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2024 Supreme(Online)(P&H) 11840

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Harpreet Singh Brar, J
Sajjan Kumar Goyal – Appellant
Versus
State of Haryana – Respondent
CWP-32661-2024



Advocates:
For the Appellants/Petitioners: Raman B. Garg, Mayank Garg, Navjeet Singh
For the Respondents: Arun Singla, Navya Jindal, Prince Singh

Recovery of excess payment from a retired employee's pension is impermissible without the pensioner's express written consent or an undertaking, and any such action without prior notice and a fair opportunity of hearing violates the principles of natural justice and applicable service rules.

Headnote:(A) Constitution of India - Articles 226 and 227 - Principles of Natural Justice - Recovery of excess payment from pensioner - Absence of notice or opportunity of hearing - Unilateral deduction from pension account is impermissible where recovery is effected without prior notice and opportunity of hearing, violating principles of natural justice. (Paras 6, 20)

(B) Service Jurisprudence - Pension - Recovery of excess payment - Requirement of express consent - Under relevant service rules, recovery of government dues from sanctioned pension is prohibited except at the request or with the express consent of the pensioner. Law mandates that in absence of consent, government must seek recovery through legal proceedings in a court of law. (Paras 10, 11, 13)

(C) Service Jurisprudence - Pension - Revision of pension - Pension once authorised after final assessment should not be revised to the disadvantage of the employee unless necessitated by clerical error; however, such revision requires due notice and concurrence where the error is detected after a significant delay. (Paras 25, 32, 34)

Facts of the case:
The petitioner, upon retirement, was granted pensionary benefits. Subsequently, authorities unilaterally revised the pension and deducted a significant amount from the petitioner's bank account, citing a clerical error regarding Dearness Allowance payments, without issuing any show-cause notice or seeking the petitioner's consent. The petitioner challenged this recovery, asserting it was illegal and in violation of established service rules and natural justice.

Findings of Court:
The court held that the recovery was arbitrary and illegal. The authority failed to provide an opportunity of hearing, and the statutory rules explicitly prohibit recovery from pension without the pensioner's written consent. Furthermore, there was no undertaking provided by the petitioner to refund excess payments, rendering the recovery unsustainable.

Issues: 1. Whether recovery of excess payment can be effected from a retired employee's pension without express consent. 2. Whether pension authorized after final assessment can be refixed to the disadvantage of an employee without due process and notice.

Ratio Decidendi: The court reasoned that the principle of natural justice requires a prior opportunity of hearing before any adverse civil consequence, such as the recovery of funds, is inflicted. Given the lack of written consent and the absence of any prior undertaking by the petitioner, the state entity cannot unilaterally recover excess payments, which causes financial hardship and violates the protective regime governing retired employees.

Result: Petition allowed. Impugned order quashed. Respondents directed to refund the recovered amount with interest.

Table of Content
1. factual history regarding pension recovery without notice. (Para 2 , 3 , 4 , 5)
2. contentions regarding illegal recovery and natural justice. (Para 6 , 7 , 8)
3. requirement of express consent for pension recovery under rule 2.2(a). (Para 9 , 10 , 11 , 12 , 13 , 14 , 15)
4. impermissibility of recovery from retirees absent undertaking. (Para 16 , 17 , 18 , 19 , 20 , 21 , 22)
5. agency bank unauthorized to unilaterally debit pension. (Para 23 , 24)
6. pension refixation rules under punjab civil services. (Para 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32)
7. refixation/recovery limitations under haryana service rules. (Para 33 , 34 , 35 , 36)
8. administrative duty of procedural fairness in pension matters. (Para 37 , 38 , 39 , 40 , 41)

HARPREET SINGH BRAR, J. (Oral)

1. The present writ petition has been filed under Article 226/227 of the Constitution of India with a prayer for issuance of an appropriate writ or order in the nature of certiorari for quashing the impugned order dated 16.11.2022 (Annexure P-4) which upheld the recovery of an amount of ₹6,63,688/- from the petitioner's pension with further directions to pay the recovered amount to the petitioner with interest @ 12% p.a.

FACTUAL BACKGROUND

2. Briefly stated, the facts are that the petitioner retired from the post of Executive Officer from the Municipal Council, Kaithal (Respondent No. 3) on attaining the age of superannuation on 29.02.2016. Upon retirement, the petitioner was issued a Pension Payment Order (PPO) No. 6386 by the Director, Urban Local Bodies, Haryana (Respondent No. 2) vide letter dated 09.08.2016, sanctioning his pension with effect from 01.03.2016. A copy of the PPO was sent to the Punjab National Bank, Kaithal (Respondent No. 4), where the petitioner held his pension account.

3. In the year 2019, the respondent authorities, on their own motion, revised the petitioner's pension with effect from 01.03.2016. This revision was undertaken under the Haryana Civil Services (Revised Pension) Part-I Rules, 2017, read with Office Memorandum dated 10.01.2018 and Office Memo dated 27.05.2019. However, neither any calculations for this revision were provided to the petitioner, nor did he make any representation inducing the authorities to pay any alleged excess amount. Thus, the revision was a unilateral act of the respondents. Subsequently, on 31.03.2021, an amount of ₹6,63,688/- was deducted from the petitioner's personal bank account with Respondent No. 4 Bank. The transaction was remarked as ‘Recovery of Excess Pension.’ This recovery was effected without any prior notice, show-cause, or opportunity of hearing to the petitioner.

4. Aggrieved by the aforesaid action, the petitioner issued a legal notice-cum-representation dated 22.06.2022 (Annexure P-2) to Respondent No. 2, requesting the refund of the recovered amount. Upon receiving no response, the petitioner approached this Court by way of CWP No. 18207 of 2022. Vide order dated 22.08.2022 (Annexure P-3), this Court disposed of the said writ petition with a direction to Respondent No. 2 to decide the petitioner's representation by passing a speaking order within eight weeks.

5. In purported compliance with the aforesaid direction, Respondent No. 2 passed the impugned order/endorsement dated 16.11.2022 (Annexure P-4) whereby the petitioner's claim for refund was rejected. The respondent authority justified the recovery by stating that due to a ‘clerical error,’ the petitioner had been inadvertently paid two Dearness Allowances (DA), one on the revised pension and another on the unrevised pension, from April 2019 to February 2021, amounting to an excess payment of ₹28,856/- per month. The impugned order further insinuated that the petitioner, being an educated person, must have been aware that he has received an excess payment. Being aggrieved by the impugned order (Annexure P-4), the petitioner has filed the present writ petition.

CONTENTIONS

6. Learned counsel for the petitioner

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