Central Administrative Tribunal - Chandigarh
Surinder Mohan vs M/O Railways on 24 January, 2023
1- O.A. No. 669/2020
CENTRAL ADMINISTRATIVE TRIBUNAL
CHANDIGARH BENCH
Original Application No.060/669/2020
Chandigarh, this the 24th day of January 2023
(Reserved On: 05.01.2023)
HON'BLE SH. SURESH KUMAR BATRA, MEMBER (J)
Surinder Mohan aged 61 years son of Madan Lal, resident of Kothi No. 5,
Tej Enclave, Bhamian Road (Chandigarh Road), Ludhiana - 141001.
....Applicant
(By Advocate: Sh. G.P. Vashisht)
Versus
1. Union of India through its General Manager, Northern Railway,
Baroda House, New Delhi - 110001.
2. The Divisional Railway Manager, Northern Railway, Ferozepur -
152001.
3. The Senior Divisional Personnel Officer, Northern Railway, Ferozepur
- 152001.
... .Respondents
(By Advocate: Sh. Rohit Sharma for Sh. Sanjay Goyal)
ORDER
Per: SURESH KUMAR BATRA MEMBER (J):-
1. The applicant has filed present Original Application under Section 19 of the Administrative Tribunals Act, 1985, challenging the letter/ order (Annexure A-2) regarding recovery of HRA for the period 2nd February 2010 to November 2015 issued by Respondent No. 3, whereby the pay of the applicant has wrongly been re-fixed with effect from February 2010 to November 2015 and amount of Rs.1,41,629/- illegally deducted from the gratuity amount of the applicant after his retirement. He has prayed for issuance of a direction to respondents to refund the 2- O.A. No. 669/2020 recovery amounting to Rs.1,41,629/- illegally deducted after retirement of the applicant from gratuity amount along with interest.
2. The pleaded case of the applicant is that he joined the service on 10.06.1978 as a Fire Dropper and thereafter he was promoted as a Fitter and retired as Senior Section Engineer on 30.11.2018 from Sahnewal, Ludhiana. The applicant was working as a Senior Section Engineer at Sahnewal and his head office was situated at Ludhiana and HRA was rightly given to him @ 20%. However, the respondents illegally effected the recovery of Rs.1,41,629/- towards HRA from the gratuity of the applicant after his retirement.
3. The applicant has challenged the action of the respondents in effecting recovery of Rs.1,41,629/- towards excess HRA paid to him from his gratuity amount on the ground that no show cause notice before recovery was issued to him, which is against the principles of natural justice. It has also been submitted that though he was posted at Sahnehwal, but since he was residing at Ludhiana, which is classified as 'Y' category city, where his head office was situated, therefore, he had rightly been given HRA @ 20% of the basic pay and recovery has illegally been effected. It has been pleaded that there was no misrepresentation by the applicant and no fraud has been committed by him. He has placed reliance upon a judgment of Hon'ble Supreme Court in the case of State of Punjab and Others Vs. Rafiq Masih (White Washer) etc. 2015 (4) 334 to support his averment that the recovery from the employee belonging to Class-III and Class IV service (or Group 'C' and Group 'D' Service) and recovery from retired employees, or 3- O.A. No. 669/2020 employees, who are due to retire within one year of the order of recovery would be impermissible in law.
4. Along with the Original Application, a Misc. Application No. 980/2020 has also been filed by the applicant seeking condonation of delay of 188 days in filing the Original Application. The grounds for delay, as mentioned in the application, are that there was delay of 10 days due to incomplete paper and 178 days due to the Covid-19 period. It has been pleaded that the delay in filing is neither intentional nor deliberate, but due to the aforesaid bonafide reasons.
5. The respondents filed written statement stating therein that the applicant retired on 30.11.2018 and during the service at Sahnewal (SNL), the applicant was paid HRA @ 20% instead of 10% of basic for the period of February, 2010 to November, 2015. The Audit Department, FZR objected regarding irregular payment of Rs.9,74,180/- towards House Rent Allowance to various employees including applicant. The Audit Department stated for recovery from the concerned employees. The applicant was posted as SNL and the admissible HRA for that place is @ 10% of basic pay, being classified as 'Z' city, but he was paid @ 20% of the basic pay. As per Audit Inspection Note, the final recovery of HRA difference (20% -10%) of total Rs.1,41,629/- from the applicant for the period February, 2010 to November, 2015 was started @ Rs.1500-/ per month from 04/2016 to 06/2018 and recovered part amount of Rs.40500/- from his regular salary bills. The pending HRA difference amount of Rs.101129/- was sent to Division to be recovered from his final settlement dues at the time of his superannuation.
4- O.A. No. 669/2020
6. Learned counsel for the respondents has placed reliance upon the following judgments:-
(i) High Court of Punjab and Haryana Vs. Jagdev Singh (Civil Appeal No. 3500 of 2006 decided on 29.07.2016 by the Hon'ble Apex Court).
(ii) Smt. Sunita Mahajan Vs. The Union of India and Others (CWP No. 3159 of 2016 decided on 20.05.2019 by the Hon'ble Punjab and Haryana Court)
7. The applicant has filed rejoinder reiterating the pleas made in the Original Application.
8. I have gone through the pleadings and considered the arguments of learned counsels for both the sides.
9. The Misc. Application No. 980/2020 filed by the applicant for condoning the delay in filing the Original Application is allowed for the bonafide reasons stated therein.
