Central Administrative Tribunal - Jabalpur
Henry D Souza vs M/O Railways on 17 May, 2023
1 O.A.No. 203/00859/2015
Reserved
CENTRAL ADMINISTRATIVE TRIBUNAL, JABALPUR BENCH
CIRCUIT SITTINGS:BILASPUR
Original Application No.203/00859/2015
Jabalpur, this Wednesday, the 17th day of May, 2023
HON'BLE SHRI JUSTICE AKHIL KUMAR SRIVASTAVA, JUDICIAL MEMBER
HON'BLE SHRI KUMAR RAJESH CHANDRA, ADMINISTRATIVE MEMBER
Henry D' Souza S/o Late J D' Souza aged about 58 years presently
working as OS/CCC/BSP r/o Qtr NO.848/A Construction Colony
Tarbahar Bilaspur Chhattisgarh 495004 -Applicant
(By Advocate -Shri A.V. Shridhar)
Versus
1. Union of India, Through the Secretary Railway Board, Rail
Bhawan New Delhi 110001
2. General Manager, South East Central Railway, New GM
Building Bilaspur Chhattisgarh 495004
3. Senior Divisional Personnel Officer, South East Central
Railway Divisional Office, Personnel Branch Bilaspur
Chhattisgarh 495004
4. Assistant Personnel Officer, South East Central Railway
Divisional Office, Personnel Branch Bilaspur Chhattisgarh
495004 - Respondents
(By Advocate -Shri Sanjeev Pandey)
(Date of reserving the order:-12.04.2023)
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2 O.A.No. 203/00859/2015
ORDER
By Justice Akhil Kumar Srivastava, JM;
The applicant in this Original Application has prayed for the following reliefs:-
"8.1 That, the learned Tribunal may kindly be pleased to quash the order no.P/SB/M & Elec/Bill-I/Stepping up dated 26/27.05.2015 Annexure A/1.
8.2 That, the Hon'ble Tribunal may kindly be pleased to direct the respondents to refund the amount deducted from the basic pay of the applicant in pursuance to the order Annexure A/1 with an interest of at the rate of 12% p.a. 8.3 Cost of the Original Application.
8.4 Any other relief which the learned Tribunal deems fit and proper may be awarded."
2. The brief facts of the case are that the applicant was appointed on 17.04.1978 and was promoted to the post of Assistant Loco Pilot on 16.03.1995. The applicant was medically de-categorized on 03.01.2001 and posted as Senior Clerk. Thereafter he was promoted as Head Clerk on 13.08.2004 and further promoted as Office Superintendent. The applicant made an application in the year 2006 requesting stepping up of pay since his juniors had been drawing higher basic pay. Respondents on considering his application granted stepping up of pay at par with his juniors in the year 2009. The applicant received the salary with lesser basic pay for the month of May 2015. Applicant submitted Page 2 of 9 3 O.A.No. 203/00859/2015 representation on 26.05.2015 (Annexure A/2). Respondents issued a letter to the applicant stating that the stepping up of pay granted earlier has been cancelled and recovery would be made shortly. Thereafter the applicant sought information from Right to Information Act 2005 regarding the Rule position under which the stepping up of pay has been cancelled. The respondents did not supply complete information and provided guidelines of the DOPT regarding stepping up of pay. On seeking further information, the respondents provided the copy of relevant note sheets. Respondents have deducted the basic pay without any intimation and issuance of show cause notice of the applicant. Hence this Original Application.
3. Respondents in their reply have submitted that the applicant and four other staff were working in running cadre. All the five staff including the applicant were medically decategorized from the post of ALP/Sr. ALP. The applicant and Shri U.K. Yadav applied for stepping up of their pay at par with Shri A.K. Mishra, Head Clerk w.e.f.05.10.2006. The stepping up of pay were allowed as vetted by associated accounts. Subsequently Shri S.K. Mishra had been registered his grievance for stepping up of his pay at par Shri U.K. Yadav, OS and Shri S.V. Naidu OS. At the time of examination of stepping up of case of Shri S.K. Mishra OS it was found that none Page 3 of 9 4 O.A.No. 203/00859/2015 of them are entitled to get stepping up of their pay with each other according to the Estt. Rule No.5/95 as all the above named staff were medically decategorised in different dates and years. Accordingly, a proposal had been sent to the associated account for reduction of pay of Shri U.K. Yadav under office note sheet dated 11.03.2015 (Annexure R/7, R/8 & R/9). As vetted by associated accounts, a letter dated 26.05.2015 was issued for reduction of pay of the applicant and three others OS. It is further submitted by the respondents that the applicant was medically decategorized from the post of ALP in scale of Rs.3050-4590/- on 03.01.2001 and he had been posted as Sr. Clerk in scale of Rs.4500-7000 and his pay was fixed to Rs.4750/- on 25.01.2001 (Annexure R/10). After medical decategorization applicant's cadre has been changed to running to Ministerial Staff in 5th Pay Commission and his seniority being maintained in ministerial category from 25.01.2001. Shri A.K. Mishra was continuing his pay in running category upto 04.10.2006 (in 6th Pay Commission) and was medically decategorised in 6th Pay Commission from the post of Sr. ALP on 04.07.2006 and he was posted as Head Clerk on 05.10.2006 and his pay was fixed to Rs.12460+GP 4200/- on 05.10.2006 (Annexure R/11). Both the staff had been medically decatogorised in different year thus question for stepping up of ay Page 4 of 9 5 O.A.No. 203/00859/2015 does not arise according to Estt. Rule No.5/95. The over payment for the period from October 2006 to April 2015 (Rs.276349/-) has been assessed and recovery has not yet been started.
