AI Structured Summary
Not yet generated for this judgment
Judgment
The applicant has filed this OA under Section 19 of the Administrative Tribunals Act, 1985 to claim for the following reliefs:
“8.1This Hon’ble Tribunal be pleased to hold and declare the recovery of Rs.14,37,449/- from the applicant’s salary and settlement dues on the alleged ground of wrong pay fixation after more than two decades as illegal and arbitrary, and consequently quash and set aside the said recovery in its entirety, including all deductions and adjustments made before and after the applicant’s retirement.
8.2Direct the respondents to refund to the applicant the entire recovered amount of Rs.14,37,449/- together with interest at GPF rate from the date of deduction till the date of actual payment.
8.3To pass any other just and equitable orders as deemed fit and proper by this Hon’ble Tribunal under the given facts and circumstances of the case.
8.4The cost of this original application be ordered in favour of the applicant.”
It is the case of the applicant that he was due for retirement on superannuation on 30.09.2025. The respondents have issued show cause notice dated 11.10.2024 stating that his pay was wrongly fixed w.e.f. 01.09.1994 as Officiating Passenger Driver in the scale of Rs.1600-2660 while working as ad-hoc Goods Driver in the scale of Rs.1350-2200 w.e.f. 18.03.1994 when his substantive designation was Senior Assistant Driver in scale of Rs.1200-2040/-. Hence, the cumulative benefit granted to Officiating Passenger Driver as per the office memo No.E/L/763/5(Rg) Vol V dated 12.04.2000 was erroneous as per para 216(A)(i)(ii) Chapter II IREM Vol.I. They have tabulated the officiating position and substantive position in the show cause notice.
It is stated in the show cause notice that it conveyed the facts of pay anomaly arisen due to promotional anomaly and a revised pay fixation has been shown as per notice. The respondents have asked for his representation, if any, within seven days, failing which it will be presumed that he has no objection for corrective action as shown in the show cause notice. It is the case of the applicant that the show cause notice does not mention anything about the recovery. The applicant submitted representation to the show cause notice on 17.10.2024 (Annexure R2). It has been submitted that according to notice, the recovery period starts from the year 1995 till 2025 when there were three pay commissions and each time his pay was revised and vetted. He has further stated that as per RBE letter No.72/2016 dated 02.03.2016 referring the DoPT Office Memorandum which outlines several situations where recoveries by employers would be impermissible.
He has mentioned that the recovery from employees belonging to Class III and Class IV service (or Group ‘C’ and Group ‘D’ service)/ recovery from retired employees or employees who are due to retire within one year of the order of recovery is not permissible in law. Therefore, he requested to rectify the discrepancy and restore his basic pay to its correct amount. He has further submitted that if the recovery for the past 29 years is enforced at this stage, he will face a severe financial crisis for non fault on his part. Thereafter, the respondents have issued another letter dated 08.11.2024 to the applicant stating that his settlement cannot be made on the basis of incorrect basic pay as it would result into further overpayment which is not permissible and relied upon the Railway Board’s guidelines contained in RBE No.72/2016 whereby corrective action to rectify incorrect pay is not restricted. They have stated that in view of the above, the corrective action as indicated in the show cause notice dated 11.10.2024 shall be implemented. However, this letter also does not mention about recovery. Therefore, he has prayed for the direction to hold and declare the recovery of Rs.14,37,449/- from the applicant on the ground of wrong pay fixation after more than two decades as illegal and he should be refunded the same with interest @GPF rate.
After issuance of notice, the respondents have filed their reply and contested the OA.
It has been submitted that the applicant failed to provide any documentary evidence or valid justification in his representation dated 17.10.2024 to refute the irregularities highlighted in the show cause notice dated 11.10.2024. Consequently, the administration proceeded with the rectification in accordance with the rules, as communicated to the applicant vide letter dated 08.11.2024. Thus, an opportunity was given to the applicant by giving show cause notice dated 11.10.2024 and to give explanation as to why the irregularities committed in granted erroneous additional cumulative benefit granted of Officiating Passenger Driver should be rectified as per 216(A) (i) (ii) Chapter II IREM Vol.I by following the principle of natural Justice. And only after considering the reply dt 17.10.2024 and finding the reply without documentary evidence or valid justification in the applicant's representation dated 17.10.2024 to refute the irregularities highlighted in the said Show Cause Notice dated 11.10.2024, the administration proceeded with the rectification in accordance with the rules, as communicated to the applicant vide letter dated 08.11.2024.
It has been further submitted that the Show Cause Notice has been served as a prior intimation regarding the detection of erroneous pay fixation and the consequent recovery of overpayment. The final quantification of the recovery amount was formally communicated through the office memorandum dated 21.11.2024 issued only after due consideration of the procedure and the non-receipt of any solid or valid reason from the applicant as per the applicant's reply/ in his representation dated 17.10.2024.
