Recovery of excess salary from retired Class IV employees is impermissible absent fraud or misrepresentation.

The petitioner, appointed in the respondent department in 1997, retired on 31 May 2022 from the post of Ward Boy at Civil Hospital, Murar, Gwalior, a Class IV post.

During scrutiny of his service book for pensionary purposes, the respondents allegedly found that his pay had been incorrectly fixed and that an excess amount of ₹1,23,008 had been paid.

The respondent authority consequently issued a recovery order dated 4 November 2022.

Despite repeated directions, the State did not file its reply, and the petition was decided on the basis of the pleadings, documents, and oral submissions available on record.

Whether recovery of ₹1,23,008 from the petitioner, a retired Class IV employee, on account of alleged erroneous pay fixation was legally permissible.

Whether the recovery order was invalid for having been passed without issuing a show-cause notice or providing an opportunity of hearing.

Whether any undertaking allegedly furnished by the petitioner could justify recovery in the absence of proof that it was voluntarily given.

The Court applied the principles laid down in State of Punjab v. Rafiq Masih (White Washer), (2015) 4 SCC 334, under which recovery is ordinarily impermissible from Class III and Class IV employees and retired employees, particularly where the recovery would be harsh or inequitable.

It relied on the Full Bench decision in State of Madhya Pradesh v. Jagdish Prasad Dubey, (2024) 2 M.P.L.J. 198, which held that recovery may be made in appropriate cases pursuant to a valid undertaking or under the applicable service rules, but an undertaking connected with pay refixation is not enforceable unless shown to have been given voluntarily; recovery must also comply with the prescribed procedure.

The Court further relied on Jogeswar Sahoo v. District Judge, Cuttack, 2025 (3) M.P.L.J. (S.C.) 25, recognising that recovery from retired non-gazetted employees, absent fraud or misrepresentation and without an opportunity of hearing, is unsustainable.

The principles of natural justice required prior notice and an opportunity of hearing before imposing the recovery.

The Court found that the petitioner had retired from a Class IV post and that the alleged excess payment arose from departmental pay-fixation errors, with no allegation or proof of fraud or misrepresentation by him.

The recovery was initiated after retirement and without a show-cause notice or hearing, contrary to the principles of natural justice.

The record also contained no pay-fixation chart establishing the basis of the alleged excess payment.

Applying Rafiq Masih and the Full Bench ruling in Jagdish Prasad Dubey, the Court held that recovery from the petitioner fell within the category of recoveries impermissible in law.

Any undertaking could not assist the respondents because there was no material showing that it had been voluntarily furnished.

The respondents were directed to refund ₹1,23,008 to the petitioner with interest at 6% per annum from the date of his retirement until actual payment; if the amount was not paid within the stipulated period, interest at 12% per annum would be payable from the date of entitlement until actual payment.

The directions were to be completed within 90 days from submission of a certified copy of the order.

The writ petition and all interlocutory applications were accordingly disposed of.