### Recovery of excess salary from Class III employees is impermissible if paid without fraud for over five years.

The petitioner, an Assistant Sub-Inspector (A) and Class-III employee, had his services regularized in 2015.

From July 1, 2015, to July 1, 2021, the Respondent Department mistakenly paid the petitioner at a higher revised pay scale.

Upon detecting the clerical error six years later, Respondent No. 3 issued recovery orders dated July 30, 2021, and July 31, 2021, seeking to recover ₹75,270/- from the petitioner.

The petitioner challenged these orders, asserting there was no fraud or misrepresentation on his part.

1. Whether the recovery of excess payments made due to a departmental mistake is permissible from a Class-III employee after a period of six years.

The court primarily applied the legal principles established by the Hon’ble Supreme Court in State of Punjab and Ors. vs. Rafiq Masih (White Washer) and Ors., (2015) 4 SCC 334.

This precedent stipulates that recovery of excess payments by employers is impermissible in specific situations of hardship, notably: (i) from employees belonging to Class-III and Class-IV service; and (ii) when the excess payment has been made for a period in excess of five years before the order of recovery is issued.

The Court examined the petitioner’s status and the timeline of the recovery. It observed that the petitioner is a Class-III employee and the excess payments spanned over six years, exceeding the five-year threshold established in Rafiq Masih.

The Court noted the absence of any allegation of fraud or misrepresentation by the petitioner, concluding that the mistake was solely departmental.

By applying the Rafiq Masih guidelines—specifically clauses (i) and (iii)—the Court reasoned that since the petitioner met both the service category and the time-period criteria, the recovery would be iniquitous, harsh, and legally impermissible.

The High Court quashed the impugned recovery orders dated 30.07.2021 and 31.07.2021. Furthermore, the Court directed the respondents to forthwith refund any amount already recovered from the petitioner. The writ petition was allowed with no order as to costs.