JASWANT SINGH JANGLA vs MINERAL EXPLORATION AND CONSULTANCY LIMITED on 28 October 2026

ORAL ORDER

Per: Justice M.G. Sewlikar, Member (J)

I have heard learned counsel for the applicant and learned counsel for the respondents.

2. It is the case of the applicant that the applicant has retired on 27th November, 2020. On 18th October, 2022, he made a representation for releasing of his Performance Related Pay (PRP) for the year 2020-2021. Applicant received the notice dated 06th February, 2023 for recovery of Rs. 2,89,024/-. This notice stated that this recover arose from the 282nd Board Meeting dated 26th September, 2022 decision to roll back Circular No. 5485 dated 13th September, 2017. The entire amount was adjusted against the applicant’s PRP for 2020-21 totalling Rs. 3,94,198.86/-, leaving a net payable balance of Rs. 1,05,175/-. Despite making several representations, the respondents have not refunded the amount to the applicant and, therefore, the applicant has filed this OA.

3. Respondents contend that the amount was wrongly paid to the applicant in view of the Board’s decision dated 13th September, 2017. This Circular was rolled back in Board’s Meeting dated 26th

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September, 2022. Therefore, it was rightly recovered from the applicant.

4. A similar question had arisen in the matter of Badri Prasad Dwivedi vs. Union of India & Ors., in OA No. 493/2023 dated 25th March, 2026 in which following observations are recorded:- “8. So far as recovery of the aforesaid amount of Rs. 3,37,653/- is concerned, it is not in dispute that this was recovered after the retirement of the applicant from the amount payable to him on account of PRP. The question that I am called upon to answer is whether such recovery is permissible after retirement.

9. Learned counsel for the applicant placed reliance on the case of Rafiq Masih (supra) for the proposition that any amount after retirement or within one year preceding the date of retirement cannot be recovered. Learned counsel for the respondents does not dispute this position but contends that the recovery is permissible from the officers belonging to Group ‘A’. He submits that the recovery was ordered on account of the anomaly created because of the Circular dated 13th September, 2017 and that anomaly has been corrected and the aforesaid amount is recovered which is completely permissible. This issue had fallen for consideration before me in the case of Dr. Pradeep Sawant vs. Union of India & Ors. in OA No. 211/2025 (CAT, Mumbai Bench) in which following observations were recorded:- “12. In the case of Chandi Prasad Uniyal and Ors (supra), Supreme Court held in para 9 thus:- “9. We are of the considered view, after going through various judgments cited at the bar, that this court has not laid down any principle of law that only if there is misrepresentation or fraud on the part of the recipients of the money in getting the excess pay, the amount paid due to irregular/wrong fixation of pay be recovered.”

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13. Thus, the Supreme Court has not laid down any principle of law that only if there is misrepresentation or fraud on the part of the recipients of the money in getting the excess pay, the amount paid due to irregular/wrong fixation of pay be recovered.

14. In the case of Rafiq Masih (supra), after considering judgment in Chandi Prasad Uniyal and Ors (supra), Supreme Court held in para 11 thus:- “11. For the above determination, we shall refer to some precedents of this Court wherein the question of recovery of the excess amount paid to employees, came up for consideration, and this Court disallowed the same. These are situations, in which High Courts all over the country. repeatedly and regularly set aside orders of recovery made on the expressed parameters.

(i) . Reference may first of all be made to the decision in Syed Abdul Qadir v. State of Bihar, (2009) 3 SCC 475, wherein this Court recorded the following observation in paragraph 58: "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 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 v. State of Haryana, 1995 Supp. (1) SCC 18, Shyam Babu Verma v. Union of India, (1994) 2 SCC 521, Union of India v. M. Bhaskar, (1996) 4 SCC 416, V. Ganga Ram v. Director, (1997) 6 SCC 139, Col. B.J. Akkara (Retd.) v. Govt. of India, (2006) 11 SCC 709, Purshottam Lal Das v. State of Bihar, (2006) 11 SCC 492, Punjab National Bank v. Manjeet Singh, (2006) 8 SCC 647 and Bihar SEB v. Bijay Bahadur, (2000) 10 SCC 99."

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(emphasis is ours) First and foremost, it is pertinent to note, that this Court in its judgment in Syed Abdul Qadir's case (supra) recognized, that the issue of recovery revolved on the action being iniquitous. Dealing with the subject of the action being iniquitous, it was sought to be concluded, that when the excess unauthorised payment is detected within a short period of time, it would be open for the employer to recover the same. Conversely, if the payment had been made for a long duration of time, it would be iniquitous to make any recovery. Interference because an action is iniquitous, must really be perceived as, interference because the action is arbitrary. All arbitrary actions are truly, actions in violation of Article 14 of the Constitution of India. The logic of the action in the instant situation, is iniquitous, or arbitrary, or violative of Article 14 of the Constitution of India, because it would be almost impossible for an employee to bear the financial burden, of a refund of payment received wrongfully for a long span of time. It is apparent, that a government employee is primarily dependent on his wages, and if a deduction is to be made from his/her wages, it should not be a deduction which would make it difficult for the employee to provide for the needs of his family. Besides food, clothing and shelter, an employee has to cater, not only to the education needs of those dependent upon him, but also their medical requirements, and a variety of sundry expenses. Based on the above consideration, we are of the view, that if the mistake of making a wrongful payment is detected within five years, it would be open to the employer to recover the same. However, if the payment is made for a period in excess of five years, even though it would be open to the employer to correct the mistake, it would be extremely iniquitous and arbitrary to seek a refund of the payments mistakenly made to the employee.”

