Central Administrative Tribunal - Ernakulam
Parukutty Ammal vs Financial Advisor & Chief Accounts ... on 7 November, 2016
CENTRAL ADMINISTRATIVE TRIBUNAL,
ERNAKULAM BENCH
Original Application No. 180/00334/2016
Monday, this the 7th day of November, 2016
CORAM:
Hon'ble Mr. U. Sarathchandran, Judicial Member
Parukutty Ammal, W/o. Late Raghavan Achary,
aged 103 years, Vadukedath House, Kongal, Paravoor,
Kollam - 691 301. ... Applicant
(By Advocate : Mr. C.S.G. Nair)
Versus
1. Financial Advisor & Chief Accounts Officer (Pension),
Southern Railways, Chennai - 600 001.
2. Senior Divisional Manager, Southern Railways,
Thiruvananthapuram - 695 014.
3. Union of India, represented by Chairman, Railway Board,
Rail Bhavan, New Delhi - 110 001.
4. Senior Manager, Indian Bank, Centralized Pension
Processing Centre, 4th Floor, Rajaji Salai,
Chennai - 600 001.
5. Branch Manager, Indian Bank,
Paravoor, Kollam District - 691 301. ... Respondents
[By Advocates : Mrs. K. Girija (R1-3) &
Mr. P.N. Santhosh (R4&5)]
This application having been heard on 26.09.2016, the Tribunal on
07.11.2016 delivered the following:
ORDER
Hon'ble Mr. U. Sarathchandran, Judicial Member -
Applicant, a family pensioner, has described herself in this OA as aged 103 years. She is the wife of the late Sri.Raghavan Achary who was a Chargeman retired from the service of the respondent Railways on 30.4.1971. When he died on 6.9.1975 the applicant, his wife, started receiving family pension vide Annexure A1 Pension Payment Order. On implementation of the VIth Pay Commission recommendations her family pension was fixed as only Rs. 3,500/-. According to applicant, as per CCS (Revised Pay) Rules, 2008 the pay of Chargeman was revised to the pay band Rs. 9,300-34,800/- plus Rs. 4,200/-Grade Pay, as per fitment table the minimum pay in the said pay band plus Grade Pay was Rs. 13,500/- and accordingly, the family pension to be paid was 30% of Rs. 13,500/- amounting to Rs. 4,050/- reckoning her as a person who has crossed a century in her age. She therefore, submitted Annexure A3 representation dated 15.1.2015 to respondent No. 1 for revising her family pension to Rs. 4,050/- but no reply was received. Up to July, 2015 applicant was receiving a total family pension of Rs. 15,400/- but since August, 2015 without any intimation to her the pension was reduced to Rs. 13,332/-. On inquiring with the 5th respondent pension disbursing bank, she was told that her age recorded in the Adhar card was taken into account and therefore her pension was reduced accordingly. Her date of birth in Annexure A4 Adhar card is 1.1.1921. According to her she does not know how such entry was made in the Adhar Card. In Annexure A5 identity card issued by the Election Commission of India her age as on 1.1.1997 was recorded as 85. She states that as per Annexure A6 OM dated 11.8.2009 issued by the Government of India PAN card, matriculation certificate, passport, CGHS card, driving license and voters identity card could be accepted as proof of date of birth/age of family pensioners when they complete 80 years and above. On 27.11.2015 the applicant submitted Annexure A7 representation to respondent No. 4, central processing bank along with a copy of Annexure A5 voters identity card and Annexure A7(2) affidavit sworn before the Judicial First Class Magistrate stating that her date of birth is 1.8.1912. However, no reply was given by respondent No. 4 or respondent No. 5 and deduction from her pension continued till March, 2016 as indicated in Annexure A8 copy of the pass book of her saving bank account. Applicant further states that despite the Government of India issuing Annexure A9 OM dated 2.3.2016 advising ministries/departments to deal with the issue of wrongful/excess payments made to government servants in the light of the Apex Court decision in State of Punjab & Ors. v. Rafiq Masih (White Washer) in CA No. 11527 of 2014, the respondents are recovering amounts from her pension and are not revising her family pension correctly with effect from 1.1.2006. Hence she prays:
'(i) To declare that no amount is to be recovered from the applicant towards the alleged excess payment.
(ii) To direct the 4th and 5th respondents to refund the amount of Rs. 60,559/-
with interest @ 12% p.a. within stipulated period.
