Allowed

Suresh Eknath Pardeshi v. the State of Maharashtra and Others

Bombay HC2 Jul 2014WP/2405/2013

Case brief

AI extract

What is this about?

This judgment allows a writ petition by a retired employee challenging a post-retirement order that revised his pay downwards. The court held that recovering excess pay granted due to an earlier bona fide mistake, after the employee had relied on it for over 35 years, causes undue hardship and is not justified in equity.

What did the court decide?

Impugned order dated 25.07.2012 quashed; recovery of amounts stopped; any amounts already recovered refunded within four months.

Suresh Eknath Pardeshi Vs the State of… — Pension and Retirement Benefits | Bombay HC (2014)

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IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD

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WRIT PETITION NO.2405 OF 2013

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Suresh s/o Eknath Pardeshi, age: 58 years, Occ: Retired, R/o House No.13267, Northern Branch, Shrirampur, Taluka Shrirampur, District Ahmednagar. Petitioner

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Versus

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1 The State of Maharashtra, through its Secretary, Mantralaya, Mumbai.

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2 Maharashtra State Electricity Distribution Company Ltd., Prakashgad, Plot No.G-9, Bandra (E), Mumbai, through its Executive Director, MSEDCL Corporate Office, Mumbai.

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3 The General Manager (HR), Maharashtra State Electricity Distribution Company Ltd., Prakashgad, Plot No.G-9, Bandra (E), Mumbai.

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Respondents

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Mr.Anand Bhandari, advocate for the petitioner Mr.S.K.Tambe, A.G.P. for Respondent No.1. Mr.A.S.Bajaj, advocate for Respondents No.2 & 3.

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CORAM : R.M.BORDE &

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V.L.ACHLIYA, JJ. DATE :04^th July, 2014

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JUDGMENT (Per R.M.Borde, J.):

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1 Heard. Rule. Rule made returnable forthwith and

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heard finally by consent of learned Counsel for respective parties.

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2 The petitioner, who was in employment with Respondent-Maharashtra State Electricity Distribution Company Ltd., and has retired on attaining age of superannuation since 31^st July, 2012, is assailing the order passed by Respondent No.2 on 25.07.2012 thereby revising the pay admissible to the petitioner and reducing the same from Rs.36,090/- to Rs.34,855/-. The petitioner is also praying for disbursement of financial benefits which are withheld in pursuance to such decision.

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3 The petitioner was appointed as Lower Division Clerk by the erstwhile Maharashtra State Electricity Board on 16.05.1977. At the time of his appointment, petitioner was holding educational qualification as B.A. and during course of employment, he acquired Post-Graduate qualification i.e. M.A.. In view of the Circular issued by Maharashtra State Electricity Board bearing No.220, since petitioner has acquired additional qualification while in employment, he was held eligible for grant of one advance increment. The petitioner has been granted one advance increment by order dated 27.11.1981 with effect from 25.06.1977. Thereafter he was promoted as Upper Division Clerk (General Administration) on 23.05.1984 and by subsequent order dated 27.06.1994, he was awarded deemed date of promotion as 28.08.1980. The petitioner received a further promotion as Head Clerk on 01.12.1988, whereas, he was promoted as Establishment Superintendent with effect from 26.07.1997. On 21.08.2003, he was promoted as Assistant Personnel Officer and next promotion followed was on 22.08.2008 as Deputy Manager (HR). The last

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promotion awarded to the petitioner, during his service career, was with effect from 07.02.2011 and he was promoted as Manager (HR) till 31.07.2012. At the time of his retirement, in the salary slip, his basic pay was recorded as Rs.36,090/- and D.A. is recorded as 23,459/-.

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4 Respondent-Company issued a correction slip bearing No.308 whereby criteria for grant of increment has been changed. In the correction slip, it is recorded that past cases shall not be reopened and additional increment granted shall be absorbed in the pay by treating the amount as personal pay. It thus appears that in view of the office order issued on 25.07.2012, a week before his retirement, entire pay of the petitioner, drawn during his service career, has been recalculated. According to the petitioner, while recalculating his salary, his basic pay has been reduced to Rs.34,855/-.

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5 The petitioner contends that the Respondents, on application of revision in the pay scale, awarded amount of gratuity to the tune of Rs.11,50,220/- to the petitioner. So far as leave encashment admissible to the petitioner is concerned, alleged excess payment is deducted from the amount payable as leave encashment. A further sum of Rs.24,396/- is refunded to the petitioner, which was deposited by him towards contribution to provident fund. The petitioner made representation to the Respondent-Company and prayed for recalling the revision / refixation of pay on 21.08.2012. The petitioner claimed that a sum of Rs.40,760/- towards amount of gratuity has been paid less. He also claims fixation of his basic pay @ Rs.36,090/-. The petitioner

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has also prayed for refund of amount of Rs.2,26,676/-, illegally deducted from the salary of the petitioner. The petitioner claims an amount of Rs.32,608/- towards leave encashment and contribution towards provident fund Rs.24,396/-. The petitioner claimed total amount of Rs.3,24,440/- from the Respondents.

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6 According to the petitioner, correction slip No.308 dated 10.07.1984 does not permit reopening of calculations and as such, salary of the petitioner shall remain same. The increment granted to the employee is required to be considered as personal pay and same is to be absorbed in the next increment as per the said circular. The petitioner contends that the order issued by Respondents, a week prior to date of his retirement, thereby reducing financial benefits accruable to him after lapse of more than 32 years, is illegal and erroneous.

