K.P Krishnan Kutty vs State Of Kerala on 3 August, 2022

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Kerala High Court

K.P Krishnan Kutty vs State Of Kerala on 3 August, 2022

This intra court appeal is against the judgment dated 10/06/2022 in W.P.(C) No.4952/2021. The appellant is the petitioner and the respondents herein, the respondents in the writ petition. The parties in this appeal and the documents will be referred to as described in the writ petition.

2. The petitioner, working as Watchman (Higher Grade) in SAS SNDP Yogam College, Konni, Pathanamthitta, retired on 31/05/2016 on attainment of the age of superannuation. The original pension sanctioned to the petitioner with effect from 01/06/2016 is ₹ 4500/-, which on 21/09/2017 was revised to ₹ 8928/-. At present the petitioner is receiving a monthly pension of ₹16,460/-. On 08/02/2021, the petitioner was called to the office of the 3rd respondent and was informed that an amount of ₹ 3,58,364/- had been paid in excess to him due to certain mistakes that had crept in while computing his pension and that the 3 rd respondent is proposing to recover the excess amount disbursed from his pension. The meager amounts received by the petitioner as pension has been spent by him and therefore it would be Writ Appeal No. 925 of 2022 3 arbitrary unreasonable, unjustified as well as capricious to recover any amount for no fault on his part, the mistake being solely on the part of the respondents. As the 3rd respondent intends to initiate recovery, the writ petition seeking a writ of mandamus barring the respondents from recovering any amount(s) from the pension payable to the petitioner.

3. The 3rd respondent, the Sub Treasury Officer, Sub Treasury Office, Mallapally, Pathanamthitta has filed a counter affidavit in which it is contended that the petitioner after the commutation of his pension is entitled to only an amount of ₹5357/- as monthly pension. However, due to a mistake in the computation of his pension, DA @ of 121% of the basic pension was disbursed instead of the 20% DA to which he is entitled to. As a result of this incorrect computation, the petitioner has been wrongly paid pension in excess of the pension actually due to him. This excess payment ₹ 9,017/- per month continued for some time before the same was noticed and corrected. The total amount paid in excess, amounts to ₹3,58,364/-. Though excess pension has been paid to the petitioner by mistake, the money belongs to the exchequer and it is an expense from the consolidated fund of the Government and hence needs to be recovered from the petitioner.

3.1. The 3rd respondent, after hearing the petitioner and taking into account the circumstances, has taken a lenient view and permitted the petitioner recovery @ ₹864/- per month in 413 installments, which would not Writ Appeal No. 925 of 2022 4 be a heavy burden on him. The petitioner was well aware of the excess amount that was being paid as pension. However, he never brought the same to the notice of the authorities concerned. The Government anticipating such situations and to prevent any loss to the public exchequer has introduced the practice of obtaining a statutory undertaking from every pensioner before the disbursement of the initial pension on superannuation. On the basis of the said Government order, the petitioner has also voluntarily submitted an undertaking by which he has agreed to repay any excess amount, if any, received by him. That being the position, the petitioner cannot now contend that the amounts which have been mistakenly paid to him cannot be recovered from him, contends the 3rd respondent.

4. The learned Single Judge by the impugned judgment disposed of the writ petition reserving liberty to the respondents to initiate action against the petitioner, in the event of establishing that the petitioner has in fact given an undertaking as contended by them. It was also clarified that such action would be initiated only after properly notifying the petitioner and hearing him. Aggrieved, the petitioner has come up in appeal.

5. Heard Sri.Nandakumara Menon, the learned Senior Counsel instructed by Ms.Siny M.C, the learned counsel for the petitioner and Sri.A.J.Varghese, the learned Senior Government Pleader.

6. The fact that the petitioner had received pension in excess of the Writ Appeal No. 925 of 2022 5 amount due to him is not disputed. It appears that it was more than double the amount of actual pension, that is, ₹ 16,460/- in the place of ₹7,443/- that was being disbursed to him from 01/06/2016 till it was detected sometime in February 2021. His only case is that the respondents are not entitled to recover the excess amounts admittedly paid to him in the light of the dictum in State of Punjab v. Rafiq Masih (White Washer), (2015) 4 SCC 334. The learned Senior counsel for the petitioner submitted that it is immaterial whether the petitioner has given any undertaking agreeing to refund any excess payments made to him, as he is a retired class-IV employee falling under category-(i) of the employees, from whom recovery has been held to be impermissible by the Hon'ble Supreme Court in White Washer (Supra).