10. The main thrust of learned counsel for the applicant is on judgement of Rafiq Masih's case (supra), wherein the Hon'ble Supreme Court has summarised certain situations, where under the recovery by the employer would be impermissible in law. Learned counsel for the applicant has also relied upon the Office Memorandum dated 06.02.2014 issued by the Department of Personnel and Training, Ministry of Personnel and Pension, Government of India. Further, on the basis of OMs dated 06.02.2014 and 02.03.2016 the Railway Board, Ministry of Railways, Government of India, had circulated instructions enumerating certain situations, wherein recovery was held to be impermissible in law.
5- O.A. No. 669/2020
11. Learned counsel for the respondents has relied upon judgment of Hon'ble Apex Court in the case of High Court of Punjab & Haryana Vs. Jagdev Singh (supra). The Hon'ble Apex Court, in this case has disposed the Writ Petition preferred by the High Court of Punjab and Haryana against the judgment dated 01.08.2005 of Hon'ble High Court of Punjab and Haryana, wherein Hon'ble High Court had set aside the impugned direction of recovery of excess payment towards salary and allowance, there being no fraud or misrepresentation on respondent's part. The Hon'ble Apex Court has distinguished the judgment of Hon'ble Supreme Court in the matter of State of Punjab & Others etc. Vs. Rafiq Masih (white washer) and observed as under:-
"The submission of the Respondent, which found favour with the High Court, was that a payment which has been made in excess cannot be recovered from an employee who has retired from the service of the state. This, in our view, will have no application to a situation such as the present where an undertaking was specifically furnished by the officer at the time when his pay was initially revised accepting that any payment found to have been made in excess would be liable to be adjusted. While opting for the benefit of the revised pay scale, the Respondent was clearly on notice of the fact that a future re-fixation or revision may warrant an adjustment of the excess payment, if any, made."
The second judgment referred to by learned counsel for the respondents is Smt. Sunita Mahajan Vs. The Union of India and Others (CWP No. 3159 of 2016 decided on 20.05.2019) wherein the Hon'ble High Court of Punjab and Haryana has disposed of the Writ Petition on the basis of judgment of Hon'ble Supreme Court in the matter of High Court of Punjab & Haryana & Others Vs. Jagdev Singh (supra). The Hon'ble High Court has held as under:-
"Similar is the position as the petitioner had given an undertaking to the bank binding herself to any loss, suffered or incurred by the bank in so crediting her pension to her account and also authorising the bank to recover the amount due by debiting from her account.
In such circumstance, counsel for the petitioner could not hold out that recovery was being made without any basis. He further submits that the amount which are due should be adjusted against easy equal monthly 6- O.A. No. 669/2020 instalments since the petitioner is family pensioner. He has placed reliance upon paragraph no. 12 of the judgment in Jagdev Singh's case (supra)."
12. From the facts of the case as narrated in the pleadings, undisputedly the applicant during service at Sahnewal (SNL) was paid HRA @ 20% instead of 10% of basic pay for the period from February 2010 to November 2015. The Audit Department, FZR objected to irregular payment of HRA to various employees including the applicant vide audit report dated 20.12.2015 for the year 2015- 2016. The applicant herein retired on 30.11.2018, whereas the department had started recovery of excess amount of HRA i.e. Rs. 1,41,629/- for the period from February, 2010 to November, 2015, @ Rs.1500/- per month from month of April 2016 till June, 2018 and thereby during his service period, the department had recovered part amount of Rs.40500/- out of the total amount of Rs.1,41,629/- from the regular salary bills. The applicant was fully aware of the said recovery of excess HRA @ Rs.1500/- per month from his salary during his service time, but he had neither objected to the Audit report nor recovery before his retirement. As the applicant was due for superannuation from the services on 31.08.2018, therefore, the department had recovered the remaining amount of Rs.1,01,129/- of excess HRA from the gratuity of the applicant at the time of his superannuation, which was in continuity of the recovery process initiated well before his superannuation.
13. The applicant has filed instant Original Application on 22.09.2020 after two years of his retirement with a delay of 188 days. It is clear that out of total amount of Rs.1,41,629/- being 7- O.A. No. 669/2020 excess HRA paid @ 20% of the basic, the amount of Rs.40500/- was deducted and recovered during his service and the recovery of remaining amount of Rs.1,01,129/- is in continuation of said recovery, which was finally recovered by the department from the retiral benefits of the applicant due to proceeding on superannuation.
14. The grievance of the applicant that, no prior notice was issued to him before effecting recovery is baseless as the applicant was voluntarily repaying Rs.1500/- per month from his salary, during the period of April 2016 to June, 2018. It has been, pleaded by the applicant that the respondents have re-fixed the pay of the applicant by impugned order (Annexure A-2), which is factually incorrect. From the perusal of Annexure A-2, it is evident, that it is a simple HRA calculation in respect of applicant showing payment of excess HRA. Vide impugned Annexure A-2, no pay fixation or order for effecting recovery has been issued by the Competent Authority.
15. The proposition in the judgment of Hon'ble Supreme Court in Rafiq Masih's case (supra) has been filtered by the Hon'ble Apex Court in the judgment of Jagdev Singh (supra). In the facts and circumstances of the instant case, the principles enunciated in judgment of Rafiq Masih (supra) are not applicable to the facts of the present case as the applicant had already voluntarily accepted the repayment of excess HRA during his service period. By accepting the arguments of learned counsel for the applicant, this Tribunal cannot go back to set aside the recovery process, which was initiated in 2016 and concluded in 2018. The applicant has raised an 8- O.A. No. 669/2020 objection to the audit report of Audit Department first time in his rejoinder.
16. Keeping in view the facts and circumstances of the case, the case of the applicant lacks merit. Therefore, the Original Application is dismissed being devoid of merit. No costs.
(SURESH KUMAR BATRA) MEMBER (J) 'mw'