IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 12.04.2011 CORAM THE HONOURABLE MR. JUSTICE M.M.SUNDRESH W.P. NO.17197 OF 2002 S.Subramanian .. Petitioner Versus 1. Life Insurance Corporation of India Rep.by its Chairman "Yogakshema" Central Office Jeevan Bima Marg Bombay – 400 021. 2. Life Insurance Corporation of India Rep.by its Senior Divisional Manager Divisional Office, Coimbatore – 641 018. 3. The Manager (Personnel & Industrial Relations) P.B.No.3810, India Life Building LIC of India, Divisional Office Trichy Road, Coimbatore – 641 018. .. Respondents PRAYER: Petition filed Under Article 226 of the Constitution of India praying to issue a Writ of Certiorarified Mandamus, calling for the records relating to Circular bearing Ref.No.Department: Personnel/IR/ZD/687/ASP/89 dated 02.06.1989 issued by the 1st respondent insofar as clause-5 is concerned as communicated by the 3rd respondent vide Circular dated 27.06.1989 bearing Ref.No.Personnel & IR/8/1989-90 and the consequential order issued by the 2nd respondent vide his letter dated 30.04.2001 read with the letter No.Nil dated 25.04.2002 issued by the 3rd respondent reducing the basic pay of the petitioner from Rs.1450/- to 1000/- without any prior notice as being illegal, arbitrary and unconstitutional and quash the same and consequently direct the respondents to fix the pay of the petitioner as per Clause-3.8 of the aforesaid Circular: Dept:Personnel/IR/ZD/687/ASP/89 dated 02.06.1989 with attendant benefits. For Petitioner : Shri.N.G.R.Prasad Senior Counsel for M/s.Row & Reddy https://hcservices.ecourts.gov.in/hcservices/ For Respondent-2 : M/s.S.Silambanan Associates O R D E R The petitioner herein was appointed as an Assistant by the respondents on 29.01.1990 by way of re-employment. Prior to the appointment the petitioner was working in the Indian Air Force for a period of 15 years. He joined in the Indian Air Force as an Airman on 28.01.1970 and got discharged on 31.01.1985 as a Sergeant. After his discharge, he joined the Office of the respondents on 29.01.1990. 2.The petitioner's basic pay was fixed at Rs.1450/- with effect from 30.04.1990 and he was also paid the arrears thereon. Even before the appointment of the petitioner, instructions have been issued by the Central Office of the respondents by way of a Circular dated 02.06.1989 relating to re-employment ex-servicemen. As per the said instruction, the benefits of pay fixation under Paragraphs 3.7 and 3.8 were given only to those ex-servicemen who were already employed prior to 01.01.1988 and not to those appointed after 01.01.1988. This was done considering the fact that the ex-servicemen who have been employed after 01.01.1988 have been allowed to retain their pension from the defence services. The pay which they are getting from the respondents on the basis of the formula fixed under paragraph 3.1 is in addition to the pension which they are getting. This benefit however was apparently not available to the ex- servicemen re-employed prior to 01.01.1988. 3.The instruction dated 02.06.1989 issued by the respondents was the subject matter of a challenge before the Honourable High Court of Kerala. The Honourable High Court was pleased to dismiss the Writ Petition filed by the ex-servicemen who have been re-employed after 01.01.1988 in the year 1992. The Honourable Apex Court in O.K.UDAYASANKARAN vs. UNION OF INDIA [AIR 1996 SC 1901] was pleased to dismiss the Civil Appeal as well as the Writ Petition filed by the Ex-servicemen Life Insurance Corporation Employees Association upholding the instructions dated 02.06.1989. In so far as the recovery of the excess amount paid, the direction of the High Court was confirmed by the Honourable Apex Court. 4.The petitioner continued to receive the pension as payable to those ex-servicemen appointed prior to 01.01.1988, by oversight and mistake on the part of the respondents. By the order dated 30.04.2001, the Senior Divisional Manager of the respondents informed the petitioner that by oversight and inadvertence the basic pay of the petitioner has been wrongly fixed at Rs.1450/- with effect from 30.04.1990 and therefore, it will be fixed at Rs.1000/- with effect from 30.04.1990. Accordingly, the petitioner was informed that his basic pay will be Rs.6545/- as on 30.04.2001. It was further intimated to the petitioner that the nature of recovery on excess https://hcservices.ecourts.gov.in/hcservices/ payment will be intimated in due course. The petitioner gave a representation requesting the respondents not to re-fix the pay scale. However, the same was rejected by the proceedings dated 12.01.2002. Challenging the instruction issued by the first respondent by way of Circular dated 02.06.1989 and the consequential orders of the second respondent dated 