Karnataka High Court
Sri. K.S. Ranganatha vs The Managing Director on 6 November, 2020
Author: S.G.Pandit
Bench: S.G.Pandit
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 6TH DAY OF NOVEMBER, 2020
BEFORE
THE HON'BLE MR.JUSTICE S.G.PANDIT
WRIT PETITION No.48553/2016 (S-R)
BETWEEN
SRI. K.S.RANGANATHA,
S/O. LATE SANNAHALAPPA,
AGED ABOUT 60 YEARS,
RETIRED JUNIOR ENGINEER (ELEC.),
O/O THE EXECUTIVE ENGINEER (ELEC.),
BANGALORE ELECTRICITY SUPPLY
COMPANY LIMITED,
PEENYA DIVISION, NEAR TVS CROSS,
PEENYA, BANGALORE-560058.
& R/A NO.176, 4TH MAIN ROAD,
M.S.RAMAIAH LAYOUT,
NAGASANDRA POST, BANGALORE-560073.
...PETITIONER
(BY SRI. DEVARAJ.N, ADVOCATE)
AND
1. THE MANAGING DIRECTOR,
KARNATAKA POWER TRANSMISSION
CORPORATION LIMITED,
CAUVERI BHAVAN,
BANGALORE-560009.
2. THE GENERAL MANAGER/DIRECTOR (ADMN & HRD),
KARNATAKA POWER TRANSMISSION
CORPORATION LIMITED,
CAUVERI BHAVAN,
BANGALORE-560009.
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3. THE CHIEF GENERAL MANAGER (A & R)
BANGALORE ELECTRICITY SUPPLY
COMPANY LIMITED, CORPORATE OFFICE,
K.R.CIRCLE, BANGALORE-560009.
4. THE EXECUTIVE ENGINEER (ELEC.)
BANGALORE ELECTRICITY SUPPLY
COMPANY LIMITED,
PEENYA DIVISION, NEAR TVS CROSS,
PEENYA, BANGALORE-560058.
...RESPONDENTS
(BY SMT. GIRIJA PATIL, ADVOCATE FOR
SRI. RAVINDRA REDDY, ADVOCATE FOR R1 & R2
R3 & R4 SERVED)
THIS WRIT PETITION IS FILED UNDER ARTICLES 226
AND 227 OF THE CONSTITUTION OF INDIA PRAYING TO
CALL FOR THE ENTIRE RECORDS, PERTAINING TO THE
CASE; QUASH THE IMPUGNED ORDER DATED 05.04.2016
AT ANNEX-D ISSUED BY R-4 AS THE SAME IS ILLEGAL,
UNJUST, ARBITRARY, MALAFIDE, UNREASONABLE AND
GROSSLY VIOLATIVE OF PRINCIPLES OF NATURAL JUSTICE
AND ETC.
THIS WRIT PETITION HAVING BEEN HEARD AND
RESERVED ON 20/10/2020 THROUGH VIDEO
CONFERENCE, COMING ON FOR PRONOUNCEMENT THIS
DAY, THE COURT MADE THE FOLLOWING:
ORDER
A retired Junior Engineer (Elec.) of the respondent- Corporation is before this Court under Article 226 of the Constitution of India, praying to quash Annexure-D, bearing No.PÁ.¤.EA(«)/¦Ã.«/¯É/»¸À(¹)/94, dated 05.04.2016, by 3 which a sum of Rs.1,83,528/- is ordered to be recovered from the pensionary benefits of the petitioner on the ground that over payment has been made on wrong fixation of pay.
2. The brief facts of the case are that, the petitioner retired from the respondent-Karnataka Power Transmission Corporation Limited (for short 'the Corporation') on attaining the age of superannuation as Junior Engineer (Elec.) on 31.03.2016. It is stated that the petitioner was appointed initially as Attender Grade-II on 09.03.1981. He was promoted as Attender Grade-I on 29.08.1984. Further, he was promoted as Lineman Grade-II on 01.06.1989 and as Meter Reader on 16.10.1989. The petitioner was further promoted to the post of Junior Engineer (Elec.) on 20.08.2001. The petitioner states that on 30.10.2013 as per Annexure-B, he made a representation to the respondent-Corporation stating that his annual increment was in the month of 4 March and in the recent past it has been changed to June of every year. As such, he requested to correct the said anomaly. As requested, the respondent-Corporation by Official Memorandum dated 21.11.2013 (Annexure-C) corrected the discrepancy with regard to the grant of annual increment. By letter dated 05.04.2016 (Annexure-D), respondent No.4-The Executive Engineer (Elec.) addressed letter to respondent No.3-The Chief General Manager(A&R) to recover a sum of Rs.1,83,528/- from the pensionary benefits of the petitioner as he has been wrongly granted one additional increment for having passed Executive Lower Examination for which the petitioner was not entitled for, being a non-technical staff. Thereafter, the petitioner was paid pensionary benefits deducting the above said amount on his retirement on 31.03.2016. Aggrieved by the said recovery from his pensionary benefits, the petitioner is before this Court in this petition.
