
22. As regards the undertaking (Annexure R-2/1), which
constitutes the fulcrum of arguments advanced by the S.B.I. to establish
its right to initiate recovery from the petitioner, a Division Bench of this
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Court in "The Chief Postmaster General, Haryana Circle, Ambala and
Others Vs. Kavita Devi and Another", CWP-1656-2025, has held that
such undertakings obtained on dotted lines from retirees or their family
members, authorizing the employer to deduct any amount outstanding
against the employee from pension, amount to exploitation and cannot, by
themselves, justify recovery. The decision rendered in Jagdev Singh's
case (supra) was also taken into consideration by the Division Bench
while laying down such principle. The relevant paragraph of the verdict
rendered in Chief Postmaster General's case is extracted hereinafter:-
"5. We, therefore, have carefully noticed the document placed
before relating to the consent statement of the respondent No.1
and find that the respondent No.1 has signed on the dotted lines
authorizing the Postal Department to deduct any amount
outstanding against her from pension or DCRG. The lady is the
widow of the deceased Government servant and asking her to sign
on the consent statement is nothing but a clear case of
exploitation. Moreover, we don't find that it is a case of
outstanding amounts against the deceased Government servant
and it is only a case where the payments were made by the
authorities without there being any fault on his part. The
contentions of the learned counsel for the petitioners, therefore,
need not be addressed again here and we, therefore uphold the
impugned order passed by the Central Administrative Tribunal."
23. Applying the principles enunciated in Rafiq Masih and Chief
Postmaster General's case (supra), this Court finds no merit in the
submissions advanced on behalf of the S.B.I. Accordingly, the present writ
petition is allowed, and the impugned demand notice is set aside to the
extent of the remaining outstanding recovery. It is clarified that the
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petitioner shall henceforth be entitled only to the family pension strictly in
accordance with the P.P.O. (Annexure P-1).
24. Pending application, if any, stands disposed of accordingly.
(KULDEEP TIWARI)
January 19, 2026 JUDGE
devinder
Whether speaking/reasoned : Yes/No
Whether Reportable : Yes/No
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