MANOJ KUMAR vs NOTHERN RAILWAY on 4 November 2026

ORDER

Shri U P Srivastava, learned counsel for the applicant and Shri M K Sharma, learned counsel for the respondents, were present at the time of hearing.

2. The present original application has been filed seeking following reliefs: “(i) Allow the present Original Application and issue an order or direction setting aside the order dated 25.01.2023 passed by Divisional Railway Manager / P Northern Railway, Moradabad.

(ii) To issue a direction to the respondent authority for fixing pension of the applicant on the pay scale of Rs. 76500/- in accordance with law in place of Rs. 74,300/- and issue PPO No. 20227030700100 dated 02.05.2022 accordingly.

(iii) To pay and also the arrears of the difference of pension with interest admissible under the law may also be released forthwith.

(iv) To issue any other necessary order or direction which this Hon’ble Tribunal may deem fit and proper in the circumstances of the case.

(v) To award cast of application / petition.” RITU RAJ SINGH

3. The brief facts of the case is that the instant original application has been filed by the applicant challenging the order dated 25.01.2023 passed by the Divisional Railway Manager / P Northern Railway, Moradabad. Applicant has contended that his pension was liable to have been fixed on the pay scale of Rs. 76500/- as he was drawing that pay on the date he retired from service but the respondents instead issued pension on pay scale of Rs. 74,300/- and issued PPO. Applicant has alleged that no show cause notice was issued to him by the respondents before reducing his pay scale and thus has prayed for a direction to the respondents to issue revised PPO by fixing the pension on the pay scale of Rs. 76500/- and the arrears of difference of pension be paid with interest.

4. Heard learned counsel for the parties.

5. Learned counsel for the applicant submitted that the applicant retired from the post of Chief Office Superintendent Carriage and Wagon Department, Northern Railway, Bareilly on 30.04.2022. At the time of retirement, he was receiving salary at the basic pay scale of Rs. 76,500/- which was his last pay scale but his pension was arbitrarily fixed on the pay scale of Rs. 74,300/-. Learned counsel further argued that the whole service of the applicant has been clear and satisfactory and no disciplinary proceedings were pending during his service period so much so that no dues certificate dated 13.04.2022 was issued in his favour. Also, the respondent no 2 issued family identity card on 14.05.2022, in which the pay scale of the applicant has been mentioned as Rs. 76,500/-. Without giving any notice or opportunity of hearing, one increment applicant has been reduced and consequently his pay scale also reduced. Applicant preferred a representation dated 06.05.2022 before the respondents but for no avail. Being aggrieved, the applicant preferred OA No 835 of 2022 which was decided on 20.09.2022 directing the respondents to decide the representation dated 24.06.2022. In compliance, the respondents have rejected the representation vide order under challenge on the basis of illegal and false facts. Thus, referring to RITU RAJ SINGH

entire facts and circumstances of the case, prayer was made to allow the OA.

6. Per contra, learned counsel for the respondents, relying upon his counter affidavit, vehemently opposed the claim of the applicant. He submits that the instant recovery has been affected by the respondents due to excess payment / over payment done to the applicant erroneously. The pay of the applicant was wrongly fixed at Rs. 17,660/- w.e.f. 01.07.2006 instead of Rs. 17,560/-. This clerical error resulted in fixation of excess pay. Upon scrutiny of service records, the discrepancy was detected, a corrected pay chart was prepared on 26.04.2022, and the final pay was fixed at Rs. 74,300/- and thus Rs. 76,500/- is an incorrect pay. Learned counsel further submits that upon detection of the error, it was the responsibility of the respondents to have refix the pay scale and recover the amount which was paid to the applicant on account of wrong fixation of pay and thus no illegality or arbitrariness can be attributed to the same. Thus, referring the contents of the counter affidavit, prayer was made to dismiss the OA being devoid of merits.

