Employers may rectify erroneous dual pay benefits but are barred from recovering past excess payments from Group C and D employees.

The Government of UT of J&K challenged several orders of the Central Administrative Tribunal (CAT), Jammu, which had quashed recoveries and restored pay/pension for employees

The dispute arose because certain employees in the Jal Shakti/PHE Department were granted higher pay scales (Rs. 950-1500) under SRO 59 of 1990 and subsequently also availed in-situ promotion benefits under SRO 14 of 1996

The Government contended this constituted an illegal "dual benefit" and initiated verification and recovery processes via a 2021 Circular

The employees, primarily Group ‘C’ and ‘D’ staff, argued that Government Instruction No. 1 to Article 242 of the Civil Service Regulations (CSR) barred the state from re-opening emolument records older than 24 months preceding retirement

1. Whether the 24-month limitation on verifying the "correctness of emoluments" under Instruction No. 1 to Article 242 of CSR applies to the rectification of unauthorized dual benefits based on repealed or misinterpreted orders

2. Whether the Government is entitled to recover excess payments made over several decades to Group ‘C’ and ‘D’ employees resulting from administrative error

The Court applied Article 242 of the J&K Civil Service Regulations (CSR), specifically Instruction No. 1, which generally limits the verification of past emoluments to 24 months preceding retirement

However, it also considered S.O. 129 (Government Instruction No. 2), which waives this 24-month bar in cases involving undue benefits from deleted or withdrawn SROs

The Court relied on the equitable principles established in *Syed Abdul Qadir v. State of Bihar*

and the specific prohibitions against recovery from Class-III/IV employees laid down in *State of Punjab v. Rafiq Masih (White Washer)*

It also cited the Division Bench precedent in *Sita Ram v. UT of J&K*, which held that while a mistake in pay fixation can be corrected at any time, recovery of past excess payments may be barred by equity

The Court distinguished between "correctness of emoluments"—which covers clerical or arithmetical errors in an individual's pay—and the unauthorized grant of "dual benefits" to a whole class of employees, holding that the latter does not fall under the 24-month restrictive bar of Instruction No. 1

It reasoned that SRO 59 and SRO 14 were mutually exclusive as they served the same objective of granting higher pay; therefore, employees were not legally entitled to both

While the Court affirmed the Government’s inherent right to rectify pay/pension at any stage to prevent a recurring loss to the exchequer

it applied the *Rafiq Masih* criteria to the issue of recovery. It noted that the respondents were Group ‘C’ and ‘D’ employees and that the excess payments spanned decades

Consequently, the Court found that forcing these employees to refund amounts spent on essential needs would be "harsh and arbitrary," outweighing the State's right to recover

It held that the petitioners (UT of J&K) are at liberty to re-fix the pay and pension of the respondents by excluding the wrongly granted dual benefits

However, the Court strictly prohibited the Government from effecting any recovery of the excess amounts already paid; if any such amounts were already recovered, they must be refunded within the period prescribed by the Tribunal

The petitions were disposed of with no order as to costs