30.04.2001 and 25.04.2002 by which the third respondent informed the petitioner that his pay will be reduced from the month of April 2002, the present Writ Petition has been filed. Submissions of the Petitioner: 5.Shri.N.G.R.Prasad, learned senior counsel appearing for the petitioner submitted that the petitioner has since retired. Therefore, there shall not be any recovery of the amount paid to him. The respondents being the erstwhile employers will have to adopt fairness in recovering the amount. The payment has been made due to the mistake committed by the respondents. There is no misrepresentation or fraud on the part of the petitioner. Courts have to use there discretion when a recovery has been sought for from an employee considering the hardship. Inasmuch as the pay fixation having been done by the respondents themselves and the inadvertence was made at their end, for the said mistake the petitioner cannot be penalised. Therefore, considering the length of time and the fact that the petitioner has retired in the year 2010, this Court has to exercise the judicial discretion by directing the respondents not to recover the amount payable by the petitioner. The judgment of the Honourable Apex Court cannot be a binding precedent, since the legal question regarding a recovery to be made has not been put into issue in the said pronouncement. Therefore, inasmuch as the said issue having not decided, it is well open to the Honourable Apex Court to mould the relief in favour of the petitioner. In support of the said contentions, the learned senior counsel has made reliance upon the following judgments: "SHYAM BABU VERMA AND OTHERS vs. UNION OF INDIA AND OTHERS [(1994) 2 SCC 521] SAHIB RAM vs. STATE OF HARYANA AND OTHERS [1995 SUPP (1) SCC 18] O.K.UDAYASANKARAN vs. UNION OF INDIA [AIR 1996 SC 1901] CENTRAL BOARD OF DAWOODI BOHRA COMMUNITY AND ANOTHER vs. STATE OF MAHARASHTRA AND ANOTHER [(2005) 2 SCC 673] STATE OF BIHAR AND OTHERS vs. PANDEY JAGDISHWAR PRASAD [(2009) 3 SCC 117] SYED ABDUL QADIR AND OTHERS vs. STATE OF BIHAR AND OTHERS [(2009) 3 SCC 475] BHAKRA BEAS MANAGEMENT BOARD vs. KRISHAN KUMAR VIJ AND ANOTHER [(2010) 8 SCC 701] UNION OF INDIA AND OTHERS vs. R.VASUDEVA MURTHY AND OTHERS [(2010) 9 SCC 30]" https://hcservices.ecourts.gov.in/hcservices/ Submissions of the Respondents: 6.Per contra, Shri.S.Silambanan, learned senior counsel appearing for the respondents submitted that the issue involved in the Writ Petition is no longer res integra. The judgment of the Division Bench of the Kerala High Court rendered in the year 1992 has been approved by the Honourable Apex Court in the year 1996. Merely because the petitioner has approached this Court and obtained interim orders against the recovery, no equity can be extended to him. When the law is settled there is no question of extending the equity in favour of the parties. Inasmuch as the Writ Petition itself is devoid of facts as the issue is concluded by the judgment of the Honourable Apex Court, the relief sought for cannot be granted. The fact that the petitioner has retired in the year 2010 cannot be a ground to hold that there shall be no recovery as it has been made uniformly through out the country against the identically placed employees. The Honourable Apex Court in O.K.UDAYASANKARAN vs. UNION OF INDIA [AIR 1996 SC 1901], after taking note of the difficulties directed the respondents to recover the amount in instalments. It is pertinent to note that the petitioner has already been receiving the pension as an ex-servicemen and therefore, he is enjoying the double benefits which was not available to others identically placed. Therefore, the learned senior counsel submitted that the Writ Petition will have to be dismissed. Binding Nature of a judgment:- 7.It is trite law that a judgment cannot be read as a statute. A decision would be a binding one, only when it is decided on a conscious consideration of the issue involved. A mere observation or an incidental remark cannot be termed as a binding precedent. There has to an issue raised and decided by the Court on the earlier occasion. 8.LORD DENNING while dealing with the law of precedent has observed as follows: "Each case depends on its own facts and a close similarity between one case and another is not enough because even a single significant detail may alter the entire aspect, in deciding such cases, one should avoid the temptation to decide cases (as said by Cordozo) by matching the colour of one case against the colour of another. To decide therefore, on which side of the line a case falls, the broad resemblance to another case is not at all decisive." 