7. Rejoinder has been filed by the applicant citing the similar facts as have been stated in the original application.

8. We have considered the rival submissions of the learned counsel for the parties and perused the records.

9. As the facts of the case have already been narrated above, the same are not reiterated for the sake of brevity. Applicant was drawing salary on the pay scale of Rs. 76,500/- which was his last pay. However, when he was retired from service, PPO was issued fixing his pension on the pay scale of Rs. 74,300/-. It is evident from the records that no show cause notice was issued to the applicant by the respondents before reducing his pay scale and the pay of the applicant was reduced during the time of retirement of the applicant. Respondents have stated that the pay of the applicant was wrongly fixed at Rs. 17,660/- w.e.f. 01.07.2006 instead of Rs. 17,560/-. This clerical error resulted in fixation of excess pay. Upon scrutiny of RITU RAJ SINGH

service records at the time of preparation of the PPO, the discrepancy was detected, a corrected pay chart was prepared on 26.04.2022, and the final pay was fixed at Rs. 74,300/-. Respondents have further stated that once the pay has been refixed, the overpayment which was been made to the applicant due to wrong fixation of pay is liable to be recovered and the same has been done.

10. Here, it is pertinent to mention that it is an admitted fact that in getting his pay refixed, the applicant had neither misrepresented nor was there any fraud committed on his part. Further, the refixation of pay and consequent recovery of alleged excess payment has been made during the retirement of the applicant. It is needless to state that if recovery is made from the salary of the applicant at this juncture, that too for the fault which was never committed by him, it would be difficult for him to meet his basic needs.

11. It is worthwhile to mention that it is settled law that firstly, no recovery can be made unless any fraud or misrepresentation is alleged on the part of any person from whom the recovery is being sought to be made and secondly, if at all there is any justification for making any recovery, then the same has to be inflicted upon the person who made the wrong pay fixation. Thirdly, imposition of any recovery to a person or refixation of his pay without issuance of a show cause notice or without providing any opportunity of hearing is bad in the eyes of law and violative of the principles of natural justice.

12. Furthermore, in the case of Rafiq Masih (supra), Hon’ble Supreme Court has been pleased to observe as under:- “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). RITU RAJ SINGH

(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”.

13. Also, recently Hon’ble Supreme Court in the case of Dr. M.K. Ravi Varma etc. etc. Vs. National Institute of Technology and Others, Civil Appeal Nos. 8329–8336 of 2016, decided on 23.09.2026 in paragraph 17 to 24 has held as under:- “17. In Jagdev Singh (supra), the coordinate Bench considered paragraph 18 of Rafiq Masih (White Washer) (supra), extracted above, and explained the legal position as follows: “11. The principle enunciated in Proposition (ii) above cannot apply to a situation such as in the present case. In the present case, the officer to whom the payment was made in the first instance was clearly placed on notice that any payment found to have been made in excess would be required to be refunded. The officer furnished an undertaking while opting for the revised pay scale. He is bound by the undertaking.”

18. Respondents, as appellants before the Division Bench of the High Court, had placed Exhibit R2(c) which contained an undertaking given by the appellants conveying their willingness to permit recovery of such amounts in the event that the pay fixation was found to be erroneous. It was, thus, contended that the respondents had merely corrected the mistake in accordance with the entitlement of the appellants under the applicable rules.

19. The contention was accepted by the Division Bench in the impugned judgment. While placing reliance on Chandi Prasad Uniyal (supra), it was held as follows: “32. Apex court was considering a batch of cases relating to recovery and re- fixation of pay of teachers in rectification of mistakes occurred while implementing the 5th and 6th pay commission orders. Apex court while upholding the same, held that unjust enrichment cannot be permitted. It is also pertinent to note that petitioners were not required to perform any additional duties on account of the placement as Associate Professors. Admittedly the petitioners have given their undertaking Ext R2(c) expressing their willingness for re- fixation of pay, refund of excess pay etc., as and when any mistake was detected, as in the cases considered by the apex court. The case of the petitioners do not come under that of exceptional categories. However we are of the view that fairness in action required that a notice was issued to them, before effecting re-fixation and recovery as well as de- designation. RITU RAJ SINGH

33. Now that the reasons for re-fixation are already made known to petitioners and their contentions are already in the pleadings before this court, we do not think that issuance of a notice will serve any purpose, especially when we have found that they were not entitled to any benefits as originally granted. Moreover the petitioners approached this court only in 2012, much after the re fixation of pay and recovery were effected in early 2010. At this stage therefore we are not directing the appellants to undertake the empty formality of issuing notice or opportunity of hearing to petitioners.”

