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Case Number

WP (S) No. 6717 of 2004

Judges

Narendra Nath Tiwari, J.

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Smart Summary

Summary of the Court Opinion (Narendra Nath Tiwari, J.)

Factual and Procedural Background

The petitioner joined the Police Department of the erstwhile State of Bihar as a Constable (O) Wireless on 16.8.1969, was promoted to Assistant Sub Inspector in 1974 and to Sub Inspector of Police w.e.f. 1.8.1992. After reorganisation he was allotted to the State of Jharkhand in 2001 and retired on attaining superannuation on 29.2.2004.

After retirement, by Office Order No. 195/2004 issued by Memo No. 669 dated 26.5.2004 (Annexure 3), respondent No. 4 directed deduction of Rs. 88,893/- from the petitioner’s gratuity on the ground that Reducible Personal Pay (RPP) of Rs. 700/- granted w.e.f. 1.1.1996 was not authorised by the Finance Department. The Finance Department, by Office Order No. 564.F dated 9.3.2004, fixed the petitioner’s pay at Rs. 6,900/- w.e.f. 1.1.1996 and calculated the excess paid as Rs. 88,893, which was sought to be recovered from gratuity; the Accountant General directed deduction accordingly.

The petitioner challenged the deduction and sought quashing of the office order and a direction to pay the full gratuity to which he was entitled. Two counter affidavits were filed on behalf of the State respondents (including the Deputy Inspector General of Police, Wireless, Jharkhand) and by the Under Secretary, Department of Finance, Jharkhand.

Legal Issues Presented

Whether the State/Finance Department was entitled to recover Rs. 88,893/- from the petitioner’s gratuity on the ground that the Reducible Personal Pay (RPP) paid to him was unauthorised?
Whether an employee who was not instrumental in obtaining an allegedly erroneous pay fixation can be made liable to refund amounts paid pursuant to that fixation?
Whether the principle laid down in Sahib Ram v. State of Haryana applies to prevent recovery of salary paid on a revised scale where the employee is not at fault?

Arguments of the Parties

Petitioner's Arguments

The pay fixation and granting of RPP were done by the competent authority; the petitioner was not involved or instrumental in obtaining that fixation.
There is no allegation of misrepresentation or fault against the petitioner; therefore he cannot be held liable for recovery of excess payments made pursuant to the department’s fixation.
Reliance was placed on the Supreme Court decision in Sahib Ram v. State of Haryana (1995 (Suppl.) (1) SCC 18) to contend that where the employee is not at fault recovery should not be ordered.
Even if the fixation is revised post-retirement, at best pension can be revised prospectively; retrospective curtailment of salary paid during service and recovery thereof is impermissible.

Respondents' (State/Finance) Arguments

The revised pay fixation was provisional and, on scrutiny, the competent authority (Finance Department) did not approve the RPP; the payment of RPP was therefore unauthorised.
The government is entitled to correct mistakes in pay fixation and to recover any excess payment from available funds, including gratuity.
The excess amount paid from 1.1.1996 until retirement was quantified at Rs. 88,893 and recovery from gratuity was justified.
Reliance was placed on decisions of the Division Bench of this Court in State of Jharkhand v. Smt. Girish Kumari Pd. (2004 (2) JUR 426) and Rameshwar Pd. v. JSEB (2005 (2) JCR 198) which followed the Girish Kumari decision.

Accountant General's Submissions

The Accountant General supported recovery on the basis that a wrong fixation cannot create a vested right in favour of the petitioner and that payments made by mistake or illegally can be recovered from pensionary dues.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Sahib Ram v. State of Haryana, 1995 (Suppl.) (1) SCC 18	Where a higher pay scale was granted by mistake and the employee was not at fault or did not misrepresent, the amount paid on the revised scale may not be recovered from the employee.	The court applied this principle and held that the petitioner, who was not instrumental in the fixation and received RPP as fixed by competent authorities, could not be made liable for recovery; Sahib Ram was held to be squarely applicable.
State of Jharkhand v. Smt. Girish Kumari Pd., 2004 (2) JUR 426	On its facts: where a promotion was given without reference to an admitted break in service and the error was detected and corrected; the principle in Sahib Ram was held not to apply in that factual matrix.	The court distinguished Girish Kumari on the facts of the instant case, observing that Girish Kumari involved a break in service and acceptance of the position by the petitioner in that case, and therefore was not applicable here.
Rameshwar Pd. v. JSEB, 2005 (2) JCR 198	Followed the decision in Smt. Girish Kumari Pd. (as cited by respondents).	The court noted that respondents relied on Rameshwar Pd. (which followed Girish Kumari) but did not find those authorities applicable on the facts of the present case and therefore did not follow them.