7. Per contra the learned Senior Government Pleader submitted that in the light of the dictum in High Court of Punjab and Haryana v. Jagdev Singh, 2016 KHC 6515, the single judge was justified in reserving the liberty to the respondents to recover the amount.

8. Therefore, the only point to be determined is - whether there is a complete or absolute bar in recovering the excess amount disbursed to a class-IV employee over and above his entitlement, even in cases he has given an undertaking agreeing to return/refund any excess payments made to him, in the light of the dictum in White Washer (Supra). Before we answer the point, we briefly refer to the decisions submitted by either side in support of Writ Appeal No. 925 of 2022 6 their respective stand.

9. In Col. B. J. Akkara v. Government of India, 2006 (11) SCC 709, one of the questions that came up for consideration was- whether the petitioners therein, all of whom had retired prior to 01/01/1996, should be granted relief against the recovery of excess payments made on account of the wrong interpretation/understanding of the rules applicable. It was held relying on Sahib Ram v. State of Haryana, 1995 Suppl (1) SCC 18; Shyam Babu Verma v. Union of India, 1994 (2) SCC 521; Union of India v. M. Bhaskar, (1996) 4 SCC 416 and V. Gangaram v. Regional Joint Director (1997) 6 SCC 139 that- the relief against recovery of excess wrong payment of emoluments/allowances from an employee can be granted, if the following conditions are fulfilled: (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 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 would spend whatever emoluments he receives for the Writ Appeal No. 925 of 2022 7 upkeep of 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 would cause undue hardship to him, relief can be granted in his favour. 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 should 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.

9.1. On the same principle, it was further held that pensioners can also seek a direction that wrong payments should not be recovered, as pensioners are in a more disadvantageous position when compared to in- service employees. Any attempt to recover excess wrong payment would cause undue hardship to them. The petitioners therein were found not guilty of any misrepresentation or fraud in regard to the excess payment. Non- Practising Allowance was added to the minimum pay of the petitioners for purposes of stepping up, due to a wrong understanding by the implementing departments. Therefore, it was held, that the respondents cannot recover any excess payments made towards pension in pursuance of the circular which formed the basis of the wrong interpretation till the issue of the clarificatory circular. In so far as excess payment made after the clarificatory circular was Writ Appeal No. 925 of 2022 8 issued, the Apex court held, that, Union of India would be entitled to recover the excess as the validity of the said clarificatory circular had been upheld and as the pensioners had been put on notice with regard to the wrong calculations earlier made.

10. In Syed Abdul Qadir v. State of Bihar, 2009 (3) SCC 475, relying on the decisions in Sahib Ram (Supra); Shyam Babu Verma (Supra); Union of India v. M. Bhaskar, (Supra); V. Ganga Ram (Supra); Col. B. J. Akkara (Supra); Purshottam Lal Das v. State of Bihar, (2006) 11 SCC 492; Punjab National Bank v. Manjeet Singh (2006) 8 SCC 647; and Bihar State Electricity Board v. Bijay Bahadur (2000) 10 SCC 99, the Apex court reiterated the principles laid down in Col. B. J. Akkara (Supra).

11. In Chandi Prasad Uniyal and Others v. State of Uttarakhand and Others, 2012 (8) SCC 417, reference was made to aforesaid decisions in addition to the decisions in Shyam Babu Verma (Supra), Sahib Ram (Supra), State of Bihar v. Pandey Jagdishwar Prasad, 2009 (3) SCC 117 and Yogeshwar Prasad v. National Institute of Education Planning and Administration, (2010) 14 SCC 323. Shyam Babu Verma (supra) is a three

-Judge Bench judgment, in which case a higher pay scale had been erroneously paid in the year 1973. The same was sought to be recovered in the year 1984, after a period of eleven years. The court felt that the sudden Writ Appeal No. 925 of 2022 9 deduction of the pay scale after several years of implementation of said pay scale had not only affected the petitioners financially but also their seniority. Under such circumstances, it was held that it would not be just and proper to recover any excess amount paid. In Sahib Ram case (supra), a two - Judge Bench noticed that the appellants who did not possess the required educational qualification and consequently would not be entitled to the relaxation in question, was granted the relaxation and paid salary on the revised scales. It was held that the excess payment should not be recovered applying the principle of equal pay for equal work. In Yogeshwar Prasad (supra), a two - Judge Bench after referring to the above-mentioned judgments took the view that the grant of higher pay could be recovered unless it was a case of misrepresentation or fraud. On facts, neither misrepresentation nor fraud could be attributed to appellants therein and hence, restrained the recovery of excess amount paid.

