Central Administrative Tribunal - JabalpurIqbal Khan vs M/O Railways on 27 April, 20231            O.A.No. 203/01046/2019\n\n                                                                           Reserved\n     CENTRAL ADMINISTRATIVE TRIBUNAL, JABALPUR BENCH\n                         CIRCUIT SITTINGS:BILASPUR\n\n                  Original Application No.203/01046/2019\n            Jabalpur, this Thursday, the 27th day of April, 2023\n\n    HON'BLE SHRI JUSTICE AKHIL KUMAR SRIVASTAVA, JUDICIAL MEMBER\n     HON'BLE SHRI KUMAR RAJESH CHANDRA, ADMINISTRATIVE MEMBER\n\n\n\nIqbal Khan\nS/o Shri Nawab Khan\nAged 61 yrs.\nRetd. Sr. Commercial Clerk\nR/o Ward NO.41\nNear Noor Maszid\nKelabadi Durg 491001 (CG)                                       -Applicant\n\n(By Advocate -Shri B.P. Rao)\n\n                                           Versus\n\n\n 1. Union of India,\n Through The General Manager\n SEC Railway Bilaspur Zone\n Headquarters' office\n Bilaspur 495004 (CG)\n\n 2. The Sr. Divisional Personnel Officer\n SEC Railway,\n Raipur Division\n DRM's Office\n Raipur 492004 (CG)                                       - Respondents\n\n(By Advocate -Shri Siddharth Rathod)\n(Date of reserving the order:11.04.2023)\n\n\n\n\n                                                                Page 1 of 10\n                            2             O.A.No. 203/01046/2019\n\n\n\n\n                            ORDERBy Justice Akhil Kumar Srivastava, JM;Through this Original Application the applicant has sought\n\ndirection to set aside the letter dated 14.12.2018 (Annexure A/3)\n\nwhereby excess payment of Rs.95605/- has been deducted from\n\nhis settlement dues and to repay the overpayment of said amount\n\nto him with interest from 01.01.2019 onwards.2.    The facts of the case are that the applicant joined as\n\nTemporary Khalasi on 27.12.1980. Applicant was issued pay slip\n\nfor the month of November 2018 wherein his date of appointment\n\nwas shown as 27.12.1980 but just before his retirement vide letter\n\ndated 14.12.2018, the Sr. DPO/Raipur informed the applicant that\n\nhis date of appointment was entered in the service book as\n\n11.01.1981 in place of 27.12.1980 therefore his 3rd MACP which\n\nwas granted on 27.12.1980 has been changed to 01.01.2012\n\ntherefore on refixation of his basic pay from 01.07.2018 i.e. from\n\n46200/- to 44900/- and further Rs.10 has also extra paid from July\n\n2007 to December 2015 therefore computed Rs.95605/- as Extra\n\nPayment granted to him erroneously and which will be recovered\n\nfrom his settlements vide letter dated 14.12.2018 (Annexure A/3).\n\nHence this Original Application.Page 2 of 103             O.A.No. 203/01046/20192.1. Learned counsel for the applicant has contended that as per\n\nservice particulars/service sheet, the date of joining in service has\n\nbeen entered as 27.12.1980 and in every official letters and\n\nseniority list the date of joining has been entered by the\n\nrespondents as 27.12.1980 therefore treating his date of joining as\n\n11.01.1981 is baseless. Moreover if assume the date of joining as\n\n11.01.1981 i.e. just 14 days after actual date of joining i.e.\n\n27.12.1980 but for this error the 3rd MACP which was granted to\n\nthe applicant on 27.12.2010 can be changed to 11.01.2011 but\n\ncannot be 01.01.2012 therefore the said computation of excess\n\npayment of Rs.95605 was wholly incorrect and baseless.               He\n\nfurther relied upon the judgment of Hon'ble Apex Court in the\n\nmatters ofState of Punjab and others vs. Rafiq Masih (While\n\nWasher) 2014 SLJ 136 (SC), Principal Bench of CAT in O.A.\n\n2527/2016 (Tara Chand vs. General Manager (Pension) Northern\n\nRailways) reported in AISLJ 2019(1) CAT-1, O.A. 3379/2016\n\n(Inder Singh vs. Union of India and others) reported in AISLJ 2019\n\n(1) (CAT)-4 and Allahabad Bench of CAT in O.A. No.656/2011\n\n(Umakant Jha vs. Union of India)..3.    Respondents in their reply have submitted that the applicant\n\nwas appointed as Temporary Khalasi on 27.12.1980 and he was\n\nregularized in the post of Khalasi on 11.05.1981. While reviewingPage 3 of 104              O.A.No. 203/01046/2019the case of the applicant at the time of his retirement, it was\n\nobserved that inadvertently 27.12.1980 was taken as the date of\n\nappointment of the applicant for grant of MACP instead of\n\n11.05.1981 (the regular service). It is submitted by the\n\nrespondents that after completing 30 years (counted from\n\n11.05.1981 from regular service) the applicant was due for 3rd\n\nMACP of regular service 10.01.2011 but due to ongoing\n\npunishment (withholding of increment for 6 months) 3rd MACP was\n\ngiven effect from 01.01.2012. Thus, in terms of Estt. Sr. 138/09 the\n\nimplementation of 3rd MACP benefit has been granted on\n\n27.12.2010 instead of 01.01.2012. Accordingly as a consequence\n\nof the review undertaken the pay of the applicant was refixed by\n\nreducing   the   basic   pay   of   Rs.   46200/-    to   Rs.44900/-\n\nw.e.f.01.07.2018. Further it was also notice that since July 2007 to\n\nDecember 2015 he was getting Rs.10 as excess pay. Since the\n\napplicant was retiring from Railway service on superannuation\n\nw.e.f.31.12.2018 as per Railway Service (Pension) Rules, 1993\n\nthe