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Judgment
O R D E R
Applicant is a 88 year old Railway pensioner who retired from service on 31.03.1988 as Fitter in Loco Station, Southern Railway. According to him, he is completely bed ridden. From 01.01.2006 onwards he was getting pension of Rs.4,920/-; from 01.01.2016 it was revised to Rs.12,645/-. While so in November 2018 he received Annexure-A1 communication stating that the pension fixed from 2006 and 2016 respectively were erroneous and in excess of what was actually due to him, that he has been paid an excess amount of Rs.1,37,494/-which they intend to recover. After receipt of the same, he gave Annexure-A2 representation to the Director, Ministry of Personnel, Department of Pension and Pensioner's Welfare, but of no avail. Thus he has approached this Tribunal seeking to quash Annexure-A1 and to direct the respondents to refund whatever amount already recovered from his pension with 18% interest. According to the applicant, Annexure-A1 is illegal, arbitrary, unjust, unreasonable and irrational, it violates Article 14 and 16 of the Constitution, that by virtue of the dictum in State of Punjab and Others v. Rafiq Masih (White Washer) [(2015) 2 SCC (L&S) 33] recovery from him is impermissible. Even if it is assumed that there was mistake in the calculation of pension, that is not liable to be recovered, that before issuing Annexure-A1 he was not afforded opportunity of being heard and principles of natural justice are violated.
The 1st respondent filed a reply along with five documents challenging the correctness of the claims made by the applicant. According to him, the applicant had retired from service on 31.03.1988 in the scale of Rs.950-1500 while drawing basic pay of Rs.1,275/-. As he had put in 33 years of service, was granted pension of Rs.637/- from 01.04.1988 onwards. In the revision of pension effected from 01.01.1996 the corresponding scale was Rs.3050-4590 and his pension was fixed at Rs.1,949/-. During the Vth Pay Commission, the scales Rs.950-1400 and Rs.950-1500 were merged and replaced by a revised scale of Rs.3050-4590, that was how he was given pension of Rs.1,949/-. The equivalent Pay Band and grade pay in VIth Pay Commission is Rs.5200-20200 + grade pay of Rs.1,900/-, with effect from 01.01.2006. But by mistake, instead of reckoning scale of Rs.3050-4590, higher replacement scale of Rs.4000-6000 was taken for revision and grade pay was taken at Rs.2,400/-instead of Rs.1,900/-. Thus there occurred a difference in the pension payable to the applicant. According to the respondents, instead of paying pension at the rate of Rs.4,406/- from 01.01.2006 he was paid at the rate of Rs.4,920/-. This defect was continued in the 7th CPC also; then instead of paying Rs.11,900/- from 01.01.2016 he was paid pension at the rate of Rs.12,645/-. This anomaly was noticed only before issuing Annexure-A1 and thus a total sum of Rs.1,43,782/- was paid in excess; Rs.1,37,494/- for the period from 01.01.2006 to 30.06.2018 and the balance amount upto December 2018. That amount is liable to be refunded and that was how Annexure-A1 was issued. The respondent submitted that the decision in Rafiq Masih,quoted supra, is not applicable and the over payment is liable to be refunded by the applicant.
The respondents 2 and 3 submitted a separate reply statement contending that the application is bad for non-joinder of necessary parties, since the pension disbursing agency the Centralised Pension Processing Centre of the State Bank of India is a necessary party to the proceedings. They also pointed out that the bank is only the pension disbursing agency on behalf of the 1st respondent, that before granting pension to the applicant he had submitted Annexure-R2(b) undertaking which clearly indicates that whenever excess payment is made, the bank is entitled to recover the same from his account. In the light of Annexure-R2(b) undertaking such a contention is not available to the applicant. In this connection, he also referred to the decision in High Court of Punjab and Haryana v. Jagdev Singh [AIR 2016 SC 3523]. According to them, there are standing instructions, Annexure-R2(c), of the Reserve Bank of India, which also enable the bank to recover excess payments made to the pensioners owing to calculation mistakes. They also adopted the other contentions of the 1st respondent and sought dismissal of the application.
During the pendency of the application, on 07.09.2019 the applicant passed away, and thereafter, in 2022 his wife Seemanthini, 79 years, sought to be impleaded after condoning delay and setting aside abatement. These applications were allowed and the said Seemanthini was impleaded as the additional 2nd applicant and she continues the proceedings.
