Recovery of Excess Payments Made to Superannuated Employees Prohibited; Re-fixation of Pay and Pension Permissible.

The five applicants, all retired employees of the Jal Shakti Department (Mechanical Division, Rajouri) aged between 61 and 65, approached the Tribunal seeking a refund of amounts recovered from their gratuity and pension following their superannuation.

They alleged that the respondents illegally recovered these amounts and failed to fix their pension based on their last pay drawn.

The dispute centered on the application of SRO 59 and the subsequent recovery of perceived overpayments from retired personnel.

1. Whether the respondents are legally permitted to recover excess payments made to employees from their retiral benefits after superannuation.

2. Whether the respondents are required to refund any such amounts already recovered while retaining the right to re-fix future pay and pension.

The Tribunal primarily relied on the precedent set by the Hon’ble High Court of Jammu Kashmir in UT of JK Ors. vs. Maqbool Sheikh Ors. (WP(C) No. 936/2025), which established that while the government maintains the liberty to re-fix pay or pension to exclude wrongly granted benefits, it is impermissible to effect recoveries of excess amounts already paid to the employees.

Section 19 of the Administrative Tribunals Act, 1985, under which the application was filed.

The Tribunal noted that the controversy surrounding SRO 59 is no longer res integra, as it was conclusively settled by the High Court in the Maqbool Sheikh case.

Applying the High Court's ratio to the present facts, the Tribunal reasoned that any recovery of excess pay from these retirees is "impermissible".

The court reconciled the rights of the employees and the State by holding that while the recovery of past payments is prohibited, the State retains the authority to rectify the pay scale prospectively for the purpose of future pension calculations.

Consequently, the Tribunal found that the applicants were entitled to a refund of recovered amounts but subject to a re-fixation of their current pensionary status based on corrected service records.

The respondents were ordered to refund any recovered excess amounts and forward the complete service records and Last Pay Certificates to the Accountant General for the final settlement of pension and release of consequential retiral benefits and gratuity.

This exercise must be completed within four weeks from the date of receipt of the order.

No order was made as to costs.