Refixation of pay is permissible, but recovery of excess salary from an employee is legally unsustainable.

The Government (Appellants) challenged a Writ Court order dated 09.07.2025.

Based on audit objections, the appellants had issued orders for the refixation of pay and the consequential recovery of "excess" salary from the first respondent, an employee.

While the Writ Court upheld the legality of the pay refixation, it directed the appellants to refund the amount already recovered from the respondent, citing a lack of misrepresentation by the employee.

1. Whether the recovery of excess salary paid to an employee, in the absence of misrepresentation or fraud on their part, is legally sustainable.

2. Whether the Writ Court's direction to refund the recovered amount remains valid despite confirming the downward refixation of pay.

The Court primarily applied the principles governing the recovery of excess payments from employees as established by the Hon'ble Supreme Court in State of Punjab v. Rafiq Masih (White Washer) (2015) 4 SCC 334.

This precedent establishes that recoveries by employers are impermissible in specific circumstances—such as when the payment was made due to an error by the employer and not because of any fraud or misrepresentation by the employee—as such recovery would be iniquitous and harsh.

The Court reviewed the findings of the Writ Court, noting that while the refixation of the respondent’s scale of pay was necessary to align with applicable pay rules and government orders, the recovery of past payments was unjustified.

The Bench observed that there was no evidence of misrepresentation or fraud on the part of the respondent regarding the initial calculation of pay.

Consequently, applying the Rafiq Masih doctrine, the Court reasoned that the employee should not be penalized for an administrative error in pay fixation.

The Court found no infirmity in the lower court's balancing of the State's right to correct pay scales versus the employee's right to be protected against the recovery of funds already spent.

It held that while the refixation of pay is confirmed, the recovery of excess salary is impermissible.

The Appellants were directed to refund the amount already recovered from the first respondent within twelve weeks from the receipt of the order.