(iii) To direct the 1 st respondent to revise the family pension of the applicant to Rs. 4,050/- w.e.f. 1.1.2006 by issuing a revised PPO and grant the arrears of family pension within a time frame.
(iv) Grant such other relief or reliefs that may be prayed for or that are found to be just and proper in the nature and circumstances of the case.
(v) Grant cost of this OA.'
2. At the time of admission hearing of this OA this Tribunal issued an interim order restraining respondent Nos.4 and 5 from recovering any amount from the family pension of the applicant.
3. The Railway (respondent Nos. 1 to 3) filed reply statement stating that Shri Raghavan Asary- the applicant's husband retired from Quilon Railway Station under the then Madurai Division of Southern Railway on 30.6.1969, not on 30.4.1971 as stated by the applicant. Producing Annexure R1 service certificate of the deceased employee and Annexure R2 copy of the declaration made by Sri. Raghavan Asary on his family composition as on 30.5.1969 respondent Nos. 1 to 3 contend that the date of birth of the applicant had been declared by him as 10.6.1921. The VIth CPC introduced enhanced pension/family pension to the aged beneficiaries, according to which they are entitled to 20% more pension after they crossed the age of 80 years, 35% after 85 years, 40% after the age of 90 years, 50% after the age of 95 years and 100% after the age of 100 years. Respondents Nos. 1 to 3 state that the family pension to the applicant was arranged by the pension disbursing bank based on the fitment table issued by DOP&PW and accordingly 100% enhanced family pension was arranged to be paid to the applicant by the bank authorities based on the voters identity card issued by the Election Commission of India produced by her; however, when Adhar card was linked to the pension payment account, based on the date of birth entered in the Adhar card i.e. 1.1.1921, the bank authorities arranged to recover the arrears of family pension erroneously paid to the applicant based on her voter identity card. The respondent railway further states that the corresponding VIth CPC pay band in respect of the applicant's husband was Rs. 5200-20,200/- with Grade Pay of Rs. 2,800/- and accordingly she is entitled to Rs. 2,883/- only as family pension, but she was paid Rs. 3,500/- as family pension. Respondents 1 to 3 have produced Annexure R3 series work sheet for sanction of revised family pension in respect of the applicant and Annexure R4 revised pension payment advice in which, according to them, the correct amount of family pension in terms of Government of India OM No. 38/37/08-P&PW(A)pt.I, dated 1.9.2008 has been given. Respondents Nos. 1 to 3 have also produced a copy of the Indian Railway Establishment Manual Volume-I chapter 4 (page 84) showing the Vth CPC scale of pay of the post the applicant's husband had held at the time of his retirement. Respondents 1 to 3 state that based on the date of birth in the Adhar card the bank authorities have suo motu revised the family pension of the applicant as 50% enhanced family pension which was earlier erroneously paid to her as 100% based on the age shown in the voter identity card. According to respondents 1 to 3, the year of birth declared by the applicant's husband in the official record and the year of birth shown in the Adhar card being the same and the age shown in the voters identity card is contradictory. Though by Annexure R6 Railway Board instructed to comply with the OM dated 13.9.2012 of DOP&PW [Annexure R6(2)] to follow the date of birth available in the voter identity card there was no need to do so as the office record in the form of declaration by the applicant's husband about her date of birth is available. According to them the decision of the Apex Court in Rafiq Masih's case (supra) is not in favour of the applicant as over payment of family pension was due to the misrepresentation of her age by producing voter identity card and not due to the mistake committed by the employer in fixation of the pay by the employee. The Railway further points out that by Annexure R7 OM dated 31.3.2015 of DOP&PW a facility is provided in the name of 'Jeevan Pramaan' to enable the pensioners to submit a digital life certificate on line and to link Adhar number with bank accounts and PPO numbers to ensure authenticity of pension payment. Respondents 1 to 3 pray for rejecting the OA.
