High Court says no to recovery of excess amount paid to employee for 20 years

Saurabh Malik

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Chandigarh, February 11

For almost 20 years, excess amount was paid to a Bhakra Beas Management Board employee. However, the board and another appellant just before his retirement in February 2015 embarked upon the exercise to refix the pay on the grounds that an increment was wrongly paid in September 1995. The action has, however, failed to find favour with the Punjab and Haryana High Court.

At retirement, needs are more

The SC had held that a retired employee or one about to retire is a class apart from those who have sufficient service. At retirement, an employee’s needs are in excess of what they were when he was younger. — Division Bench of Justice MS Ramachandra Rao & Justice Sukhvinder Kaur

Quoting the Supreme Court, the Division Bench of Justice MS Ramachandra Rao and Justice Sukhvinder Kaur has made it clear that recoveries sought to be made after the retirement date or soon before it would be iniquitous and arbitrary. Any such recovery would outweigh the monetary gains to the employer.

The matter was placed before the Bench after the board and another appellant filed an appeal against a single judge verdict, setting aside the order for recovering Rs 1,79,463 and directing them to pay back the amount within two months. The single judge verdict added that the appellants woke up from slumber to correct the pay and to recover the amount without giving a notice at the fag-end of the respondent’s service career. The Single Bench added that the respondent had earned his retirement dues by serving long years. It would not be justified to say that Rs 1,79,463 was a small amount and hardship would not be caused to the respondent while paying it.

Taking up the appeal, the Bench asserted that respondent-employee Jai Bhagwan had admittedly joined the service of the epartment in 1979 and was working as an assistant design engineer at the time of his retirement on July 31, 2015. Just prior to his retirement, the appellants on February 10, 2015, started the exercise to refix the pay by reducing certain amounts.

The Bench asserted that the excess payment was admittedly being made from September 15, 1995, for almost 20 years till February 10, 2015. The appellant did not allege mistake or fraud on the respondent’s part, because of which the excess payment was made. It was also not their case that the respondent had any role in the sanction of increments or fixation of his pay.

Dismissing the appeal, the Bench asserted that the respondent obviously was an innocent party, though he benefited from the appellants’ mistake and had drawn Rs 1,79,613 in excess of the entitlement.