Court No. - 33
Case :- WRIT - A No. - 9955 of 2012
Petitioner :- Arun Kumar
Respondent :- State Of U.P. & Others Counsel for Petitioner :- S.C. Srivastava Counsel for Respondent :- C.S.C.
Hon'ble Manoj Misra,J. Hon'ble Shashi Kant,J.
We have heard learned counsel for the petitioner; the learned Standing Counsel for the respondents; and have perused the record.
The petitioner has challenged the order dated 06.09.2011 passed by the Labour Commissioner, U.P. by which the salary of the petitioner, earlier fixed, has been revised downwards, with effect from 01.10.1986, upon finding that the petitioner, by mistake, was given one additional increment.
The learned counsel for the petitioner has assailed the impugned order on the ground that such fixation of salary was not made on account of any misrepresentation or fraud played on the part of the petitioner and the same was initially fixed in the year 1995 and since the petitioner has superannuated on 31.07.2009, the decision to revise the salary downwards, now, is not legally justified as it would result in recovery of the excess payment earlier made. It has also been pointed out that at the bottom of the impugned order, an endorsement has been made that recovery proceeding in accordance with law be initiated against the petitioner which would not be justified in the light of the law laid down by the Apex Court in the case of State of Punjab and others : Rafiq Masih (White Washer) and others : (2015) 4 SCC 334.
The learned Standing Counsel has submitted that in view of the larger Bench decision of the Apex Court in Syed Abdul Qadri Vs. State of Bihar (2009) 3 SCC 475 as also in State of Punjab and others Vs. Ragiq Masih (White Washer) : (2014) 8 SCC 883, which has approved the law laid down in Chandi Prasad Uniyal And Ors vs State Of Uttarakhand And Ors : (2012) 8 SCC 417, the department is legally justified in correcting the salary by removing the error and making it in consonance with law and therefore no fault can be found in the order whereby the salary has been corrected after noticing that one extra unauthorised increment was provided to the petitioner.
The learned Standing Counsel has also submitted that, at this stage, no order for recovery has been issued though it has been endorsed to the concerned authority to examine and take appropriate steps to recover, in accordance with law. It has been suggested by him that the petition to that extent is premature because as and when recovery orders are issued, it shall be open to the petitioner to challenge the recovery order by taking such pleas as may be permissible.
We have considered the rival submissions and have perused the record carefully.
A perusal of the counter-affidavit would reveal that the salary of the petitioner was wrongly fixed by providing one extra increment which came to notice when the error was brought to the notice of the establishment through a complaint made by a person senior to the petitioner that his junior (the petitioner) was getting a higher scale than what he was getting. Thereafter, the matter was examined and it was found that one additional increment was wrongly provided to the petitioner and, consequently, the salary of the petitioner was corrected retrospectively so as to make it in conformity with what was legally admissible to the petitioner.
The learned counsel for the petitioner has not challenged the correctness of the re-fixation. The only ground on which the impugned order has been challenged is that the petitioner has since retired from service and there is nothing on record to show that the petitioner had made any misrepresentation or had played fraud in obtaining higher salary.
There can be re-fixation of salary so as to make it in conformity with circulars, notification, etc. and errors can be corrected, but when it comes to recovery, in case of extreme hardship, the Court may direct that recovery should not be made of any excess payment already made.
On the issue of recovery, after examining the previous decisions, the apex court in its subsequent decision in the case of State of Punjab and others : Rafiq Masih (White Washer) and others : (2015) 4 SCC 334, had taken the view that in certain situations, recovery would be impermissible. Those situations have been enumerated in paragraph 18 of the report, which is extracted below:-
"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 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. "
In a subsequent decision rendered by the Apex Court in State of Punjab & Haryana and Ors. Vs. Jagdev Singh : 2016 Legal Eagle 512, the Apex Court had the occasion to deal with a situation where employee had given an undertaking that if any payment made is found to be in excess of his entitlement he would refund. After examining the law laid down in Rafiq Masih (White Washer) (supra), in paragraphs 10 and 11 of the report, the Apex Court, in Jagdev Singh's case (supra), held as follows:-
"10. In State of Punjab & Ors etc. vs. Rafiq Masih (White Washer) etc (2015) 4 SCC 334. this Court held that while it is not possible to postulate all situations of hardship where payments have 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."
In view of the law noticed above, the position that emerges is that ordinarily recovery should not be made from retired employees but there may be situations where an undertaking may have been given by an employee that in case the payment made is found to be excess of his entitlement then the same would be refunded or there may be a situation where the employee is aware that higher than his entitlement has been paid to him or is being paid to him as also a situation where he has been put to notice that if payment made is found in excess of his entitlement then the same shall be recovered from him. In such cases, recovery may be justified in the light of law laid down in Jagdev Singh's case (supra).
As, in the instant case, till date, no order of recovery has yet been passed by the respondents and it appears that only a decision has been taken to initiate proceeding for recovery, we consider it appropriate to dispose of this petition by directing that an order of recovery of the excess payment alleged to have been made to the petitioner, shall be made only after considering the explanation of the petitioner and by recording reasons. It is left open to the petitioner to challenge order of recovery, if any, that may be passed.
It is made clear that this court has not expressed any opinion as to whether recovery of the excess payment ought to be made from the petitioner.
With the aforesaid observations/directions, the petition stands disposed
of.
Order Date :- 24.8.2018 Sunil Kr Tiwari
(Shashi Kant, J.) (Manoj Misra, J.)