Musaddi Lal Garg vs Haryana Agro Industries Corporation ... on 26 February, 2014

[Cites 11, Cited by 1]

Punjab-Haryana High Court

Musaddi Lal Garg vs Haryana Agro Industries Corporation ... on 26 February, 2014

1. Challenge in the present writ petition is to the order dated 17.04.2007 (Annexure P3), whereby the pay of the petitioner has been refixed/reduced and the order dated 11.07.2007 (Annexure P7), whereby the excess amount of `1,75,689/-, drawn by him, on account of the refixation, was directed to be recovered along with interest.

2. The pleaded case of the petitioner is that he was appointed as an Accountant on 20.04.1977 and was promoted as Senior Accounts Officer in the year 1992 and was never awarded any punishment. Vide order dated 01.05.1986, a Committee, consisting of the Board of Directors, decided to give him two advance increments, on account of exceptional good work done by him in settling the accounts with dedication and devotion. That vide order dated 19.03.2007, the pay of the petitioner was reduced and re-fixed from `11,300/- to `10,475/-. A similar order was passed on 17.04.2007, to the same effect, superseding the earlier order. Thereafter, the show cause notice was issued on 01.05.2007 as to why the recovery of `1,75,689/- be not made from him. The petitioner represented to the Appellate Committee that his pay has been arbitrarily reduced and the recovery issue may be decided after the appeal against the refixation Sailesh ranjan order was decided.

2014.03.10 10:03

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However, refixation was ordered vide the order dated integrity of this document CWP No.4307 of 2008 -2- 11.07.2007 (Annexure P7).

3. Resultantly, the writ petition was filed and the recovery from the salary was ordered to be stayed vide order dated 18.03.2008, by a Division Bench of this Court. Thereafter, on 27.05.2008, the matter was adjourned sine die, to be listed after the decision of the Larger Bench in RSA No.4507 of 2003 titled Jai Krishan Verma Vs. Chief Executive Officer & others, in view of the reference on the issue that if there is no fraud and misrepresentation, in re-fixing the salary, whether recovery could be effected from the employees. The Full Bench of this Court in Budh Ram & others Vs. State of Haryana 2009 (3) PLR 511 thereafter, held that the recovery of service benefits in the absence of any fraud or misrepresentation cannot be there. Accordingly, the matter was listed for decision on merits.

4. No written statement has been filed by the respondents and nobody is present, on behalf of the respondents, despite being informed of the date of hearing. The case of Jai Krishan Verma (supra) was also allowed by a Single Bench of this Court, in view of the judgment of the Full Bench of this Court in Budh Ram (supra).

5. Learned Senior Counsel for the petitioner submits that he does not challenge the refixation issue as the petitioner has already retired on 30.05.2009, during the pendency of the present writ petition and would be satisfied if the order of recovery is quashed and in case the amount is being recovered, the same be refunded to the him.

6. A perusal of the paperbook would go on to show that the advance increments were directed to be paid vide order dated 24.04.1986 (Annexure P1) by the Managing Director of the Corporation, on account of exceptional good work done by the petitioner. In the show cause notice dated 01.05.2007, it was submitted that as per Rule 4.10 of the Civil Services Rules, Volume I, Part-I, Sailesh ranjan 2014.03.10 10:03 I attest to the accuracy and integrity of this document CWP No.4307 of 2008 -3- advance/premature increments, so granted, have to be adjusted in the future increments and therefore, he had continued to withdraw the said increments, without any adjustments. Thus, it is apparent that there was no misrepresentation or concealment on the part of the petitioner and it was a mistake, on the part of the office, who has failed to adjust the amount and he continued to withdraw the same from the year 1986 till his refixation of pay, for the first time, in the year 2007, after a period of more than 20 years. Thus, for no fault of the petitioner, the amount could not be ordered to be recovered from the petitioner.

