E K Srinivasulu vs Income Tax Appellate Tribunal on 3 November 2026

1. Union Ministry of Law and Justice, Shastri Bhavan, New Delhi-110001, Represented by the Secretary.

2. Income Tax Appellate Tribunal, 3rd & 4th Floors, Pratishta Bhawan, 101, Maharshi Karve Marg, Mumbai-400020. Represented by the President.

3. The Income Tax Appellate Tribunal, Bangalore Bench, No.51, 1st Cross, 4th T Block East, Tilaknagar, Jayanagar, Behind Jal Bhawan, Bangalore-560041. Represented by its Assistant Registrar. ...Respondents (By Senior Panel Counsel, Shri Vishnu Bhat for Respondents 1 to 3)

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O R D E R (ORAL) PER: MRS. JUSTICE S. SUJATHA, MEMBER (J)

The applicant has filed this original application under Section 19 of the Administrative Tribunals Act, 1985 seeking the following reliefs: “(i) Call for relevant records from the Respondent and

(ii) Quash or set aside, by issuing of Certiorari or any other appropriate Writ, Order or direction, Annexure A13 dated 09.03.2021 bearing No.F.03-Ad(ATB)/2020-21 in the interests of justice.

(iii) Pass any other order or direction as this Hon’ble Tribunal deems fit in the facts and circumstances of the case and in the interests of justice, equity and fair play in administration.”

2. Facts in brief as narrated by the applicant are that he was appointed as Personal Assistant to Member in the 3rd Respondent Office on adhoc basis by order dated 02.04.1979 with effect from 01.03.1979 and on regular basis with effect from 28.02.1984 vide order dated 01.01.1987. The post of Personal Assistant to Member, was re-designated as Senior Personal Assistant (General Central Services Group B Gazetted) vide notification of the Department of

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Legal Affairs dated 23.08.1988. The post of applicant was also re- designated as Senior Personal Assistant vide order dated 30.09.1988, which was modified as per notification dated 23.12.1992. The pay scale was revised with effect from 01.09.1990 and the applicant was placed in the pay scale of Rs.2000-60-2300-EB-75-3200. On the erstwhile pay scale, there were two different scales Rs.2000-60-2300- 75-3200 and Rs.2000-60-2300-75-3500, both these scales were merged and revised to Rs.6500-200-10500 with effect from 01.01.1996. The post of Assistant Registrar which was a promotional post to Senior Stenographer was in the pay scale of Rs.2000-60-2300- 75-3500 and that was also revised to Rs.6500-200-10500. 106 posts of Senior Personal Assistants in the Income Tax Appellate Tribunal carrying the pay scale of Rs.6500-200-10500 were upgraded to 106 posts of Senior Private Secretaries in the pay scale of Rs.7500-250- 12000 vide letter dated 18.12.2001 issued by the Respondent No.1. The applicant was upgraded to the post of Senior Private Secretary in the pay scale of Rs.7500-250-12000 vide order dated 10.01.2002 issued by Respondent No.2. The applicant approached this Tribunal in OA No.981/2016 for the relief of treating his services from 01.03.1979 for purposes of grant of ACP and MACP and also to grant 3rd MACP in Grade Pay of Rs.7600/- (Level 12 as per VII Pay

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Commission) to the applicant based on DOPT Circular dated 12.04.2010. Arrears of pay consequent to grant of MACP were drawn and paid to the applicant in January, 2017 and no audit objection was raised on the payment. This Tribunal allowed OA No.981/2016 vide order dated 14.11.2018 holding that the applicant is eligible for one more MACP observing that upgradation of his pay scale to Rs.7500- 250-12000, was only pay scale of merger and there was no career enhancement. The said order was challenged by the respondents before the Hon’ble High Court of Karnataka in W.P.No.3814/2021 and the same was allowed vide order dated 16.11.2021 setting aside the order dated 14.11.2018 passed by this Tribunal in OA No.981/2016, remitting the matter back to this Tribunal for fresh consideration in accordance with law. However, the applicant superannuated from service on 31.12.2019 as Senior Private Secretary. Subsequent to the passing of the said order in OA No.981/2016 being restored, the mater was taken for disposal. The said OA was disposed of as withdrawn with liberty to the applicant to file a fresh OA within a period four weeks with better particulars vide order dated 02.12.2022. Accordingly, applicant filed OA No.548/2022 before this Tribunal. The respondents have issued order dated 09.03.2021 demanding refund from the applicant along with recovery request

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made to the Assistant Registrar to recover the excess amount paid to the applicant. Being aggrieved, the applicant has preferred this OA.