Court's Reasoning and Analysis

The court examined the factual record and the parties' contentions. The Finance Department's position was that the petitioner’s pay fixation in the revised scale had been made provisionally and was not subsequently vetted/approved by the competent authority; accordingly the RPP of Rs. 700/- was unauthorised and the excess paid needed to be recovered.

The court, however, found on the record that:

The pay fixation and grant of RPP were made by the competent authority within the department (Office Orders Nos. 660/99 and 776/99 and related actions), and the petitioner was not instrumental at any stage in obtaining that fixation.
The RPP was granted to protect the petitioner’s pay vis-à-vis juniors and the salary was drawn on the basis of that fixation continuously up to retirement.
There was no allegation or material that the petitioner had misrepresented facts or acted fraudulently in relation to the fixation.

Having established that the petitioner bore no fault, the court applied the principle from Sahib Ram v. State of Haryana, which holds that where an employee is not at fault and higher pay was erroneously granted, the amount paid until detection of the error may not be recovered from the employee. The court explicitly held that the present facts are squarely covered by Sahib Ram.

The court considered the decision in State of Jharkhand v. Smt. Girish Kumari Pd. relied upon by respondents, but concluded that Girish Kumari was distinguishable because it involved a break in service and acceptance of a position on the facts of that case; therefore the principle in Sahib Ram was not held inapplicable here.

On this analysis the court concluded that the order directing recovery of Rs. 88,893/- from the petitioner’s gratuity was arbitrary and illegal because the petitioner could not be held liable for an excess payment resulting from departmental fixation for which he was not responsible.

Holding and Implications

Core Ruling: The writ petition is allowed and the impugned Office Order No. 195/2004 (Memo No. 669 dated 26.5.2004) directing deduction of Rs. 88,893/- from the petitioner’s gratuity is quashed.

Consequences and directions:

The amount deducted from the petitioner’s gratuity on the basis of the impugned order shall be refunded to the petitioner.
The respondents are directed to refund/pay the said amount with statutory interest within four weeks from the date of receipt of the order.
In default, the petitioner shall be entitled to compensatory interest at the rate of 10% per annum from the date the said amount was payable until the actual date of refund/payment.
The writ application is allowed without any order as to costs.

Broader implications: The court applied the existing Supreme Court principle in Sahib Ram to prevent recovery where the employee is not at fault. The opinion does not purport to lay down a new legal principle; the immediate effect is the quashing of the recovery order and refund to the petitioner with interest as directed.

Note: This summary is based exclusively on the content of the provided opinion and does not add information not contained therein.

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Baleshwar Singh v. State Of Jharkhand And Others

Narendra Nath Tiwari, J.:— In this writ application the petitioner has prayed for quashing the Office Order No. 195/2004 issued by Memo No. 669 dated 26.5.2004 (Annexure 3) whereby the respondent No. 4 has passed the order for deduction of Rs. 88,893/- from the petitioner's amount of gratuity. The petitioner has also prayed for a direction commanding upon the respondents to pay the entire amount of gratuity; which he is legally entitled to.

2. The facts leading to this writ application are as follows: The petitioner joined the service of the Police Department in the erstwhile State of Bihar as a Constable (O) Wireless, on 16.8.1969

3. He was given promotion to the Post of Assistant Sub Inspector (ASI) in the year 1974 and subsequently to the rank of Sub Inspector of Police w.e.f 1.8.1992 After reorganization of the State of Jharkhand, the petitioner's services were placed in the Head Quarter of the State of Jharkhand in the year 2001. The petitioner retired on attaining the age of superannuation on 29.2.2004 After his retirement, the impugned Office Order No. 195/04 has been issued by Memo No. 669 dated 26.5.2004 whereby the respondent No. 4 has directed for deduction of a sum of Rs. 88,893/- from the amount of the petitioner's gratuity, denying/disapproving the Reducible Personal Pay (RPP) which was paid to the petitioner during his service period on the basis of the fixation made by the department. According to the petitioner, the respondents have also reduced the amount of his pension on the plea of the said impugned order and fixed the monthly amount of pension at Rs. 8300/-. It has been stated that the petitioner had no role in the fixation of pay or in getting RPP and the pay was fixed by the department and the salary was paid on the said scale from 1996 till his retirement.