11.1. Referring to the decision in Syed Abdul Qadir (Supra), it was held that the direction given therein was keeping in view the peculiar facts and circumstances of that case since the beneficiaries had either retired or were on the verge of retirement and so as to avoid any hardship to them. After noticing the aforesaid judgments, the Apex court held that, the said decisions could not be said to have down any proposition of law that only in the event of the State or its officials establishing misrepresentation or fraud Writ Appeal No. 925 of 2022 10 on the part of the recipients of the excess pay, the amount paid could be recovered from them. On the other hand, most of the cases turned on the peculiar facts and circumstances of those cases, either because the recipients had retired or were on the verge of retirement or were occupying lower posts in the administrative hierarchy. The concern of the court was with the excess payment of public money, often described as "tax payers' money", which belong neither to the officers who had effected over-payment nor to the recipients. The court felt that it was quite unnecessary to bring the concept of fraud or misrepresentation into such situations. The only question that required to be considered is whether excess money has been paid or not. Excess payments may have been made due to very many reasons like - due to a bona fide mistake or due to negligence, carelessness, collusion, favouritism etc. because money in such situations do not belong to the payer or the payee. Situations may also arise where both the payer and the payee are at fault, in which situations the mistake would be mutual. There are many situations in which payments are made and payments received without any authority of law. Therefore, any amount paid/received without the authority of law can always be recovered barring a few exceptions of extreme hardship, but not as a matter of right. In such situations law implies an obligation on the payee to repay the money, or else it would amount to unjust enrichment. The Apex court was therefore of the considered view that except in the instances Writ Appeal No. 925 of 2022 11 pointed out in Syed Abdul Qadir (Supra) and in Col. B.J. Akkara (Supra), the excess payment made due to wrong/irregular pay fixation, can always be recovered. On the facts of the said case, it was noticed that, in addition to the fact that the appellants therein did not fall in any of the exceptional categories, there was a stipulation in their fixation order that in the event of irregular/wrong pay fixation, the institution in which the appellants were working could recover the amounts paid in excess from their salary/pension.

12. In State of Punjab v. Rafiq Masih (White Washer), 2014 (8) SCC 883, a batch of matters came up before a 3 Judge Bench for authoritative pronouncement on the apparent difference of opinion expressed in Shyam Babu Verma (Supra) and Sahib Ram (Supra) on the one hand, and Chandi Prasad (Supra) on the other hand. The order of reference reads:

"In View of an apparent difference of views expressed on the one hand in Shyam Babu Verma and Others v. Union of India and Others, 1994 (2) SCC 521 and Sahib Ram Verma v. State of Haryana, 1995 Supp (1) SCC 18; and on the other hand in Chandi Prasad Uniyal and Others v. State of Uttarakhand and Others, 2012 (8) SCC 417, we are of the view that the remaining special leave petitions should be placed before a Bench of Three Judges. The Registry is accordingly directed to place the file of the remaining special leave petitions before the Hon'ble the Chief Justice of India for taking instructions for the constitution of a Bench of Three Judges, to adjudicate upon the present controversy."

12.1. The issue in the matter pertained to recovery of excess money from the pensionary benefit of the respondent, namely, White washer, on Writ Appeal No. 925 of 2022 12 account of a wrong fixation of pay. The question of law for consideration before the High Court concerned was: whether the Government is entitled to recover from an employee any payment made in excess of what the employee is otherwise entitled to, in the absence of any fraud or misrepresentation on the part of the employee. The High Court declined permission for recovery of excess amounts paid to him. The Apex court referring to the decisions in Shyam Babu Verma (Supra) and Sahib Ram (Supra), held that the observations made therein preventing recovery of the excess amount paid to the appellants therein were in exercise of its extra - ordinary powers under Art.142 of the Constitution of India, by which the Apex Court is vested with the power to pass equitable orders to do complete justice. The law laid down in Chandi Prasad (Supra) was held to be in no way in conflict with the observations in the other two cases, because the same was one made under Art.136. Therefore, it was held that the decisions based on different scales of Art.136 and Art.142 of the Constitution of India could not be best weighed on the same grounds of reasoning and hence found no conflict in the views expressed in the first two judgments and the latter judgment. The reference was thus held to be unnecessary and the matter was sent back to the Bench concerned for disposal.