3. In this OA, the relief claimed by the applicant relates to the recovery action initiated against the applicant towards the excess amount paid amounting to Rs.6,70,926/-, the break up of which is as under:

Excess of Pay & Allowances : Rs.4,90,997/-

Excess of Commutation of Pension: Rs. 98,329/- Excess of Provisional Pension : Rs. 23,100/-

Excess of EL Encashment : Rs. 58,500/-

4. As regards the pay fixation, the applicant has filed OA No.548/2022 seeking a direction to the 1st Respondent to consider the case of the applicant taking into account the initial appointment on 01.03.1979 for all purpose including the ACP/MACP and the consequential benefits. Learned Counsel for the applicant has filed a Memo in OA NO.548/2022 signed by the applicant as well, seeking for withdrawal of the said application. Separate order is passed in OA No.548/2022 dismissing the OA as withdrawn. Accordingly, this OA is confined to recovery proceedings initiated against the applicant.

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5. Learned Counsel Shri N.S.Prasad representing the applicant placing reliance on State of Punjab and others vs. Rafiq Masih (White Washer) and others reported in (2015) 4 SCC 334, submitted that recovery action initiated from the retired employee that too without issuing a show cause notice is not merely infraction of principles of natural justice but is in gross violation of the orders of the Hon’ble Apex Court. However, in view of the interim order being in operation against the recovery proceedings, though no recovery has been made pensionary benefits are not settled in full.

6. Learned Counsel Shri Vishnu Bhat representing the respondents would submit that as per the recommendation of VI Central Pay Commission, the post of Senior Private Secretary in the Grade Pay of Rs.4800/- was granted Non Functional Selection Grade (NFSG) Pay Rs.5400/- (PB-2) with effect from 01.01.2006. The applicant has been granted 3 upgradation/benefits of pay fixations in his career. On retirement of the applicant on 31.12.2019, the pension papers of the applicant were returned from the Pay and Accounts Office, Delhi stating that grant of MACP in the Grade Pay of Rs.6600/- is not correct and Grade Pay of Rs.5400/- in PB 3 should have been granted and hence a clarification may be sought from the

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DOP&T regarding the same. As the clarification was pending, provision pension was paid for only one year. The Respondent No.3 vide letter dated 09.03.2021 on the advice of the Pay and Accounts Office, requested the applicant to refund excess amount paid towards pay and allowances and other retirement benefits. Learned Counsel does not and cannot dispute the applicability of Rafia Masih (White Washer) supra, to the facts and circumstances of the case.

7. We have carefully considered the submissions of the learned Counsel for the parties and perused the material on record.

8. The recovery of excess amount towards pay and allowances and other retirement benefits amounting to Rs.6,70,926/- under the Head- Pay and Allowances relates to the period from 01.03.2009 to 31.12.2019. The excess payment has arisen due to one increment under grant of MACP in Grade Pay of Rs.6600/- as against Rs.5400/- with effect from 01.01.2006. The entire recovery proceedings have been initiated subsequent to the retirement of the applicant. It is not in dispute that no show cause notice was issued for proceeding with recovery action. The said amount was paid for more than five years. In the circumstances, Rafiq Masih (White Washer) supra, would certainly apply to the case on hand mainly for the reason that there was

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no fraud played by the applicant or any misrepresentation made by him for the said pay fixation. The relevant paragraph of Rafiq Masih (White Washer) supra, reads thus:

“18. 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 the 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.

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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.”

9. In the light of the said judgment, recovery proceedings initiated against the applicant, a retired employee is not justifiable. Accordingly, the impugned order dated 09.03.2021 (Annexure A13) issued by the Respondent No.3 is quashed and set aside.

10. OA is allowed to the extent indicated above.

No order as to costs.

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(DR. SANJIV KUMAR) (JUSTICE S. SUJATHA) MEMBER (A) MEMBER (J)

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