Supreme Court of India
JAGDISH PRASAD SINGHversusSTATE OF BIHAR AND OTHERS
- Citation
- 2024 INSC 591
- Decided
- 8 August 2024
- Disposal
- Appeal(s) allowed
- Bench
- SANDEEP MEHTA
Holding
The Court held that paragraph 11 of the 1999 Government Resolution protects employees who received time‑bound promotions before 31 December 1995, rendering the reduction of the appellant’s pay scale and the recovery of excess salary after retirement illegal, arbitrary and violative of natural justice.
Summary
Jagdish Prasad Singh, a retired government employee, was promoted to Senior Selection Grade (ADSO) on 10 March 1991 and received the revised pay scale of Rs.6500-10500 under the 5th Pay Commission. The State of Bihar later claimed that a 1999 Government Resolution (paragraph 11) automatically terminated his promotion after 31 December 1995, reducing his pay to the lower scale and demanding recovery of Rs.63,765 as excess salary, even though he had retired in 2001. The appellant challenged the reduction and recovery, arguing that the resolution protected time‑bound promotions granted before the cut‑off date and that the State had no authority to act after his superannuation without a departmental inquiry or notice, violating natural justice. The Supreme Court examined the interpretation of the resolution, the principles of equity in recovering excess payments, and the requirement of procedural fairness. It held that the resolution indeed safeguards such promotions, that the State cannot retrospectively reduce his pay or recover the amount after a long lapse, and quashed the impugned orders, allowing the appellant to retain his pension based on the higher pay scale.
Issues considered
- The applicability of paragraph 11 of the Government Resolution dated 8 February 1999 to employees who received time‑bound promotions before 31 December 1995.
- Whether the State can retrospectively reduce the pay scale and recover excess salary from a retired employee without a departmental inquiry or notice, in violation of natural justice.
- Whether recovery of excess emoluments after a long lapse, especially from a retired employee, is permissible under service law and constitutional principles.
Subjects
Service LawMarketing Officer in Junior Selection GradeSenior Selection Grade, Marketing Officer-cum-Assistant District Supply Officer (ADSO)PromotionObjection to promotionPay-scaleReduction of pay-scaleRecovery of the amount paid in excess beyond his entitlementMistake in fixation of payDepartmental inquirySuperannuationEmployer-employee relationshipPrinciples of Natural Justice
Judgment
[2024] 8 S.C.R. 377 : 2024 INSC 591
Jagdish Prasad Singh
v.
State of Bihar and Others
(Civil Appeal No. 1635 of 2013)
08 August 2024
[Sandeep Mehta* and R. Mahadevan, JJ.]
Issue for Consideration
The Accountant General, State of Bihar, raised an objection dated
28.01.2003, regarding the promotion accorded to the appellant on
10.03.1991 with a further remark that the promotion given to the
appellant on 10.03.1991 would become ineffective after 01.01.1996
in view of the Government Resolution dated 08.02.1999 and, thus,
the pay scale of the appellant would have to be revised and reduced
to match that of the lower post, i.e., the Marketing Officer from the
post of Senior Selection Grade, Marketing Officer-cum-Assistant
District Supply Officer (ADSO).
Headnotes†
Service Law – Objection to promotion – Reduction of pay
scale – Recovery of the amount paid in excess beyond his
entitlement – The High Court held that the revision and
consequent reduction in pay fixation of the appellant was
done in accordance with the paragraph 11 of the Government
Resolution dated 08.02.1999 as per which, the appellant was
not entitled to the higher pay scale which had wrongly been
accorded to him – Correctness:
Held: The fact regarding the appellant having been accorded
time bound promotion from the post of Marketing Officer in Junior
Selection Grade to Senior Selection Grade, Marketing Officer-cum-
Assistant District Supply Officer (ADSO) as per his entitlement on
10.03.991 is not in dispute – It is not the case of the respondents
that the said promotion suffered from any irregularity or was given
against the rules and regulations – The Resolution dated 19.01.1991
indicates that the next promotional channel from the post of the
Lower Senior Grade (Marketing Officer) was to the post of Upper
Senior Grade (Upper Marketing Officer) – The appellant having
been duly promoted to the post of Upper Senior Grade (Upper
* Author
378 [2024] 8 S.C.R.
