Recovery of excess salary paid for over five years is impermissible absent employee misrepresentation.

The petitioner was appointed as an Examiner on 24 April 1992 and was later promoted as a Junior Assistant in the Principal District Court with effect from 4 June 2008.

Following an internal audit, the respondents found that an inadmissible promotional increment had been granted due to erroneous pay fixation and ordered recovery of ₹2,51,783 for the periods from 3 April 2006 to 30 November 2022 and from 1 December 2022 to 31 October 2025.

The petitioner challenged the recovery order dated 24 November 2025, passed in Dis. No. 3043/2025, and sought reimbursement of the amount deducted from her salary.

The High Court upheld the correction of pay fixation but considered whether recovery of the excess payments, made over a prolonged period without employee misrepresentation, was legally permissible.

1. Whether the respondents were entitled to revise the petitioner’s pay fixation in accordance with the applicable Pay Rules and Government Orders after detecting an erroneous promotional increment.

2. Whether recovery of ₹2,51,783 from the petitioner, representing excess salary and allowances paid over several years without any misrepresentation by her, was permissible in law.

The Court applied the principle that public authorities may correct an erroneous pay fixation and ensure that an employee receives only the salary legally admissible under the applicable Pay Rules and Government Orders.

However, recovery of excess payments may be impermissible where it would cause undue hardship, particularly in the situations identified by the Supreme Court in State of Punjab v. Rafiq Masih, (2015) 4 SCC 334, including recovery from Group C or Group D employees, retired or imminently retiring employees, recovery relating to payments made for more than five years before the recovery order, and cases where recovery would be inequitable, harsh, or arbitrary.

The Court also applied the principle that an employee should not be penalised for an establishment’s pay-fixation error after a substantial lapse of time, in the absence of misrepresentation by the employee.

The Court distinguished between correcting the petitioner’s pay fixation and recovering amounts already paid.

It held that the respondents were competent to rectify the erroneous fixation and that the revised fixation, made pursuant to the audit objection and in conformity with the applicable rules, should continue.

However, the respondents failed to establish that the petitioner had made any misrepresentation when her pay was fixed.

Since the excess payments had continued over many years, recovery at that stage would impose extreme hardship and fall within the equitable restrictions recognised in Rafiq Masih.

Accordingly, the Court upheld the administrative correction but disallowed recovery of the excess salary.

The Court confirmed the revision of the petitioner’s pay pursuant to the audit objection but set aside the recovery of ₹2,51,783.

Any amount already recovered under the impugned order was directed to be repaid to the petitioner within twelve weeks from the date of receipt of a copy of the order.

The connected miscellaneous petition was closed, with no order as to costs.