Excess-pay recovery from retired Group C employees is impermissible absent fraud or misrepresentation.

The applicant, a Group-C railway employee, retired as Store Issuer on 31 August 2015.

The respondents sought to recover ₹11,83,917 as alleged excess pay arising from pay fixation and ad hoc promotions granted during his service, including for a period beginning in 1986.

The respondents attributed the excess to the applicant’s second ad hoc promotion and relied on Railway instructions permitting only one promotion in the Construction Organisation.

The applicant had not been accused of fraud, misrepresentation, or concealment.

After an earlier application was disposed of with a direction to decide his representation by a reasoned order, the respondents issued the impugned order dated 25 March 2022.

The applicant challenged that order and sought refund of any amount recovered.

Whether recovery of alleged excess pay from the applicant’s retiral benefits was permissible where he was a retired Group-C employee, the payments were made without fraud or misrepresentation, and the alleged excess extended over more than five years.

Whether the applicant was entitled to refund of the amount recovered, and, if so, on what terms.

Section 19 of the Administrative Tribunals Act, 1985, provides the procedural basis for the application.

In State of Punjab v. Rafiq Masih (White Washer), (2015) 4 SCC 334, the Supreme Court identified categories in which recovery of excess payments is impermissible, including recovery from Group-C or Group-D employees, retired employees, and cases where excess payment continued for more than five years before the recovery order.

In Thomas Daniel v. State of Kerala, (2022) 5 SCC 470, the Supreme Court reiterated that excess payments made through the employer’s mistake, without employee fraud or misrepresentation, are generally not recoverable; relief is equitable and depends on the circumstances.

The Tribunal found that the applicant was a Group-C employee who had retired before recovery was sought, that the alleged excess payments had continued for more than five years, and that the respondents did not allege fraud, misrepresentation, or concealment.

The pay and benefits had been fixed by the respondents’ competent authorities, with no evidence that the applicant had caused the error.

Applying Rafiq Masih and Thomas Daniel, the Tribunal held that recovery—particularly from retiral benefits—would cause undue hardship and was impermissible.

It did not need to decide whether the respondents could re-fix the applicant’s pay under the applicable rules; it held that such re-fixation could not sustain recovery of amounts already paid.

It directed the respondents to refund any amount already recovered from the applicant’s retiral dues within three months of receiving a certified copy of the order.

If repayment is not made within that period, interest at the applicable GPF rate is payable from expiry of the three-month period until payment.

No order as to costs.