4. Two separate counter affidavits have been filed, one by the respondent No. 3 the Deputy Inspector General of Police, Wireless, Jharkhand and another by the respondent No. 5 the Under Secretary, Department of Finance, Jharkhand. The contentions made, by the said respondents in both the counter affidavits are almost similar. It has been stated that the State Government employees were granted the benefit of revised central pay scale by the finance department Resolution No. 660 dated 8.2.1999 modified by the corrigendum and issued by Resolution No. 3277 dated 2.6.1999 Schedule V of the said resolution provided the procedure for drawal of pay in the revised scale of pay, according to which the service book along with the Statement A was to be forwarded by the Drawing and Disbursing Officer/Office Head to the competent authority for vetting of the fixation of pay. The concerned authority was authorized to fix the pay of the employees in the revised scale only on provisional basis. But in the petitioner's case after provisional pay fixation, the same was not sent to the competent authority for vetting and the petitioner was allowed to draw salary in the revised scale of pay w.e.f 1.4.1997 The petitioner was promoted to the rank of Sub Inspector (Operator) on 1.8.1992 while his juniors Suresh Rd. Singh and Ujjair Mallik were promoted to the rank of Sub Inspector (Operator) on 15.12.1994 The Wireless organization fixed the pay of the petitioner in the revised pay scale of Rs. 5500-9000 on 17.5.1999 as per the recommendation of 6th Pay Commission w.e.f 1.1.1996 By office order Nos. 660/99 and 776/99 while fixing the pay of the petitioner, he was allowed Reducible Personal Pay (RPP) of Rs. 700/- w.e.f 1.1.1996 to protect his pay from the Junior Sub-inspectors namely Suresh Pd. Singh and Ujjair Mallick. The petitioner was then allotted Jharkhand State while Suresh Pd. Singh and Ujjair Maiiik remained in the State of Bihar as per the division made by the State Cadre Advisory Committee. The petitioner's, statement of pay fixation was sent to the Finance Department, Jharkhand Ranchi for verification as the petitioner was going to retire w.e.f, 29.2.2004, The finance department then held that the petitioner was not entitled for RPP which was granted to him by Office Order No. 660/99 and 776/99. The finance department then fixed the petitioner's pay at Rs. 6900/- w.e.f 1.1.1996 by Office Order No. 564.F dated 9.3.2004 On the basis of the said fixation, the excess amount paid to the petitioner w.e.f 1.1.1996 was calculated which came to the tune of Rs. 88,893.00 and the same was sought to be recovered from the amount of gratuity and the Accountant General, Jharkhand, Ranchi accordingly directed for deduction of Rs. 88,893/- from the final gratuity of the petitioner. It has been stated that the petitioner was not entitled for the said RPP and the amount paid to the petitioner as RPP was unauthorized payment and the government is entitled to recover the same. On the said ground, the order of recovery of Rs. 88,893 has been sought to be justified by the respondents.

5. Dr. S.N Pathak, learned counsel for the petitioner, submitted that admittedly the pay fixation was made by the competent authority and the RPP was paid to the petitioner in order to protect his pay from the pay of the junior Sub-Inspectors namely Suresh Pd. Singh and Ujjair Mallick. Learned counsel submitted that the respondents even in their counter affidavits have not stated that the petitioner was in any way instrumental in getting the said fixation of pay from the authorities concerned. There is absolutely no allegation of misrepresentation or any act of the petitioner at any stage in the process of the fixation of pay and he can not be held liable for the alleged excess payment made on the basis of the said fixation by the department and amount of salary can not be recovered from the petitioner. In support of the said submission the learned counsel felled on a decision of the Supreme Court in Sahib Ram v. State of Haryana, reported in 1995 (Suppl.) (1) SCC 18. Learned Counsel further submitted that since the earlier fixation of the petitioner's pay scale has been revised after his retirement, the same at best can be made effective by revising the pension on the basis of the said fresh fixation order, but salary of the service period paid to the petitioner can not now be curtailed with retrospective effect and no recovery can be made from the petitioner on the basis of said post retirement fixation of pay scale. The order of recovery is wholly illegal, arbitrary and unjust.