4. In the reply statement filed by respondents 4 & 5 - the centralized pension processing bank and the pension disbursing bank respectively - it is stated that the applicant had submitted a representation for revising her family pension to Rs. 4,050/-. According to them, after the VIth Pay Commission circular, as the pension is directly credited to the pensioner's account by the central processing centre, they have to pay additional pension/family pension to those pensioners who have crossed 80 years, if their date of birth is available in the pension payment order. With effect from 10.8.2015 Adhar was linked to the pension account. Since the date of birth of the applicant in the Adhar card and identity card issued by the Election Commission of India were different, the date of birth in the Adhar card was taken into account as the Adhar card is linked to the pension account. Respondents Nos. 4 and 5 further state that in the pension payment order of the applicant her date of birth is not mentioned. The applicant had provided a copy of the Adhar card showing her date of birth as 1.1.1921. Thereafter, she provided a copy of her voters identity card and made representation to consider her date of birth mentioned in the voter identity card as 85 years as on 1.1.1997 i.e. treating her date of birth as 1.8.1912. In the circumstance, the bank sent Annexure R5(c) communication dated 3.2.2016 to the respondent No. 1. As no reply was received another communication dated 20.4.2016 [Annexure R5(d)] was sent by respondent No. 4 to the 1st respondent. On receipt of Annexures R5(c) and R5(d) respondent No. 1 forwarded the same to the Senior Divisional Financial Manager, Madurai Division of Southern Railway vide Annexure R5(e) communication dated 4.7.2016. Since no clarification was received from respondent No. 1, respondent No. 4 again sent Annexure R5(f) communication dated 11.7.2016.
5. In the additional reply statement filed by respondent No. 5 it is stated that while verifying the data of the applicant it was found that her date of birth mentioned as 1.7.1911 was the date of birth of her husband. Only when the applicant submitted her Adhar card to respondent No. 5 - pension disbursing bank it was detected that her date of birth is different from the entry given in the bank and hence the Branch Manager (respondent No. 5) was directed to recover the excess payment given to the applicant. Annexure R5(h) is the communication given by the Bank to the applicant on 10.8.2015. On getting Annexure R5(h) the applicant submitted Annexure R5(i) representation dated -10-2015 to respondent No. 4. According to respondents Nos. 4 & 5 from Annexure R5(i) and Annexure A7 produced by the applicant it is clear that she has submitted false statement and affidavit before bank to get excess pension. It is further stated by respondents Nos. 4 & 5 that as the date of birth shown in Adhar card is correct and as her husband has already given a declaration that her date of birth is 10.6.1921, the applicant herself has made misrepresentation to get the additional pension. Therefore, the action taken by the respondents to recover the excess amount from the applicant is legally sustainable.
6. Heard both sides. Mr. C.S.G. Nair, appeared for the applicant, Smt. Girija for respondents Nos. 1 to 3 and Shri P.N. Santhosh for respondents Nos. 4 & 5. During the hearing of this case the competency of respondents Nos. 4 & 5 to effect reduction of pension/family pension on the ground of excess payment made by them and the jurisdiction of this Tribunal over respondents 4 & 5 also came up for consideration.
7. In the beginning of his arguments Shri C.S.G. Nair fairly conceded that in view of Annexure R2 'declaration of family composition for family pension' signed by her husband on 30.5.1969 it would be a futile exercise to establish that she is aged 103 years and hence the applicant cannot claim the additional family pension at the rate payable to family pensioners aged 100 years or more. Annexure R2 declaration contains the dates of birth of all family members of Sri. Raghavan Asary. As per Annexure R2, the date of birth of the applicant as declared by the applicant's husband to the Railway authorities is 10.6.1921. Therefore, going by Annexure R2 her age as on 1.6.2016 would be only 95 years. Therefore, as per the OM dated 2.9.2008 issued by the DOP&PW of Government of India, she will be entitled to an additional pension of 50% of the basic family pension, not 100% pension as has been claimed by her in this OA.
8. Respondent No. 1 is the pension sanctioning authority. Respondent No. 4 is the Central pension processing centre - an authorised bank which processes pension in accordance with the pension payment orders issued by respondent No. 1. Respondent No. 5 is the disbursing branch which disburses family pension to the applicant.
9. According to the additional reply statement of respondent Nos. 4 and 5 as the applicant initially did not produce any proof relating to her date of birth and by mistake, the bank relied on the date of birth of her husband i.e. 1.7.1911 as her date of birth and she continued payment of her family pension at the enhanced rates. The bank states that when they found out that her date of birth is not in tune with the date of birth shown in the Adhar card, they decided to recover the excess payment made to her and in that regard and they sent Annexures R5(h) communication to her informing that the bank would recover 1/3 rd of her pension at the rate of Rs. 3,605/- per month in 59 monthly instalments on account of the excess pension paid to her. According to the bank the incorrectness of the date of birth of the applicant was noted when she produced the Adhar card wherein her date of birth is shown as 1.1.1921. They bank states that the payment by way of excess additional pension given to her is to the tune of Rs. 2,12,654/- the details of which are shown in Annexure R5(h).