Digital Supreme Court Reports
Marketing Officer) w.e.f. 10.03.1991 was entitled to and was rightly
given the pay scale of the promotional post – Pursuant to the 5th
Pay Commission being applied, the Government of Bihar issued a
Resolution dated 08.02.1999, whereby the pay scale applicable to the
post of Upper Senior Grade (Upper Marketing Officer) was revised
from Rs. 2000-3800 to Rs. 6500-10500 – The paragraph 11 of the
said Government Resolution specifically protects the promotions
granted to the employees prior to 31.12.1995 – Apparently the
appellant could not have been put to a disadvantage and his pay
scale could not have been reduced prospectively by virtue of the
said Resolution – The order whereby it was communicated to the
appellant that it was decided to recover a sum of Rs. 63,765/-
paid in excess due to mistake in fixation of pay, also indicates
that a departmental inquiry was conducted against the appellant
which had led to the impugned action – No departmental action
could have been initiated by the State against the appellant after
eight years following his superannuation because the employer
employee relationship had come to an end after the appellant’s
superannuation – The order directing reduction in pay scale and
recovery from the appellant was manifestly not preceded by any
show cause notice and was thus, passed in gross violation of the
principles of natural justice – The State Government to reduce
an employee’s pay scale and recover the excess amount cannot
be applied retrospectively and that too after a long time gap –
The Government Resolution dated 08.02.1999 to be specific, is
amenable to the interpretation that it protects the status and pay
of those employees who had received their time bound promotions
prior to 31.12.1995 – The said Resolution was misinterpreted and
misapplied to the detriment of the appellant – Thus, the impugned
action directing reduction of pay scale and recovery of the excess
amount is grossly arbitrary and illegal and also suffers from the vice
of non-adherence to the principles of natural justice and hence, the
same cannot be sustained. [Paras 18, 19, 20, 21, 25, 26]
Case Law Cited
Syed Abdul Qadir and Others v. State of Bihar and Others [2008]
17 SCR 917 : (2009) 3 SCC 475; ITC Limited v. State of Uttar
Pradesh and Others [2011] 7 SCR 66 : (2011) 7 SCC 493; State
of Punjab and Others v. Rafiq Masih (White Washer) and Others
[2014] 13 SCR 1343 : (2015) 4 SCC 334 – relied on.
Thomas Daniel v. State of Kerala and Others [2022] 4 SCR 606 :
(2022) SCC OnLine SC 536 – referred to.
[2024] 8 S.C.R. 379
Jagdish Prasad Singh v. State of Bihar and Others
List of Keywords
Service Law; Marketing Officer in Junior Selection Grade; Senior
Selection Grade, Marketing Officer-cum-Assistant District Supply
Officer (ADSO); Promotion; Objection to promotion; Pay-scale;
Reduction of pay-scale; Recovery of the amount paid in excess
beyond his entitlement; Mistake in fixation of pay; Departmental
inquiry; Superannuation; Employer-employee relationship;
Principles of Natural Justice.
Case Arising From
CIVIL APPELLATE JURISDICTION: Civil Appeal No.1635 of 2013
From the Judgment and Order dated 27.08.2012 of the High Court
of Patna in LPA No.1254 of 2011
Appearances for Parties
Gaurav Agrawal, Sr. Adv., C. George Thomas, Advs. for the Appellant.
Vikramjit Bannerjee, A.S.G., Rupesh Kumar, Sr. Adv., Manish Kumar,
Chandan Kumar, Raj Bahadur Yadav, Nachiketa Joshi, Rajesh
Kr Singh, Mrs. Sushma Verma, Ms. Priya Mishra, Advs. for the
Respondents.
Judgment / Order of the Supreme Court
Judgment
Mehta, J.
