Kishori Lal Ahirwar vs The State Of Madhya Pradesh

Court: Madhya Pradesh High Court
Decided on: 06-04-2026

<div> NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 1 WP-6300-2014 IN THE HIGH COURT OF MADHYA PRADESH AT GWALIOR BEFORE HON'BLE SHRI JUSTICE ANAND SINGH BAHRAWAT th ON THE 6 OF APRIL, 2026 WRIT PETITION No. 6300 of 2014 KISHORI LAL AHIRWAR Versus THE STATE OF MADHYA PRADESH AND OTHERS Appearance: Shri Alok Kumar Sharma - learned counsel for petitioner. Ms. Smrati Sharma - learned Government Advocate for respondent/State. Shri Yogesh Singhal - learned counsel for respondent No.6. ORDER This petition, under Article 226 of the Constitution of India, has been filed seeking the following reliefs:- "(i) | That, the respondents may kindly be directed to pay all the retiral dues including gratuity, amount of GPF, full pension and all other illegally withheld benefits alongwith 12% interest from the date of retirement till the date of actual payment. (ii) Any other relief, which this Hon'ble Court may deem fit and proper may also be given to the petitioner along with costs." 2. Learned counsel for the petitioner submits that petitioner was initially appointed as an Assistant Teacher w.e.f. 25.09.1978. After completing his service, he retired from the post of Head Master/U.D.T., Government Girls Middle School, Tiyota Block, High School, Sirnota, Ganjbasoda, District Vidisha w.e.f. 28.02.2014. It is submitted that the G.P.F. account of petitioner was not properly maintained by the respondents resulting in discrepancies in the G.P.F. account statements with respondent Nos. 5 and 6. In this regard, the Principal of Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 2 WP-6300-2014 Government High School, Sirnota, addressed a letter dated 30.09.2012 to respondent No. 6 pointing out discrepancies in the petitioner’s G.P.F. account. In the said letter, it was clearly stated that petitioner had withdrawn part final amounts from the G.P.F. during his entire service period against total deposits of Rs. 4,15,800/- and advances amounting to Rs. 1,76,901/- had been duly repaid through salary deductions. It is further submitted that as mentioned in the aforesaid letter, the G.P.F. account of petitioner had not been properly managed by respondent Nos. 5 and 6 due to which a negative balance of Rs. 5,31,229/- was shown in the account slip. Thereafter, the account of the petitioner was reconciled and as per the computerized passbook, the negative balance was shown as Rs. 4,92,017/-, which was further reduced to Rs. 4,27,333/-. However, without considering the aforesaid aspects, the petitioner was informed that his G.P.F. account reflected a negative balance of Rs. 6,16,520/-. It is further submitted that, after more than 10 months from the date of retirement, the respondents recovered the aforesaid amount from the petitioner’s gratuity and initiated recovery proceedings. Without giving any show cause notice to the petitioner and without compliance of the principle of natural justice. The petitioner was already retired on 28.02.2014, therefore, after retirement, no recovery can be initiated from gratuity amount. Learned counsel for the petitioner also placed reliance upon the judgment of Division Bench of this Court in the case of Ramnarayan Sharma Vs. State of M.P. and Ors. decided on 06.03.2017 in W.A.No.357/2016. 3. Per contra, learned counsel for the respondent/State submitted that the petitioner's GPF account was settled by respondent and that the answering respondents are not required to pay back any amount to the petitioner, as the petitioner does not have any amount to be paid back due to final deduction. Learned counsel for the respondent/State also placed reliance upon the order of Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 3 WP-6300-2014 Principal Seat, at Jabalpur in case of Ram Baksh Dwivedi Vs. State of M.P. and Ors. decided on 27.06.2024 in W.P.No.14080/2012 and submitted that as per Rule 14(7) of Rules, 1955, the Government has right to recover the amount from the petitioner as there is excess withdrawal of amount from GPF account of petitioner and minor balance was shown in the account, there was nothing illegal because the provision itself provide that the recovery can be made if excess withdrawal of amount is made form GPF account. It is further submitted that the GPF final payment case of petitioner was forwarded by the Principal, Government High School, Sirnota, Ganjbasoda, District Vidisha (Respondent No. 7), vide letter No. 584 dated 17.02.2014, along with the GPF passbook and the list of withdrawals made by petitioner during his service period. Upon reconciliation with the ledger account, the list of part-final withdrawals and the passbook, it was noticed that debits of Rs. 15,000/- in 12/1993, Rs. 4,700/- in 08/1994, Rs. 25,000/- in 06/1998, Rs. 50,000/- (year not mentioned