excess payment of Rs.95605/- made to the applicant was\n\nrecovered from the retirement gratuity with prior intimation to the\n\napplicant. The recovery has been made as per the extant Railway\n\nEstt. Rules and Rule 15 (4) of the Railway Service Pension Rule\n\n1993. Further the applicant was upper grade commercial clerkPage 4 of 105             O.A.No. 203/01046/2019dealing with commercial matters and it is understood that he was\n\nhaving the knowledge about his regularization as Khalasi\n\nw.e.f.11.05.1981 and also having the knowledge in regard to the\n\nrules that the eligibility of 3rd MACP benefits on completion of 30\n\nyears of regular service which will be reckoned in his case from\n\n11.05.1981 but he was silently taking the above benefit which was\n\ngranted to him mistakenly by reckoning from 27.12.1980 without\n\nany protest.3.1   Respondents haveplaced reliance uponthe judgment\n\npassed by Hon'ble Supreme Court in the matter of Chandi Prasad\n\nUniyal and others vs. State of Uttarkhand and others.He also\n\nrelied upon the order passed by Co-ordinate Cuttack Bench of\n\nTribunal in O.A. No.231/2017 (Pramod Chandra Patnaik vs. State\n\nof Odishaand other) decided on 07.09.2020.4.    We have heard the learned counsel for the parties and\n\nperused the pleadings and documents annexed therewith.5.    Hon'ble Supreme Court in a catena of decisions has\n\nconsistently held that if the excess amount was not paid on\n\naccount of any misrepresentation or fraud of the employee or if\n\nsuch excess payment was made by the employer by applying a\n\nwrong principle for calculating the pay/allowance or on the basis of\n\na particular interpretation of rule/order which is subsequently foundPage 5 of 106                O.A.No. 203/01046/2019to be erroneous, such excess payment of emoluments or\n\nallowances are not recoverable. This relief against the recovery is\n\ngranted not because of any right of the employees but in equity,\n\nexercising judicial discretion to provide relief to the employees\n\nfrom the hardship that will be caused if the recovery is ordered.6.    On this aspect, the Hon'ble Supreme Court in the case of\n\nState of Punjab and others etc. Vs. Rafiq Masih (White\n\nWasher) etc., (2015) 4 SCC 334 in Paragraphs 13 and 14 of this\n\njudgment has held that recovery from retired employees or\n\nemployee who are due to retire within one year of the order of\n\nrecovery even though it would be open to the employer to correct\n\nthe mistake, it would be extremely iniquitous and arbitrary to seek\n\na refund of the payments mistakenly made to the employee. The\n\nrelevant portion of this judgment reads as under:-"(13) First and foremost, it is pertinent to note, that this Court in\n      its judgment in Syed Abdul Qadir's case (supra) recognized, that\n      the issue of recovery revolved on the action being iniquitous.Dealing with the subject of the action being iniquitous, it was\n      sought to be concluded, that when the excess unauthorised\n      payment is detected within a short period of time, it would be\n      open for the employer to recover the same. Conversely, if the\n      payment had been made for a long duration of time, it would be\n      iniquitous to make any recovery. Interference because an action\n      is iniquitous, must really be perceived as, interference because\n      the action is arbitrary. All arbitrary actions are truly, actions in\n      violation ofArticle 14of the Constitution of India. The logic of the\n      action in the instant situation, is iniquitous, or arbitrary, or\n      violative ofArticle 14of the Constitution of India, because it would\n      be almost impossible for an employee to bear the financialPage 6 of 107               O.A.No. 203/01046/2019burden, of a refund of payment received wrongfully for a long\nspan of time. It is apparent, that a government employee is\nprimarily dependent on his wages, and if a deduction is to be\nmade from his/her wages, it should not be a deduction which\nwould make it difficult for the employee to provide for the needs\nof his family. Besides food, clothing and shelter, an employee has\nto cater, not only to the education needs of those dependent\nupon him, but also their medical requirements, and a variety of\nsundry expenses. Based on the above consideration, we are of\nthe view, that if the mistake of making a wrongful payment is\ndetected within five years, it would be open to the employer to\nrecover the same. However, if the payment is made for a period\nin excess of five years, even though it would be open to the\nemployer to correct the mistake, it would be extremely iniquitous\nand arbitrary to seek a refund of the payments mistakenly made\nto the employee.