Recovery from Class III employees is impermissible where excess payment resulted from administrative error without fraud.

The petitioners were appointed as Forest Guards (Class-III) in 2008.

Following a 2014 amendment to the recruitment rules and a subsequent 2016 notification, the respondents notionally re-fixed the petitioners' pay scale to Rs. 5200-20200 with a Grade Pay of Rs. 1900.

Asserting that excess payments had been made due to erroneous fixation between 2008 and 2015, the respondents issued a recovery order dated 30.07.2019 for Rs. 98,933/-.

The petitioners challenged this recovery, alleging it was ordered without a show-cause notice and violated established legal protections for low-paid employees.

The State contended recovery was valid based on an undertaking (Annexure R-1) signed by the petitioners in 2017.

1. Whether the recovery of excess salary from Class-III employees is permissible when the payment was made more than five years prior to the recovery order and without any misrepresentation by the employee.

2. Whether an undertaking signed years after the initial pay fixation constitutes a "voluntary" waiver that permits the State to bypass protections against iniquitous recovery.

The Court primarily applied the Five-Point Test from *State of Punjab v. Rafiq Masih (White Washer)*, which prohibits recovery from Class-III/IV employees or when excess payment exceeds five years.

It further relied on the Full Bench decision in *State of M.P. v. Jagdish Prasad Dubey*, which clarifies that recovery based on an undertaking is only valid if the undertaking was given voluntarily at the time of the benefit, rather than being "forced".

The Court also cited *Central Inland Water Transport Corp. Ltd. v. Brojo Nath Ganguly* regarding the unenforceability of unequal/forced contracts.

The Court also cited *Jogeswar Sahoo v. District Judge, Cuttack* regarding the necessity of principles of natural justice (show-cause notice) before recovery.

The Court found that the petitioners are Class-III employees and the recovery pertained to a period (2008-2015) exceeding five years from the date of the recovery order (2019), squarely falling under the prohibitions set in *Rafiq Masih*.

Regarding the State's reliance on the undertaking, the Court noted the pay fixation occurred in 2014-15, but the undertaking was only obtained in 2017.

Following the *Jagdish Prasad Dubey* precedent, the Court reasoned that since the State failed to prove the undertaking was voluntary and not a "forced" condition of service, it was unenforceable.

Furthermore, the Court observed that the respondents violated natural justice by failing to provide a show-cause notice or a hearing before initiating recovery.

The Court held that the 2017 undertaking did not validate the recovery of payments made in 2014-15.

Consequently, the Court quashed the recovery order, directed the respondents to refund the recovered amount of Rs. 98,933/- with 6% annual interest from the date of recovery until payment, and ordered the exercise to be completed within 90 days.