1. Heard.
2. This appeal by special leave is directed against the final judgment
dated 27th August, 2012 passed by the Division Bench of the High
Court of Judicature at Patna in Letters Patent Appeal No. 1254 of
2011, whereby the said appeal preferred by the appellant herein was
dismissed and the judgment dated 23rd February, 2010 passed by
the learned Single Judge of the High Court in Civil Writ Jurisdiction
Case (CWJC) No. 18542 of 2009 and so also the judgment dated
23rd March, 2011 passed by the learned Single Judge in Civil Review
No. 82 of 2010 were upheld.
3. Facts in a nutshell are that the appellant herein was appointed to the
post of Supply Inspector in the Government of Bihar in the year 1966.
After serving for 15 years, he received his first time bound promotion
380 [2024] 8 S.C.R.
Digital Supreme Court Reports
as Marketing Officer and was put in Junior Selection Grade w.e.f. 1st
April, 1981. Upon completing 25 years in service, the appellant was
further promoted to the post of Senior Selection Grade, Marketing
Officer-cum-Assistant District Supply Officer (in short ‘ADSO’) w.e.f.
10th, March 1991 in the pay scale of Rs.2000-3800.
4. The Government of Bihar issued a Resolution dated 8th February,
1999 revising the pay scale of Marketing Officer from Rs.1640-
2900 to Rs.5500-9000 and that of ADSO, from Rs.2000-3800 to
Rs.6500-10500 w.e.f. 1st January, 1996. Since the appellant had
been promoted as ADSO w.e.f. 10th March, 1991, his pay scale was
revised to Rs.6500-10500 in accordance with the Resolution dated
8th February, 1999 which is quoted below for ready reference: -
“11. The State Government have decided to abolish
the existing facilities of Time Bound Promotions and
Selection Grades, discussed in paras 10 and 12 of
F.D. Resolution No.6021 dated 18th December, 1989
and they shall cease to be applicable with effect
from 1st January, 1996 and thereafter in the existing
pay scales. If any such promotion, however, is due
under the Rules before 1st January, 1996, it shall be
given and the payment of arrears in the existing scale
shall be made only upto 31st December, 1995 after
which the promotion would be deemed to have been
automatically terminated. While fixing pay in the revised
scales, such promotions given after 31st December, 1995
will not be taken into consideration. If such promotions
have been given after 31st December, 1995 then the
question of adjustment of such additional emoluments
obtained in the process, will be decided after the Fitment
Committee submits its recommendations on promotion
Policy. Promotion to any vacancy of a post identified as
need based post would be admissible. The procedure for
identification of such need based posts has been set out
in paragraph 12.”
(emphasis supplied)
5. The appellant superannuated from the post of ADSO on 31st January,
2001. At the time of retirement, the last pay drawn by the appellant
was Rs.10500 in the pay scale of Rs.6500-10500 with admissible
[2024] 8 S.C.R. 381
Jagdish Prasad Singh v. State of Bihar and Others
emoluments. As per the Bihar Pension Rules of 1950, his pension was
calculated at 50% of the average emoluments and was quantified at
Rs.5247 per month. Accordingly, the pension as above was disbursed
to the appellant from the date of his retirement.
6. It seems that the Accountant General, State of Bihar, raised an
objection dated 28th January, 2003, regarding the promotion accorded
to the appellant on 10th March, 1991 with a further remark that
the promotion given to the appellant on 10th March, 1991 would
become ineffective after 1st January, 1996 in view of the Government
Resolution dated 8th February, 1999 and, thus, the pay scale of the
appellant would have to be revised and reduced to match that of
the lower post, i.e., the Marketing Officer.
7. After more than eight years from his retirement, the appellant received
a letter dated 15th April, 2009 from the Government of Bihar conveying
that an error had been committed in his pay fixation and, therefore, a
sum of Rs.63,765/- had to be recovered from him as the same had
been paid in excess beyond his entitlement. The letter directed the
appellant to refund the aforesaid amount in one go or instalments.
Language of the said letter is extracted below :-
“With reference to the above mentioned subject it is
submitted that after receiving the enquiry report from the
enquiry officer of the departmental enquiry done against you
and the analysis of the department, it has been decided that
a sum of Rs.63,765/- has been paid to you in excess due
to mistake in fixation of pay which is recoverable from you.