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3. Heard the learned counsel Sri. Devaraj.N through video conference and Smt. Girija Patil, learned counsel appearing for Sri. Ravindra Reddy, learned counsel for respondent Nos.1 and 2 in person. Perused the entire writ petition papers.
4. Learned counsel for the petitioner would submit that the petitioner is challenging only recovery of a sum of Rs.1,83,528/- from the pensionary benefits of the petitioner. He fairly submits that the petitioner is not challenging the re-fixation of pay and allowances. Further, the learned counsel would submit that the petitioner retired as Junior Engineer (Elec.) and he is Group-C employee of the respondent-Corporation. The recovery is without even providing any opportunity to the petitioner. The action of the respondents is in violation of the principles of natural justice. Further, learned counsel relying upon the decision of the Hon'ble Apex Court in the case of STATE OF PUNJAB AND ORS. etc v. RAFIQ 6 MASIH (WHITE WASHER) etc reported in AIR 2015 SC 696, submits that the recovery from an employee belonging to Class-III and IV services that too from retired employee is impermissible. Learned counsel would submit that the Hon'ble Apex Court in the above decision after considering the earlier decisions in the matter of recovery of over payments made due to wrong fixation of pay has categorically held that recovery from retired employees that too from Class-III and IV would be arbitrary. Thus, he prays for allowing the writ petition.
5. Learned counsel for the respondents taking through the statement of objections filed, submits that the petitioner was not entitled for one additional increment which was granted to him under Regulation 47-B of the K.E.B. Employees service Regulation (for short 'the Regulation'). An additional increment would be available only for technical persons for having passed the Executive Lower Examination as per Annexure-R1, Circular dated 7 24.04.2002. As the petitioner was non-technical person, he was not entitled for one additional increment for having passed Executive Lower Examination. Further, it is contended that Regulation 173 of K.E.B. Employees service Regulation would permit recovery of any board dues outstanding against the employee from the gratuity including death-cum-retirement gratuity. In that circumstance, learned counsel would submit that the recovery is proper and correct. Further, learned counsel would submit that the excess payment was made due to the mistake committed by the respondent-Corporation and the same was noticed at the time of settlement of pensionary benefits. As such, recovery was ordered from the pensionary benefits of the petitioner. Further, the learned counsel would rely upon the decision of the Hon'ble Apex Court in the case of CHANDI PRASAD UNIYAL vs. STATE OF UTTARAKHAND AND OTHERS reported in (2012) 8 SCC 417 to contend that any 8 amount paid without authority of law could be recovered. Thus, she prays for dismissal of the petition.
6. Having heard the learned counsels for the parties and on perusal of the writ petition papers, the only point which falls for consideration is "Whether the respondents are justified in effecting recovery of a sum of Rs.1,83,528/- from the pensionary benefits of the petitioner?". Answer to the said point would be in the negative for the following reasons.
7. The petitioner retired from the respondent- Corporation services on attaining the age of superannuation on 31.03.2016 as Junior Engineer (Elec.) which is a Class-III post. According to the respondents, the petitioner was granted one additional increment, for which he was not entitled to and that one additional increment would be granted to technical persons who have passed Executive Lower Examination. The petitioner was not a technical person but he was a non-technical 9 Junior Engineer (Elec.) having been promoted from the Cadre of Meter Reader. Under Annexure-D, respondent No.4-The Executive Engineer (Elec.) addressed letter to respondent No.3-The Chief General Manager(A&R) to recover a sum of Rs.1,83,528/- from the death-cum- retirement gratuity of the petitioner stating that the petitioner was over paid on grant of one additional increment, for which he was not entitled. Before directing the recovery of the above said amount, no notice whatsoever is issued to the petitioner calling upon him why the said amount should not be recovered. The above amount is not determined after hearing the petitioner. Moreover, the petitioner's case itself is different as could be seen from Annexure-C, Official Memorandum dated 21.11.2013, wherein the date of increment of petitioner was pre-poned from June to March. Thereby he was paid difference of pay. Be that as it may, before ordering recovery, no notice was issued and the entire action of the 10 respondent-Corporation is in violation of principles of natural justice.
