IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA. CWP-T No. 5115/2008 Decided on:5.3.2010 _____________________________________________ Dr. Din Dayal Bisht. …Petitioner. Versus State of Himachal Pradesh and another. …Respondents. ________________________________________________________ Coram: Hon’ble Mr. Justice Rajiv Sharma, Judge. Whether approved for reporting?1. yes. For the petitioner : Mr. K.D. Shreedhar, Advocate. For the Respondents: Mr. Rajinder Dogra, Addl. Advocate General. _____________________________________________________ Rajiv Sharma, Judge (oral). Material facts necessary for the adjudication of this petition are that petitioner was granted benefit of one advance proficiency increment on the basis of Annexure A-1 dated 28.2.1974. This advance increment was granted to petitioner by way of incentive/award for not participating in employees’ strike in 1970. Name of petitioner figures at Sr. No. 13 of this list. He retired after attaining the age of superannuation on 31.12.1996. A query was put up by the Office of the Accountant General to the respondent- State why the entry of proficiency increment has not been recorded in the service book of the petitioner. Petitioner made a 1 Whether reporters of the local papers may be allowed to see the judgment? Yes. 2 representation to the District Ayurveda Officer on 10.3.1997. The matter was taken up by the Director, Ayurveda with the State Government on 11.4.1997. The State Government took following decision: “The matter has been examined in F.D. It is clarified that the increment granted for non- participation in strike to the employees during 3/70 amounts to gain in the pay and the period for grant of proficiency increment was to be reckoned from the date of grant of such increment. In view of this, Dr. Deen Dayal Bisht (Redt.) is not entitled to 2nd proficiency increment w.e.f. 1.2.1986.” This decidion was conveyed to the Director of Ayurveda on 10.9.1997. In sequel to office order dated 10.9.1997, pay of the petitioner was re-fixed after reduction of second proficiency increment awarded to him. His gratuity was also withheld for a period of two years and recoveries were directed to be effected on the basis of over payment. Mr. K. D. Shreedhar has vehemently argued that the action of respondents to re-fix the salary of petitioner on the basis of Annexure A-5 and thereafter to effect recoveries from the retiral benefits of petitioner that too after the retirement is illegal, arbitrary and thus violative of Articles 14 and 16 of the Constitution of India. Mr. Rajinder Dogra, learned Additional Advocate General has supported the issuance of Annexures A-6, A-7 and A-8. I have heard the learned counsel for the parties and have perused the pleadings carefully. 3 Petitioner had been granted one advance increment on the basis of Annexure A-1 dated 28.2.1974. This entry ought to have been recorded in his service book. The Office of Accountant General raised query why this entry was not made in the service record of petitioner. Petitioner also made representation to the District Ayurveda Officer on 10.3.1997. The matter, as noticed above, was referred to State Government vide Annexure A-4 by the Director Ayurveda. Decision was taken against the petitioner, which was conveyed by the Director Ayurveda on 10.9.1997. It is in these circumstances, the pay of petitioner was re-fixed vide office order dated 3.10.1997. The same has also resulted in reducing the amount of gratuity. Petitioner had earned one advance increment on the basis of Annexure A-1 dated 28.2.1974. This was an award for not participating in the strike. The entry ought to have been made in the service record. Petitioner had earned two proficiency increments from 1.1.986 after putting in number of years as stipulated in the rules. Grant of one advance increment was over and above the increments to which petitioner was entitled in normal course. Respondent-Department instead of taking pragmatic view by making an entry in his service record, referred the entire matter to the State Government. The State Government rejected the case of petitioner, which led to re-fixation of salary of petitioner vide Annexure A-6 and which further led to recovery of over payment from petitioner. The course adopted by the respondent-State on the basis of above discussion was illegal. Respondent-State was only required to make entry in the service record of petitioner and 4 by clarifying that this was increment over and above two proficiency increments, which were granted to petitioner after 1.1.1986. The matter is required to be considered from another angle. Petitioner has not been heard before the issuance of Annexures A-5 and A-6. He has suffered civil and evil consequences since his pay stood reduced. He has superannuated on 31.12.1996. Petitioner has neither misled nor misrepresented the authorities at the time of release of two proficiency increments after 1.1.1986. A conscious decision had been taken to grant two proficiency increments as per law to petitioner. Their Lordships of the Hon’ble Supreme Court in Syed Abdul Qadir and others versus State of Bihar and others, (2009) 3 SCC 475 have culled out the following principles governing the circumstances in which the excess amount cannot be recovered by the employer: “55. That apart, it also appears from the record produced before us that while the Finance Department of the Government of Bihar was in favour of making the amended provisions of FR. 22-C applicable to the appellants-teachers after having come to know that the said rule did not exist and had been substituted, the Department of Human Resource Development, Government of Bihar, wanted to apply the unamended provision to the appellants-teachers so as to make available the benefit of additional increment provided for under FR.22-C to its