10. Thereafter applicant made Annexure R5(i)representation to respondent No. 4 relying on the date of birth shown in her Annexure A5 voters identity card wherein her age as on 1.1.1997 is shown as 85 years. According to the bank, on receipt of Annexure R5(i) representation along with the copy of the election ID card and an affidavit sworn before the Judicial First Class Magistrate, Paravur, Kollam, they contacted respondent No. 1 vide Annexure R5(c) - R5(f) but no reply was received except a copy of a forwarding letter sent by respondent No. 1 to the Senior Divisional Finance Manager of the railway at Madurai under whom the applicant's husband was working at the time of his retiring.
11. It appears that respondents Nos. 1 to 3 the Railway Authorities woke up only after the filing of this OA. They ferreted out Annexure R1 service certificate and Annexure R2 declaration made by Shri Raghavan Asary on 30.5.1969 - a month before his retirement on superannuation on 30.6.1969 where he had declared that the date of birth of his wife is 10.6.1921. Referring to the year of birth of the applicant as shown in Annexure A4 Adhar documents, the railway contends that as the date of birth in Annexure R2 synchronises with the year of birth in Annexure A4 Adhar Card placing reliance on Annexure A4 Adhar card, for reckoning her age is justified.
12. As observed earlier, in view of the submission made by learned counsel for the applicant that Annexure R2 being an official record coming from the proper custody applicant cannot dispute that her date of birth is 10.6.1921. As per Annexure R2 she is now aged only 95 years. The official respondents i.e. respondents 1 to 3 attribute the fault on the part of respondents Nos. 4 & 5 stating that the pension disbursing bank had relied on the age shown in the voters identity card and hence the erroneous overpayment happened to occur. It has to be noted that there is nothing to show that the respondent No. 1 has ever verified the quantum of family pension that was being paid to the applicant and that the railway had ever bothered to cross check her age with the declaration by the deceased employee kept in the official records. It further appears that the pension sanctioning authorities of the respondent Railway had mechanically left everything to the pension disbursing bank as a sequel to the new pension dispensation regime i.e. 'Scheme For Payment of Pension to Central Government Civil Pensioners by Authorised Banks' (hereinafter referred to as the Scheme) put in place from 1-2-1977, entrusting pension payment through the authorised banks. Smt. Girija produced a copy of the Scheme and some other regulatory instructions issued by the Reserved Bank of India (RBI) which has been authorised to oversee the operation of the Scheme.
13. The question that crops up for consideration by this Tribunal is whether the excess amount paid by the respondents Nos. 4 & 5 is recoverable from the applicant or not ? Applicant relies on Annexure A9 Office Memorandum dated 2.3.2016 issued by the DOP&T, Government of India. The relevant portion of Annexure A9 OM reads:
'4. The Hon'ble Supreme Court while observing that 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 has summarized 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.
5. The matter has, consequently, been examined in consultation with the Department of Expenditure and the Department of Legal Affairs. The Ministries / Departments are advised to deal with the issue of wrongful / excess payments made to Government servants in accordance with above decision of the Hon'ble Supreme Court in CA No.11527 of 2014 (arising out of SLP (C) No.11684 of 2012) in State of Punjab and others etc vs Rafiq Masih (White Washer) etc. However, wherever the waiver of recovery in the above-mentioned situations is considered, the same may be allowed with the express approval of Department of Expenditure in terms of this Departmentb�s OM No.18/26/2011-Estt (Pay-I) dated 6th February, 2014.' (emphasis supplied) Shri C.S.G. Nair submitted that as the Apex Court ruling in Rafiq Masih's case (supra) was accepted by the Government of India by issuing Annexure A9 OM the Railway authorities or its agents i.e. respondents 4 & 5 cannot recover the amounts paid to the applicant alleged to be in excess of her entitlement.
14. Contradicting the above submission of the learned counsel for the applicant, Smt. Girija learned counsel for the respondents 1-3 Railways brought to the attention of this Tribunal the caveat contained in Paragraphs 2 to 4 of the judgment of the Apex Court in Rafiq Masih's case. It reads:
'2. All the private respondents in the present bunch of cases, were given monetary benefits, which were in excess of their entitlement. These benefits flowed to them, consequent upon a mistake committed by the concerned competent authority, in determining the emoluments payable to them. The mistake could have occurred on account of a variety of reasons; including the grant of a status, which the concerned employee was not entitled to; or payment of salary in a higher scale, than in consonance of the right of the concerned employee; or because of a wrongful fixation of salary of the employee, consequent upon the upward revision of pay-scales; or for having been granted allowances, for which the concerned employee was not authorized. The long and short of the matter is, that all the private respondents were beneficiaries of a mistake committed by the employer, and on account of the said unintentional mistake, employees were in receipt of monetary benefits, beyond their due.