13. After the reference was returned, a Two Judge Bench decided the matter in State of Punjab v. Rafiq Masih (White Washer), (2015) 4 SCC Writ Appeal No. 925 of 2022 13

429. All the respondents in the bunch of cases, had been given monetary benefits in excess of their entitlement. The benefits flowed to them, consequent upon a mistake committed by the competent authority concerned, in determining the emoluments payable to them. Another essential factual component in the bunch of cases noted was that the respondent-employees were not guilty of furnishing any incorrect information, misrepresentation or fraud, which led the competent authority concerned, to commit the mistake of making the higher payment to the employees. Therefore, the respondents/employees were found as innocent as their employers, in the wrongful determination of the inflated emoluments. The issues that the court was called upon to adjudicate were- whether all the respondents, against whom an order of recovery of the excess amount had been made, should be exempted in law, from reimbursement of the same to the employer and whether merely on account of the fact, that the release of the monetary benefits was based on a mistaken belief at the hands of the employer, and further, because the employees had no role in the determination of the employer, was it legally feasible for the respondents to assert, that they should be exempted from refunding the excess amount received by them?

13.1. The court referred to its earlier reference order and said that in view of the conclusions made in the same, it would be laying down the parameters of fact situations, wherein employees, who are beneficiaries of Writ Appeal No. 925 of 2022 14 wrongful monetary gains at the hands of the employer, may not be compelled to refund the same. It has been held that the instant benefit could not be extended to an employee merely on account of the fact, that he was not an accessory to the mistake committed by the employer; or merely because the employee did not furnish any factually incorrect information, on the basis whereof the employer committed the mistake of paying the employee more than what was rightfully due to him; or for that matter, merely because the excessive payment was made to the employee, in absence of any fraud or misrepresentation at the behest of the employee. After examining a number of judgments, it held that orders passed by the employer seeking recovery of monetary benefits wrongly extended to employees, could only be interfered with, in cases where such recovery would result in a hardship of a nature, which would far outweigh, the equitable balance of the employer's right to recover. In other words, interference would be called for, only in such cases where, it would be iniquitous to recover the payment made. In order to ascertain the parameters of the aforesaid consideration, and the test to be applied, it was held that, reference needs to be made to situations where exemption from such recovery had been granted even in exercise of the jurisdiction under Art.142 of the Constitution as repeated exercise of such power, "for doing complete justice in any cause" would establish that the recovery being effected was iniquitous, and arbitrary and hence the Writ Appeal No. 925 of 2022 15 interference by the Court.

13.2. Referring to the embodiment of the doctrine of equality, a dynamic and evolving concept having many dimensions, found in Articles 14 , 38 , 39 , 39A , 43 and 46 of the Constitution, the Apex court held that these Articles contain a mandate to the State requiring it to assure a social order providing justice - social, economic and political, by inter alia minimizing monetary inequalities, and by securing the right to adequate means of livelihood, and by providing for adequate wages so as to ensure, an appropriate standard of life, and by promoting economic interests of the weaker sections. These Articles of the Constitution, besides assuring equality before the law and equal protection of the laws; also disallow, discrimination with the object of achieving equality, in matters of employment; abolishing untouchability, to upgrade the social status of an ostracized section of the society; and extinguish titles, to scale down the status of a section of the society with such appellations. In view of the afore-stated constitutional mandate, equity and good conscience, in the matter of livelihood of the people of the country, has to be the basis of all governmental actions. An action of the State, ordering a recovery from an employee, would be in order, so long as it is not rendered iniquitous to the extent, that the action of recovery would be more unfair, more wrongful, more improper, and more unwarranted, than the corresponding right of the employer, to recover the Writ Appeal No. 925 of 2022 16 amount.