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15. The Supreme Court gave directions in para 12 as under:- “12. It is not possible to 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 herein above, 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 retired employees, or employees who are due to retire within one year, of the order of recovery.

(iii) Recovery from 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 other case, where the Court arrives at the conclusion, that 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.”

16. From the judgment of the Supreme Court in the case of Rafiq Masih (supra), it is clear that recovery towards excess payment cannot be made if the recovery causes undue hardship to the employee and for this purpose, Supreme Court laid down a period of five years for effecting recovery of excess payment. If recovery is effected within 05 years from the date of making excess payment, the recovery is permissible. From the situations enumerated by the Supreme Court in the case of Rafiq Masih (supra), it is clear that recovery is impermissible in the case of employees belonging to class-III and class-IV

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employees (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 also impermissible. Situation no. (iii) is relevant for decision of these O.As i.e. “Recovery from employees, when the excess payment has been made for a period in excess of five years, before the order of recovery is issued.” Condition no. (iii) does not say that recovery is impermissible with respect to the employees who are in service. It specifically states that recovery from employees shall not be made if recovery is effected after five years from the excess payment. The wordings in situation no. (iii) clearly indicate that it applies to serving employees as well. Therefore, I do not find any merit in the contention of the learned counsel for the respondents that judgment in the case of Rafiq Masih (supra) is applicable only to retired employees. Only situation no. (ii) is applicable to retired employees. Situation nos. (iii),

(iv) and (v) are applicable to all classes of employees.

17. Learned counsel for the respondents placed reliance on the case of Pramod Kumar Sinha vs. Union of India and Ors. in Civil Writ Petition No. 11407 of 2024 (Patna High Court). In the case of Pramod Kumar Sinha (supra), it has been held that direction is only for Class-III and class-IV employees whereas the petitioner is retired class-II officer. In the case of Pramod Kumar Sinha (supra) relied by learned counsel for the respondents, it has been held that Rafiq Masih (supra), is not applicable to the case of class-II officers. However, in the case of Union of India and Ors. versus Rakesh Chandra Verma and Another in Civil Misc Review Application No.- 334 of 2023, Allahabad High Court has held that the equitable principle laid down by the Supreme Court in the case of Rafiq Masih (supra) applies not only to retired employees but it also applies to the case of the serving employees as well, subject to stipulations contained in that decision. It is further held that the equitable principle referred to above applies not only to Class-III and Class-IV employees but it also applies to other employees, to the extent indicated in that decision. It is further held that Clause-I is specific to Class-III & IV employees whereas the other clauses may apply to other class of employees as well, subject

Munarshi to the stipulations contained in that decision. From the decisions of Allahabad High Court in the case of Rakesh Chandra Verma (supra), it is clear that judgment of Rafiq Masih (supra) applies to Class-I employees also.”

10. From the above, it is clear that the wording of Clause iii of the Supreme Court directions in para 12 of the Rafiq Masih (supra) clearly indicates that the recovery from employees belonging to any class is not permissible when the excess payment has been made for a period in excess of five years. Situation no. (ii) also makes it clear that recovery from retired employees is not permissible. This clause nowhere says that it applies only to the employees belonging to Group ‘C’. Rather, it shows that it applies to all employees irrespective of the Group to which they belong.

11. Learned counsel for the applicant has invited my attention to Office Memorandum dated 19th September, 2022 to contend that recovery is not permissible in case of retired employees irrespective of their Group to which they belong. Clause III of this Office Memorandum deals with situations wherein recoveries of wrongful/excess payments by the employers would be impermissible in law. Clause III of the aforesaid OM is reproduced hereunder for ease of reference:- “III Situations wherein recoveries of wrongful/excess payments by the employers would be impermissible in law Para II(iv) of the above instructions provides inter- alia that recovery should be made in all cases of overpayment barring few exceptions of extreme hardships. The issue was considered by the Hon’ble Supreme Court in the case of State of Punjab & Ors Vs Rafiq Masih (White Washer) etc. in CA No.11527 of 2014 {arising out of SLP(C) No.11684 of 2012}.In this case, the Hon’ble Supreme Court observed that it is not possible to 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. The Hon’ble Supreme Court summarized the following few situations, wherein recoveries by the employers would be impermissible in law:-

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(i) Recovery from employees belonging to Class-III and Class-IV service (or Group ‘C’ and Group ‘D’ service).

(ii) Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery.

(iii) Recovery from 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 other case, where the Court arrives at the conclusion, that 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.”

12. This clause or the entire OM does not even remotely indicate that it pertains to only Group ‘C’. It pertains to all the employees irrespective of their Group to which they belong. In these circumstances, I do not find that the recovery was permissible in the eyes of law. Hence, OA is allowed. The order dated 04th February, 2023 (Annexure-A-1) is set aside. Amount of Rs. 3,37,653/- be refunded to the applicant within a period of four months from the date of receipt of a certified copy of this order.”

5. From these observations, it is clear that the recovery was made illegally as the respondents were laboring under the impression that the said Circular pertains only to the Group ‘C’ employees. It pertains to all the employees irrespective of the Group to which they belong. In this view of the matter, the

Munarshi impugned notice dated 06th February, 2023 is set aside. The respondents are directed to refund an amount of Rs. 2,89,024/- to the applicant within a period of four weeks from the date of receipt of a certified copy of this order.

6. With these directions, OA stands disposed of. Pending MAs, if any, stand disposed of. No costs.

(Justice M.G. Sewlikar)

Member (J)

nk. Deepti Ganesh Munarshi