3.Another essential factual component in this bunch of cases is, that the respondent-employees were not guilty of furnishing any incorrect information, which had led the concerned competent authority, to commit the mistake of making the higher payment to the employees. The payment of higher dues to the private respondents, in all these cases, was not on account of any misrepresentation made by them, nor was it on account of any fraud committed by them. Any participation of the private respondents, in the mistake committed by the employer, in extending the undeserved monetary benefits to the respondent-employees, is totally ruled out. It would therefore not be incorrect to record, that the private respondents, were as innocent as their employers, in the wrongful determination of their inflated emoluments.
4. The issue that we have been required to adjudicate is, whether all the private respondents, against whom an order of recovery (of the excess amount) has been made, should be exempted in law, from the reimbursement of the same to the employer. For the applicability of the instant order, and the conclusions recorded by us hereinafter, the ingredients depicted in the foregoing two paragraphs are essentially indispensable. '( underlining supplied) Smt. Girija argued that the ruling in Rafiq Masih's case is applicable only if the employees were not guilty of furnishing any incorrect information which has lead the authority to commit the mistake of making higher payments and hence the ruling in Rafiq Masih's case and Annexure A3 OM arising of the said ruling are not applicable. According to her, in the instant case there has been a patent complicity on the part of the applicant in misrepresenting her age to the pension disbursing bank.
15. However, in their additional reply statement respondent Nos. 4 & 5 bank authorities admit that, by mistake, they have been treating the date of birth of applicant's husband i.e. 1.7.1911 in her pension records as date of birth of the applicant and that the said mistake perpetuated and it could be discovered only when her Adhar card was linked to the pension account. As mentioned earlier, respondents Nos. 1 to 3 simply remained in a 'hands off' mode, leaving everything to the authorised banks for determining the pension/family pension even for revising it from time to time in tune with the Government orders/instructions communicated to such banks. When respondents Nos. 4 and 5 were faced with Annexure R5(i) representation respondents 1 to 3 had been remaining indolent even after the former wrote Annexure R5(c) to R5(f) communications, till this OA was filed except for the act of respondent No. 1 simply forwarding R5(c) and (d) communications received from respondents Nos. 4 & 5 to the Senior Divisional Finance Manager of Madurai Division vide Annexure R5(e). For the first time Respondents 1 to 3 relied on Annexure R2 declaration furnished by the employee, only when they dug it out after receiving notice in this OA and produced it along with their reply statement. This reveals the sad state of affairs in the office of the pension sanctioning authority, who did not verify whether the actual disbursement of pension/ family pension by the authorized banks are correctly done or not.
16. In the above circumstance the excess payment made by the bank based on their erroneous assumption that the date of birth of her husband is her date of birth cannot be attributed to the incorrect information furnished by the applicant. It has to be noted that the excess payment of additional family pension was already being made much before production of Annexure A4 Adhar Card to the bench authorities. The pleadings and record show that the applicant requested for restoration of the family pension already enjoyed by her by submitting Annexure R5(i) representation along with Annexure A5 voters ID card and Annexure A7 affidavit sworn before the magistrate wherein she states that she did not have any formal education. Such attempts made by the applicant can be viewed only as her desperate attempts to get the same amount of family pension she was already being paid by the bank. There is nothing to show that the erroneous excess payments made by respondents 4 to 5, as admitted by them, was by reason of any fraud practised or misrepresentation made by the applicant. True, the applicant had requested the pension disbursing bank to treat her voters identity card as the proof of her age. Such a request was perfectly in tune with the Annexure R6(2)Government of India Office Memorandum dated 13.9.2012 issued by DOP&PW which was being followed by the Railways also as per Annexure R6 communication. It is only when Adhar was introduced and the banks were directed to link Adhar cards with bank accounts and pension payment order numbers vide Annexure R7 instructions the date of birth shown in Annexure A4 Adhar card was noted by the bank and steps for recovery of excess payments were initiated. In such circumstances, this Tribunal is of the view that, as the applicant was not guilty of furnishing any incorrect information which lead to the mistake of excess payment of family pension to her. Therefore this Tribunal holds that the decision in Rafiq Masih's case and Annexure A3 OM issued by the Government of India also are squarely applicable to the applicant and therefore the respondents are prohibited from recovering the excess payment made to her.
