Punjab-Haryana High Court
Jagdev Singh vs State Of Punjab & Ors on 21 April, 2025
Neutral Citation No:=2025:PHHC:050901
CWP-9298-2004 and 1
other connected case
IN THE HIGH COURT OF PUNJAB & HARYANA
AT CHANDIGARH
734-2 cases
Date of decision: 21.04.2025
1) CWP-9298-2004
Jagdev Singh vs. State of Punjab and others
2) COCP-1351-2004
Avtar Singh Atwal vs. VK Mantrao
CORAM: HON'BLE MR. JUSTICE AMAN CHAUDHARY
*****
Present : None for the petitioners.
Mr. Manipal Singh Atwal, DAG, Punjab.
*****
AMAN CHAUDHARY, J. (Oral)
1. Prayer made in the present petition is for quashing the impugned
orders, Annexure P-3 with regard to the recovery being effected from the
petitioner, which the Division Bench vide order dated 01.07.2004, while issuing
notice of motion, had stayed.
2. The sole reliance in this case was placed on the judgment passed in
Rajinder Paul vs. State of Punjab and others, CWP-19749-2003, Annexure P-
4, wherein the limited prayer of the petitioner with regard to the recovery not to
be effected was accepted by the Division Bench on 18.12.2003.
3. In Jogeshwar Sahoo and others vs. The District Judge, Cuttack
and others, SLP (C) No(s). 5918-2024, decided on 04.04.2025, the Hon’ble
Supreme Court has held that the recovery of excess emoluments or allowances,
disbursed as a consequence of an erroneous computation of the same, ought not to
be affected, such indulgence being granted as an equitable relief, extended solely
to alleviate the hardship that might otherwise be caused by such recovery,
especially to those retired, the relevant paras whereof read thus:-
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other connected case“7. The issue falling for our consideration is not about the legality of
the retrospective promotion and the financial benefit granted to the
appellants on 10.05.2017. The issue for consideration is whether
recovery of the amount extended to the appellants while they were in
service is justified after their retirement and that too without
affording any opportunity of hearing.
8. The law in this regard has been settled by this Court in catena of
judgments rendered time and again; Sahib Ram vs. State of Haryana,
(1995) Supp (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 Jt. Director, (1997) 6 SCC 139
and in a recent decision in the matter of Thomas Daniel vs. State of
Kerala & Ors., (2022) SCC online SC 536.
9. This Court has consistently taken the view that if the excess
amount was not paid on account of any misrepresentation or fraud on
the part of the employee or 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, such excess
payments of emoluments or allowances are not recoverable. It is held
that such relief against the recovery is not because of any right of the
employee but in equity, exercising judicial discretion to provide
relief to the employee from the hardship that will be caused if the
recovery is ordered.
10. In Thomas Daniel (supra), this Court has held thus in paras 10,
11, 12 and 13:
“10. In Sahib Ram v. State of Haryana, this Court restrained
recovery of payment which was given under the upgraded pay
scale on account of wrong construction of relevant order by
the authority concerned, without any misrepresentation on part
of the employees. It was held thus:
“5. Admittedly the appellant does not possess the required
educational qualifications. Under the circumstances the
appellant would not be entitled to the relaxation. The Principal
erred in granting him the relaxation. Since the date of
relaxation, the appellant had been paid his salary on the
revised scale. However, it is not on account of any
misrepresentation made by the appellant that the benefit of the
higher pay scale was given to him but by wrong construction
made by the Principal for which the appellant cannot be held
to be at fault. Under the circumstances the amount paid till
date may not be recovered from the appellant. The principle of
equal pay for equal work would not apply to the scales
prescribed by the University Grants Commission. The appeal
is allowed partly without any order as to costs.”
11. In Col. B.J. Akkara (Retd.) v. Government of India2
this Court considered an identical question as under:
“27. 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 consistently2 of 6
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other connected casegranted relief against recovery of excess wrong payment of
emoluments/allowances from an employee, if the following
conditions are fulfilled (vide Sahib Ram v. State of Haryana
[1995 Supp (1) SCC 18 : 1995 SCC (L&S) 248], Shyam Babu
Verma v. Union of India [(1994) 2 SCC 521 : 1994 SCC
(L&S) 683 : (1994) 27 ATC 121], Union of India v. M.
Bhaskar [(1996) 4 SCC 416 : 1996 SCC (L&S) 967] and V.
Gangaram v. Regional Jt. Director [(1997) 6 SCC 139 : 1997
SCC (L&S) 1652]):
(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.
28. Such relief, restraining back 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 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.
