MP HC Upholds ₹3.97 Lakh Refund To Class IV Employee As Employer Failed To Produce An Undertaking To Repay Excess Pay

In brief

The question

Whether recovery of the alleged excess pay was justified by the undertaking relied upon by the appellants

The court held

The Court held that the Single Judge had correctly set aside the recovery and ordered repayment with interest.

It also directed

Finding no ground for interference, it dismissed the appeal.

01Facts

The respondent, a Class IV employee, received successive higher-pay benefits after completing 9, 18 and 30 years of qualifying service.

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In 2017, the appellants ordered recovery of ₹3,97,114 in 35 instalments, alleging excess payment due to erroneous pay fixation.

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The respondent challenged the recovery.

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The Single Judge set it aside and directed repayment with interest, relying on *State of Punjab v. Rafiq Masih (White Washer)*.

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The appellants appealed, contending that the respondent had given an undertaking to refund excess payments.

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02Issues

i.Whether recovery of the alleged excess pay was justified by the undertaking relied upon by the appellants

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ii.Whether the Single Judge’s order setting aside the recovery and directing repayment with interest warranted appellate interference

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03Law Applied

Under *State of Punjab v. Rafiq Masih (White Washer)*, (2015) 4 SCC 334, recovery of excess payments from employees may be impermissible in the circumstances identified by the Supreme Court.

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*High Court of Punjab and Haryana v. Jagdev Singh*, (2016) 14 SCC 265, was cited by the appellants in support of recovery where an employee has given a relevant undertaking.

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The Court also applied the Full Bench decision in *State of Madhya Pradesh v. Jagdish Prasad Dubey*, (2024) 2 M.P.L.J. 198, which it held covered the case.

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A recovery undertaking must relate to repayment of excess amounts arising from erroneous pay fixation; an undertaking concerning a different matter does not establish such an obligation.

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Provisions in the judgment · 1

M.P. Uchcha Nyayalaya (Khand Nyayapeeth Ko Appeal) Adhiniyam, 2005 Section 2

04Reasoning

The undertaking produced as Annexure R-4 concerned the respondent’s obligation, upon absorption against a regular post, to join at the place of posting and the consequences of refusal.

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It did not require him to refund excess payments resulting from erroneous pay fixation.

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The appellants produced no undertaking given at the time of any of the three pay upgradations, and there was no finding of misrepresentation by the respondent.

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The Court therefore rejected the appellants’ reliance on *Jagdev Singh* and held that the recovery was unlawful, consistent with the Full Bench decision in *Jagdish Prasad Dubey*.

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