Dismissed

Kerala Forest Development Corporation Ltd. v. Thomas P.V.

Kerala HC10 Nov 2017WA/1637/2017

Case brief

AI extract

What is this about?

The Single Judge's order preventing recovery of retirement benefits previously paid to retired employees was affirmed. The Court held that amounts paid under valid orders cannot be recovered from retired employees absent proof of fraud or misrepresentation.

What did the court decide?

Recovery of excess amounts from retired employees is restrained; Corporation may adjust future benefits only following due process.

Kerala Forest Development Corporation Ltd. Vs… — Pension and Retirement Benefits | Kerala HC (2017)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR.JUSTICE P.N.RAVINDRAN &

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THE HONOURABLE MR. JUSTICE DEVAN RAMACHANDRAN

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FRIDAY, THE 10TH DAY OF NOVEMBER 2017/19TH KARTHIKA, 1939

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WA.No. 1637 of 2017 () IN WP(C).28192/2014

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AGAINST THE JUDGMENT IN WP(C) 28192/2014 of HIGH COURT OF KERALA DATED 07-04-2017

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APPELLANT(S)/RESPONDENTS 3 AND 4:

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KERALA FOREST DEVELOPMENT CORPORATION LTD, REGISTERED OFFICE AT ARANYAKOM,KARAPUZHA, KOTTAYAM-PIN-686003,REPRESENTED BY ITS MANAGING DIRECTOR.

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THE MANAGING DIRECTOR, KERALA FOREST DEVELOPMENT CORPORATION LTD, ARANYAKOM,KARAPUZHA,KOTTAYAM,PIN-686003.

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BY ADV. SRI.T.R.HARIKUMAR, (SC FOR KFDC)

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RESPONDENT(S)/PETITIONERS & RESPONDENTS 1 & 2:

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THOMAS P.V., AGED 60 YEARS,S/O.THOMAS VARGHESE,PEON,KFDC,KOTTAYAM, RESIDING AT PALATHINKKAL,KURUSUMOOD.P.O,CHANGANASSERY, KOTTAYAM DISTRICT,PIN-686104.

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K.RAVEENDRAN NAIR, AGED 61 YEARS,S/O.KUNJU PANIKAR,

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PEON,KFDC,PUNALOOR,THOLIKODU.P.O,RESIDING AT LIJI BHAVAN, KARAVOOR.P.O,PIRAVANTHUR,KOLLAM DISTRICT,PIN-689696.

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N.GOPINATHAN NAIR, AGED 61 YEARS,S/O NARAYANA PILLAI,PEON,KFDC,TRIVANDRUM, PIN-695521.

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G.SASIDHARAN NAIR, AGED 59 YEARS,S/O.GOPALAN NAIR,PEON,KFDC,PUNALOOR, THOLIKODU.P.O,RESIDING AT SARADA BHAVAN,MANNADY.P.O, PATHANAMTHITTA,PIN-691530.

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P.SUBRAMANIAN, AGED 53 YEARS,S/O.PARANGODAN,PEON,KFDC,MANANTHAVADY, RESIDING AT POOPATTA,MANALODI.P.O,NILAMBUR, WAYANAD-679329.

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S.RAJENDRAN, AGED 60 YEARS,S/O.SADASIVAN,DRIVER,KFDC,TRIVANDRUM, RESIDING AT SUNIL BHAVAN,TC 9/832,SREEKARYAM, TRIVANDRUM-695017.

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P.N.MOHANDAS, S/O.APPUKUTTAN NAIR,DRIVER,KFDC,KOTTAYAM,RESIDING AT POTTAVATHIL HOUSE,MEDICAL.P.O,CALICUT,PIN-673008.

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STATE OF KERALA, REPRESENTED BY THE SECRETARY,FINANCE DEPARTMENT, THIRUVANANTHAPURAM-695001.

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PRINCIPAL SECRETARY TO GOVERNMENT, FOREST & WILD LIFE DEPARTMENT,THIRUVANANTHAPURAM-695001.

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R8 AND R9 BY SR.G.P.SHRI RENIL ANTO KANDAMKULATHY R1 TO R6 BY SRI.THAMPAN THOMAS

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THIS WRIT APPEAL HAVING COME UP FOR ADMISSION ON 10-11-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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P.N. Ravindran & Devan Ramachandran, JJ.

