Recovery orders passed without prior inquiry or opportunity of hearing violate principles of natural justice and are unsustainable.

The petitioner was an employee of the Municipal Council, Baikunthpur, having been promoted through the ranks from an Ad-hoc appointment in 1992 to Assistant Grade-I in 2018

On March 15, 2019, Respondent No. 4 issued a notice/letter directing the petitioner to deposit ₹3,79,374/- based on an audit objection regarding alleged embezzlement

The respondent subsequently withheld this amount from the petitioner’s retiral dues, claiming they acted pursuant to an undertaking by the petitioner

The petitioner challenged the notice on the grounds that no inquiry was conducted and no opportunity of hearing was provided

1. Whether the recovery notice dated March 15, 2019, was legally sustainable given the alleged lack of departmental inquiry or opportunity of hearing

The court applied the principles of Natural Justice, specifically the doctrine of audi alteram partem, which necessitates that a party must be afforded a fair opportunity of hearing before an adverse order involving financial recovery or civil consequences is passed

The court further recognized the procedural obligation of a state authority to conduct a proper inquiry and verify departmental records before quantifying alleged liabilities against an employee

The court observed that the impugned notice directing the petitioner to deposit a specific sum was issued solely on the basis of an audit objection

The court noted that Respondent No. 4 failed to issue a prior show-cause notice, did not conduct a formal inquiry, and provided no opportunity for the petitioner to be heard before the recovery was contemplated

While the respondent argued that original documents were with another employee and that the petitioner had given an undertaking, the court found these justifications insufficient to bypass due process

The court reasoned that the respondent was under a legal obligation to afford a proper hearing and follow departmental procedures to verify the alleged debt before passing an adverse order

The High Court quashed the impugned notice (Annexure P/1) and allowed the writ petition

The court granted Respondent No. 4 the liberty to take fresh action against the petitioner strictly in accordance with the law, provided they afford her a due opportunity of hearing and conclude the entire exercise within 150 days