Back
2019 Supreme(Cal) 215
IN THE HIGH COURT OF CALCUTTA
Arijit Banerjee, J.
Niladri Kumar Choudhury - Appellant
Vs.
State of West Bengal & Ors. - Respondents
Writ Petition No. 24231 of 2017
Decided On : 30-01-2019
Sourav Mitra, Adv., Balaram Dutta, Adv., Bhaskar Prasad Vaisya, Adv., Suman Dey, Adv.
Recovery from pensionary benefits of an employee can be made if the employee has fraudulently induced the employer to make the excess payment, but recovery cannot be made if the employee had no role to play in the wrong fixation of his pay and allowances
Headnote:
Recovery - Retiral Benefits - Shyam Babu Verma vs. Union of India (1994) 2 SCC 521, Syed Abdul Qadir vs. State of Bihar (2009) 3 SCC 475, State of Punjab vs. Rafiq Masih (2015) 4 SCC 334, Chandi Prasad Uniyal vs. State of Uttarakhand (2012) 8 SCC 417, High Court of Punjab & Haryana vs. Jagdev Singh - Recovery from employees belonging to Class-III and Class-IV service, Recovery from retired employees, Recovery from employees when the excess payment has been made for a period in excess of five years, Recovery in cases where an employee has wrongfully been required to discharge duties of a higher post, Recovery if made from the employee would be iniquitous or harsh or arbitrary, Excess payment due to wrong/irregular pay fixation can always be recovered, Excess payment can be recovered only up to one year before the retirement of the employee, Excess payment made due to wrong/irregular pay fixation can always be recovered, Excess payment could be recovered from a retired employee or employees who are due to retire within one year of the order of recovery, Excess payment can be recovered if an employee had undertaken to refund any excess amount paid to him, Excess payment can be recovered if the employee was aware that he was receiving payment in excess of what he was entitled to, Excess payment can be recovered if the error is detected or corrected within a short time of wrong payment, Recovery from pensionary benefits of an employee can be made if the employee has fraudulently induced the employer to make the excess payment, Recovery from pensionary benefits of an employee cannot be made if the employee had no role to play in the wrong fixation of his pay and allowances
Fact of the Case:
The petitioner, a retired Assistant Teacher, approached the court after an amount was deducted from his retiral benefits on account of alleged overdrawal. The petitioner argued that recovery of excess payment cannot be made from retiral benefits unless such excess payment was made due to misrepresentation or fraud on his part.
Finding of the Court:
The court considered various Supreme Court decisions and observed that recovery from employees belonging to certain service classes, retired employees, and employees due to retire within one year of the order of recovery would be impermissible. The court also noted that excess payment due to wrong/irregular pay fixation can always be recovered, but only up to one year before the retirement of the employee. The court held that the petitioner should not be subject to recovery from his retiral benefits as he had no role in the wrong fixation of his pay and allowances.
Issues: Recovery of excess payment from retiral benefits, Applicability of Supreme Court decisions on recovery of excess payment
Ratio Decidendi: Recovery from pensionary benefits of an employee can be made if the employee has fraudulently induced the employer to make the excess payment, Recovery from pensionary benefits of an employee cannot be made if the employee had no role to play in the wrong fixation of his pay and allowances
Final Decision: The court directed the concerned Treasury Officer to release the amount deducted from the petitioner's retiral benefits along with interest, and the writ petition was disposed of in favor of the petitioner.
Arijit Banerjee, J.
Affidavit-Of-Service filed in Court be kept with the record.
2. The petitioner was an Assistant Teacher of a Primary School. He retired from service on 31 January, 2006. The Pension Payment Order was issued by the respondent authorities on 23 June, 2006. An amount of Rs. 1,43,970/- was deducted on account of alleged overdrawal. Being aggrieved, the petitioner has approached this Court by way of the present writ petition.
3. Learned Counsel for the petitioner submitted that recovery of excess payment cannot be made from the retiral benefits of an employee unless such excess payment was made to the concerned employee because of some misrepresentation or fraud on his part. In support of his submission, Learned Counsel relied on several decisions of this court and primarily on three Supreme Court decisions in the cases of Shyam Babu Verma vs. Union of India, (1994) 2 SCC 521, Syed Abdul Qadir vs. State of Bihar, (2009) 3 SCC 475 and State of Punjab vs. Rafiq Masih, (2015) 4 SCC 334. In paragraph 18 of the last of the said three judgments, the Hon'ble Apex Court observed as follows:-
"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 follow 3 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."
4. Xxx
5. Xxx
6. I have also considered the decision of the Hon'ble Apex Court in Chandi Prasad Uniyal vs.State of Uttarakhand, (2012) 8 SCC 417, which is to the effect that except in few instances pointed out in Syed Abdul Qadir (supra) and in Col. B. J. Akkara vs.Govt. of India, (2006) 11 SCC 709, excess payment made due to wrong/irregular pay fixation can always be recovered. I have also considered the decision of the Hon'ble Apex Court dated 29 July, 2016 delivered in Civil Appeal No. 3500 of 2006 (High Court of Punjab & Haryana vs. Jagdev Singh) to the effect that if at the time of taking benefit of a revised higher pay scale or at the time of applying for pensionary benefits the concerned employee/officer gives an undertaking/declaration that he would be liable to refund any excess payment made to him, he would be bound by such undertaking/declaration. As and when the excess payment is detected by the employer/State, the same can be recovered from the concerned employee and the same can be deducted from the pensionary benefits released in favour of a superannuating employee if such excess payment is detected prior to releasing such benefits.
7. I have considered the rival contentions of the parties.
8. In Shyam Babu Verma (supra), although the Hon'ble Apex Court held that the petitioners were entitled to a lower scale of pay than they actually enjoyed, yet, since they received a higher scale of pay due to no fault of theirs, the Hon'ble Apex Court held that it shall only be just and proper not to recover any excess amount which had already been paid to them. In Syed Abdul Qadir (supra), the Hon'ble Apex Court observe
