The doctrine of 'legitimate expectation' imposes a duty on public authority to act fairly by taking into consideration all relevant factors relating to such 'legitimate expectation'. Pre-decisional notice is a requirement in the observance of principles of natural justice.

1. An ex-army Captain who had been absorbed in a public sector undertaking is the writ petitioner. The question is with regard to pay fixation and; recovery of excess payment,

2. The writ petitioner joined the service of Indian Army with effect from 20th October 1975. He had six years service to his credit in the Army. His period of service in the Army ended on 18th November 1981. On 16th May 1984 he was appointed as Junior Security cum Liaison Officer in the State Bank of Travancore. Ext. P1 is the letter of appointment issued by the State Bank of Travancore on 12th May 1984. As per Ext. P1 the petitioner is given the basic pay of Rs. 700 per mensem in the scale of Rs. 700-40-900-50-1100-EB-1200-60-1800 in the Junior Management Grade as applicable to ex-service men employees of the Bank. Subsequently on the basis of the Government orders the petitioner's basic pay was fixed at Rs. 950, since it did not exceed the basic pay of Rs. 1,800 as last drawn by him in the army service. In the year 1986 the pay scale of the officers of the State Bank of Travancore was revised. Consequently the petitioner's basic pay was fixed at Rs. 1,545 in the revised pay scale. However by Ext. P-4 the State Bank of Travancore proposed to revise the pay scale in the case of all Ex-ECOs./SSCOs. Apprehending reduction in the pay scale, the petitioner submitted a representation before the Bank. The petitioner did not receive any reply. However the second respondent, General Manager of the Bank, without issuing; any notice and without even affording an opportunity to file representation, issued Ext. P5 memorandum fixing the basic pay of the petitioner at Rs. 1,295. It was also proposed to recover the alleged excess payment in monthly instalments from the salary. It was under that situation the petitioner came before this court with the present writ petition.

3. The Ext. P-2 order of the Government of India, inter alia, provides thus:

"So far as benefit in fixation of pay is concerned however, the Government have agreed that taking cognizance of the fact that, these ECOs/SSCOs have spent a part of their earlier service in the Army in the time of need, they could be given the benefit of pay fixation on the same terms and conditions as were applicable to those ECOs/SSCOs who were appointed against reserved or unreserved vacancies as the case may be in Group A/Group B post/service."

Ext. P--3 Circular issued by the Bank says that the Government of India have advised the Bank that Ex-ECOs/SSCOs who joined pre-commissioned training or were commissioned after 10th January 1968 may also be granted advance increments equal to the number of completed years of service rendered by them in the armed forces. Placing reliance on Exts. P-2 and P-3, the petitioner submits that the Bank has no authority or power to revise basic pay to his disadvantage and to recover the alleged excess payment. The revision of basic pay and the consequent recovery of the alleged excess payment, in other words, would violate his fundamental rights under Art.14 and 16 of the Constitution.

4. The State Bank of Travancore, on the other hand, submitted that the Government of India subsequently has issued certain guidelines in the matter of pay fixation of ex-ECOs/SSCOs re employed in public sector Banks. The Bank has placed reliance on Exts. R-2(a) and R-2(b). It is submitted that in the case of ex-ECOs/SSCOs who joined public sector Banks on or after 1st February 1984, their pay will be fixed in the Bank's revised scale at the minimum of the pay scale and thereafter they will be allowed as many increments as completed year of service they put in service subject to the condition that the total emoluments in the re-employed post do not exceed the total emoluments he was drawing at the time of his release from the armed forces. However the respondent has not produced any ' orders superseding Ext. P-2 order of the Government of India. The benefits available to the petitioner under Exts. P-2 and