(14) In this context, reference may also be made to the decision\nrendered by this Court inShyam Babu Verma v. Union of India(1994) 2 SCC 521, wherein this Court observed as under:"11. Although we have held that the Petitioners were\n       entitled only to the pay scale of Rs.330-480 in terms of the\n       recommendations of the Third Pay Commission w.e.f. 1-1-\n       1973 and only after the period of 10 years, they became\n       entitled to the pay scale of Rs.330-560 but as they have\n       received the scale of Rs.330-560 since 1973 due to no\n       fault of theirs and that scale is being reduced in the year\n       1984 with effect from 1-1-1973, it shall only be just and\n       proper not to recover any excess amount which has\n       already been paid to them. Accordingly, we direct that\n       no steps should be taken to recover or to adjust any\n       excess amount paid to the Petitioners due to the fault\n       of the Respondents, the Petitioners being in no way\n       responsible for the same."It is apparent, that inShyam Babu Verma's case (supra), the\nhigher pay-scale commenced to be paid erroneously in 1973. The\nsame was sought to be recovered in 1984, i.e., after a period of\n11 years. In the aforesaid circumstances, this Court felt that\nthe recovery after several years of the implementation of the\npay scale would not be just and proper. We therefore hereby\nhold, recovery of excess payments discovered after fivePage 7 of 108              O.A.No. 203/01046/2019years would be iniquitous and arbitrary, and as such,\n     violative ofArticle 14of the Constitution of India."(emphasis supplied by us)7.   No doubt, in para 18(iii) of the judgment in the matters ofRafiq Masih(supra) the Hon'ble Supreme Court has held that\n\nrecovery from employees would be impermissible in law, when the\n\nrecovery from retired employees or employee who are due to retire\n\nwithin one year of the order of recovery. Para 18 ofthe said\n\njudgmentreads as under:-"(18). It is not possible to postulate all situations of hardship,\n      which would govern employees on the issue of recovery, where\n      payments have mistakenly been made by the employer, in\n      excess of their entitlement. Be that as it may, based on the\n      decisions referred to herein above, we may, as a ready\n      reference, summarise the following few situations, wherein\n      recoveries by the employers, would be impermissible in law:(i)    Recovery from the employees belonging to Class-III and\n            Class-IV service (or Group 'C' and Group 'D' service).(ii)    Recovery from the retired employees, or the employees\n            who are due to retire within one year, of the order of\n            recovery.(iii) Recovery from the employees, when the excess payment\n            has been made for a period in excess of five years, before\n            the order of recovery is issued.(iv) Recovery in cases where an employee has wrongfully been\n            required to discharge duties of a higher post, and has been\n            paid accordingly, even though he should have rightfully\n            been required to work against an inferior post.(v)    In any other case, where the Court arrives at the\n            conclusion, that recovery if made from the employee, would\n            be iniquitous or harsh or arbitrary to such an extent, as\n            would far outweigh the equitable balance of the employer's\n            right to recover."Page 8 of 109                 O.A.No. 203/01046/20198.In the case ofPramod Chandra Patnaik(supra), the\n\napplicant had not challenged the recovery of excess payment from\n\nhis gratuity dues in the year 2012 and had not raised any objection\n\nbefore the authorities. He was kept silent from the date of recovery\n\ntill the date of submission of representation. Furtherin that caseapplicant had submitted undertaking to refund if any excess\n\npayment is detected later on. In the present case, the applicant\n\nhas challenged the impugned recovery and there was no oral\n\nsubmission at the time of final arguments, made by the\n\nrespondents, regarding undertaking to refund excess payment by\n\nthe applicant.Therefore, the case ofPramod Chandra Patnaik(supra) will not be applicable in this case.9.   In the instant case, it is apparent from the record that an\n\nexcess amount of Rs.95605/- was found to be paid to the applicant\n\nwhile considering his date of appointment as 27.12.1980 instead of\n\n11.05.1981 in granting 3rd MACP. It is not contended before us\n\nthat the excess payment has been paid on account of the\n\nmisrepresentation or fraud of the applicant in fact it was a mistake\n\nby taking his date of appointment of applicant as 27.12.1980 by\n\nthe respondents themselves. Therefore, this Court felt that the\n\nrecovery at the time of retirement would not be just and proper.\n\nWe therefore hereby hold, recovery of excess paymentsPage 9 of 1010            O.A.No. 203/01046/2019discovered at the time of retirement would be iniquitous and\n\n       arbitrary, and as such, violative ofArticle 14of the Constitution of\n\n       India.10.      Accordingly, this Original Application is hereby allowed. The\n\n       impugned order dated 14.12.2018 (Annexure A/3) is hereby\n\n       quashed and set aside. Respondents are directed to refund the\n\n       amount recovered on account of implementation of aforesaid order\n\n       to the applicant within a period of two months from the date of\n\n       receipt of a copy of this order. However, the applicant will not be\n\n       entitled for any interest. No order as to costs.(Kumar Rajesh Chandra)                    (Akhil Kumar Srivastava)\n       Administrative Member                              Judicial Member\nkg/-Page 10 of 10