17. Smt. Girija produced a good number of documents including copies of the aforesaid Scheme, Reserve Bank of India instructions relating to the payment of pension to the Government pensioners updated as on 1 st June, 2015, decision of the Apex Court in High Court of Punjab & Harayana & Ors. v. Jagdev Singh - 2016 Supreme (SC) 589 (decision dated 29.7.2016 in Civil Appeal No. 3500 of 2006), a decision dated 27.1.2014 of this Tribunal in OA No. 1153 of 2012, a decision of the Rajasthan High Court at Jodhpur in Smt. Balveer Kaur v. State Bank of Bikaner & Jaipur (S.B Civil Writ Petition No. 1012 of 2008 decided on 5.10.2009) and the Reserve Bank of India instructions dated 13.3.2015, 17.3.2016, 1.6.2009 and the decision dated 17.4.2015 of the co-ordinate Bench of this Tribunal at Chandigarh in OA No. 060/561/2014.
18. Referring to the aforementioned judicial precedents including the decision of the Apex Court in High Court of Punjab & Harayana and Ors. v. Jagdev Singh(supra), Smt. Girija submitted that, as per the RBI instructions, when there is an undertaking by the account holder of the bank to repay the excess payments received such person is bound to repay the amount to the bank as the amount involved is public money. The theory of 'Public Money' was for the first time introduced by the Apex Court in Chandi Prasad Uniyal & Ors. v. State of Uttarakhand & Ors. - (2012) 8 SCC 417 but in that judgment also the Apex Court had acknowledged that there are cases where recovery would result in hardship of a nature which would far out-weigh the equitable balance of the employer's right to recover. It is based on the realities involved in the hardship in cases of recovery of excess amounts made for no fault of the employee, law was laid down by the Apex Court in Rafiq Masih's case (supra) that recovery of the excess amount would be impermissible in the cases of certain classes of employees/ pensioners. The dictum of the apex court has been reproduced in Annexure A3 OM also.
19. Smt. Girija then brought to the attention of this Tribunal of a decision of the Madras High Court in Senior Manager (Services) v. Hemavathy Rajan, Union of India (decision dt 12-4-2005)wherein the Madras High Court held that the regulations and administrative instructions issued by the Reserve Bank of India are binding and therefore, they would have to be complied with by the bank. It has to be noted that the banks get the authority to recover the excess amounts made to the pensioners on the strength of the principle of bankers' lein and the undertaking they obtain from the account holders. It has to be noted that till some time back, pension of the retired employes of Central Government was paid through the government treasuries/postal department. When the Scheme for payment of pensions by authorized bank was framed by the Government of India a new regime for disbursement of pension through Authorised banks was put in place. According to the Scheme, RBI has been authorised to oversee the disbursement of pension by authorised banks. One of the administrative instructions relied on by Mrs. Girija issued by the Reserve Bank of India RBI/2015-16/340 DGBA. GAD No.2960/45.01.001/2015-16 dated 17 th March, 2016 reads:
'a) As soon as the excess/wrong payment made to a pensioner comes to the notice of the paying branch, the branch should adjust the same against the amount standing to the credit of the pensionerb�s account to the extent possible including lumpsum arrears payment.
b) If the entire amount of over payment cannot be adjusted from the account, the pensioner may be asked to pay forthwith the balance amount of over payment.
c)In case the pensioner expresses his inability to pay the amount, the same may be adjusted from the future pension payments to be made to the pensioners. For recovering the over-payment made to pensioner from his future pension payment in instalments 1/3rd of net (pension + relief) payable each month may be recovered unless the pensioner concerned gives consent in writing to pay a higher installment amount.
b�&..........' According to Smt. Girija the aforesaid regulatory instruction of the RBI is binding on pension disbursing banks. However, the aforequoted RBI instructions dated 17.3.2016 does not mention about giving notice to the account holder/pension before the unilateral action of recovery of over- payments is effected. It simply authorises the paying branch to adjust the excess amount from future pension payments to be made to the pensioners. This is indeed violative of the principle of natural justice audi alteram partem which requires hearing of the other party before an adverse decision is taken against him/her. As the aforesaid RBI instructions does not provide for any hearing of the pensioner before 'adjustment from future pension payments', such action certainly involves, arbitrariness leading to violation of the equality principles enshrined in Article 14 of the Constitution of India.