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7 An affidavit-in-reply has been presented on behalf of Respondents wherein it is stated that in view of Correction Slip No.308 dated 10.07.1984, advance increment was admissible only in relation to the qualifications which were notified and the petitioner could not have been granted advance increment in 1981. According to the Respondents, petitioner's additional qualification of Master of Arts Degree was not recognised as additional qualification and as such, advance increment given to the petitioner, as per Correction Slip No.308, shall have to be treated as special pay and thereafter was supposed to be absorbed in the future increments. It is contended that the mistake, which has occurred, is corrected and excess financial benefits granted to the petitioner are withdrawn.

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8 The contention raised by the petitioner that benefits paid to him in the year 1984 were not as a result of misrepresentation made by him. The petitioner was granted advance increment since 25.06.1977 in view of order dated 27.11.1981 since he acquired additional qualification while in employment. Correction Slip No.308, which was issued in 1984, was not acted upon until retirement of the petitioner and it was acted upon after about 28 years from the date of issuance of Correction Slip. The benefits of advance increment awarded with effect from 25.06.1977 are taken away and pay admissible to the petitioner is revised since 1977 by issuing order in 2012, a week prior to the date of his retirement. The petitioner contends that the order, apart from illegal and hopelessly delayed, causes serious financial prejudice to the petitioner. The order has been given effect after his retirement. The petitioner contends that financial benefits awarded since 1977 are being taken away after lapse of more than 35 years and since the petitioner was not instrumental in securing benefits erroneously, recovery of amount, after such huge lapse of time, landed him in financial crisis and as such, recovery directed is not justified and proper.

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9 In the matter of Shyam Babu Verma and others vs. Union of India and others, reported in (1994) 2 Supreme Court Cases 521 , higher pay-scale was erroneously granted in the year 1973 and recovery, on account of excess payment, was sought to be made in the year 1984, after lapse of eleven years. The Supreme Court, while dealing with the matter, observed that the recovery of amount, on account of reduction in pay scale after lapse of several

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years, affects the employee financially and such recovery would not be just and proper.

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10 Similarly, in the matter of Sahib Ram vs. State of Haryana and others, reported in 1995 Supp. (1) Supreme Court Cases 18 , it was found that the appellant therein did not possess the required educational qualification and consequently was not entitled to claim relaxation, but having been granted relaxation erroneously by the Principal and having been paid the salary in the revised pay scale, it was directed that the excess payment shall not be recovered.

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11 In the matter of Chandi Prasad Uniyal and others vs. State of Uttarakhand and others, reported in 2012 A.I.R. S.C.W. 4742 , it is observed by the Supreme Court, in paragraph 9 of the judgment, thus:

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"9. We are of the considered view, after going through various judgments cited at the bar, that this court has not laid down any principle of law that only if there is misrepresentation or fraud on the part of the recipients of the money in getting the excess pay, the amount paid due to irregular/wrong fixation of pay be recovered."

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12 In the matter of Col. B.J. Akkara (Retd.) Vs. Government of India & others , reported in (2006) AIR SCW 5252, referring to the judgments in the matter of Shyam Babu Verma and Sahib Ram , (supra), it is observed by the Supreme Court, thus:

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“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 would spend whatever emoluments he receives for the 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 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.”

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13 In the matter of Syed Abdul Qadir & others Vs. State

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of Bihar & others, reported in (2009) AIR SCW 1871, referring to the earlier judgments, the Supreme Court has observed thus:

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“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

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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 appellantsteachers, we are of the view that no recovery of the amount that has been paid in excess to the appellants-teachers should be made. (emphasis added)”

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14 Although, it is observed in the matter of Chandiprasad Uniyal (supra), that any amount paid or received without authority of law can always be recovered barring few exceptions of extreme hardships but not as a matter of right, in such situation, law implies an obligation on the payee to repay the money, otherwise it would amount to unjust enrichment. It is further observed that barring few instances pointed out in the matter of Syed Abdul Qadir and B.J. Akkara ( supra), excess payment made due to wrong/irregular pay fixation can always be recovered.

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15 In the instant matter, the petitioner has already retired on attaining age of superannuation. The Respondent-authorities have sought to revise the pay scale granted to the petitioner in the year 1977 by issuing orders in that behalf in the year 2012, much after the retirement of the petitioner. The case of the petitioner squarely falls within the exceptions carved out in the matters of Syed Abdul Qadir and B.J.Akkara , cited supra.

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16 For the reasons recorded above, writ petition deserves to be allowed and same is accordingly allowed. The impugned order issued by Respondents on 25.07.2012 is quashed and set aside. The Respondents are directed not to effect any recovery of amount, in pursuance to order dated 25.07.2012; and amount already recovered, if any, based on said order, be refunded to the petitioner, as expeditiously as possible, preferably within four months from today.

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17 Rule is accordingly made absolute. There shall be no order as to costs.

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V.L.ACHLIYA R.M.BORDE JUDGE JUDGE

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R.M.BORDE

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Suresh Eknath Pardeshi v. the State of Maharashtra and Others

Case brief

What is this about?

What did the court decide?

Suresh Eknath Pardeshi v. the State of Maharashtra and Others

Case brief

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What did the court decide?

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