20. It is, therefore, clear that a mistake was committed in extending financial benefits to the appellants; and this was immediately withdrawn upon detection of such mistake. Such recovery of the amounts paid by mistake to the appellants, in view of the undertakings given by them, did not warrant interference by the Single Judge in exercise of writ jurisdiction and the Division Bench appears to be right in its interdiction.

21. Much emphasis has been placed by learned counsel for the appellants on the letter addressed by the Director (T), Government of India, Ministry of Human Resource Development, Department of Higher Education, to the Directors of all the National Institutes of Technology dated … (sic) March, 2013.

22. Sub-paragraph 4 of the last paragraph of such letter reads as follows: “iv) The benefits already given would not be recovered from the academic staff of the Institutes as directed by the Hon’ble Court and also as per NIT Councils decision.” 23. Since the recovery had already been effected from the appellants two years prior to the institution of their writ petition before the writ court, the aforesaid instruction would be of no avail.

24. Insofar as the circumstance of hardship canvassed by learned counsel for the appellants is concerned, we need to observe that no such case had been pleaded in the writ petition. In any event, whether recovery of money would result in hardship has to be determined on the facts of each particular case. After all, we cannot presently conceive of a situation where recovery of money from the recipient would not cause hardship. However, for instance, if it is pleaded and proved to the satisfaction of the writ court that entirety of the excess payment received by the employee has since been spent towards medical treatment and that the employee concerned would face immense hardship in returning such excess payment, or if the same were recovered from him through initiation of appropriate proceedings, in a deserving case the Court would be justified in quashing the notice seeking recovery or refund. This would also be subject to the employee satisfying the Court that the excess payment was not received on account of any misrepresentation or fraud on his part. Since no such case exists here, the contention is rejected” If the principle laid down in Dr. M.K. Ravi Varma (supra) case is taken into consideration, the undertaking, if any given by employee concerned at the time of preparation of pension paper for adjustment or refund of any excess payment at the time of settlement of retiral dues cannot be applied to recover the excess payment made due to fault of the respondents’ department itself. Hon’ble Supreme Court in Dr. M.K. Ravi Varma (supra) case itself has held that hardship factor has to be determined on the facts of each particular case and this would be subject to the employee satisfying the court that the excess RITU RAJ SINGH

payment was not received on account of any misrepresentation or fraud on his part.

14. Admittedly, in the instant case, applicant had not committed any fraud or misrepresentation in getting the pay scale. Therefore, reducing his pay and recovering amount from his post retiral dues at this stage when the applicant has retired from service, is certainly not justifiable, especially when the respondents have not issued any show cause notice to him nor has the applicant been given adequate opportunity of hearing. Therefore, I am of the considered opinion that the applicant is liable to be granted the benefit as has been claimed by him. Accordingly, in view of the aforesaid deliberations and contemplations, the instant original application is allowed. Impugned order dated 25.01.2023 passed by the respondents is hereby set aside in view of law laid down in the case of State of Punjab and others Vs. Rafiq Masih (supra) and the entire amount already recovered shall be refunded to the applicant within a period of 3 months from the date of receipt of certified copy of this order after restoring his pay to the original scale as he was drawing on the date of his retirement. If not made within the stipulated period, the payment shall also attract interest @ GPF rate. However, if the respondents intend to rectify the mistake committed on their part regarding fixation of applicant’s pay and they advise so, they must do so after issuing a fresh show cause notice and after affording opportunity of hearing to the applicant. They must refix the salary but in no case, the recovery could be made of the excess payment said to have been made to the applicant.

15. All associated MAs stand disposed of accordingly.

16. No costs.

(Justice Om Prakash VII)

Member (Judicial)

(Ritu Raj) RITU RAJ SINGH