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- - - - - - - - - - - - - - - - - - - - - -- - - W.A.No.1637 of 2017

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- - - - -- - - - - - - - - - - - - - - - - - - - - Dated this the 10^th November, 2017

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JUDGMENT

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Devan Ramachandran, J.

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The first appellant is a Government of Kerala undertaking incorporated under the provisions of the Companies Act. The respondents, who are the writ petitioners in W.P.(C)No.28192 of 2014, were their employees.

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The respondents were initially appointed on an adhoc basis. Even though they had made a request for regularisation, the Government did not accede to the said request and they continued as such for a fairly long period of time. Thereafter from 2011 the respondents/writ petitioners were regularised in service and consequential orders were issued by the appellant Corporation granting them the benefits of annual increments, dearness allowance as well as leave benefits as were applicable to regular employees.

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It appears that after retirement of some of the respondents/ writ petitioners, a complaint had been raised by the Audit Department finding that the benefits granted and disbursed to the respondents/writ petitioners with effect from the year 2000 were made on a wrong fixation of pay. It transpires that the finance inspection wing

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thereafter recommended recovery of excess amounts from the writ petitioners and orders were issued by the Government directing recovery of such amounts allegedly paid in error to the writ petitioners. It is conceded to by the appellant Corporation that the respondents/writ petitioners have all retired from service now and they had, in fact, superannuated even when the order was issued directing recovery from them. The respondents/writ petitioners challenged the orders impugned, namely, Exts.P12, P13 and P14, under which large amounts of money were directed to be recovered from them on the allegation that they had been paid these excess amounts by mistake and on account of the wrong fixation of pay and allowances. The writ petitioners challenged these orders primarily on the ground that they had retired from service and that they were entitled to retain the amounts received by them because the said amounts were paid to them not on account of any misrepresentation or fraud that can be attributed to them but on the basis of valid orders that was issued by the Corporation at the relevant time.

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The learned single Judge, on a consideration of all the materials placed on record and on an assessment of the submissions made at the Bar, allowed the writ petitions relying on the binding precedents of the Honourable Supreme Court in State of Punjab and Others v. Rafiq Masih (White Washer) etc. [(2015) 4 SCC 334] ,

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WA No.1637/2017

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Syed Abdul Qadir and Others v. State of Bihar and Others [2009 KHC 4219] and State of Punjab and Others v. Jagjit Singh and Others [AIR 2016 SC 5176] , setting aside the orders impugned and clarifying that the amounts sought to be recovered from the writ petitioners cannot be recovered since they were paid from the year 2000 onwards on valid order and that thus going by the judgments of the Honourable Supreme Court referred to above, such recovery is impermissible.

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We have heard Sri.T.R.Harikumar, the learned counsel for the appellant, Sri.Thampan Thomas, the learned counsel for respondents 1 to 5 and Sri.Renil Anto Kandamkulathy, the learned Government Pleader appearing for respondents 6 and 7.

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The facts in this case are not seriously in dispute. Even the appellant admits that all the respondents/writ petitioners except respondent No.5, have now retired from service. The said respondent, now in service, is stated to retire very soon in less than a year. The only allegation of the appellant Corporation is that they were paid certain allowances and benefits from the year 2000, consequent on their regularisation in the year 2011, on account of a wrong fixation of pay with effect from 2000. This allegation is founded on the report of the audit wherein it was found that the writ petitioners ought not have been granted benefits taking into account the allowances payable in

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the year 2000 but that it ought to have been fixed only taking into account the pay entitled to them as on that year. The objection of the audit appears to be that since the writ petitioners were regularised only from the year 2011, allowances could have been reckoned only after that year and not from the year 2000. The appellant reiterates that even going by the pay that was fixed in favour of the writ petitioners it was in excess, taking into account the figures that could have been applicable to them in the year 2000.