8. The contention that the respondent-Corporation could recover any board dues outstanding against an employee from the gratuity or death-cum-retirement gratuity in view of Regulation 173 of the Regulation is liable to be rejected in the facts and circumstances of the present case. Under the above said Regulation, any determined dues outstanding against the employee or with the consent of the concerned employee recovery could be effected. In the instant case, the amount sought to be recovered from the petitioner's pensionary benefits is not a determined amount nor the petitioner has consented for recovery. Regulation 171 empowers the Board to withhold or withdraw the pension or any part of it, permanently or for a specified period or for ordering recovery from the pension any pecuniary loss caused to the Board, if the pensioner is found guilty of grave misconduct or 11 negligence during the period of his service, in a departmental or judicial proceedings. No such determination is made after retirement, or any enquiry is conducted to determine the amount sought to be recovered during the period of service of the petitioner. The action of the respondents to recover Rs.1,83,528/- is unilateral. Even assuming that the petitioner was not entitled for an additional increment, why action was not initiated during the service of the petitioner in the respondent-Corporation is not forthcoming. It is not the case of the respondent-Corporation that the petitioner misrepresented or has played fraud. The respondent- Corporation is silent about what action was taken against the persons who were responsible for such wrong payment. Moreover, in the statement of objections, the respondent Nos.1 and 2 have admitted that mistake has been done in the previous division and it was noticed at the time of settlement of pension. Even while granting additional increment, no undertaking appears to have 12 been taken from the petitioner i.e., undertaking to return an amount, if it is found that the petitioner was not entitled for such pay fixation. It is also not the case of the respondents that the additional increment was granted with a condition to recover the same if it is found that the petitioner was not entitled for such additional increment.
9. Learned counsel for the respondents relied upon the decision of the Hon'ble Apex Court in Chandi Prasad's case (supra) and submitted that any amount paid without authority of law could be recovered from an employee. In Chandi Prasad's case, over payments were made due to wrong fixation of 5th and 6th pay scales of Teachers/Principals based on 5th Pay Commission Report and that over payments were sought to be recovered from such Teachers/Principals who were still in service. Moreover, pay fixation was made with a condition that irregular/wrong pay fixation could be recovered from the salary/pension of the petitioners therein who were still in 13 service and recoveries were sought to be made from their salary. In those circumstances, Hon'ble Apex Court held that the recovery could be effected. But in the instant case, the petitioner is retired and recovery is sought to be made from his retirement benefits. In Chandi Prasad's case (supra) there was stipulation in the pay fixation order that in the case of irregular/wrong pay fixation, the amount could be recovered from the salary/pension.
10. A careful reading of the Rafiq Masih's case (supra) would reveal that in view of an apparent difference of views expressed in various decisions referred to therein including Chandi Prasad's case, was ordered to be placed before the three Judges Bench. On reference, the three Judges Bench answered that there is no conflict in the views expressed in the judgments and further noted that the observations made not to recover the excess amount paid were in exercise of its extraordinary powers under Article 142 of the Constitution of India. In the above 14 stated circumstances, the Hon'ble Apex Court in the case of Rafiq Masih (supra) after considering all the earlier decisions with regard to recovery of an amount which was paid on account of wrong fixation of pay has laid down the following principles at Paragraph No.12:
"12. 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.15
(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."
11. The Hon'ble Apex Court in the above said decision has made it clear that wherever the over payments are made to the employee on account of wrong fixation of pay, or excess payment is made on the result of wrong interpretation of Rule, the employee cannot be held responsible and recovery of such over payments from employees of lower rungs and employees retired or on the 16 verge of retirement, would be arbitrary and iniquitous. The Hon'ble Apex Court has come to the above conclusion on the reasoning that employees in lower rung of service would spend their entire earning in the upkeep and welfare of their family and if such excess payment is allowed to be recovered from them, it would cause them far more hardship, than the reciprocal gains to the employer.
12. In the case on hand, the petitioner was Class-III employee who retired from service on attaining the age of superannuation on 31.03.2016. The recovery is sought to be made from pensionary benefits of the petitioner. As the petitioner belongs to Class-III employee and as recovery is sought to be made from pensionary benefits or death- cum-retirement gratuity, the same would be arbitrary and iniquitous in view of the principles laid down in Rafiq Masih's case (supra). When the recovery is held to be arbitrary and was impermissible, it would follow that the 17 petitioner was entitled for that amount as on the date of his superannuation. If that amount was paid as on the date of petitioner's retirement he would have invested the same in any Bank or he would have utilized the same for any useful purpose. Hence, the petitioner would be entitled for Bank rate of interest on the amount ordered to be recovered.
13. For the reasons stated above, the writ petition is allowed. The recovery of a sum of Rs.1,83,528/- directed against the petitioner under Annexure-D, bearing No.PÁ.¤.EA(«)/¦Ã.«/¯É/»¸À(¹)/94, dated 05.04.2016 is quashed. The respondents are directed to pay a sum of Rs.1,83,528/- along with interest at the rate of 5% per annum to the petitioner within a period of three months from the date of receipt of certified copy of this order.
Sd/-
JUDGE SMJ