9.The Honourable Apex Court in COMMISSIONER OF CENTRAL EXCISE, BANGALORE v. SRIKUMAR AGENCIES AND OTHERS [(2009) 1 SCC 469] has held as follows: https://hcservices.ecourts.gov.in/hcservices/ "4.Courts should not place reliance on decisions without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. Observations of Courts are neither to be read as Euclid's theorems nor as provisions of the statute and that too taken out of their context. These observations must be read in the context in which they appear to have been stated. Judgments of Courts are not to be construed as statutes. To interpret words, phrases and provisions of a statute, it may become necessary for judges to embark into lengthy discussions but the discussion is meant to explain and not to define. Judges interpret statutes, they do not interpret judgments. They interpret words of statutes; their words are not to be interpreted as statutes." 10.Applying the said ratio laid down by the Honourable Apex Court to the present case on hand, this Court finds that the facts involved in the judgment rendered by the Honourable Apex Court in O.K.UDAYASANKARAN vs. UNION OF INDIA [AIR 1996 SC 1901] are different than the one on hand. The discussions made above would clearly demonstrate the negligence, mistake and inadvertence on the part of the respondents. In the said judgment referred supra, the Honourable Apex Court was dealing with the recovery to be made in pursuant to the order impugned. It was primarily concerned with the payment of excess amount payable by the ex-servicemen in view of the interim orders obtained. Further, the question of the legality of a recovery of an amount paid to an employee not due to the misrepresentation or fraud on his part was never an issue before this Court. Moreover, the facts involved in the present case would show that it involves an action taken after the judgment of the Honourable Apex Court. Therefore, this Court is of the considered view that the judgment rendered by this Court would not be a bar for deciding the issue of recovery of the excess amount paid to the petitioner. Whether the respondents can recover the arrears till the passing of the order impugned dated 25.04.2002:- 11.The facts narrated above show no doubt in the mind of this Court that the legal issue raised in the Writ Petition, challenging the Circular dated 02.06.1989 has already attained finality. It is trite law that under Article 141 of the Constitution of India, a judgment rendered by the Honourable Apex Court is binding on the High Courts. Therefore, when the very same Circular has already been upheld by the Honourable Apex Court then the very basis of the Writ Petition itself falls to the ground. https://hcservices.ecourts.gov.in/hcservices/ 12.The only remaining question to be decided in the Writ Petition is the recovery sought to be made. Now in the present case on hand, we are concerned with two categories of recovery; one recovery is as per the orders impugned and the other is after passing the said orders as a consequence on the interim orders granted by this Court. 13.In so far as the recovery is sought to be made as per the orders impugned is concerned, it is seen that the Honourable Apex Court has rendered the judgment on 27.03.1996. Admittedly, the respondents are parties to the said judgment. The Circular was issued on 02.06.1989 and the petitioner was appointed by the respondents only on 29.01.1990. The pay scale was fixed with effect from 30.04.1990. As submitted by the learned counsel appearing for the respondents the anomaly came to the notice of the respondents only in pursuant to an audit objection. Therefore, the facts clearly demonstrate that the petitioner has no act or part in the fixation of pay scale. Admittedly, the pay scale has been fixed by the respondents on their own though inadvertently. The question for consideration is, can the petitioner be penalised for the same? The answer has to be in the negative. There was no recovery on the petitioner from the date of the fixation of pay scale till the passing of the orders impugned. Except by stating during arguments that it came into light only during audit objection, no other plausible explanation has been given for fixing the pay scale wrongly and then continuing with it over the years. Right from the fixation of the pay scale with effect from 30.04.1990 till the year 2002, no recovery has been made. The respondents are quite aware of the orders passed by the Division Bench of the High Court of Kerala which was passed in the year 1992 and the subsequent affirmation by the Honourable Apex Court in the year 1996. This Court finds clear negligence and mistake on the part of the respondents which continued over the years and there is no misrepresentation or false statement by the petitioner as against the inconvenience and hardship that would be caused to him. Therefore, this Court is of the view that considering the fact