Recovery of Excess Salary Payments Prohibited Following Employee Retirement Absent Evidence of Fraud

The applicant was engaged as a daily wager in the Respondent Department and regularized in 1994 as a Road Worker/Supervisor.

He was granted pay benefits under SRO 59 of 1990, which resulted in a higher pay grade of ₹29,700 as of July 1, 2018, following directions from the Hon’ble High Court and subsequent office orders.

Following the applicant’s superannuation, the Government sought to recover arrears and excess payments previously paid to him under the said SRO.

The applicant approached the Central Administrative Tribunal (CAT) seeking to restrain the respondents from making such recoveries and requesting the disposal of his pending representations.

1. Whether the respondents can legally effectuate the recovery of alleged excess salary/arrears from a retired employee.

2. Whether the applicant is entitled to the same protection against recovery as granted to similarly situated persons in previous judicial pronouncements.

The Tribunal primarily applied the principles governing the recovery of excess payments from employees as established by the Supreme Court of India in Thomas Daniel v. State of Kerala [2022 (SC) 438] and State of Punjab & Others v. Rafiq Masih (White Washer), which prohibit recovery from retired employees or those nearing retirement when the excess payment was not due to the employee's fraud or misrepresentation.

It further referenced the mandate of the Division Bench of the Hon’ble High Court of J&K in Sita Ram v. U.T of J&K & Others regarding the doctrine of fairness and natural justice.

The Tribunal analyzed the applicant's status as a superannuated employee and noted that the benefits under SRO 59 of 1990 had been reflected in his service record for a significant period.

Relying on the precedent set in Rafiq Masih and Thomas Daniel, the Tribunal observed that the law generally protects retired officials from the hardship of recovering excess pay where no fault is attributable to the employee.

The court noted that since similarly situated persons had recently received relief from the J&K High Court in WPC No. 719/2025, the principle of parity and the doctrine of fairness required the respondents to reconsider the recovery order in light of the settled legal position.

The respondents are ordered to mandatorily dispose of the representation within eight weeks by passing a speaking and reasoned order; the decision must be in consonance with natural justice and the principles laid down in Sita Ram v. U.T of J&K, extending the same analogy as provided in WPC No. 719/2025 if the applicant is found similarly circumstanced and there is no legal impediment.