13.3. After referring to the decisions in Syed Abdul Qadir; Shyam Babu Verma; Akkara and Sahib Ram, it was held that it was not possible to postulate all situations of hardship, which would govern employees on the issue of recovery, where payments had mistakenly been made by the employer, in excess of their entitlement. Based on the decisions referred to, as a ready reference, the Apex court summarized the following few situations, wherein recoveries by the employers, was held 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 and (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. The reasons or the basis for arriving at situations (i) to (iv) are given in paragraphs 13 to 17 of the Writ Appeal No. 925 of 2022 17 judgment which are-

(a) Situation no. (i)- no recovery from employees belonging to Class-III and Class-IV service (or Group 'C' and Group 'D' service) - Relying on the dictum in Col. B.J. Akkara (Supra) to which we have already adverted to, the court held that a perusal of the observations made therein would reveal a reiteration of the legal position recorded in the earlier judgments inasmuch as, it was again affirmed, that the right to recover would be sustainable so long as the same is not iniquitous or arbitrary. Referring to the observations in Col. B.J. Akkara (Supra) relating to recovery from employees in the lower rung of service, it held that the apparent explanation for the same is, that employees in the lower rung of service would spend their entire earnings 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. Therefore, it concluded, that such recovery from employees belonging to the lower rungs (i.e., Class- III and Class-IV - sometimes denoted as Group 'C' and Group 'D') of service, should not be subjected to the ordeal of any recovery, even though they are beneficiaries of receiving higher emoluments, than were due to them, as such recovery would be iniquitous and arbitrary and therefore would also breach the mandate contained in Art.14 of the Constitution of India.

(b) Situation no. (ii) - no recovery from retired employees, or Writ Appeal No. 925 of 2022 18 employees who are due to retire within one year, of the order of recovery- Referring to the dictum in Syed Abdul Qadir (Supra), it has been held that, it is apparent from the conclusions drawn therein, that recovery of excess payments made from employees who have retired from service, or are close to their retirement, would entail extremely harsh consequences outweighing the monetary gains by the employer. A retired employee or an employee about to retire, is a class apart from those who have sufficient service to their credit, before their retirement. Needless to mention, that at retirement, an employee is past his youth, his needs are far in excess of what they were when he was younger. Despite that, his earnings have substantially dwindled (or would substantially be reduced on his retirement). Keeping the aforesaid circumstances in mind, it has been held that, recovery would be iniquitous and arbitrary, if it is sought to be made after the date of retirement, or soon before retirement. A period within one year from the date of superannuation, has been held to be the period during which the recovery ought to be treated as iniquitous. Hence the conclusion arrived at that, it would be justified to treat an order of recovery, on account of wrongful payment made to an employee, as arbitrary, if the recovery is sought to be made after the employee's retirement, or within one year of the date of his retirement on superannuation. Thus, the reason for situation no.(ii).

(c) Situation no.(iii) - no recovery from employees, when the Writ Appeal No. 925 of 2022 19 excess payment has been made for a period in excess of five years, before the order of recovery is issued - The Court held that the court in Syed Abdul Qadir (Supra) had 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 unauthorized 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 actions in violation of Art.14. The logic of the action in the instant situation, would be iniquitous or arbitrary, or violative of Art.14 of the Constitution, 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. 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, it was held that that if the mistake of making a wrongful Writ Appeal No. 925 of 2022 20 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. Reference was also made to Shyam Babu Verma (Supra) wherein a higher pay-scale was paid erroneously for a period of 11 years or so and thereafter it was sought to be recovered. In the aforesaid circumstances, the Court held that the recovery after several years of the implementation of the pay-scale would not be just and proper. Relying on the dictums in Syed Abdul Qadir and Shyam Babu Verma, situation no.(iii) has been carved out.

(d) Situation no. (iv)- no 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 - Lastly, reference was made to the decision in Sahib Ram (Supra), wherein a mistake had been committed by wrongly extending to the appellants therein revised pay scale, by relaxing the prescribed educational qualifications, even though the appellants were ineligible for the same. They were held not eligible for the higher scale, by applying the principle of "equal pay for equal work". In the said case, the court did not allow recovery of the excess payment, which was apparently Writ Appeal No. 925 of 2022 21 done because the Court felt that the employees were entitled to wages, for the post against which they had discharged their duties as it would be iniquitous and arbitrary for an employer to require an employee to refund the wages of a higher post, against which he had wrongfully been permitted to work, though he should have rightfully been required to work against an inferior post. Situation (iv) has thus been carved out.