7. In Col. (Retd.) B.J.Akkara Vs. The Government of India & others 2006 (11) SCC 709, it has been held by the Apex Court that where the employee has retired, it would not be appropriate, in the evening of his life, to recover the said amount. Relevant portion of the judgment read as under:

"25. The last question to be considered is whether relief should be granted against the recovery of the excess payments made on account of the wrong interpretation/understanding of the circular dated 7.6.1999. This Court has consistently granted relief against recovery of excess wrong payment of emoluments/allowances from an employee, if the following conditions are fulfilled [Vide Sahib Ram vs. State of Haryana [1995 Suppl.1 SCC 18], Shyam Babu Verma vs. Union of India [1994 (2) SCC 521], Union of India vs. M. Bhaskar [1996 (4) SCC 416], and V. Gangaram vs. Regional Joint Director [AIR 1997 SC 2776] :

a) The excess payment was not made on account of any misrepresentation or fraud on the part of the employee.

b) 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 relief, restraining recovery back of excess payment, is granted by courts not because of any right in the employees, but in equity, in exercise of judicial discretion, to relieve the employees, from the hardship that will be caused if recovery is implemented. A Government servant, particularly one in the lower rungs of service Sailesh ranjan would spend whatever emoluments he receives for the upkeep of 2014.03.10 10:03 I attest to the accuracy and integrity of this document CWP No.4307 of 2008 -4- his family. If he receives an excess payment for a long period, he would spend it genuinely believing that he is entitled to it. As any subsequent action to recover the excess payment will cause undue hardship to him, relief is granted in that behalf. But where the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or where the error is detected or corrected within a short time of wrong payment, Courts will not grant relief against recovery. The matter being in the realm of judicial discretion, courts may on the facts and circumstances of any particular case refuse to grant such relief against recovery."

8. The three Judge Bench of the Apex Court in Syed Abdul Qadir Vs. State of Bihar 2009 (2) RSJ 416 has held that any excess payment made, which was not on account of any misrepresentation or fraud, could not be recovered from the teachers. The relevant observations are as under:

"27. 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. 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 may, on the facts and circumstances of any particular case, order for recovery of the amount paid in excess. See Sahib Ram vs. State of Haryana, 1995 Supp. (1) SCC 18, Shyam Babu Verms vs. Union of India, [1994] 2 SCC 521; Union of India vs. M. Bhaskar, [1996] 4 SCC 416; V. Ganga Ram vs. Regional Jt., Director, [1997] 6 SCC 139; Col. B.J. Akkara [Retd.] vs. Government of India & Ors. (2006) 11 SCC 709; Purshottam Lal Das & Ors., vs. State of Bihar, [2006] 11 SCC 492; Punjab National Bank & Ors. Vs. Manjeet Singh & Anr., [2006] 8 SCC 647; and Sailesh ranjan 2014.03.10 10:03 Bihar State Electricity Board & Anr. Vs. Bijay Bahadur & Anr., I attest to the accuracy and integrity of this document CWP No.4307 of 2008 -5- [2000] 10 SCC 99.

28. Undoubtedly, the excess amount that has been paid to the appellants - 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 appellants-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 appellants-teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellants-teachers should be made.

9. In Chandi Prasad Uniyal & others Vs. State of Uttarakhand & others (2012) 8 SCC 417 it has been held that in cases of extreme hardship, the amount should not be recovered.

10. As noticed above, once the petitioner has retired, it would not be appropriate to recover the said amount, in view of the principle laid down above, as this Court is satisfied that there was no misrepresentation, on part of the petitioner. Accordingly, the order of recovery dated 11.07.2008 (Annexure P7) is quashed. In case the amount has already been recovered from the petitioner, the said amount be refunded, within a period of 4 weeks, from the receipt of a certified copy of the order.

11. Writ petition is allowed in the above stated terms.




            26.02.2014                                                         (G.S.SANDHAWALIA)
            sailesh                                                                  JUDGE
Sailesh ranjan
2014.03.10 10:03
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