I heard the learned counsel for the applicant and learned Standing Counsel for the 1st respondent as well as respondents 2 and 3. According to the learned counsel for the applicant, the applicant had retired from service on 31.03.1988 while working as a Class-III employee during the 4th Pay Commission period, after putting in 33 years of service. At that time his basic pay was Rs.1,275/- in the scale of Rs.950-1500, which was revised to Rs.3050-4590 which rose to Rs.5200-20200 with grade pay of Rs.2400/- during the VIth Pay Commission. Even if it is assumed that there was calculation mistake in pension from 01.01.2006 onwards, recovery, if any should have been contemplated only after giving notice and after giving opportunity of being heard. That was not done and therefore the recovery is bad. Moreover, Annexure-R2(b) is a proforma undertaking, which cannot be used for any purpose. Even if such an undertaking was given, that had lost its validity on the death of the applicant and therefore, steps initiated for recovering the excess payment is bad and illegal. The learned counsel also submitted that the dictum in MP Medical Officers Association v. State of Madhya Pradesh and others [AIR 2022 SC 4009] is squarely applicable to the facts of the case. He also relied on the Bench decision of this Tribunal, in which myself was also a party in O.A.1012/2018 dated 23rd September 2022, and submitted that recovery proceedings initiated against the applicant are bad.
On the other hand, the learned Standing Counsel for the 1st respondent submitted that the dictum in Rafiq Masih are not applicable to the facts of this case. According to him, the Original Applicant, hereinafter referred to as the applicant, has not challenged the mistake in estimation of pension. Unless the correctness of calculation of pension is challenged, the reliefs cannot be allowed. The learned Standing Counsel for the respondents 2 and 3 submitted that the bank is only a disbursing agency, an amount of Rs.5,100/- already recovered has been refunded. According to him, so long as determination of the emoluments was the important consideration and in the absence of a challenge against the same, the applicant cannot be allowed to challenge the process of recovery.
As mentioned earlier, the applicant is a 88 years old pensioner. In the application itself it is stated that he is completely bed ridden and has engaged a nursing assistant for looking after his affairs, that he is going through the last stage of his life. That has come true by the subsequent development, on 07.09.2019 he passed away which necessitated his widow to implead as additional 2nd applicant.
The facts are not in dispute, in the sense, payment of excess pension is not disputed. Originally, he was granted a pension of Rs.637/-from 01.04.1988 onwards. He had retired from the scale of Rs.950-1500. During the Vth Pay Commission report, the corresponding scale was Rs.3050-4590 and his pension was enhanced to Rs.1,949/-, with effect from 01.01.1996. There is no dispute on this estimation. During the VIth Pay Commission revision, the scale Rs.950-1500 of the IVth CPC was replaced by the revised scale of Rs.3050- 4590. That was how he was paid pension of Rs.1,949/-. During the VIth Pay Commission the scale of Rs.3050-4590 was revised to 5200-20200 with grade pay of Rs.1,900/-. But the applicant was given grade pay at Rs.2400/- taking pre-revised scale as Rs.4000-6000 and thus was granted enhanced pension of Rs.4920/- instead of Rs.4406/-. This mistake in calculation continued during the 7th Pay Commission also. Thus instead of paying Rs.11,900/-he was granted pension of Rs.12,645/- on realising the mistake, and necessitated recovery of total amount of Rs.1,43,782/- paid in excess and that was how Annexure-A1 communication was issued and thereafter recovery was commenced.
It is true that the applicant has not taken the trouble to challenge the estimation of pension. He did not file any rejoinder also. That means, mistake in calculation of pension has been accepted by him.
After going through various materials, in the circumstance, I do not have any doubt in saying that the case squarely falls within the scope of Rafiq Masih, the oft-quoted decision in the context. Paragraph 12 of the decision requires to be extracted below:
“12.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 herein above, we may, as a ready reference, summarise the following few situations, wherein recoveries by the employers, would be impermissible in law:
(i)Recovery from employees belonging to Class-III and Class-IV service (or Group 'C' and Group 'D' service)
(ii)Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery.
(iii)Recovery from 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.”