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We have considered the submissions made by Sri.T.R. Harikumar, the learned counsel appearing for the appellant in detail. We are certain that the respondents/writ petitioners were given certain benefits consequent to their regularisation in the year 2011 reckoning the pay and allowances as was applicable in the year 2000. The audit objection is that while doing so, allowances with effect from the year 2000 ought not have been reckoned and only the pay should have been reckoned. This objection is the edifice on the assertion that since the writ petitioners were regularised only from the year 2011, allowances for the period from 2000 ought not have been reckoned. We do not intend to enter into an enquiry as to the validity or legitimacy of this assertion because we are aware that the amounts that were paid to the writ petitioners were paid by the appellant Corporation under valid orders, reckoning their eligible pay on the

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basis of the applicable pay and allowances of the year 2000. Even if that calculation was in error, as is now contended by the appellant, it is certain that going by the binding precedents of the Honourable Supreme Court in Rafiq Masih [supra] , the amounts allegedly paid in excess to the writ petitioners cannot be recovered unless the appellant has a case that such payments were made on account of misrepresentation or fraud on the part of the respondents/writ petitioners or for any reason that can be attributed to them, which lead to a wrong fixation of pay. On the contrary, the pleadings on record would virtually make it ineluctable that even the appellant does not have a case that the writ petitioners were in any manner guilty of any such conduct or that their pay and allowances were fixed with effect from 2000 on account of any reason attributable to them. It is evident from the material before us that the fixation was made by the Corporation on their own and that the amounts were paid to the writ petitioners on the basis of valid orders. Viewed from that perspective it is inevitable that the ratio of the Honourable Supreme Court in Rafiq Masih [supra] would apply to the facts of this case on all its fours. We cannot find anything wrong with the view and conclusion entered into by the learned single Judge because all that the learned Judge is done is to injunct recovery of the amounts already paid to the writ petitioners since all of them, except one are now admittedly retired

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and since the amounts were paid to them while they were in service under valid orders. As regards respondent No.5, who is stated to be still in service, he will admittedly retire in less than a year, thus again being entitled to the protection declared in Rafiq Masih (supra).

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We notice that the action now proposed by the appellant Corporation is not on account of any orders that was passed on its own but on the basis of an audit objection raised by the Finance Department. We see that the appellant Corporation has been literally forced to take action based on the audit objections, failing which, we understand that it would be found that they are at fault in having sanctioned this amount. This, however, does not alter the entitlement of the writ petitioners to retain the amounts already paid to them since as we have already said above the declaration of law by the Honourable Supreme Court in this context is completely without doubt.

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At this point of time Sri.T.R.Harikumar, learned counsel appearing for the appellant says that the appellant Corporation has a right in law to redetermine the amounts payable to the respondents/ writ petitioners in future. He makes this assertion on the allegation that the pay fixed for the writ petitioners in the year 2011, when they were regularised, was, in fact, much higher from their actual pay and that the retirement benefits were also, therefore, calculated based on such fixation. He says that the Corporation, even going by the

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conclusions of the learned single Judge, should not be interdicted from taking further action in order to redetermine the retiremental benefits based on the fixation of pay as of the year 2011.

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Learned counsel for the respondents/writ petitioners assails the submissions made by Sri.T.R.Harikumar asserting that the benefits sanctioned and paid to the writ petitioners were, in fact, paid under valid orders consequent to a resolution that was adopted by the appellant Corporation itself. He says, therefore, that the appellant Corporation is not justified in now saying that the fixation was wrong.

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We do not propose to say anything on this because we are not sure if the appellant Corporation would be in a position legally to do this taking into account the fact that the writ petitioners are all retired from service and that the payments were sanctioned to them while they were in service. However, we do not want to foreclose any right that may be available to the appellant Corporation and we make it clear that the Corporation will be entitled to take any further action against the respondents/writ petitioners, to notionally refix their salary and allowances as on 2011 and consequently the retirement benefits, but only by following the procedure established in law and after issuing valid and proper notices to the respondents/writ petitioners and hearing them.

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Needless to say, if any order may be passed by the

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appellant Corporation after this exercise, the writ petitioners would be at liberty to initiate remedies available to them against the same in terms of law.

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The appeal is disposed of as above.

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(P.N. Ravindran, Judge)

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(Devan Ramachandran, Judge)

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kav/

Kerala Forest Development Corporation Ltd. v. Thomas P.V.

Case brief

What is this about?

What did the court decide?

Kerala Forest Development Corporation Ltd. v. Thomas P.V.

Case brief

What is this about?

What did the court decide?

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