Recovery of excess payment from retired employee is permissible where voluntary undertaking exists.

The husband of Applicant No. 1, Late Shri N. Moorthy, served as a Loco Pilot (Mail) in the South Western Railway from 1989 and retired on 31.07.2013

On 11.04.2014, he received communication from the Senior Divisional Finance Manager stating that an excess leave salary of Rs. 2,73,411/- had been paid at the time of retirement due to the erroneous inclusion of 55% running allowance

On 21.04.2014, he submitted a representation referring to a news report about the Madras High Court's decision on recovery from retired employees

On 24.04.2014, he voluntarily remitted the entire amount via cheque, requesting that no recovery be made from his pension

On 02.05.2014, he submitted another representation, stating that although he had returned the amount, he believed the recovery to be unjust

He did not initiate any legal proceedings during his lifetime and passed away on 19.02.2024

In May 2024, Applicant No. 2 invoked CPGRAMS and sought a refund.

On 18.06.2024, the respondents declined to reopen the matter, stating it had been closed in 2014

The applicants contend that the undertaking he signed (Form No. 21) related only to provisional pensionary benefits and not leave encashment

Whether the recovery of excess leave salary from the deceased employee was arbitrary, illegal, and contrary to law, warranting a refund with interest

Whether there is sufficient cause to condone the delay of approximately 3650 days in filing the Original Application by the legal heirs

The court referred to the legal position on recovery of excess payments, primarily relying on *State of Punjab v. Rafiq Masih* (2015) 4 SCC 334, which held that recovery from retired employees is ordinarily impermissible, especially when not attributable to fraud or misrepresentation

However, it also relied on *High Court of Punjab and Haryana v. Jagdev Singh* (2016) 14 SCC 267, which clarified that recovery is legally permissible where an employee furnishes a specific undertaking agreeing to refund excess payments

The court also invoked principles of condonation of delay, citing *Collector v. Katiji* (1987) 2 SCC 107 and *Ram Nath Sao v. Gobardhan Sao* (2002) 3 SCC 195, which emphasize a liberal approach in condoning delay where substantial justice demands, but noted that this does not apply to conscious inaction over a decade

Additionally, the court distinguished between legitimate entitlement and excess payment due to computational error, asserting that equitable protection against recovery does not convert mistaken disbursement into inheritable property

The Tribunal found that the deceased employee had executed Form No. 21, an undertaking acknowledging that provisional benefits might require a refund of excess payments detected later

While the applicants argued that this undertaking only covered pension and not leave encashment, the respondents maintained it was a general undertaking

Crucially, the deceased employee voluntarily remitted the entire excess amount within 13 days of the notice, without disputing the calculation, requesting instalments, or pleading financial hardship, despite having knowledge of legal precedents

He lived for a decade after this event without initiating any legal proceedings, indicating a conscious, voluntary choice not to pursue the matter further

The court distinguished *Rafiq Masih* by pointing out that in the present case, the excess payment occurred at the time of retirement and was detected within nine months, making a blanket plea against recovery post-retirement unconvincing

The Tribunal concluded that principles of natural justice were observed as the employee received written notice, had ample opportunity to respond, and made voluntary payment

The long delay of ten years, coupled with the employee's conscious inaction, did not warrant condonation

The court found no sufficient cause to condone the delay, no merit warranting interference, no violation of binding precedent, and no subsisting enforceable right

The matter could not be reopened by the legal heirs a decade later after the employee's conscious closure of the issue

No order as to costs was made