14. The next decision referred to is Jagdev Singh (Supra). In this case the respondent therein claimed the benefit of situation no. (ii) in White Washer (Supra). The Apex court held that the same would have no application because an undertaking had been specifically furnished by the officer at the time when his pay had been 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 put to notice of the fact that a future re-fixation or revision may warrant an adjustment of the excess payment, if any, made. The officer had furnished the undertaking while opting for the revised pay scale and so he is bound by the same. Holding so, recovery of excess payments made, was permitted to be made in reasonable instalments.

15. The next decision referred to is a Division Bench decision of this court, that is, State of Kerala v. Vinod Kumar, 2020(4) KLT 230. In the said case, an argument was advanced on behalf of the State that the Apex Writ Appeal No. 925 of 2022 22 court in Jagdev Singh (Supra) had made a complete departure from the principles laid down in White washer (Supra). This argument was repelled and it was held that a reading of paragraphs 10 and 11 of Jagdev Singh (Supra) makes it clear that, the Supreme Court had only clarified that, in cases of recovery from retired employees or employees who are due to retire within one year of the order of recovery, there would be no bar in ordering recovery if the employee concerned had executed an undertaking agreeing to refund any excess payment. Hence this Court held that, Jagdev Singh (Supra) cannot be read as having laid down the proposition that in every case where there is an undertaking, recovery can be ordered from the employee concerned whatever be the point of time that such payment was made, for there is not even a suggestion that in the event of there being an undertaking to refund excess pay, none of the situations envisaged as items (i) to (v) of White Washer (Supra) can be pressed into service. Holding so recovery of the excess amounts given within a period of 5 years alone was allowed and recovery of payments made before 5 years was declined.

16. In yet another Division Bench decision of this Court in State of Kerala v. Abraham P. Joseph, 2021 (2) KHC 259 also the argument on behalf of the State that the Supreme court in Jagdev Singh (Supra) has given a go by to the principles laid down in White Washer (Supra) has been repelled. Instead, the argument of the respondent that the court in Jagdev Writ Appeal No. 925 of 2022 23 Singh (Supra) has not held that the earlier judgment in White Washer (Supra) is wrong and that it had only carved out a distinction in cases coming under the second criterion of employees noted in paragraph 18 of the judgment in White Washer (Supra), has been accepted. In Abraham P. Joseph (Supra) the mistake in the grant of second and third- time bound higher grades, had occurred 14 and 9 years respectively prior to the retirement of the respondent. The decision to cancel the time bound higher grades granted to the respondent, a Group C Class 3 category employee, had been taken and the order for recovery had been issued much after his retirement. In the said circumstances, the dictum in White Washer (Supra) was held to squarely apply to the facts of the case and so recovery was declined.

17. Finally, to the decision in Thomas Daniel v. State of Kerala, 2022 KHC 6489 (SC). Relying on the decisions in Sahib Ram; Col. B. J. Akkara; Syed Abdul Qadir and White Washer, the Apex court held that, the attempt to recover the increments paid in excess by a mistake after passage of ten years of the retirement of the employee as unjustified.

18. It is true that this Court in Vinod Kumar (Supra) rejected the argument advanced on behalf of the State that, Jagdev Singh (Supra) is a complete departure from the principles laid down in White Washer (Supra). This Court held that in Jagdev Singh (Supra) the apex Court has only Writ Appeal No. 925 of 2022 24 clarified that in cases of recovery from retired employees or employees who are due to retire with in a year of the order of recovery, there would be no bar on ordering recovery, if the employee concerned had executed an undertaking agreeing to refund any excess payment(s). Hence it has been concluded that one cannot read Jagdev Singh (Supra) as having laid down the proposition that in every case where there is an undertaking given by the employee agreeing to refund the amount, recovery can be ordered from the employee concerned whatever be the point of time that such payment had been made. It was also noticed that it cannot be overlooked that, there is not even a suggestion in Jagdev Singh (Supra) that in the event of there being an undertaking to refund excess pay, none of the situations envisaged under items (i) to (v) of White Washer (Supra) can be pressed into service. Therefore, what has been concluded based on Jagdev Singh (Supra) is that, even in case of employees falling under categories (i) and (ii) of White Washer case (Supra), there would be no bar in initiating recovery against them if the employee concerned had executed an undertaking agreeing to refund any excess payment.