20. It is well settled by a catena of apex Court decisions including the Constitution bench decision in D.S. Nakara & Ors. v. Union of India (1983) 1 SCC 305 that pension is not a bounty or gratuitous payment but is a deferred salary. In State of West Bengal v. Haresh C. Banerjee & Ors. - (2006) 7 SCC 651 the apex court held that pension is a Constitutional right under Article 300 A of the Constitution of India. In an earlier decision in State of Kerala & Ors. v. M. Padmanabhan Nair - (1985) 1 SCC 429 the apex court had recognised the right of pension as a valuable right and property in the hands of the pensioner. In Smt. Poonamal & Ors. v. Union of India & Ors. - (1985) 3 SCC 345 the Apex Court held that where Government servant rendered service, to compensate which a family pension scheme is devised, the widow and dependent minors will be equally be entitled to family pension as a matter of right. It was further ruled by the apex court that family pension is not merely a statutory right but a Constitutional right as envisaged in Articles 38, 39 & 41 of the Constitution of India which partakes the character of public assistance in cases of old age and undeserved want. The Apex Court observed that the rules governing family pension effects the Constitutional mandate.
21. The desiderata in a pension administration are prompt and uninterrupted payment of pension and a humane approach within the pension regime. In the light of the aforementioned rulings of the Apex Court which take pension/family pension to a special legal realm, treating it as a Constitutional right of such pensioners under Article 300 A of the Constitution, any unilateral action recovery on the ground of excess payments by the pension disbursing banks without giving the pensioner opportunity of hearing will amount to an arbitrary act of expropriation of pension/family pension by such banks. It is settled law that as pension partakes the character of a social security measure, any law or administrative action relating to pension must receive interpretative process in consonance with Art.38(1),39(d),(e),41 and 43 of the Constitution.(see D.S.Nakara).
22. Therefore, the legal position is that pension/family pension cannot be lightly left to the arbitrary decisions of the authorised banks which are traditionally commercial banks governed by the rigorous of tight fisted banking laws. The power of such banks to invoke the weapons like banker's lein and written undertaking for realisation of the amounts due to them are often not pensioner-friendly. It is startling to note that the new dispensation has been given the power even to divert money from the pension account, thereby creating tectonic shifts in the already unstable financial edifice of the pensioners. Such banks are further controlled by the regulatory policies and instructions of the RBI which also are not informed of the aforesaid interpretative process required in pension matters. This Tribunal is of the view that the power given to the pension disbursing banks by the afore- quoted RBI directives to unilaterally recover the excess pension amount in installments of 1/3rd of the net pension payable without any prior notice to the pensioner is infringement of the fundamental right of the pensioners under Art 14. Such unilateral Shylockian action would be an affront to the dignity of the pensioners assured in the Preamble of our Constitution also. It is worth remembering that the Constitution Bench in D.S.Nakara's case (supra) had held that Constitutionality of such administrative actions should be examined in the context of the Preamble of the Constitution and the Directive Principles.
23. In view of the above legal position, the pension disbursing banks have to reminded of their legal status that they are acting only as agents of the pension disbursing authority and that the introduction of the aforesaid Scheme is not taking away the legal character of the pension/family pension as declared by the apex court. Sanctioning of pension/family pension is the power to be excercised by the executive i.e. the pension sanctioning authority alone and a decision as to what should be the pension and family pension cannot be left to the pension disbursing banks. Determination of the quantum of pension is always within the province of the pension sanctioning authority and the pension disbursement bank are obliged to take instructions from the pension sanctioning authority from time to time as to what should be the quantum of pension payable to the pensioner and for this purpose they should conduct periodical reconciliation of the pension accounts with the records of pension sanctioning authorities. In this case, it appears that, no such periodical reconciliation process had ever taken place and thereby leaving open the power of recovery of excess payments to the pension disbursement banks in tune with the straight jacket instructions they receive from the Reserve Bank of India from time to time. This is obviously an unsatisfactory state of affairs causing loss of money to the banks, which again is public money, due to the inadvertent omissions of the officials of the disbursing bank.
24. Pension being a very valuable right of the pensioner, the pension disbursing bank should always take instructions from the pension sanctioning authority even for recovering excess pension paid as a result of the mistakes on the part of the bank. In this context it is worth mentioning that the apex court in S.K. Mastan Bee v. General Manger, South Central Railway & Anr. - 2003 SCC (L&S) 93 has held that denial of family pension to the rightful claimant amounts to violation of the guarantee given to such pensioner by Article 21 of the Constitution of India.