It has been submitted that the said recovery, as per Annexure A-1 to OA, arose due to the mandatory rectification of an erroneous pay fixation, which has to be rectified and cannot be allowed to be continued. The applicant had wrongly been granted cumulative benefits of 'Officiating Passenger Driver' in violation of Para 216(A)(i)(ii) of Chapter II, IREM Vol. I. and the administration is duty-bound to correct such errors. Hence, the recovery resulting from the correct implementation of Railway Board circulars is fully justified.
The applicant has not filed any rejoinder to the reply submitted by the respondents.
During arguments, learned counsel for both the sides have argued their case on the basis of pleadings.
Shri Samir Singh, learned counsel for the applicant submitted that the respondents have failed to establish that the incorrect pay fixation was done due to any wrong submission on the part of the applicant or any fraud having been played by the applicant. He submitted that if some mistakes had been committed by the respondents and that too 29 years back, the applicant cannot be made to suffer for the fault of the respondents. He further submitted that in the show cause notice dated 11.10.2024 and subsequent letter dated 08.11.2024, there is not even a single word regarding the recovery. He submits that the respondents have illegally started recovery of Rs.15,000 per month from March, 2025 which continued till September, 2025 i.e. for seven months which amounts to Rs.1,05,000/-. He submits that amount of Rs.13,86,449/- has been recovered from the Gratuity of the applicant on 24.11.2025 i.e. after his retirement which is impermissible. He has placed reliance on the DoPT OM F.No.18/26/2011-Estt (Pay-I) dated 06.02.2024 (Annexure A-6), DoPT OM F.No.18/03/2015-Estt.(Pay-I) dated 02.03.2016, Railway Board letter No.F.No.2016/F(E)II/6/3 dated 22.06.2016, Ministry of Railways’ letter No.F(E)III/2008/PN1/11 dated 06.02.2009 regarding verification of correctness of emoluments of Railway servants, judgement of Hon’ble Supreme Court in the case of State of Punjab and Others Vs. Rafiq Masih (White Washer), (2015) 4 SCC 334 and order of this Tribunal in OA No.258/2025 in case of Tikaram Kasherwal Vs. Union of India, Through : Secretary, Railway Board, Delhi & Others decided on 24.07.2025.
Shri Samir Singh has specifically drawn my attention to the conditions laid down in para 18 of the Hon’ble Supreme Court judgement in the case of Rafiq Masih (White Washer) (supra) wherein in clause (ii) it is provided that recovery from the retired employees, or the employees who are due to retire within one year, of the order of recovery and in clause (iii), recovery from the employees, when the excess payment has been made for a period of excess of five years, before the order of recovery is issued, it has been held that the same is impermissible in law. He submits that the respondents have made the payment to the applicant from 1994 to 2025 which is for 29 years and, therefore, the recovery at the fag end of his retirement has caused him irreparable financial loss and put him to a lot of inconvenience. He, therefore, submits that the OA should be allowed and the respondents be directed to refund the amount with interest.
Learned counsel for the respondents Shri Ravi has vehemently argued that corrective action does not mean only correction in the pay fixation but includes recovery which has been made due to overpayment. He submits that the money in the public exchequer is the public money and if the applicant has been paid excess salary for which he was not entitled, the respondents have right to recover the same.
I have considered the rival submissions.
It is not in dispute that the applicant has been paid the salary since March, 1994 which continued till 2024. It is not in dispute that the applicant has not made any misrepresentation for his pay fixation which was done in 1994 and is not result of any fraud having been played by him. The applicant being a Group ‘C’ employee and having been paid the amount which is sought to be recovered for 29 long years, the case of the applicant is fully covered by the judgement of Hon’ble Supreme Court in the case of Rafiq Masih (White Washer) (supra). It will be helpful to extract herein para 18 of the said judgement of the Hon’ble Supreme Court for ready reference:
“18.It is not in 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 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 case, where the Court arrives at the conclusion, the 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.”
In view of the above, the position of the law as laid down by the Hon’ble Supreme Court, I am of the considered view that the recovery from the applicant is not permissible in law even though the respondents are entitled for correction in the pay drawn by him. In view of the above, the respondents are directed to refund the amount of Rs.14,37,449/- (Rs.1,05,000/-recovered in seven months’ salary, Rs.15000/- each month from March to September, 2025 and amount of Rs.13,86,449/- recovered from his Gratuity). Further, there shall be no order regarding the grant of interest. The respondents are directed to refund the amount to the applicant within a period of three months from the date of receipt of a certified copy of this order.
The Original Application is, accordingly, partly allowed in terms of above order and direction. Pending MAs, if any, stand closed. No costs.