Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Ori) 667

IN THE HIGH COURT OF ORISSA AT CUTTACK
BIRAJA PRASANNA SATAPATHY, J.
K. Prabhakar Prusty - Petitioner
Versus
State Of Odisha And Others – Respondents
W.P.(C) No.33013 of 2021
Decided On : 12-01-2026

Advocates Appeared:
For the Petitioner:Mr. P.K. Mishra, Advocate
For the Respondent: Mr. S.P. Das, Asc

Decisions affecting public servants' benefits must adhere to principles of natural justice to prevent arbitrary actions and ensure fairness.

Headnote:(A) Service Law - Principles of Natural Justice - Order issued without affording an opportunity to be heard is unsustainable - Beneficial orders granted previously should not be retracted without proper procedure - Recovery from retired employees requires careful scrutiny under provisions established by the Supreme Court. (Paras 3.1, 5.1)

(B) Administrative Action - The necessity of following the audi alteram partem rule guarantees fair procedure in administrative decisions, particularly those that affect civil rights. (Paras 3.6, 3.9)

Facts of the case:
The petitioner sought to quash several letters and orders that refixed his pay and granted erroneous recoveries after attaining retirement, highlighting a lack of due process in these actions.

Findings of Court:
The Court found that the impugned order was issued without following the principle of natural justice, leading to its quashing and direction for a fresh decision on the benefits due to the petitioner.

Issues: The court addressed whether the orders to retract benefits were consistent with natural justice and if recoveries conducted were legally permissible.

Ratio Decidendi: The Court ruled that decisions affecting pensions and service benefits must adhere to fairness and the established framework of natural justice, rejecting arbitrary decision-making by administrative bodies.

Result: Writ Petition allowed; the order quashed with a directive for reconsideration.

Table of Content
1. petitioner's prayer for relief from the court (Para 2)
2. background of pension benefits and adjustments post-retirement (Para 3)
3. challenges to the withdrawal of benefits and procedural fairness (Para 4)
4. quashing of the impugned order due to violation of natural justice (Para 5)
5. conclusion of the writ petition by the court (Para 6)

JUDGMENT :

Biraja Prasanna Satapathy, J.

1. Heard Mr. P.K. Mishra, learned counsel for the petitioner and Mr. S.P. Das, learned Addl. Standing Counsel for the State.

2. Petitioner has filed the present Writ Petition inter alia with the following prayer:-

“It is prayed, therefore that this Hon’ble Court may graciously be pleased to;

(i) Admit and allow the writ petition

(ii) And be pleased to quash the impugned letters vide No. 8631/T dated 02.11.2020, vide No.4466 dated 17.05.2021, order No.8820 dated 19.08.2021 and letter No. 500 dated 30.09.2021 under Annexure-5, 8, 9 and 10 respectively;

(iii) And be pleased to direct the Opp. Parties to allow the petitioner to get Grade Pay of Rs.6600/- towards 3" RACP as was granted vide order No.5452/TC dated 11.04.2016 under Annexure-3;

iv) And further be pleased to direct the Opp. Parties to sanction and disburse all retirement dues such as pension, Gratuity. and Commuted Value of pension as per the pension papers submitted earlier under Annexure-6 within a stipulated period of time.

v) And further be pleased to direct the Opp. Parties to pay interest’ @ 18% per annum on arrear pension, Gratuity and Commuted value of pension in terms of Annexure-12 & 13 within a stipulated period of time.

vi) Pass such other order (s), direction (s) as deem fit and proper to the facts and circumstances of the case to give complete relief to the petitioner.”

3. It is contended that petitioner while continuing in service he was extended with the benefit of 1^st, 2^nd and 3^rd RACP vide order dated 11.04.2016 under Annexure- 3. While in receipt of the benefit in terms of such order, petitioner retired from his services on attaining the age of superannuation on 31.01.2020 pursuant to office order dated 29.01.2020 under Annexure-4.

3.1. After such retirement of the petitioner, petitioner was sanctioned with the provisional pension. But while considering the sanction of final pension and other pensionary benefits as due and admissible, basing on the letter issued by Opp. Party No.3 on 02.11.2020 under Annexure-5, Opp. Party No.4 re-fixed the pay of the petitioner by withdrawing the benefit of order dated 11.04.2016 so issued under Annexure-3. While re- deciding the pay vide order dated 19.08.2021 under Annexure-9, petitioner was not allowed the benefit of 3^rd RACP and his entitlement to get the benefit of 1^st and 2^nd RACP was also re-fixed.

3.2. While re-fixing the benefit vide the impugned order under Annexure-9, petitioner was also directed to pay the excess amount so drawn by him on the ground of wrong extension of the benefit vide order under Annexure-3. It is also contended that the excess amount to the tune of Rs.5,37,907/- was kept withheld from the retiral gratuity in terms of order dated 30.09.2021 so issued under Annexure-10. Basing on such re-fixation of the pay, petitioner however was sanctioned with the pension and other pensionary benefits.

3.3. Learned counsel for the petitioner contended that since the benefit extended vide order dated 11.04.2016 under Annexure-3 prior to its withdrawal with passing of the impugned order on 19.08.2021 under Annexure- 9, has been passed by Opp. Party No.4 without following the principle of natural justice and without issuing a show-cause basing on the letter issued by Opp. Party No.3 on 02.11.2020 under Annexure-5, the said order is not sustainable in the eye of law.

3.4. In support of his submission, reliance was placed on the decisions of the Hon’ble Apex Court in the case of Menaka Gandhi vs. Union of India , AIR 1978 SC- 597, State of Orissa vs. Binapani Das , AIR 1967 SC-1269, State Bank of India And Others Vs. Rajesh Agar