Recovery of excess salary from retired Group C employees is impermissible in the absence of fraud.

The applicant, a Group ‘C’ employee, retired as a Machinist (HS II) from the Army Base Workshop on June 30, 2025

Upon retirement, the respondents withheld ₹3,69,125 from his Retirement Gratuity, citing overpayment of pay and allowances

This recovery arose because the applicant’s promotion to Highly Skilled Grade II, originally effective from January 1, 2006, was retrospectively shifted to February 18, 2006, following a review mandated by the High Court of Karnataka in Writ Petition No. 31240/2015

The applicant submitted a representation for a refund on May 10, 2025, which went unanswered, leading to the current application under Section 19 of the Administrative Tribunals Act, 1985

1. Whether the recovery of excess pay from the Retirement Gratuity of a Group ‘C’ employee upon superannuation is legally sustainable when the overpayment was not due to fraud or misrepresentation by the employee

The Tribunal primarily applied the legal principles established by the Supreme Court in State of Punjab Ors vs. Rafiq Masih (White Washer) (2015) 4 SCC 334, which prohibits recovery from Group ‘C’/Class III employees and retired employees when the recovery would be iniquitous or harsh

It further relied on Thomas Daniel v. State of Kerala (2022) SCC On Line SC 536, which protects employees from recovery of excess pay mistakenly granted by employers

Additionally, the court cited the Department of Personnel and Training (DoPT) Office Memorandum (OM) dated March 2, 2016, which summarizes the categories of employees exempt from such recoveries

The Tribunal observed that the applicant is a Group ‘C’ employee and that the excess payment was not a result of any fraud or misrepresentation on his part

The overpayment occurred due to a "mistaken notion" by the respondents regarding the effective date of promotion, which was only corrected years later following a High Court directive

The Tribunal noted that the recovery situation fell squarely within the prohibitive categories defined in Rafiq Masih, specifically Clause (i) regarding Class III employees and Clause (ii) regarding retired employees

Citing its own precedent in Shri Tazimulla Shariff S.D. v. Union of India (OA No. 371/2022), the Tribunal reasoned that since the applicant actually worked in the promoted post during the period in question and the error was purely administrative, recovery at the time of retirement was arbitrary and outweighed the employer's right to recover

It directed the respondents to refund the recovered amount of ₹3,69,125 to the applicant within eight weeks from the date of receipt of the order

If the respondents fail to refund the amount within the stipulated time, the sum shall carry interest at the prevailing General Provident Fund (GPF) rate

No order was made as to costs