in the PF list but actually withdrawn in 05/2000 as per the office records of this respondent), Rs. 65,000/- in 05/2003, and Rs. 11,500/- in 11/2004 were neither entered in the GPF passbook nor deducted from the closing balances of the respective years. However, except for the first two withdrawals, all remaining withdrawals were reflected in the list of withdrawals sent along with the GPF final payment case. All these debits, amounting to Rs. 1,71,200/-, are recorded in the ledger account maintained by this respondent’s office. After calculation, a negative balance of Rs. 6,16,520/- was assessed and accordingly, a show-cause notice dated 04.04.2014 (Annexure P/2) was issued to petitioner and the department, along with a calculation sheet, requesting reconciliation of deposits and withdrawals and intimation of any discrepancies within two months. However, no acceptance or refusal was received either from petitioner or the department. In response to the notice served through counsel, the Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 4 WP-6300-2014 department was requested to confirm the aforementioned withdrawals and to furnish details of certain missing credits vide letter No. Nidhi 19/1159-61 dated 20.11.2014 issued by this respondent’s office, with intimation to petitioner. All the above withdrawals were confirmed by the department vide letter No. 416 dated 29.11.2014. However, after adjusting missing credits on collateral evidence, the final negative balance was determined to be Rs. 5,16,864/- as on the date of retirement. This amount was communicated to the Principal, Government High School, Sirnota, Ganjbasoda, District Vidisha, vide this respondent’s office letter No. Nidhi 19/1362-64 dated 17.12.2014 (Annexure R-6/3). The said amount is recoverable from the petitioner along with penal interest w.e.f. 01.03.2014 in terms of Rule 14(7) of the M.P. GPF Rules, 1955. The GPF final payment case has been duly reconciled and finally settled in accordance with the provisions of the M.P. GPF Rules, 1955 and the Provident Fund Act, 1925, and an amount of Rs. 5,16,864/- is recoverable from the petitioner. 4. Heard learned counsel for the parties and perused the record. 5. Admittedly, the petitioner retired on 28.02.2014 upon attaining the age of superannuation. However, the recovery proceedings were initiated by order dated 10.12.2014, i.e., after a lapse of more than ten months from the date of retirement. 6. The controversy involved in the present case has already been decided by Division Bench of this Court by order dated 06.03.2017 in the case of Ramnarayan Sharma (Supra). Paragraphs 8 to 11 of the said order are held as under:- "8. After hearing learned counsel for the parties, this Court is of the considered view that the present appeal is liable to be allowed as the action of the respondents in adjusting the debit balance of the GPF account from the gratuity amount due to the petitioner after more than two years of superannuation is unsupported by any authority of law for Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 5 WP-6300-2014 the reasons mentioned infra. 8.1 The GPF rules are framed under the proviso to Article 309 of the Constitution of India for constitution of General Provident Fund and prescribing procedure for depositing, withdrawal, payment of interest and borrowing qua the said GPF. 8.2 The State has referred to Rule 14(7) of the GPF Rules which is reproduced supra. Rule 14(7) contemplates situation that if withdrawal is made from the fund by the subscriber in excess of the amount to his credit on the date of drawal, the overdrawn amount shall be repaid by the subscriber with interest thereon in lump sum or in default shall be recovered by deduction in one lump sum / in installments from the emoluments of the subscriber. 8.3 Apart from Rule 14(7) in GPF Rules, no other rule governs the field of recovery of over drawn GPF amount. Therefore, this court will have to fall upon Rule 14(7) for judging the validity and legality of the order of recovery assailed herein. 8.4 The expression “emoluments” used in Rule 14(7) is not defined in the GPF Rules. However, if assistance of the Pension Rules of 1976 is sought then definition of emoluments is found in Rule 3(1) (d) read with Rule 30, to mean the pay as defined in Rule 9 (21) of Fundamentals Rules (including dearness allowance pay, if any,) which a Government servant was recieving immediately before his retirement or on the date of his death, as the case may be. For ready reference and convenience rule 3(1) (d) and Rule 30 of the Pension Rules are reproduced below:- “Rule 3(1)(d)-”Emoluments” means emoluments as defined in Rule 30. Rule 30. Emoluments- The expression “ emoluments” means pay as defined in rule 9(21) of the Fundamental Rules (including dearness pay, if any, as determined by the order of the Government issued from