6. Mr. P. Modi, learned GP-I, on the other hand, supported the impugned order and contended that if there was wrong fixation of pay by the mistake of officers, the government is entitled to set right the mistake and if there was excess payment, to recover the same from the fund at hand. It has been further stated that the petitioner's said fixation by the department was only provisional and on scrutiny the same has not been approved by the competent authority. Any excess amount paid on the basis of such provisional fixation is liable to be recovered from the petitioner. There is thus no-arbitrariness or illegality in the impugned order of recovery and adjustment of the said amount. Since the petitioner was wrongly allowed RPP of Rs. 700/- w.e.f 1.1.1996 till the date of his retirement, the finance department has rightly corrected the mistake and calculated the amount and ordered for recovery from the gratuity of the petitioner, Learned counsel relied on a decision of a Division Bench of this Court in the State of Jharkhand v. Srnt. Girish Kuma'ri Pd., reported in 2004 (2) JUR 426, and another decision in Rameshwar Pd. v. JSEB, reported in 2005 (2) JCR 198, which followed the decision Smt. Giirish Kumar, supra.

7. Mr. S. Srivastava, learned counsel appearing on behalf of respondent No. 6 the Accountant General, Jharkhand, supported the impugned order on the same line and submitted that a wrong fixation can not create any right in favour of the petitioner and payment made by mistake or illegally can be recovered from the pensionary amount. Learned counsel submitted that there is absolutely no illegality in the impugned order and the recovery of the excess payment is wholly justified.

8. In the State of Jharkhand v. Smt, Girish Kumari Pd., (supra) the writ petitioner of that case had challenged the order whereby the second time bound promotion granted to her, was cancelled because she had not completed the requisite number of years of service before her retirement. On the facts of the said case it was held that the promotion was given without reference to the admitted break in service and the said error was detected and sought to be corrected. On the facts of the said case it was held that the principle as laid down in Sahib Ram's case by the Apex Court was not applicable as there was break in the service of the petitioner and the petitioner had accepted thesaid position and as such she was not entitled to get second time bound promotion before completion of the required number of years and the error was corrected. In Sahib Ram's case (supra) the Supreme Court in its concluding paragraph 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”

9. In the instant case admittedly the pay fixation was done by the competent authority and the petitioner was not at all instrumental at any stage of the fixation process. The amount of RPP was given to the petitioner by the appropriate authority in order to protect his pay from the pay of his juniors. Since the said fixation was all along accepted and the payment of salary was made on the said basis still the date of retirement the petitioner cannot be held liable for excess payment. This case is squarely covered by the principle laid down by the Hon'ble Supreme Court in Sahib flam's case, supra. The decision of this Court in Smt. Girish Kumari Pd.'s case has no application in the facts and circumstances of this case. The impugned order as contained in Annexure 3 is thus wholly arbitrary and illegal and is hereby quashed. The amount deducted from the gratuity of the petitioner on the basis of the said impugned order shall be refunded, to the petitioner. The respondents are directed to refund/pay the said amount to the petitioner with statutory interest within a period of four weeks from the date of receipt of this order, failing which the petitioner shall be entitled to get compensatory interest @ 10% per annum from the date the said amount was payable till the actual date of refund/payment of the said amount.

10. This writ application is accordingly allowed, but without any order as to costs.

11. Writ petition accordingly allowed.

Baleshwar Singh v. State Of Jharkhand And Others

Summary of the Court Opinion (Narendra Nath Tiwari, J.)

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Petitioner's Arguments

Respondents' (State/Finance) Arguments

Accountant General's Submissions

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

Baleshwar Singh v. State Of Jharkhand And Others

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