29. On the same principle, 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
are not guilty of any misrepresentation or fraud in regard to
the excess payment. NPA was added to minimum pay, for
purposes of stepping up, due to a wrong understanding by the
implementing departments. We are therefore of the view that
the respondents shall not recover any excess payments made
towards pension in pursuance of the circular dated 7-6-1999
till the issue of the clarificatory circular dated 11-9-2001.
Insofar as any excess payment made after the circular dated
11-9-2001, obviously the Union of India will be entitled to
recover the excess as the validity of the said circular has been
upheld and as pensioners have been put on notice in regard to
the wrong calculations earlier made.”
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other connected case
12. In Syed Abdul Qadir v. State of Bihar3 excess payment
was sought to be recovered which was made to the appellants-
teachers on account of mistake and wrong interpretation of
prevailing Bihar Nationalised Secondary School (Service
Conditions) Rules, 1983. The appellants therein contended
that even if it were to be held that the appellants were not
entitled to the benefit of additional increment on promotion,
the excess amount should not be recovered from them, it
having been paid without any misrepresentation or fraud on
their part. The Court held that the appellants cannot be held
responsible in such a situation and recovery of the excess
payment should not be ordered, especially when the employee
has subsequently retired. The court observed that in general
parlance, recovery is prohibited by courts where there exists
no misrepresentation or fraud on the part of the employee and
when the excess payment has been made by applying a wrong
interpretation/understanding of a Rule or Order. It was held
thus:
“59. Undoubtedly, the excess amount that has been paid to the
appellant 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 appellant
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 appellant teachers, we are of the
view that no recovery of the amount that has been paid in
excess to the appellant teachers should be made.”
13. In State of Punjab v. Rafiq Masih, (2015) 4 SCC 334
wherein this court examined the validity of an order passed by
the State to recover the monetary gains wrongly extended to
the beneficiary employees in excess of their entitlements
without any fault or misrepresentation at the behest of the
recipient. This Court considered situations of hardship caused
to an employee, if recovery is directed to reimburse the
employer and disallowed the same, exempting the beneficiary
employees from such recovery. It was held thus:
“8. As between two parties, if a determination is rendered in
favour of the party, which is the weaker of the two, without
any serious detriment to the other (which is truly a welfare
State), the issue resolved would be in consonance with the
concept of justice, which is assured to the citizens of India,4 of 6
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other connected caseeven in the Preamble of the Constitution of India. The right to
recover being pursued by the employer, will have to be
compared, with the effect of the recovery on the employee
concerned. If the effect of the recovery from the employee
concerned would be, more unfair, more wrongful, more
improper, and more unwarranted, than the corresponding right
of the employer to recover the amount, then it would be
iniquitous and arbitrary, to effect the recovery. In such a
situation, the employee’s right would outbalance, and therefore
eclipse, the right of the employer to recover.
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18. 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, wherein
recoveries by the employers, would be impermissible in law:
(i) Recovery from the employees belonging to Class III and
Class IV service (or Group C and Group D service).
(ii) Recovery from the retired employees, or the employees
who are due to retire within one year, of the order of recovery.
(iii) Recovery from the 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.
(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.”
11. In the case at hand, the appellants were working on the post of
Stenographers when the subject illegal payment was made to them. It
is not reflected in the record that such payment was made to the
appellants on account of any fraud or misrepresentation by them. It
seems, when the financial benefit was extended to the appellants by
the District Judge, Cuttack, the same was subsequently not approved
by the High Court which resulted in the subsequent order of
recovery. It is also not in dispute that the payment was made in the
year 2017 whereas the recovery was directed in the year 2023.
However, in the meanwhile, the appellants have retired in the year
2020. It is also an admitted position that the appellants were not
afforded any opportunity of hearing before issuing the order of
recovery. The appellants having superannuated on a ministerial post
of Stenographer were admittedly not holding any gazetted post as
such applying the principle enunciated by this Court in the above
quoted judgment, the recovery is found unsustainable.”
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other connected case
4. In the case at hand, there is nothing in the written statement that the
petitioner received the amount by making any misrepresentation or concealment
of facts.
5. Despite best efforts the learned State counsel has not been able to
dispute the factual position and draw out any distinctive aspects in the
aforementioned judgment or cite any contrary law.
6. In view of the afore, the present petition is partly allowed insofar as
recovery ordered is concerned.
7. Photocopy of this order be placed on the file of connected case.
(AMAN CHAUDHARY)
JUDGE
21.04.2025
Hemant
Whether speaking/reasoned : Yes / No
Whether reportable : Yes / No
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