Authorities cannot retrospectively revise settled pay fixation and recover alleged excess payments after decades.

The petitioners were employed as Junior Field Investigators in the Directorate of Economics and Statistics, Bihar. Petitioner No. 1 was appointed on 8 January 1986 and superannuated on 31 December 2020, while Petitioner No. 2 was appointed on 15 April 1988 and superannuated during the pendency of the writ petition.

By Memo No. 94 dated 11 January 1991, the Directorate had determined that Junior Field Investigators appointed on or after 1 January 1986 would receive an initial pay of ₹1,000, with monetary benefits from 1 March 1989 and without arrears for the period from 1 January 1986 to 28 February 1989.

After approximately 30 years, the Directorate issued Memo No. 1492 dated 19 November 2021, withdrawing the earlier decision, fixing the initial pay at ₹975 instead of ₹1,000, and directing recovery of alleged excess payments from serving, retired and deceased employees.

The petitioners challenged the 2021 memo and sought protection against recovery, contending that the earlier fixation had been officially sanctioned and that there had been no fraud or misrepresentation on their part.

Whether the Directorate could, after approximately 30 years, withdraw or review its earlier Memo No. 94 dated 11 January 1991 and retrospectively revise the petitioners’ initial pay from ₹1,000 to ₹975?

Whether recovery of alleged excess payment could be directed from serving, retired and deceased Junior Field Investigators in the absence of fraud or misrepresentation by them?

Whether similarly situated Junior Field Investigators were entitled to the benefit of the earlier pay fixation in light of the decision rendered in the case of Surendra Singh?

The Court applied the Bihar State Litigation Policy, 2011, particularly Clause 4.C.1, which requires Government departments to consider and settle claims of similarly situated employees where the claim is covered by a court decision, rather than compelling them to litigate; the policy requires the Government to act as an efficient litigant.

The Court also applied the general administrative-law principles that an administrative authority cannot arbitrarily review and unsettle an operative pay-fixation decision after an inordinate delay, particularly without adequate explanation or procedural fairness, and that recovery of payments made without fraud or misrepresentation is impermissible in the circumstances presented.

No specific statutory provision or judicial precedent, apart from the Bihar State Litigation Policy and the decision in Surendra Singh, was relied upon in the judgment.

The Court found that Memo No. 94 dated 11 January 1991 had been issued by the same Directorate and had governed the petitioners’ pay fixation for about three decades.

The subsequent Memo No. 1492 dated 19 November 2021 retrospectively altered that position without satisfactorily explaining the earlier decision or addressing the petitioners’ specific pleading that the ₹1,000 fixation had resulted from an identified pay anomaly and had been communicated to the relevant authorities.

The Court considered it particularly untenable to direct recovery from deceased employees and questioned how amounts already paid to such persons could be realised.

Further, the State’s own pleadings indicated that the revised decision was connected with the case of Surendra Singh, in which the initial pay of ₹1,000–1,540 had been allowed.

Applying Clause 4.C.1 of the Bihar State Litigation Policy, the Court held that similarly situated Junior Field Investigators should not be denied the same benefit or forced to approach the Court individually.

Consequently, the petitioners and similarly situated Junior Field Investigators were protected from recovery founded on the impugned revision of their initial pay, and the earlier fixation at ₹1,000 was not disturbed.