Recovery of decades-old excess pay from a retired Class III employee is impermissible despite a post-retirement undertaking.

The petitioner, a retired Head Clerk (Subedar), superannuated on 31 July 2007.

Following a review of his pay fixation for the period from 1 April 1981 to 31 July 2007, the State ordered recovery of Rs. 2,37,435 on 13 February 2025.

The petitioner challenged the recovery, contending that he was a Class III employee, had not received notice or an opportunity to be heard, and had not given an undertaking when the pay benefits were granted.

He also claimed encashment of 144 days of surrendered leave, which the Superintendent of Police, Datia had sanctioned.

The State relied on an undertaking furnished after retirement.

Whether recovery of excess pay from the petitioner’s retiral dues was permissible, given that he was a retired Class III employee and the alleged excess payments related to a period decades before the recovery order.

Whether the petitioner was entitled to payment for encashment of 144 days of surrendered leave, with interest.

Under State of Punjab v. Rafiq Masih (White Washer), recovery is impermissible in specified situations, including recovery from Class III and Class IV employees, retired employees, and recovery of excess payments made more than five years before the recovery order.

The Full Bench in State of Madhya Pradesh v. Jagdish Prasad Dubey, (2024) 2 M.P.L.J. 198, held that an undertaking given at the time of pay refixation may permit recovery, subject to the applicable safeguards and hardship principles; an undertaking given at the stage of payment of retiral dues for pay benefits granted decades earlier cannot be enforced.

It also held that an undertaking given at the time of grant of financial benefits is not enforceable unless voluntary.

The Court also referred to Jogeswar Sahoo v. District Judge, Cuttack, 2025 (3) M.P.L.J. (S.C.) 25, concerning recovery from retired ministerial employees where no fraud or misrepresentation was shown and no opportunity of hearing was given.

The petitioner was a Class III employee, had retired in 2007, and the recovery order was issued in 2025 for alleged excess payments made between 1981 and 2007.

Those circumstances fell within the categories in Rafiq Masih where recovery is impermissible.

The Court found no undertaking given when the pay benefits were extended; the undertaking relied on by the State was furnished only after retirement and therefore did not make recovery of the earlier payments enforceable.

As to leave encashment, the petitioner pleaded that 144 days had been sanctioned, while the State filed no specific denial or dispute to that claim.

It also directed payment for encashment of the 144 days of surrendered leave, with interest at 6% per annum from the date of entitlement until payment.

The respondents were directed to comply within three months of receiving a certified copy; failing that, the amounts would carry interest at 12% per annum from the date of entitlement until payment.

The petition was disposed of.