19. In Jagdev Singh (Supra) the Apex court was dealing with the case of an employee falling under situation no.(ii) referred to in paragraph 18 of White Washer case (Supra), i.e., recovery from retired employees or employees who are due to retire within a year of the order of recovery. It was Writ Appeal No. 925 of 2022 25 held that the principle enunciated in proposition (ii) cannot apply to a situation where the officer to whom the payment was made in the first instance was clearly placed on notice that any payment found to have been made in excess would be required to be refunded. The officer in the said case had furnished an undertaking while opting for the revised pay scale and therefore he was held to be bound by the undertaking. Similar is the situation in the case on hand also. Copies of the undertaking alleged to have been given by the petitioner to the officer in- charge of the District/Sub Treasury agreeing to refund any excess payments made to him was handed over by the learned Senior Government Pleader for our perusal during the course of arguments. These documents are not disputed by the petitioner. That being the position, it is evident that he had been placed on notice that, in the event of payments disbursed to him found to be in excess, would be required to be refunded. The petitioner has no case that he has not submitted such an undertaking. The undertaking seems to have been given before the initial pension had been disbursed to him pursuant to his superannuation.

20. Further, as held by the Hon'ble Supreme Court in Chandi Prasad (Supra), the concern is relating to the excess payment of public money, often described as "tax payers' money", which belong neither to the officers who effected over-payment nor to the recipient. The crucial question to be looked into is whether excess money has been paid or not, which may Writ Appeal No. 925 of 2022 26 be due to a bona fide mistake or otherwise. Any amount paid/received without the authority of law can always be recovered barring few exceptions of extreme hardships but not as a matter of right, in such situations law implies an obligation on the payee to repay the money, otherwise it would amount to unjust enrichment. Moreover, the Apex court in White Washer (Supra), the very same decision relied on by the petitioner has said that orders passed by an employer seeking recovery of monetary benefits wrongly extended to employees, can only be interfered with, in cases where such recovery would result in a hardship of a nature, which would far outweigh, the equitable balance of the employer's right to recover. In other words, interference would be called for, only in such cases where, it would be iniquitous to recover the payment made (Refer paragraphs 6 & 7 in the judgment reported in (2015) 4 SCC 334). In the facts and circumstances of this case, we do not think that the same can be said to be a case where recovery would result in a hardship of a nature, which would far outweigh the equitable balance of the employer's right to recover, especially in the light of the offer made by the 3rd respondent for recovery in instalments.

21. Admittedly the petitioner retired from service on 31/05/2016. Even according to the petitioner, he was informed on 08/02/2021 by the authorities concerned that excess payments made needs to be recovered. Apparently, though this is just months before the expiry of five years, it Writ Appeal No. 925 of 2022 27 certainly is within the period contemplated in situation no.(iii) in White Washer (Supra). Furthermore, in the counter filed by the 3 rd respondent, permission is sought to recover the excess payment of ₹3,58,364/- made @ ₹ 864/- in 413 installments. This is quite a reasonable and justified prayer, which would in no way be iniquitous .

Hence the writ appeal is disposed of with liberty to the respondents to recover the excess payment made @ ₹ 864/- per month in 413 installments. The exact excess amount stated to have been made will be computed or fixed after hearing the petitioner also. When such exercise is carried out, in case it is found that the said amount is lesser or exceeds the amount of ₹ 3,58,364/- now stated to have been made in excess, then appropriate reductions or increase in the number of instalments will be made. But the monthly instalment at which the recovery will be effected shall not exceed ₹ 864/-.

Interlocutory Applications, if any pending, shall stand closed.

Sd/-

P.B. SURESH KUMAR JUDGE Sd/-

                                                        C.S.SUDHA
                                                         JUDGE

ami/Jms/27.07
 Writ Appeal No. 925 of 2022

                                        28

                          APPENDIX OF WA 925/2022

PETITIONER ANNEXURES
Annexure A1                   THE TRUE COPY OF THE LETTER DATED
                              01.07.2022 ISSUED BY THE 3RD RESPONDENT
                              TO THE APPELLANT.

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