Recovery of retiral dues without a formal departmental inquiry and witness examination is legally unsustainable.

The petitioner, a Clerk with the Ujjain Municipal Corporation, was responsible for managing employee journals and superannuation lists.

Due to an alleged oversight, a Gangman named Premchand continued working for two years beyond his retirement date, resulting in an excess payment of ₹2,49,174.

Although show-cause notices were issued in 2014 and 2015, the petitioner retired on June 30, 2016, without any formal departmental inquiry (DI) pending.

Following her retirement, the respondents withheld her benefits and eventually issued an order on June 10, 2022, recovering the alleged loss from her gratuity.

The recovery was based on a 2015 statement and a 2022 internal report by a newly appointed Inquiry Officer who skipped a fresh inquiry.

Whether the recovery of ₹2,49,174 from the petitioner’s retiral dues via the order dated 10.06.2022 is legally sustainable.

Whether the departmental proceedings were instituted in adherence to the statutory time limits and procedural safeguards.

The Court primarily applied Rule 9 of the M.P. Civil Services (Pension) Rules, 1976, which mandates that pensionary benefits can only be withheld if departmental proceedings are formally instituted via a statement of charges.

Rule 9(2)(b)(ii) specifically prohibits the institution of proceedings for events occurring more than four years prior to such institution.

The court relied on the principles of natural justice and the precedent in Aditya Mishra v. State of M.P. & others (2014), which establishes that penalties cannot be imposed without a full-fledged inquiry and a proven charge.

The Court found a "glaring procedural irregularity" in the respondents' actions.

It noted that no formal charge sheet was served, no witnesses were examined, and the petitioner was denied the opportunity for cross-examination.

The Court reasoned that recovery based merely on a preliminary explanation or a recording of a statement—without a statutory inquiry—is legally impermissible.

It further observed that the internal report dated 12.04.2022, which claimed a fresh inquiry was unnecessary, circumvented mandatory procedural safeguards.

The Court determined that holding a single clerk solely responsible for an administrative lapse involving multiple officials, without a proven charge, was arbitrary.

The Writ Petition was allowed, and the impugned order dated 10.06.2022 was quashed.

The Court directed the respondents to refund the recovered amount of ₹2,49,174 with 6% interest per annum within 60 days.

While the respondents were granted liberty to conduct a fresh inquiry to identify the actually responsible parties, the Court emphasized that such proceedings must strictly adhere to due process.