time to time) which a Government servant was receiving immediately before his retirement or on the date of his death, as the case may be. Explanation-(1) For those Government servants who are drawing pay in the revised pay scales, under the Madhya Pradesh Revision of Pay Rules, 1990 or Madhya Pradesh Revision of Pay Rules, 1998 or pay scales of U.G.C. Or All India council of Technical Education or all India Services, the expression 'emoluments' means basic pay as defined in rule 9(21)(a)(i) of the Fundamental Rules, which a Government servant was receiving immediately before his retirement and will also include dearness pay and personal Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 6 WP-6300-2014 pay, if any, as determined by the order of State Government, from time to time.” 8.5 From the definition of emoluments it becomes clear that the same refers to the pay which a Govt. servant receives till his retirement. Thus, the expression “emoluments” employed in Rule 14 (7) of GPF Rules necessarily implies that the rule making authority had in service Govt. servant in mind and not a retired Govt. servant in mind while bestowing power of recovery. Thus, it can safely be concluded that the Provident Fund Rules do not empower in expressed terms recovery to be made for adjustment of debit balance in the GPF account from gratuity. 8.6 The subject of accrual of, calculation of, payment of and recovery from the amount of gratuity of a Government servant is governed by the M.P. Civil Services Pension Rules of 1976. 8.7 Gratuity is defined in Rule 3(1)(i) while recovery of Govt. dues from gratuity is provided in rule 65 and 66 which are reproduced supra. 8.8 Rule 65 provides that every retiring Govt. servant is duty bound to clear all Govt. dues before retiring failing which the competent authority is empowered to take equivalent cash deposit from the retiring Govt. servant or recovering the ascertainable Govt. dues from the amount of gratuity payable. The expression “ascertainable Govt. dues” have though not been exhaustively defined but few illustrations i.e. house building / conveyance advance, arrears of rent and other charges pertaining to occupation of Govt. accommodation or over payment of pay and allowances and arrears of income-tax deductible at source under the income-tax Act, are prescribed in Explanation-1 appended to Rule 65 of Pension Rules. 8.9 Rule 66 circumscribes the generic power under Rule 65. The said Rule provides that if any Govt. dues (other than those referred in Rule 65) remained unrealized and unassessed, surety may be taken from the retiring Govt. servant and the amount of pension and gratuity should be released without any delay. Rule further provides that in case of inability expressed by retired Govt. servant to furnish the surety, suitable cash deposit may be taken from him or a portion of gratuity which is sufficient to meet out the standing dues should be withheld. Rule further provides that where the dues are unascertainable then withholding of gratuity should be limited to 10%. 8.10 Clause (3) of Rule 66 emphasizes that the assessment of dues and its adjustment should be completed within a period six months from the date of retirement and if there is no claim made on Government account Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 7 WP-6300-2014 against the Government servant within this period then it shall be presumed that no Government claim excluding claim of house rent and water charges are outstanding against him. This sub rule further provides that in case the dues as ascertainable, the same be adjusted against the cash deposit or the amount withheld gratuity and the balance shall be released in favour of the retired Govt. servant immediately after six months from the date of retirement. 8.11 Clause (4) of Rule 66 which is relevant herein provides that after completion of exercise of assessing the unascertainable Govt. dues, if the dues remain unascertained within six months from the date of retirement then recovery can take place from the retired Govt. servant only through legal procedure barring dues pertaining to house rent and water charges for which period of 12 months instead of 6 months is provided. 8.12 Scheme of Rule 66 can be bifurcated in two parts. The first part pertains to recovery of ascertainable dues and the second of unascertainable dues . In case of ascertainable dues the mode of taking cash deposit or surety or recovery from gratuity at the time of retirement is permissible. However, in case of unascertainable except dues relating to house rent and water charge, period of six months from the date of retirement is provided for the Govt. to assess and calculate the exact amount of dues. For adopting the same procedure of adjustment against the cash deposit or partly withheld gratuity within the period of six months. Whereas in case of unasertainable dues pertaining to house rent and water charges long period of 12 months is prescribed for completing the process of assessment and calculation. 