Recovery of excess amount due to wrong fixation of pay illegal: CAT

Ramkrishan Upadhyay

Chandigarh, June 3

The Chandigarh Bench of the Central Administrative Tribunal has quashed an order of the railway authority for the recovery of excess payments made to an employee due to the wrong fixation of pay by the department.

The bench held the order illegal and directed the respondents to refund the amount that was deducted from the applicant within two months from the date of receipt. Shiv Kumar, a retired employee of the Railways, filed an application under Section 19 of the Administrative Tribunals through advocate Karnail Singh. He said he has worked in the office of Divisional Railway Manager, Ferozepur (Punjab), since 1989. He said he was due to retire on superannuation on July 31, 2023, as Senior Section Officer Accounts in the pay band of Rs 9,300–20,200 with GP Rs 4,800 (Group C). The Railway, vide a letter dated July 12, 2023, re-fixed his pay on July 1, 2021, and reduced his basic pay from Rs. 98,700 to Rs. 95,800. He said his retiree benefits have been released in accordance with the July 12, 2023, order at the reduced rates. He added that Rs 1,61,570 has also been deducted from his dues.

Karnail Singh argued that the impugned recovery was illegal in view of the law laid down in the case of the State of Punjab, as the wrong fixation of pay was not the fault of the applicant. He also said the recovery has been done without observing the principles of natural justice.

On the other hand, the respondents, the Railway Authority, justified their decision. They said while going through the service record of the applicant for calculating the retirement benefits, they noticed that he has been drawing more pay since July 1, 2021, because he has taken advantage of the promotional increment twice. They said the applicant was in charge of the pension section, and he was aware that he was drawing an excess increment, which was recoverable.

After hearing the arguments, Suresh Kumar Batra, Member (J) of the Tribunal, said the Railway Authority recovered the excess amount from the applicant too. However, the impugned corrigendum does not speak about how much the recovery is or how it has been calculated. Moreover, no show cause notice has been served on the applicant before deducting the amount. Batra said that for these reasons, the impugned order is liable to be quashed. He said the respondents are directed to refund the amount recovered pursuant to the order dated July 12, 2023, to the applicant within two months from the date of the receipt.