Kindly make it clear whether you will pay the said amount
in one go or in instalments. Kindly submit your report in
this regard within 15 days to ensure further action.”
(emphasis supplied)
8. Being aggrieved by the recovery notice and the reduction of
his pension, the appellant made several representations to the
Government of Bihar protesting against the reduction of his pension
and the proposed recovery. However, when such representations
were not responded to by the concerned authority, the appellant
preferred a petition under Article 226 of the Constitution of India,
being Writ Petition No. 6714 of 2009 before the High Court. The High
Court, vide order dated 20th July, 2009 directed the State of Bihar
382 [2024] 8 S.C.R.
Digital Supreme Court Reports
to consider the appellant’s representation. Pursuant thereto, on 4th
September 2009, the appellant filed another detailed representation
to the Government of Bihar, pointing out that paragraph 11 (supra)
of the Government Resolution dated 8th February, 1999 had been
misinterpreted in the letter dated 15th April, 2009, to deny the benefit
of the admissible pay scale to the appellant as per his entitlement,
which led to the unjust reduction of his pensionary benefits. A pertinent
plea was taken in the representation that the paragraph 11 (supra)
could not be interpreted to the prejudice of the appellant as he had
been given time bound promotion much before 31st December, 1995
and that the said Resolution specifically protected the promotions
made prior to the said date. Therefore, the appellant was entitled
to seek protection of his pay scale fixed in the bracket of Rs.6500-
10500 on the promotional post of ADSO.
9. The Secretary, Food and Consumer Protection Department,
Government of Bihar issued a communication dated 8th October, 2009
rejecting the appellant’s representation observing that the promotion
granted to the appellant would automatically come to an end after
31st December, 1995 by virtue of the Government Resolution dated
8th February, 1999 and hence, his pay scale would have to be revised
and reduced to Rs.5500-9000, by treating the appellant on the post
of Marketing Officer instead of ADSO at the time of retirement.
10. The appellant preferred CWJC No. 18542 of 2009 before the High
Court of Patna assailing the said order. The learned Single Judge,
vide order dated 23rd February, 2010 dismissed the said writ petition.
11. Asserting that his grievances had not been properly addressed by
the learned Single Judge, the appellant filed a Review Petition No.
82 of 2010 before the High Court which was rejected vide order
dated 23rd March, 2011.
12. Being aggrieved by the aforesaid orders, the appellant filed two
Letters Patent Appeals being Letters Patent Appeal No. 1254 of 2011,
challenging the order dated 23rd February, 2010 and Letters Patent
Appeal No. 815 of 2011 challenging the order dated 23rd March, 2011.
Learned Division Bench, rejected the LPA No. 815 of 2011 as not
maintainable vide order dated 24th August, 2012, whereas the LPA
No. 1254 of 2011 was rejected vide order dated 27th August, 2012,
holding that the revision and consequent reduction in pay fixation
of the appellant had been done in accordance with the paragraph
[2024] 8 S.C.R. 383
Jagdish Prasad Singh v. State of Bihar and Others
11 (supra) of the Government Resolution dated 8th February, 1999
as per which, the appellant was not entitled to the higher pay scale
which had wrongly been accorded to him. The said order is assailed
in this appeal by special leave.
Submissions on behalf of the appellant: -
13. Learned counsel for the appellant urged that the impugned orders are
ex facie bad in the eyes of law because the Government Resolution
dated 8th February 1999, was misinterpreted by the authorities as
well as by the High Court. He urged that paragraph 11 (supra) of the
Government Resolution dated 8th February 1999, clearly postulates
that the same would not have any adverse effect on the employees
who had received the time bound promotions prior to 31st December
1995. Admittedly, the appellant had been given time bound promotion
as Senior Selection Grade, Marketing Officer-cum-Assistant District
Supply Officer on 10th March, 1991, which was long before the cut off
date fixed under the said Government Resolution, i.e., 31st December,
1995 and thus, he was rightfully conferred the benefit of the revised
pay scale i.e. Rs.6500-10500 under the recommendations of the 5th
Pay Commission. The Government Resolution dated 8th February,
1999 having clearly indicated the cut-off date as 31st December, 1995,
the appellant would be protected from the adverse effects thereof and
was entitled to protect his promotion and pay scale. He thus, urged
that the impugned orders are grossly illegal and cannot be sustained.
