Beneficial welfare schemes must receive liberal interpretation to prioritize substantive compliance over procedural technicalities.

The applicant, a retired Chief Engineer of the Military Engineering Service (MES), superannuated on 31.05.2021

Post-retirement, the Respondents reconstructed his leave account and alleged he had availed 147 days of excess Earned Leave during his 35-year career

This led to a proposed recovery of ₹6,18,445/-, later revised to ₹4,94,534/- after adjustments

Furthermore, the respondents rejected the applicant’s claim under the LTC Special Cash Package Scheme (OM dated 12.10.2020) because his initial vehicle booking payment (₹4,47,591/-) occurred on 09.10.2020, three days before the scheme's inception, even though the final invoice and delivery were dated 21.10.2020

The applicant challenged these recoveries and the denial of LTC benefits, citing a lack of show-cause notice and the arbitrary reconstruction of records

1. Whether the respondents' action in revising the leave account post-retirement and directing recovery without a show-cause notice is arbitrary and violative of natural justice

2. Whether the rejection of the LTC Cash Package benefit is sustainable when the final purchase/invoice occurred after the issuance of the policy, despite a prior booking amount

The Tribunal applied the principles of natural justice and administrative fairness regarding post-retirement recoveries. It relied on State of Punjab v. Rafiq Masih (White Washer) [AIR 2015 SC 696], which prohibits recoveries from retired employees where the mistake was not due to fraud

It also referenced Babu Lal Jain v. State of M.P. [(2006) 6 SCC], holding that mistakes by the employer cannot be recovered from employees without misrepresentation

Regarding the LTC scheme, the Tribunal applied the principle of "Purposive and Liberal Construction" for beneficial/welfare legislation as articulated in Urmila Dixit v. Sunil Sharan Dixit [(2025) 2 SCC 787], which mandates interpreting social welfare schemes to advance their objectives rather than defeat them through technicalities

The Tribunal observed that the applicant's leaves were sanctioned by competent authorities throughout his service based on unit-level records, and service books were regularly audited

The Record Office (CRO) had no authority to reconstruct accounts going back decades post-retirement without affording the retiree an opportunity to be heard

Regarding the LTC Cash Package, the Tribunal found that while an advance was paid on 09.10.2020, the substantive legal transaction—the final invoicing and purchase—occurred on 21.10.2020, within the scheme's validity period

A "hyper-technical" interpretation focusing on a booking amount (which could be cancelled) would defeat the scheme's intent to "boost consumption expenditure" during the COVID-19 pandemic

The Tribunal held that beneficial policies must be interpreted in favour of the beneficiary when two views are possible

The Respondents were directed to release the withheld leave encashment and other dues (TA/DA, CGEIS) within eight weeks; the order dated 13.09.2021 rejecting the LTC Cash Package was quashed, and respondents were directed to reconsider the claim based on the invoice date. If payments are not released within the stipulated period, the applicant is entitled to interest at GPF rates