J.D. Tiwari vs Central Provident Fund Commissioner and Others

Pradeep Nandrajog, J.—Writ petitioner retired as a Director, official language under Employees Provident Fund Organization on April 30, 2008. 13 days prior, on April 17, 2008 he was promoted on ad-hoc basis to the post of Director. His pay in the post of Director was fixed on April 29, 2008 in pay scale of Rs. 12000-375-16500 with effect from April 18, 2008 and on same day his monthly pension was fixed at Rs. 9,860/- and after obtaining commutation of 40% in the pension, the commuted pension was fixed at Rs. 5,916/-. One Yadhuvansh Narayan working as a Hindi translator had approached the Patna Bench of the Tribunal seeking upgradation of his pay scale from Rs. 5500-9000 to Rs. 6500-10500. On June 03, 2008, much after the petitioner had superannuated, the Patna Bench of the Tribunal directed the Government to look into the grievance of Sh. Yadhuvansh Narayan keeping in view the observations made by the Tribunal resulting in the department upgrading the pay scale of not only Sh. Yadhuvansh Narayan but even other people in the cadre which included the post of the Director. The upgradation was made effective from January 01, 2006. The post of the Director was placed in the pay scale Rs. 14300-18300 with effect from January 01, 2006, replacing the earlier pay scale of Rs. 12000-16500.

On July 08, 2009 the pay and the pension of the petitioner was revised with reference to the pay scale Rs. 14300-18300. The basic pay was accordingly fixed at Rs. 37,400/-. Pension was accordingly revised and enhanced. Commuted value of the pension was increased by Rs. 1,64,618/-. The same was paid.

Thereafter on May 24, 2011 the department revised the pay scale of the petitioner holding that the initial pay scale Rs. 12000-16500 was correct and accordingly his salary as of April 18, 2008 was fixed in the pay band Rs. 15600-39100. Recoveries were directed to be made.

Challenge by the petitioner before the Tribunal has failed. View taken by the Tribunal is that the department correctly fixed respondent''s salary with effect from April 18, 2008 as per recommendations of the 6th Pay Commission in PB-III with grade pay of Rs. 7,600/-. The recoveries were held justified.

In the writ petition the petitioner has questioned the impugned order limited to recoveries being permitted and for which the argument is that it is not the case of the department that the petitioner misrepresented, conceals a vital fact or played a fraud when the department on their own placed him in the pay scale Rs. 14300-18300 by changing the same from Rs. 12000-16500.

Learned counsel for the petitioner states that the petitioner would challenge the impugned order in so far it has held the action of the department to be justified by way of a separate petition.

This the petitioner cannot do for the reason it is settled law that unless leave is obtained to seek a relief founded on a cause of action, all reliefs flowing from a cause of action have to be claimed in one petition. The petitioner has not prayed for any leave to be granted to seek one relief founded on the same cause of action by filing another petition.

Thus, we are concerned with recoveries being permitted to be made. We have to approach the issue by treating that the action of the department in correcting the pay scale in which the petitioner had to be placed as correct.

We need not note various decisions on the point for the reason the latest decision reported as Chandi Prasad Uniyal and Others Vs. State of Uttarakhand and Others, has brought out the misconception created by a wrong reading of a few decisions of the Supreme Court which have been noted in said decision to the effect that it was believed that the law was that unless the mistake of the department in paying higher salary was occasioned by a misrepresentation, fraud or a suppression by the employee, while correcting the mistake the employer could not effect recoveries. The Supreme Court has clarified that the decisions in which recoveries were prohibited were the ones where either the employee was holding a low paid post or had superannuated or was on the verge of superannuation. In other words if the current salary, on being reduced, or a pension received was low, recoveries were held not to be made on equitable grounds.

Though not stated in the judgment the equitable ground would be that if the employer pays a higher salary or a pension to his employee, the employee would be entitled to the benefit of an implied representation by the employer that he could spend the money and based on the said implied representation the employee would have acted to his detriment and thus the equitable principle of not only estoppel but hardship to the employee would come into play for the reason the meagre monthly emoluments received by the employee a further reduced by the deductions made would put him in financial distress.

Thus, we declare that the department i.e. the respondent would not be entitled to any recoveries and to said extent we quash the impugned order dated May 22, 2012, but with a clarification.

The same being that the petitioner has received a higher sum of commuted pension. The commuted portion of the pension was with reference to the higher pay scale and hence the higher monthly pension. Since the monthly pension is now to be reduced, for the past excess paid recoveries being prohibited, the adjustment of the higher commuted portion of the pension would be permissible to be made for the reason this higher commuted portion of the pension was not a monthly payment received by the petitioner which he would presumably have spent, it had an element of compounding 40% pension and so understood would represent an early disbursement of a portion of the pension.

The Original Application No. 3973/2011 filed by the petitioner as also the writ petition stands disposed of in terms of paragraph 13 above. No costs.