14. He further contended that the reduction in the pay scale of the
appellant and the direction to effect recovery eight years after his
retirement, that too, without adhering to the principles of natural justice,
is even otherwise illegal, arbitrary and violative of Articles 14 and 16 of
the Constitution of India and thus, the same cannot be sustained. He
urged that the learned Single Judge as well as the Division Bench of
the High Court clearly fell in error while interpreting the Government
Resolution dated 8th February, 1999 because paragraph 11 (supra)
thereof protects the time bound promotion offered to the appellant
as per his entitlement on 10th March, 1991 and so also the revised
pay scale applicable to the said post under the 5th Pay Commission.
15. On these grounds, learned counsel for the appellant implored the
Court to set aside the impugned orders and the proposed recovery
from the appellant and so also the consequential reduction in his
future pensionary benefits.
384 [2024] 8 S.C.R.
Digital Supreme Court Reports
Submissions on behalf of the respondent: -
16. Per contra, learned counsel representing the State of Bihar, vehemently
and fervently opposed the submissions advanced by the learned
counsel for the appellant. It was contended that the Government
Resolution dated 8th February, 1999 was made uniformly applicable
to all employees in the State of Bihar. The appellant has not been
singled out for the impugned action and thus, there is no question
of any discrimination being meted out to the appellant. The Office of
the Accountant General had noticed the manifest error/irregularity in
grant of revised pay scale to the appellant and thus, a letter dated
15th April, 2009 was issued thereby, requiring the appellant to refund
the excess amount which he had received on account of wrong pay
scale having been conferred to him. He submitted that the learned
Single Judge as well as the Division Bench of the High Court rightly
interpreted the Government Resolution dated 8th February, 1999 and
recorded concurrent findings of fact denying relief to the appellant
and thus, the appellant is not entitled to seek indulgence from this
Court in this appeal under Article 136 of the Constitution of India.
He urged that the appeal should be dismissed.
Discussions and Conclusion: -
17. We have given our thoughtful consideration to submissions advanced
at bar and have gone through the material available on record.
18. At the outset, we may note that the fact regarding the appellant
having been accorded time bound promotion from the post of
Marketing Officer in Junior Selection Grade to Senior Selection Grade,
Marketing Officer-cum-Assistant District Supply Officer (ADSO) as
per his entitlement on 10th March 1991 is not in dispute. It is not
the case of the respondents that the said promotion suffered from
any irregularity or was given against the rules and regulations. The
Resolution dated 19th January, 1991 placed on record as Annexure
P-1 indicates that the next promotional channel from the post of the
Lower Senior Grade (Marketing Officer) was to the post of Upper
Senior Grade (Upper Marketing Officer). Earlier, the pay scale for
the post of Lower Senior Grade (Marketing Officer) was fixed at
Rs.1800-3330 whereas for the promotional post i.e. Upper Senior
Grade (Marketing Officer), the applicable pay scale was fixed at
Rs.2000-3800. The appellant having been duly promoted to the
post of Upper Senior Grade (Upper Marketing Officer) w.e.f. 10th
[2024] 8 S.C.R. 385
Jagdish Prasad Singh v. State of Bihar and Others
March, 1991 was entitled to and was rightly given the pay scale of
the promotional post. Pursuant to the 5th Pay Commission being
applied, the Government of Bihar issued a Resolution dated 8 th
February, 1999, whereby the pay scale applicable to the post of
Upper Senior Grade (Upper Marketing Officer) was revised from
Rs.2000-3800 to Rs.6500-10500. The paragraph 11 (supra) of the
said Government Resolution specifically protects the promotions
granted to the employees prior to 31st December, 1995. Only those
employees who were not promoted by the cut off date, i.e., 31st
December, 1995 would get a notional promotion and consequent
rise in pay scale which would come to an end w.e.f. 31st December,
1995. Apparently thus, the appellant could not have been put to
a disadvantage and his pay scale could not have been reduced
prospectively by virtue of the said Resolution. Even if paragraph
11 (supra) was not in existence, the appellant could not have been
subjected to eight years after his retirement because there was no
illegality in conferment of the revised pay scale to the appellant which
was an action taken by the State Government as per the applicable
rules and regulations.
