Recovery of excess salary is impermissible from retired Class III employees absent misrepresentation.

The petitioner was appointed as an Upper Division Teacher on 26 February 1996 and retired on 30 November 2019.

At the time of retirement, his service book was scrutinised by the District Pension Office, Morena, which objected to his pay fixation and alleged that he had received excess salary, including two additional increments.

On that basis, the respondents ordered recovery of ₹2,99,611 from the petitioner’s retiral dues.

The recovery was made without issuing a show-cause notice or granting an opportunity of hearing.

The petitioner contended that the excess payment resulted from an erroneous fixation by the Department, without any fraud or misrepresentation on his part, and that recovery from a retired Class III employee was impermissible.

Whether recovery of alleged excess salary of ₹2,99,611 could be effected from the petitioner after his retirement, when he was a Class III employee and had not committed fraud or misrepresentation

Whether the recovery order was sustainable when it was passed without issuing a show-cause notice or affording the petitioner an opportunity of hearing

Whether the respondents could rely upon any undertaking or erroneous pay fixation to justify recovery in the circumstances of the case

The Court exercised jurisdiction under Article 226 of the Constitution and applied the principles governing recovery of excess payments from Government employees.

In State of Punjab v. Rafiq Masih (White Washer), (2015) 4 SCC 334, recovery was held generally impermissible from Class III and Class IV employees, retired employees, employees due to retire within one year, and where recovery would be inequitable or harsh.

Relying on State of Madhya Pradesh v. Jagdish Prasad Dubey, (2024) 2 M.P.L.J. 198, the Court held that recovery based on an undertaking may be made only in appropriate circumstances, that recovery relating to old pay refixation must comply with the governing procedure, and that an undertaking obtained as a condition for receiving a financial benefit is not enforceable unless voluntarily given.

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

The decision in Ravindra Kumar Joshi v. State of Madhya Pradesh, W.P. No. 17831/2019, was relied upon for the principle that the State must establish that an undertaking was voluntarily given before relying upon it for recovery.

The alleged excess payment arose from the Department’s erroneous pay fixation and not from any fraud or misrepresentation by the petitioner.

The petitioner had already retired and had held a Class III post. These circumstances fell squarely within the categories identified in Rafiq Masih, where recovery is ordinarily impermissible.

The recovery was additionally vitiated by the absence of a show-cause notice and hearing, contrary to the principles of natural justice.

The State’s contention that the petitioner had received two additional increments due to his post-1993 appointment did not overcome the prohibition against recovery in the particular circumstances.

Further, there was no specific and voluntarily executed undertaking established by the respondents that could justify recovery under Jagdish Prasad Dubey and Ravindra Kumar Joshi.

Accordingly, the recovery was held legally impermissible.

The respondents were directed to refund the amount to the petitioner, together with interest at 6% per annum from the date of his retirement, 30 November 2019, until actual payment.

The relief was made conditional upon the amount having in fact been recovered from the petitioner’s retiral dues; if no recovery had been made, he would not be entitled to the refund or interest.

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