4. We have heard the learned counsel for both the parties and have perused the pleadings and documents annexed therewith.
5. Hon'ble Supreme Court in a catena of decisions has consistently held that if the excess amount was not paid on account of any misrepresentation or fraud of the employee or 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, such excess payment of emoluments or allowances are not recoverable. This relief against the recovery is granted not because of any right of the employees but in equity, exercising judicial discretion to provide relief to the employees from the hardship that will be caused if the recovery is ordered.
6. On this aspect, the Hon'ble Supreme Court in the case of State of Punjab and others etc. Vs. Rafiq Masih (White Washer) etc., (2015) 4 SCC 334 in Paragraphs 13 and 14 of this judgment has held that recovery from retired employees or employee who are due to retire within one year of the order of recovery even though it would be open to the employer to correct Page 5 of 9 6 O.A.No. 203/00859/2015 the mistake, it would be extremely iniquitous and arbitrary to seek a refund of the payments mistakenly made to the employee. The relevant portion of this judgment reads as under:-
"(13) First and foremost, it is pertinent to note, that this Court in its judgment in Syed Abdul Qadir's case (supra) recognized, that the issue of recovery revolved on the action being iniquitous. Dealing with the subject of the action being iniquitous, it was sought to be concluded, 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. Interference because an action is iniquitous, must really be perceived as, interference because the action is arbitrary. All arbitrary actions are truly, actions in violation of Article 14 of the Constitution of India. The logic of the action in the instant situation, is iniquitous, or arbitrary, or violative of Article 14 of the Constitution of India, because it would be almost impossible for an employee to bear the financial burden, of a refund of payment received wrongfully for a long span of time. It is apparent, that a government employee is primarily dependent on his wages, and if a deduction is to be made from his/her wages, it should not be a deduction which would make it difficult for the employee to provide for the needs of his family. Besides food, clothing and shelter, an employee has to cater, not only to the education needs of those dependent upon him, but also their medical requirements, and a variety of sundry expenses. Based on the above consideration, we are of the view, that if the mistake of making a wrongful payment is detected within five years, it would be open to the employer to recover the same. However, if the payment is made for a period in excess of five years, even though it would be open to the employer to correct the mistake, it would be extremely iniquitous and arbitrary to seek a refund of the payments mistakenly made to the employee.
(14) In this context, reference may also be made to the decision rendered by this Court in Shyam Babu Verma v. Union of India (1994) 2 SCC 521, wherein this Court observed as under:
"11. Although we have held that the Petitioners were entitled only to the pay scale of Rs.330-480 in terms of the recommendations of the Third Pay Commission w.e.f. 1-1-1973 and only after the period of 10 years, they became entitled to the pay scale of Rs.330-560 but as they have received the scale of Rs.330-560 since 1973 due to no fault of theirs and that scale is being reduced in the year 1984 with effect from 1-1-1973, it Page 6 of 9 7 O.A.No. 203/00859/2015 shall only be just and proper not to recover any excess amount which has already been paid to them. Accordingly, we direct that no steps should be taken to recover or to adjust any excess amount paid to the Petitioners due to the fault of the Respondents, the Petitioners being in no way responsible for the same."
It is apparent, that in Shyam Babu Verma's case (supra), the higher pay-scale commenced to be paid erroneously in 1973. The same was sought to be recovered in 1984, i.e., after a period of 11 years. In the aforesaid circumstances, this Court felt that the recovery after several years of the implementation of the pay scale would not be just and proper. We therefore hereby hold, recovery of excess payments discovered after five years would be iniquitous and arbitrary, and as such, violative of Article 14 of the Constitution of India."
(emphasis supplied by us)
7. No doubt, in para 18(iii) of the judgment in the matters of Rafiq Masih (supra) the Hon'ble Supreme Court has held that recovery from employees would be impermissible in law, when the recovery from retired employees or employee who are due to retire within one year of the order of recovery. Para 18 of the said judgment reads 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 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 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.Page 7 of 9 8 O.A.No. 203/00859/2015
(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."
8. In view of the law settled by the Hon'ble Apex Court, the case of the applicant is fully covered specifically in view of the fact that the recovery has been dealt with granting of stepping up of pay which was granted in 2006 and recovery has been proposed to be made in 2015 i.e. after more than 8 years. It is not contended before us that the excess payment has been paid on account of the misrepresentation or fraud of the applicant in fact it was a mistake in granting stepping up of pay by the respondents themselves. Therefore, this Court felt that the recovery at the time of retirement would not be just and proper. We therefore hereby hold, recovery of excess payments discovered at the time of retirement would be iniquitous and arbitrary, and as such, violative of Article 14 of the Constitution of India.
9. The impugned order dated 26.05.2015 (Annexure A/1), qua the applicant, is hereby quashed and set aside. Respondents are Page 8 of 9 9 O.A.No. 203/00859/2015 directed to refund the amount recovered on account of implementation of aforesaid order to the applicant, without interest, within a period of three months from the date of receipt of a copy of this order.
10. Accordingly, this Original Application is hereby allowed with the above directions. However, the applicant shall not be entitled for any interest. No orders as to costs.
(Kumar Rajesh Chandra) (Akhil Kumar Srivastava)
Administrative Member Judicial Member
kg/-
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