As is well known, Rafiq Masih, quoted supra, was rendered by the Hon'ble Supreme Court after elaborate consideration and surveying all the decisions of the Supreme Court hitherto made on the field and laid down the parameters that in the given circumstances the competent authorities are not permitted to recover amounts paid in excess to Class-III and Class IV employees and pensioners. As rightly pointed out by the learned counsel for the applicant, clauses (i) and (iii) of paragraph 12 of the decision squarely applies to the facts of the case. The applicant had retired from service as a Group-III employee and that excess pension has been paid from 01.01.2006 till December 2018, for more than 12 years. Therefore, efforts to recover the excess payment made after a period of 12 years is violative of clauses (i) and (iii) of paragraph 12 of Rafiq Masih.
It is evident that there was calculation mistake in the fixation of pension. But no one has a case that the said mistake is attributable to the applicant. There was no allegation of misinterpretation or fraud committed by the applicant for getting higher pension. In other words, he had absolutely no role in the matter of fixation of pension in excess. Everything is attributable to the mistakes committed by the competent authority, the 1st respondent and therefore, the said parameters are applicable.
As noted earlier, the determination of pension is not under challenge. At this stage, the applicant has no case that he was entitled to get basic pension of Rs.4,920/- from 01.01.2006 or at the rate of Rs.12,645/- from 01.01.2016. The only grievance is that he was not given opportunity to contest his case. Any how, such a stage is over, now the applicant is no more and therefore, even though he ought to have been given advance notice, that has not been done.
Now I shall consider the question as to whether the undertaking given by the applicant, Annexure-R2(b), works against him. In this connection, Jagdev Singh's case, quoted supra, is relied on by the Standing Counsel for the respondents 2 and 3. But there are factual differences. Jagdev Singh's case was rendered in facts where the said person is a judicial officer; it has to be thought that he had made specific undertaking with regard to the over payment made. Here, the applicant had retired from service way back on 31.03.1988, more than nearly 35 years before. Secondly, it is interesting to note that Annexure-R2(b) is a proforma undertaking. Again, it does not bear even a date. Moreover, by now the applicant is no more and therefore such an undertaking cannot be invoked against him.
In my reading, it cannot be thought that a person like the applicant had given the undertaking consciously. It is a proforma undertaking, which cannot be given any weight. In the order in O.A.1012/2018, this Tribunal has refused to give any importance to an undertaking given by a person belonging to a lower level category. Therefore, a document like Annexure-R2(b) cannot rescue the proposition highlighted by the respondents.
As held by the Supreme Court in Rafiq Masih, recovery of excess payments made to a pensioner would entail extremely harsh consequences outweighing the monetary gains by the employer. In the circumstances it is iniquitous to trouble him with the recovery steps. Here, the applicant is an octogenarian at the time of facing notice of recovery and filing the application; thereafter he has breathed his last. The case of the applicant that he is at the last stage of his life, pulling on with the help of a nursing assistant has come true from the subsequent developments. In the circumstances, it is most iniquitous to recover the amount.
There is a contention that the application is bad for non-joinder of necessary parties. I do not find any force in the argument. In fact the Centralised Pension Processing Centre is another limb of the State Bank of India which is adequately represented by respondents 1 and 2. There is nothing in the application, cannot be decided by another limb of the pension disbursing agency.
On these considerations, the application is allowed and the respondents are restrained from effecting any recovery from the pension for the over payment granted to the applicant.
The Original Application is allowed. No cost.
List of Annexures
Annexure A-1: True copy of the Letter No. P.500/PGT/P/10112 dated 30.11.2018 issued by the 1st respondent and addressed to the 2nd respondent
Annexure A-2: True copy of the representation dated 29.12.2018 submitted by the applicant to the Department of Pensions &, Pensioners' Welfare, New Delhi
Annexure R2 (a): A true copy of the communication issued by the 2nd respondent dated 14.01.2019 along with calculation statement
Annexure R2 (b) : A true copy of the undertaking executed by the applicant
Annexure R2 (c): A true copy of the Circular No.RBI/2015-16/340 dated 17.03.2016
Annexure R-1: True copy of relevant portion of Railway Board RBE No.138/1997 dated 16.10.1997
Annexure R-2: True copy of Railway Board order RBE No.103/2008 dated 4.9.2008
Annexure R-3: True copy of Railway Board RBE No.160/2001 letter dated 20.08.2001
Annexure R-4: A true copy of Railway Board order dated 11.7.2017 along with the O.M. dated 06.07.2017 and the relevant Table No.11
Annexure R-5: A true copy of revised Pension Payment Order (PPO) No.19887060500164
Annexure MA-1: True copy of the death certificate of the Original Applicant