Recovery of excess Fixed Medical Allowance from retired Group C employee without misrepresentation is impermissible.

The applicant, E. Palaniammal, is a family pensioner whose husband retired from the respondents' department on 31.08.1992 and subsequently died

The applicant resides at a distance of 7 kms from the CGHS Wellness Centre, Trichy

In accordance with an Office Memorandum dated 06.04.2018, pensioners residing beyond an approximate 5 km radius from a CGHS Wellness Centre are entitled to a Fixed Medical Allowance (FMA) of ₹1,000 per month.

The applicant was regularly receiving this FMA along with her family pension

However, the 2nd respondent, citing an objection raised during Inspection–2024 by IAIR and without reference to a 1st respondent's letter dated 18.12.2019, issued an order dated 15.03.2025, stating that the applicant's residential pincode falls within the CGHS Trichy coverage area

Consequently, the 2nd respondent stopped FMA payment with effect from 01.09.2024 and ordered the recovery of ₹60,000 at ₹3,000 per month from her family pension starting March 2025, alleging excess payment

The applicant contends that her residence is 7 kms from the CGHS centre, making her eligible for FMA, and that the recovery was initiated without a show cause notice and violates Supreme Court guidelines

The respondents argued that a pensioner in a CGHS-covered area cannot opt out of CGHS and avail FMA, and if they do not contribute to CGHS, FMA cannot be granted

Whether the excess payment of FMA, allegedly paid by the respondents, can be recovered from the applicant when there was no misrepresentation or fraud on her part, and no prior notice or opportunity of hearing was afforded to her before the recovery, especially considering her husband was a retired employee

The court primarily applied the principle established by the Supreme Court in State of Punjab v. Rafiq Masih (White Washer) (2015 AIR SCW 501), which outlines situations where recovery of mistaken payments from employees is impermissible in law due to inequity, harshness, or arbitrariness

Key situations include recovery from retired employees or those due to retire within one year of the order of recovery, or when there is no misrepresentation or fraud on the part of the employee

The decision also referenced previous Supreme Court cases such as Sahib Ram vs. State of Haryana (1995) Supp (1) SCC 18 and Thomas Daniel Vs. State of Kerala & Ors (2022) SCC online SC 536, affirming that excess payments are not recoverable if they were not due to the employee's misrepresentation or fraud, but rather an employer's error, operating on principles of equity

The Tribunal applied the principles from the White Washer case, noting that the applicant's husband had superannuated in 1992 and that there was no reflection in the record of any fraud or misrepresentation on his part regarding the FMA payment

The court also highlighted that the applicant was not afforded any opportunity of hearing before the recovery order was issued

The applicant's husband was a Group "C" employee, and applying the apex court's judgment, the recovery was deemed unsustainable and unjustifiable under the category of recovery from retired employees

The Tribunal reasoned that if the effect of recovery is more unfair, wrongful, and arbitrary than the employer's right to recover, then it should be disallowed, which aligns with the circumstances of this case

The impugned order dated 15.03.2025 by the 2nd respondent, which stopped the FMA and ordered recovery, was set aside

The interim order dated 18.08.2025 concerning recovery was made absolute

The respondents were directed to refund any recovered amount to the applicant without interest within two months from the date of receipt of the copy of the order

The OA was allowed on these terms