of this case, there is no justification on the part of the respondents to recover the amount paid in excess till the passing of the order dated 25.04.2002. Whether the respondents are entitled to recover the payment after the impugned order dated 25.04.2002:- 14.Admittedly when the Writ Petition was filed the legal issue has already been settled finally by the pronouncement by the Honourable Apex Court. Therefore, there is nothing to adjudicate on the order impugned in so far as the merits of the case are concerned. Merely because this Court has granted an interim order which was continued thereafter and the petitioner has retired in the year 2010 can it be said that a different treatment is given to him than the other employees when there is no mistake or wrongful action on the https://hcservices.ecourts.gov.in/hcservices/ part of the respondents. In other words, while it can be said that it was the respondents who are responsible for the payment made between the pay fixation till the passing of the order impugned it can never be said that even after the impugned order is passed, there shall be no recovery. The power under Article 226 of the Constitution of India is extraordinary and discretionary. It is trite law that once a Writ Petition is dismissed, the interim orders also go. The principle of actus curiae neminem gravabit has been well settled. A person who has got the benefit of the interim order has to surrender the said benefit when the Writ Petition is dismissed. Considering the said issue, the Honourable Apex Court in KARNATAKA RARE EARTH vs. DEPTT. OF MINES & GEOLOGY [(2004) 2 SCC 783] has held in the following manner: "16... The paragraph concerned which has also been quoted by the High Court is as under: (SCC p.784c-e) “The doctrine of actus curiae neminem gravabit is not confined in its application only to such acts of the court which are erroneous; the doctrine is applicable to all such acts as to which it can be held that the court would not have so acted had it been correctly apprised of the facts and the law. It is the principle of restitution which is attracted. When on account of an act of the party, persuading the court to pass an order, which at the end is held as not sustainable, has resulted in one party gaining an advantage which it would not have otherwise earned, or the other party has suffered an impoverishment which it would not have suffered but for the order of the court and the act of such party, then the successful party finally held entitled to a relief, assessable in terms of money at the end of the litigation, is entitled to be compensated in the same manner in which the parties would have been if the interim order of the court would not have been passed. The successful party can demand: (a) the delivery of benefit earned by the opposite party under the interim order of the court, or (b) to make restitution for what it has lost.” 15.The said judgment of the Honourable Apex Court has been quoted with approval in CANTONMENT BOARD vs. K.P.SINGH [(2010) 2 SCC 518], the relevant paragraph which is extracted herein: "20.It was argued in Karnataka Rare Earth case [(2004) 2 SCC 783] that the act of the appellants quarrying the granite stones and exporting the same was accompanied by payment of https://hcservices.ecourts.gov.in/hcservices/ royalty and issuance of transport permits by the authorities of the State and though done under the interim orders of this Court was nevertheless a lawful and bona fide act. According to the appellant, the mining lease in favour of the appellants were bound to be held to be valid in view of the interim orders passed by this Court that they could not be held liable for the payment of price of granite blocks. The Court held that the demand of the State of Karnataka of the price of mineral could not be said to be a levy of penalty or penal action. It was further observed that though the appellants were allowed the mining by way of an interim order during the pendency of the earlier appeals, the factual transport permits were obtained by the appellants only after the dismissal of their appeals. The Court recorded a final order that the appellants’ plea that they were ignorant of the dismissal of the appeals could not be accepted and entertained. 21.The Court then referred to the decision in South Eastern Coalfields Ltd. v. State of M.P. [(2003) 8 SCC 648] where the doctrine of actus curiae neminem gravabit was considered and elaborated, holding this doctrine to be the principle of restitution. Considering the facts of the case in para 11, this Court observed that: (Karnataka Rare Earth case [(2004) 2 SCC 783], SCC p.791, para 11) “11. ... But for the interim orders passed by this Court, there is no difference between the appellants and any person raising, without any lawful authority, any mineral from any land, attracting applicability of sub-section (5) of Section 21. As the appellants have lost from the Court, they cannot be allowed to retain the benefit earned by them under the interim orders of the Court.” (emphasis supplied) The Court affirmed the High Court’s finding that the appellants were liable to be placed in the same position in which they would have been if this Court would not have protected them by issuing interim orders. 