8.13 After the period of 6 months / 12 months from the date of retirement the only mode available for recovering ascertainable and unascertainable Govt. dues is by taking recourse to legal procedure which means filing the suit for recovery in the court of competent civil jurisdiction. 9. In the instant case, the dues squarely falls within the category of ascertainable dues i.e overdrawal by the petitioner from his GPF account. Thus the respondents were empowered to recover the said ascertainable dues for adjusting the debit balance in GPF account by withholding / withdrawing gratuity of the petitioner within a period of six months from the date of retirement. Petitioner attained the age of superannuation on 30.04.2012. The period of six months expired on 30th October, 2012, however, respondents by the impugned action made recovery of the dues after more than two years from the date of retirement without following the prescribed procedure of approaching the civil court for recovery of the Govt. dues. Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 8 WP-6300-2014 10. The decision relied upon by the State in the case of Kashi Yadav (supra) is of no assistance as in the said case the statutory provision, as discussed above, have not been considered and the sole reason for upholding the decision of the writ Court of dismissal of petition was that the case of State of Punjab and Ors. Vs. Rafiq Masih (White Washer) and Ors, (2015) 4 SCC 334 is not applicable. None of the statutory provisions relating to gratuity and the GPF Rules were taken into account and thus the decision in the case of Kashi Yadav appears to be rendered in peculiar facts prevailing in that case. 11. In view of the above discussion, this Court has no manner of doubt that the only course open to the respondents after expiry of 6 months of the date of retirement of the petitioner for effecting recovery of Govt. dues ( overdrawal of GPF amount) was to file a civil suit for recovery in the the court of competent jurisdiction. The recovery made from the gratuity dues of the petitioner is uncalled for in law and therefore is liable to be set aside." 7. The impugned recovery has been initiated after the period of more than ten months from the date of retirement the only mode available for recovering ascertainable and unascertainable Govt. dues is by taking recourse to legal procedure which means filing the suit for recovery in the court of competent civil jurisdiction. As per the aforesaid Division Bench judgment, the overdrawal by petitioner from his GPF account is false within the category of ascertainable dues and the respondents were empowered to recover the said ascertainable dues for adjusting the debit balance in GPF account by withholding / withdrawing gratuity of the petitioner within a period of six months from the date of retirement. Petitioner attained the age of superannuation on 28.02.2014. The period of six months expired on 31.08.2014, however, respondents by the impugned action made recovery of the dues after more than six years from the date of retirement i.e.10.12.2014 without following the prescribed procedure of approaching the civil court for recovery of the Govt. dues. The only course open to the respondents after expiry of 6 months of the date of retirement of the petitioner for effecting recovery Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM NEUTRAL CITATION NO. 2026:MPHC-GWL:11425 9 WP-6300-2014 of Govt. dues (overdrawal of GPF amount) was to file a civil suit for recovery in the court of competent jurisdiction. 8. The judgment cited by counsel for the respondent/State in the case of Rambaksh Dwivedi (Supra) is not applicable in the present case as in that case the petitioner was in service and in the present case, the petitioner has already been retired and after ten months of retirement, the recovery has been initiated. 9. The recovery made from the gratuity dues of the petitioner is uncalled for in law and therefore is liable to be set aside. Consequently, the petition is allowed in the following terms: i) The action of respondents in making recovery for adjustment of GPF debit balance from the gratuity amount, is declared unlawful. ii) The respondents are directed to refund the amount of Rs.6,16,520/- to petitioner along-with the interest of 6% per annum from the date of recovery till actual payment within a period of three months from the date of receipt of certified copy of this order. iii) The respondents are free to adopt the lawful mode to make recovery. 10. With the aforesaid, the present petition is allowed and disposed of. (ANAND SINGH BAHRAWAT) JUDGE Ahmad Signature Not Verified Signed by: MOHD AHMAD Signing time: 4/9/2026 10:20:27 AM</div>