25. Another issue which acquires significance in this context is the jurisdiction of this Tribunal over respondents Nos. 4 & 5 pension disbursing banks. As noted earlier, till recently, the pension/family pension of Government employees was being distributed through the Government machinery itself i.e. Government treasuries or by way of money orders through postal department. As per the new policy evolved by the Government of India a new dispensation in the form of 'Scheme for disbursement of pension through certain authorized banks' has come into vogue. A perusal of the Scheme produced by Smt.Girija reveals that the banks so entrusted with the function of disbursement of pension are expected to act as agents of the pension sanctioning authority. Agency is a well accepted legal arrangement where a jural relationship is created by express or implied contract or by law whereby one party delegates the transaction of some lawful business with more or less discretionary power to another who undertakes to manage the affair and to render him an account. In such arrangements the latter is treated as the agent of the former. In the three tier system of the new pension regime the authorised banks function as agents of the pension sanctioning authority, functioning under the supervision of centralized CPAO, yet another centralized organization created by the Central Government for maintaining and processing centralised pension accounts. RBI being the regulatory authority for the banking institutions in India oversees the disbursement of pension through the authorized banks (they include even private banks like HDFC bank, ICICI bank etc.).
26. However, it must be borne in mind that entrustment of pension matters to the banks which function in an atmosphere totally different from the functioning of the Government department has resulted in such banks treating the pension accounts also yet another commercial financial transaction with its clients, with over-awing powers in their arsenal like the 'bankers lien', RBI instructions etc. The old umbilical cord relationship between the pensioners and the pension granting authority through the statutory pension rules appears to have been broken, thereby loosing the human relationship between the pension wing of the department and the pensioner, thereby relegating him to a mere account holder, digitally dealt with by the bank's computers. It is settled law that pension laws are to be given a beneficial interpretation. The pension disbursement banks are unmindful of the beneficial treatment the legal system of the country has given to pensioners. RBI being concerned with the fiscal policies and regulatory functions seldom pay any heed to the interpretative process (See D.S. Nakara) required to be given to the pension rules applicable to the Government pensioners. There is nothing to show that RBI has consulted the Ministry of Law and Justice before issuing directives relating to the pension accounts of the pension disbursing banks.
27. Though it was the policy of the Government of India to put in place the aforesaid Scheme for entrusting the disbursement of pension to the authorised banks and such banks are to deal with the pension matters as the agents of the pension sanctioning authority, the ultimate responsibility for any action by such agents would be on the principal i.e. the pension sanctioning authority.
28. Under the Administrative Tribunals Act the jurisdiction of the Administrative Tribunals is on the service matters pertaining to civil service and all service matters pertaining to local or other authorities under the control of Government of India and corporations or societies owned or controlled by Governments notified under Section 14(2) of the Act. The banks authorised under the aforesaid Scheme do not come come under the purview of the Administrative Tribunals Act 1985. Nevertheless, by importing the principles of agency, such banks necessarily have to be impleaded as eo-nominee parties in proceedings before the Tribunal for examining the legality of their acts and omissions which ultimately are binding on the principal i.e. the pension sanctioning authority of the Government Departments and the other institutions notified under Section 14 of the Act.
29. In the light of the above discussion, the Reserve Bank of India guidelines contrary to the principles of natural justice and in violation of the aforesaid legal status of the pension/family pension will not have any legal effect on the legal relationship between the pension sanctioning authority and pensioner. This Tribunal is of the considered view that in every case of recovery, even the excess payments due to the mistake committed by the pension disbursing banks, they should take instructions from the pension sanctioning authority and only on obtaining sanction for recovery in tune with the law laid down by the apex court in Rafiq Masih' s case, such recoveries can be effected only after giving notice of intended recovery to the pensioner .
30. In the light of the foregoing discussion of the legal issues, the OA is allowed in part. Respondents are directed not to recover any excess payments made to the applicant in view of the Apex Court ruling in Rafiq Masih's case and also in the light of Annexure A3 OM. Respondent Nos. 1to 3 are directed to issue a revised family pension payment order in respect of the applicant in terms of Annexure R2 and Annexure R5 IREM. Respondent Nos. 1 to 3 are further directed to issue necessary directions to the pension disbursing banks to seek instructions from the pension sanctioning authority for every action that would create adverse impact on the quantum of pension of the pensioners. Ordered accordingly. The aforesaid exercise shall be completed by respondents Nos. 1 to 3 within one month from the date of receipt/production of a copy of this order. Parties shall suffer their own costs.
(U. SARATHCHANDRAN) JUDICIAL MEMBER 'SA'