19. The order dated 15th April, 2009 whereby it was communicated to the
appellant that it had been decided to recover a sum of Rs.63,765/-
paid in excess due to mistake in fixation of pay, also indicates that
a departmental inquiry was conducted against the appellant which
had led to the impugned action. On a pertinent query being made
in this regard, the learned counsel candidly conceded that no such
departmental inquiry was ever conducted against the appellant.
20. Without prejudice to the above findings, we are of the view that no
departmental action could have been initiated by the State against
the appellant after eight years following his superannuation because
the employer employee relationship had come to an end after the
appellant’s superannuation. The order directing reduction in pay
scale and recovery from the appellant was manifestly not preceded
by any show cause notice and was thus, passed in gross violation
of the principles of natural justice. Pursuant to the order dated 20th
July, 2009 passed in the Writ Petition No. 6714 of 2009 filed by the
appellant, he submitted a representation to the Secretary, Food and
Consumer Protection Department, Government of Bihar, which vide
order dated 8th October, 2009 was rejected, preceded by a personal
hearing. A perusal of the said order would indicate that the Secretary
386 [2024] 8 S.C.R.
Digital Supreme Court Reports
took a view that as per paragraph 11 (supra) of the Government
Resolution, the first/second time bound promotion of the appellant had
come to an end automatically w.e.f. on 1st January, 1996 and thus, the
appellant was required to be redesignated to the post of Marketing
Officer and would be entitled to the revised pay of Rs.5500-9000
w.e.f. 1st January, 1996 as recommended by the Fitment Committee.
Thus, even in this order, the promotion conferred to the appellant to
the post of ADSO on 10th March, 1991 is not doubted.
21. We firmly believe that any decision taken by the State Government
to reduce an employee’s pay scale and recover the excess amount
cannot be applied retrospectively and that too after a long time gap.
In the case of Syed Abdul Qadir and Others v. State of Bihar
and Others,1 this Court held that when the excess unauthorised
payment is detected within a short period of time, it would be open
for the employer to recover the same. Conversely, if the payment
had been made for a long duration of time, it would be iniquitous to
make any recovery. The relevant paras of the Syed Abdul Qadir
(supra) are extracted hereinbelow: -
“57. This Court, in a catena of decisions, has granted
relief against recovery of excess payment of emoluments/
allowances if (a) the excess amount was not paid on
account of any misrepresentation or fraud on the part of the
employee, and (b) if such excess payment was made by the
employer by applying a wrong principle for calculating the
pay/allowance or on the basis of a particular interpretation
of rule/order, which is subsequently found to be erroneous.
58. The relief against recovery is granted by courts not
because of any right in the employees, but in equity,
exercising judicial discretion to relieve the employees from
the hardship that will be caused if recovery is ordered.
But, if in a given case, it is proved that the employee had
knowledge that the payment received was in excess of what
was due or wrongly paid, or in cases where the error is
detected or corrected within a short time of wrong payment,
the matter being in the realm of judicial discretion, courts
1 [2008] 17 SCR 917 : (2009) 3 SCC 475
[2024] 8 S.C.R. 387
Jagdish Prasad Singh v. State of Bihar and Others
may, on the facts and circumstances of any particular
case, order for recovery of the amount paid in excess.
59. Undoubtedly, the excess amount that has been
paid to the appellant teachers was not because of any
misrepresentation or fraud on their part and the appellants
also had no knowledge that the amount that was being
paid to them was more than what they were entitled to. It
would not be out of place to mention here that the Finance
Department had, in its counter-affidavit, admitted that it
was a bona fide mistake on their part. The excess payment
made was the result of wrong interpretation of the Rule that
was applicable to them, for which the appellants cannot be
held responsible. Rather, the whole confusion was because
of inaction, negligence and carelessness of the officials
concerned of the Government of Bihar. Learned counsel
appearing on behalf of the appellant teachers submitted
that majority of the beneficiaries have either retired or
are on the verge of it. Keeping in view the peculiar facts
and circumstances of the case at hand and to avoid any
hardship to the appellant teachers, we are of the view that
no recovery of the amount that has been paid in excess
to the appellant teachers should be made.”