22.We have already explained the observations of this Court in Karnataka Rare Earth [(2004) 2 SCC 783] in para 10 (in para 16 above) in the light of the facts of this case and it is clear that the appellants cannot take advantage and claim refund because of the fact https://hcservices.ecourts.gov.in/hcservices/ that this was their voluntary offer and they were not directed to pay the amount that they did. In view of this, we find that the High Court’s order is quite unsustainable. We therefore, set aside that order and hold that the Cantonment Board would not be liable to refund anything in favour of Respondents 1 and 2 who have enjoyed the rights of collection of toll on the basis of their own voluntary offer made before the High Court which the High Court has merely accepted by its order dated 8-11-2006. With this observation, the appeal is allowed. It shall not now be necessary for the respondent to consider the representation made by Respondents 1 and 2. The direction to that effect by the High Court is also set aside. Costs are estimated at Rs.50,000." 16.Similarly, in KALABHARATI ADVERTISING vs. H.V.NARICHANIA [(2010) 7 MLJ 1043], it has been held by the Honourable Apex Court in the following manner: "15.No litigant can derive any benefit from the mere pendency of a case in a Court of Law, as the interim order always merges into the final order to be passed in the case and if the case is ultimately dismissed, the interim order stands nullified automatically. A party cannot be allowed to take any benefit of his own wrongs by getting an interim order and thereafter blame the Court. The fact that the case is found, ultimately, devoid of any merit, or the party withdrew the writ petition, shows that a frivolous writ petition had been filed. The maxim "Actus Curiae neminem gravabit", which means that the act of the Court shall prejudice no-one, becomes applicable in such a case. In such a situation, the Court is under an obligation to undo the wrong done to a party by the act of the Court. Thus, any undeserved or unfair advantage gained by a party invoking the jurisdiction of the Court must be neutralised, as the institution of litigation cannot be permitted to confer any advantage on a party by the delayed action of the Court. (vide: Dr.A.R.Sircar v. State of Uttar Pradesh and Others (1993) Supp. (2) SCC 734; Shiv Shanker and Others v. Board of Directors, Uttar Pradesh State Road Transport Corporation and Another, (1995) Supp. (2) SCC 726; Committee of Management, Arya Inter College, Arya Nagar, Kanpur and Another v. Sree Kumar Tiwary and Another, AIR 1997 SC 3071 : (1997) 4 SCC 388 : https://hcservices.ecourts.gov.in/hcservices/ 1997-II-LLJ-797; GIC Industries Ltd v. Union of India and Others, AIR 1998 SC 1566 : (1998) 3 SCC 376; and Jaipur Municipal Corporation v. C.L.Mishra, (2005) 8 SCC 423)." 17.Hence, by applying the said ratio of the Honourable Apex Court this Court is of the considered view that merely because the petitioner obtained an order of stay of the order impugned which has been already upheld by the Honourable Apex Court it cannot be said that the said sum can never be recovered. 18.In other words, all the benefits given to a party during pendency of the Writ Petition would automatically vanish as admittedly there are interim arrangements. Therefore, merely because the petitioner has obtained interim orders which were continued till now and he has retired in the year 2010, it cannot be said that the excess payment made to him shall not be recovered. The petitioner knew that he had to pay. It is he who challenges the order impugned. Therefore on the failure of the Writ Petition he has to face the consequences. It is also to be seen that at the time of filing the Writ Petition, the petitioner was an employee. Except him, through out the country the impugned Circular has been implemented against the identically placed other re-employed ex-servicemen working with the respondents. The recovery was also made in those cases where interim orders have been obtained pending the Court proceedings. Therefore, the petitioner cannot be placed on a higher pedestal than the other employees. 19.It is also an important factor to note that the petitioner has been receiving the pension for the service rendered by him while he was in