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P Koteswara Rao v. The State of Andhra Pradesh

Andhra Pradesh HC6 Aug 2025WP/18273/2025

Case brief

AI extract

What is this about?

Recovery of excess pay; wrong pay fixation; retired employee; withholding of Gratuity, GPF and Earned Leave Encashment; impermissibility of recovery from retired employees and those retiring within one year; Rafix Masih parameters (2015) 4 SCC 334; Thomas Daniel v State of Kerala; Jogeswar Sahoo v District Judge Cuttack; delay and laches objection rejected; interest on withheld retirement benefits; Andhra Pradesh; writ petition allowed.

What did the court decide?

Writ Petition allowed; Respondent Authorities directed to pay Rs.3,57,371/- to the Petitioner with interest at 7.5% p.a. within three (03) months; no order as to costs; miscellaneous petitions, if any, closed. ¶55

P Koteswara Rao Vs The State of Andhra Pradesh — Andhra Pradesh HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

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Issue for consideration

Whether the recovery of Rs.3,57,371/- towards excess pay and allowances on account of alleged wrong pay fixation from the retirement benefits of the retired Petitioner is sustainable in law. +1 more

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Court's answer

Following the parameters fixed in State of Punjab v Rafix Masih, recovery from retired employees or employees due to retire within one year is impermissible in law.

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Ratio / Principle

The Petitioner's case clearly fits the impermissible-recovery category; the impugned recovery towards excess pay and allowance due to wrong pay fixation cannot be sustained.

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Key takeaways

The Standing Counsel's delay objection is misconceived; since retention of the money is in contravention of the Hon'ble Apex Court's judgment, delay is not material to reject the Petitioner's case.ratio¶53

Detailed headnote1 paragraphs

Andhra Pradesh High Court at Amaravati (Nyapathy Vijay, J.), Writ Petition No. 18273/2025, decided 07.08.2025 — Recovery of Rs.3,57,371/- from the retirement benefits (Gratuity, GPF, Earned Leave Encashment) of a retired Corporation employee (Contingent Watchman, retired 29.02.2016) towards excess pay and allowances on account of wrong pay fixation, effected by proceedings dated 13.06.2025, held unsustainable. Applying the parameters in State of Punjab v Rafix Masih (2015) 4 SCC 334 (para 18), the Court held that recovery from retired employees or those due to retire within one year is impermissible, a principle reiterated in Thomas Daniel v State of Kerala and Jogeswar Sahoo v The District Judge, Cuttack. The Respondents' objection that the Writ Petition was filed after a lapse of about 10 years was rejected as misconceived, retention of the money being contrary to the Apex Court's ruling. Writ allowed; Respondents directed to pay Rs.3,57,371/- with interest at 7.5% p.a. within three months; no costs.

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APHC010357692025

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IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI

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[3460]

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(Special Original Jurisdiction)

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THURSDAY,THE SEVENTH DAY OF AUGUST TWO THOUSAND AND TWENTY FIVE

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PRESENT

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THE HONOURABLE SRI JUSTICE NYAPATHY VIJAY

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WRIT PETITION NO: 18273/2025

Between:

P Koteswara Rao

...PETITIONER

AND

The State Of Andhra Pradesh and Others

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...RESPONDENT(S)

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Counsel for the Petitioner:

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1.M PITCHAIAH

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Counsel for the Respondent(S):

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1.GP FOR SERVICES I

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The Court made the following:

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THE HONOURABLE SRI JUSTICE NYAPATHY VIJAY

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WRIT PETITION NO: 18273/2025

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The present Writ Petition is filed to declare the Proceedings vide Lr.No.EE/0/TownA/VJA/Adm/JAO/U1/D.No.915,dt.13.06.2025 of the 4^th Respondent as illegal and arbitrary and direct the respondents to pay Rs.3,57,371/- to the Petitioner with interest @ 12% P.A.

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The facts leading to filing of the present Writ Petition are as follows:

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The Petitioner had joined the Respondent Corporation as Contingent Watchman on 02.07.1977 in ERO, Town Office-1, Vijayawada and his services were regularized with effect from 01.04.1981. On attaining the age of 60 years, the Petitioner had retired from service on 29.02.2016. At the time of retirement, the Respondent Corporation had paid the retirement benefits towards Gratuity, GPF and Earned Leave Encashment short of Rs.3,57,371/-. Though no information was initially given to the Petitioner as to why the amount was withheld, eventually, the impugned Proceedings were issued on 13.06.2025 stating that the amount of Rs.3,57,371/- was recovered towards excess pay

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and allowances on account of wrong pay fixation.

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Learned Standing Counsel appearing for the Respondents

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would contend that the present Writ Petition is filed after a long lapse of 10 years and therefore, the same cannot be entertained.

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4. Heard the respective counsel.

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It is to be noted that the Petitioner had retired from service

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in the year 2016 and it is not the case of the Respondent Corporation that the Petitioner had influenced in making wrong pay fixation.

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The Hon’ble Apex Court in the case of State of Punjab and others v Rafix Masih ( White Washer)¹ has held that after considering the case law in vogue at the point of time fixed certain parameters at pargraph No.18, situations where recovery should not be effected from the employees. Paragraph No.18 of the said judgment reads as under:

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“ It is not possible to postulate all situations of hardship, which would govern employees on the issue of recovery, where payments have mistakenly been made by the employer, in excess of their entitlement. Be that as it may, based on the decisions referred to hereinabove, we may, as a ready reference, summarise the following few situations,

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1 (2015) 4 SCC 334

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wherein recoveries by the employers, would be impermissible in law:

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(i) Recovery from employees belonging to Class-III and Class-IV service (or Group 'C' and Group 'D' service).

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(ii) Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery.

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(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.

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(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.

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(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.

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In view of the above judgment, the recovery from the retired

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employess or the individuals who are due to retire within one year is impermissible.

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The same principle was reiterated by the Hon’ble Apex Court in Thomas Daniel v State of Kerala and others² and Jogeswar Sahoo and other v The District Judge, Cuttack and

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others³ .

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The Petitioner's case clearly fits under the aforementioned

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2 2022 Live Law (SC) 438

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3 2025 Livelaw (SC) 396

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category. Therefore, the impugned recovery by the Respondents towards excess pay and allowance due to wrong pay fixation cannot be sustained.

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The contention of the learned Standing Counsel appearing for the Respondents with regard to delay is misconceived considering the categorical judgment of the Hon’ble Apex Court and the retention of the money being in contravention of the judgment of the Hon’ble Apex Court, the delay would not be material to reject the case of the Petitioner..

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Accordingly, the Writ Petition is allowed and the

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Respondent Authorities are directed to pay a sum of Rs.3,57,371/- to the Petitioner with interest at 7.5% p.a. within a period of three (03) months. There shall be no order as to costs.

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As a sequel, miscellaneous petitions, pending if any, shall

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stand closed.

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_______________________________ JUSTICE NYAPATHY VIJAY

Date: 07.08.2025

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