teachers, unaware of the fact that even under FR.22-C they were not entitled to the additional increment as they were not 5 discharging duties and responsibilities of greater importance on the promoted post. 56. This further goes on to show that the authorities in the State of Bihar were not even aware of the basic requirement for grant of additional increment and the decision appears to have been taken without proper application of mind. Otherwise, there was no reason for the Finance Department to state in the counter affidavit filed before the High Court that any affidavit filed on behalf of the Education Department may be ignored as Finance Department was the competent authority. In this very affidavit, the Finance Department while admitting that the pay fixation by the Education Department was wrong, stated as under:- "...the fixation of pay under Fundamental Rule 22- C has wrongly been made as it was not in existence. Pay fixation on the basis of a nonexistent rule is a bona fide mistake." 57. This Court, in a catena of decisions, has granted relief against recovery of excess payment of emoluments/allowances if (a) the excess amount was not paid on account of any misrepresentation or fraud on the part of the employee and (b) if such excess payment was made by the employer by applying a wrong principle for calculating the pay/allowance or on the basis of a particular interpretation of rule/order, which is subsequently found to be erroneous. 58. The relief against recovery is granted by courts not because of any right in the employees, but in equity, exercising judicial discretion to relieve the employees from the hardship that will 6 be caused if recovery is ordered. But, if in a given case, it is proved that the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or in cases where the error is detected or corrected within a short time of wrong payment, the matter being in the realm of judicial discretion, courts may, on the facts and circumstances of any particular case, order for recovery of the amount paid in excess. See Sahib Ram vs. State of Haryana, 1995 Supp. (1) SCC 18, Shyam Babu Verma vs. Union of India, [1994] 2 SCC 521; Union of India vs. M. Bhaskar, [1996] 4 SCC 416; V. Ganga Ram vs. Regional Jt., Director, [1997] 6 SCC 139; Col. B.J. Akkara [Retd.] vs. Government of India & Ors. (2006) 11 SCC 709; Purshottam Lal Das & Ors.,vs. State of Bihar, [2006] 11 SCC 492; Punjab National Bank & Ors. Vs. Manjeet Singh & Anr., [2006] 8 SCC 647; and Bihar State Electricity Board & Anr. Vs. Bijay Bahadur & Anr., [2000] 10 SCC 99. 59. Undoubtedly, the excess amount that has been paid to the appellants - teachers was not because of any misrepresentation or fraud on their part and the appellants also had no knowledge that the amount that was being paid to them was more than what they were entitled to. It would not be out of place to mention here that the Finance Department had, in its counter affidavit, admitted that it was a bona fide mistake on their part. The excess payment made was the result of wrong interpretation of the rule that was applicable to them, for which the appellants cannot be held responsible. Rather, the whole confusion was because of inaction, negligence 7 and carelessness of the officials concerned of the Government of Bihar. Learned counsel appearing on behalf of the appellants-teachers submitted that majority of the beneficiaries have either retired or are on the verge of it. Keeping in view the peculiar facts and circumstances of the case at hand and to avoid any hardship to the appellants-teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellants-teachers should be made. 60. Learned counsel also submitted that prior to the interim order passed by this Court on 7.4.2003 in the special leave petitions, whereby the order of recovery passed by the Division Bench of the High Court was stayed, some installments/amount had already been recovered from some of the teachers. Since we have directed that no recovery of the excess amount be made from the appellant- teachers and in order to maintain parity, it would be in the fitness of things that the amount that has been recovered from the teachers should be refunded to them.” Petitioner’s gratuity has been delayed by respondents for two years. There is no cogent reason why there was delay in release of the amount of gratuity. Petitioner has retired from service on 31.12.1996 and the gratuity has been paid in the year 1998. Petitioner in these circumstances is held entitled to interest as per rule 68 of the Central Civil Services (Pension) Rules, 1972 read with Government of India’s decision No.2 appended thereto. 8 Accordingly, in view of the observations made hereinabove, the initiation of process by respondents to re-fix the salary of petitioner that too after the retirement of petitioner, is declared in violation of principles of natural justice. He should have been heard before the issuance of Annexures A-5 and A-6. Respondents illegally withheld his amount of gratuity. The recoveries directed to be effected from the salary of petitioner are also declared illegal. Consequently, the petition is allowed. Annexures A-5 dated 10.9.1997 and A-6 dated 3.10.1997 are quashed and set aside. Petitioner is held entitled to the same salary, which he was being paid before the issuance of Annexure A-6 for the purpose of retiral benefits. Respondents are directed to refund the amount of recoveries effected from petitioner on the basis of Annexure A-6 with interest @ 10% per annum. Respondents are directed to pay interest on the delayed payment of retiral payment as per rule 68 of the Central Civil Services (Pension) Rules, 1972 read with Government of India’s decision No.2 appended thereto. Needful be done within a period of 8 weeks from today. No costs. (Rajiv Sharma), Judge. 5.3.2010 *awasthi*