Recovery and pension reduction based on withdrawal of SRO-149 benefits from retired employees are legally impermissible.

The applicant, a Class-III employee, retired from the PHE Mechanical North Division, Jammu, after being granted higher pay scale benefits under SRO-149 of 1973

At the time of superannuation, his last pay was recorded as Rs. 46,100 in his service book

However, while preparing pension papers, the respondents ignored the service book entries and recorded his last pay as Rs. 32,300 in the Last Pay Certificate (LPC)

Consequently, the respondents reduced his pension, withheld retiral benefits, and initiated recovery of alleged excess payments despite the absence of any fraud or misrepresentation by the applicant

1. Whether the respondents can unilaterally reduce the last pay drawn for pensionary purposes and effect recovery of benefits granted under SRO-149 of 1973 from a retired Class-III employee

2. Whether the applicant is entitled to have his pension fixed on the basis of the actual last pay drawn (Rs. 46,100) in light of established judicial precedents regarding SRO-149

The Tribunal applied the principles laid down by the Hon’ble Supreme Court in State of Punjab v. Rafiq Masih (White Washer) and Thomas Daniel v. State of Kerala, which prohibit recovery from Class-III employees or retired personnel where no misrepresentation exists

It further relied extensively on the Hon’ble High Court of J&K’s decision in Provincial Power Employees Union of India & Ors. v. State of J&K & Ors. (SWP No. 809/2021), which held that the benefit of SRO-149 of 1973 cannot be arbitrarily withdrawn as it would violate Article 14 of the Constitution by creating disparity with other departments like Police and Mining

The Tribunal found that the applicant’s pay including SRO-149 benefits was duly recorded in his service book and remained valid until superannuation

Applying the ratio from the Provincial Power Employees case, the Tribunal reasoned that since SRO-149 benefits were extended to similarly situated employees across various departments, the state is "estopped" from taking a contrary stand for the applicant

The Tribunal determined that the respondents’ attempt to re-fix the pay at the time of retirement was arbitrary and irrational

Furthermore, since the applicant was a retired Class-III employee, any recovery was legally impermissible under the Rafiq Masih guidelines

The Tribunal concluded that the benefits once validly extended cannot be disturbed to the prejudice of the employee at the stage of retirement

The OA was allowed. The respondents were directed to refund any recovered amounts and to issue a revised LPC based on the actual last pay drawn (Rs. 46,100). The office of the Accountant General was directed to settle all retiral benefits, including gratuity and leave salary, within six weeks