(emphasis supplied)
22. Similarly, this Court in ITC Limited v. State of Uttar Pradesh and
Others,2 held as under: -
“108. We may give an example from service jurisprudence,
where a principle of equity is frequently invoked to give
relief to an employee in somewhat similar circumstances.
Where the pay or other emoluments due to an employee
is determined and paid by the employer, and subsequently
the employer finds, (usually on audit verification) that on
account of wrong understanding of the applicable rules
by the officers implementing the rules, excess payment
is made, courts have recognised the need to give limited
relief in regard to recovery of past excess payments, to
2 [2011] 7 SCR 66 : (2011) 7 SCC 493
388 [2024] 8 S.C.R.
Digital Supreme Court Reports
reduce hardship to the innocent employees, who benefited
from such wrong interpretation.”
(emphasis supplied)
23. In the case of State of Punjab and Others v. Rafiq Masih (White
Washer) and Others,3 this Court held as under: -
“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 hereinabove, we
may, as a ready reference, summarise the following few
situations, wherein recoveries by the employers, would
be impermissible in law:
i) Recovery from the employees belonging to Class
III and Class IV service (or Group C and Group D
service).
ii) Recovery from the retired employees, or the
employees who are due to retire within one year, of
the order of recovery.
iii) Recovery from the 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)
3 [2014] 13 SCR 1343 : (2015) 4 SCC 334
[2024] 8 S.C.R. 389
Jagdish Prasad Singh v. State of Bihar and Others
24. Recently, this Court in Thomas Daniel v. State of Kerala and
Others,4 held that the State cannot recover excess amount paid to
the ex-employee after the delay of 10 years.
25. The Government Resolution dated 8th February, 1999 to be specific,
the highlighted portion supra is amenable to the interpretation
that it protects the status and pay of those employees who had
received their time bound promotions prior to 31 st December,
1995. As a consequence, the Secretary concerned, while rejecting
the representation clearly misinterpreted and misapplied the said
Resolution to the detriment of the appellant.
26. The learned Single Judge as well as the Division Bench of the
High Court of Patna also seem to have fallen in the same error. In
addition thereto, we are of the view that any step of reduction in
the pay scale and recovery from a Government employee would
tantamount to a punitive action because the same has drastic civil
as well as evil consequences. Thus, no such action could have
been taken against the appellant, more particularly, because he
had been promoted as an ADSO, while drawing the pay scale of
Rs.6500-10500 applicable to the post, way back on 10th March,
1991 and had also superannuated eight years ago before the
recovery notice dated 15th April, 2009 was issued. The impugned
action directing reduction of pay scale and recovery of the excess
amount is grossly arbitrary and illegal and also suffers from the vice
of non-adherence to the principles of natural justice and hence, the
same cannot be sustained.
27. The order dated 8th October, 2009 passed by the State Government
directing reduction in the pay scale of the appellant from Rs.6500-
10500 to Rs.5500-9000 w.e.f. 1st January, 1996 and directing recovery
of the excess amount from him is grossly illegal and arbitrary and
is hereby quashed and set aside. The impugned order dated 27th
August, 2012 passed by the Division Bench of the High Court does
not stand to scrutiny and is hereby quashed. Therefore, the appellant
shall continue to receive the pension in accordance with the pay
scale of Rs.6500-10500.
4 [2022] 4 SCR 606 : 2022 SCC OnLine SC 536
390 [2024] 8 S.C.R.
Digital Supreme Court Reports
28. In case, if any reduction in pension and consequential recovery was
effected on account of the impugned orders, the appellant shall be
entitled to the restoration/reimbursement thereof with interest as
applicable.
29. The appeal is allowed in these terms. No order as to costs.
30. Pending application(s), if any, shall stand disposed of.
Result of the case: Appeal allowed.
†
Headnotes prepared by: Ankit Gyan
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