The Supreme Court has held in High Court of Punjab and Haryana vs Jagdev Singh 2016 thatwhere payments have mistakenly been made by an employer it's recovery is not permissible if employee belonging to class 3 or class 4 service or when the excess payment has been made for a period n excess of 5 years before the order of recovery is issued.

Therefore in your case No recovery proceedings can be initiated against you. You should challenge the notice before the High Court under article 226 of the Constitution of India.

 you should not down the citation of the judgement In which Supreme Court has given  above mentioned judgement i.e.

high court of Punjab and Haryana vs Jagdev Singh (2016) 14 SCC 267

1) The Hon’ble Supreme Court while observing that it is not possible to postulate all situations of hardship which would govern employees on the issue of recovery, where payments have mistakenly been made by the employer, in excess of their entitlement has summarized the following few situations, wherein recoveries by the employers would be impermissible in law:-

(i) Recovery from employees belonging to Class-III and Class-IV service (or Group ‘C’ and Group ‘D’ service).

(ii) Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery.

(iii) Recovery from employees, when the excess payment has been made for a period in excess of five years, before the order of recovery is issued.

(iv) Recovery in cases where an employee has wrongfully been required to discharge duties of a higher post, and has been paid accordingly, even though he should have rightfully been required to work against an inferior post.

(v) In any other case, where the Court arrives at the conclusion, that recovery if made from the employee, would be iniquitous or harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer’s right to recover.

2) excess amount cannot be recovered from you

F.No. 18/03/2015-Estt. (Pay-I)

Government of India

Ministry of Personnel, Public Grievances & Pensions

Department of Personnel & Training

New Delhi, the 2nd March, 2016

OFFICE MEMORANDUM

Sub: Recovery of wrongful / excess payments made to Government servants.

The undersigned is directed to refer to this Department’s OM No.18/26/2011-Estt (Pay-I) dated 6th February, 2014 wherein certain instructions have been issued to deal with the issue of recovery of wrongful / excess payments made to Government servants in view of the law declared by Courts, particularly, in the case of Chandi Prasad Uniyal And Ors. vs. State of Uttarakhand And ors., 2012 AIR SCW 4 742, (2012) 8 SCC 417. Para 3(iv) of the OM inter-alia provides that recovery should be made in all cases of overpayment barring few exceptions of extreme hardships.

2. The issue has subsequently come up for consideration before the Hon’ble Supreme Court in the case of State of Punjab & Ors vs Rafiq Masih (White Washer) etc in CA No.1152 7 of 2014 (Arising out of SLP(C) No.11684 of 2012) wherein Hon’ble Court on 18.12.2014 decided a bunch of cases in which monetary benefits were given to employees in excess of their entitlement due to unintentional mistakes committed by the concerned competent authorities, in determining the emoluments payable to them, and the employees were not guilty of furnishing any incorrect information / misrepresentation fraud, which had led the concerned competent authorities to commit the mistake of making the higher payment to the employees. The employees were as innocent as their employers in the wrongful determination of their inflated emoluments. The Hon’ble Supreme Court in its judgment dated 18th December, 2014 ibid has, inter-alia, observed as under:

“7. Having examined a number of judgments rendered by this Court, we are of the view, that orders passed by the employer seeking recovery of monetary benefits wrongly extended to employees, can only be interfered with, in cases where such recovery would result in a hardship of a nature, which would far outweigh, the equitable balance of the employer’s right to recover. In other words, interference would be called for, only in such cases where, it would be iniquitous to recover the payment made. In order to ascertain the parameters of the above consideration, and the test to be applied, reference needs to be made to situations when this Court exempted employees from such recovery, even in exercise of its jurisdiction under Article 142 of the Constitution of India. Repeated exercise of such power, “for doing complete justice in any cause would establish that the recovery being effected was iniquitous, and therefore, arbitrary. And accordingly, the interference at the hands of this Court.”

“10. In view of the aforestated constitutional mandate, equity and good conscience, in the matter of livelihood of the people of this country, has to be the basis of all governmental actions. An action of the State, ordering a recovery from an employee, would be in order, so long as it is not rendered iniquitous to the extent, that the action of recovery would be more unfair, more wrongful, more improper, and more unwarranted, than the corresponding right of the employer, to recover the amount. Or in other words, till such time as the recovery would have a harsh and arbitrary effect on the employee, it would be permissible in law. Orders passed in given situations repeatedly, even in exercise of the power vested in this Court under Article 142 of the Constitution of India, will disclose the parameters of the realm of an action of recovery (of an excess amount paid to an employee) which would breach the obligations of the State, to citizens of this country, and render the action arbitrary, and therefore, violative of the mandate contained in Article 14 of the Constitution of India.”

3. The issue that was required to be adjudicated by the Hon’ble Supreme Court was whether all the private respondents, against whom an order-of recovery (of the excess amount) has been made, should be exempted in law, from the reimbursement of the same to the employer. For the applicability of the instant order, and the conclusions recorded by them thereinafter, the ingredients depicted in paras 2& 3 of the judgment are essentially indispensable.

4. The Hon’ble Supreme Court while observing that it is not possible to postulate all situations of hardship which would govern employees on the issue of recovery, where payments have mistakenly been made by the employer, in excess of their entitlement has summarized the following few situations, wherein recoveries by the employers would be impermissible in law:-

(i) Recovery from employees belonging to Class-III and Class-IV service (or Group ‘C’ and Group ‘D’ service).

(ii) Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery.

(iii) Recovery from employees, when the excess payment has been made for a period in excess of five years, before the order of recovery is issued.

(iv) Recovery in cases where an employee has wrongfully been required to discharge duties of a higher post, and has been paid accordingly, even though he should have rightfully been required to work against an inferior post.

(v) In any other case, where the Court arrives at the conclusion, that recovery if made from the employee, would be iniquitous or harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer’s right to recover.

5. The matter has, consequently, been examined in consultation with the Department of Expenditure and the Department of Legal Affairs. The Ministries / Departments are advised to deal with the issue of wrongful / excess payments made to Government servants in accordance with above decision of the Hon’ble Supreme Court in CA No.11527 of 2014 (arising out of SLP (C) No.11684 of 2012) in State of Punjab and others etc vs Rafiq Masih (White Washer) etc. However, wherever the waiver of recovery in the above-mentioned situations is considered, the same may be allowed with the express approval of Department of Expenditure in terms of this Department’s OM No.18/26/2011-Estt (Pay-I) dated 6th February, 2014.

6. In so far as persons serving in the Indian Audit and Accounts Department are concerned, these orders are issued with the concurrence of the Comptroller and Auditor General of India.

7. Hindi version will follow.

(A.K. Jain)

Deputy Secretary to the Government of India

You're correct about SC judgements on the law point that you've stated, that when sanction is more than 5 years old, recovery is impermissible. Moreover, the benefit of this increment was not accorded to you on the basis of your fraudulent representation, but the same was the independent decision of the Govt. Now, the Government is realising it's mistake that this benefit ought have been granted to you as qualification allowance after 7 years from the date of it's sanction. For this mistake of the Govt, you can't be penalized.

Appreciate the High Court/Central Administrative Tribunal and seek a stay on recovery. You've an excellent case to obtain an interim order.

1.if any wrongful credit is made in the account of the employee by lawful means then the employer may not be allowed to recover the same.

2.So beofre the govt.proceed to recover the same you may file writ petition to quash the order if passed in the meantime.

3.The decision of the supreme court passed in this direction seems squarely applicable to you.

Once the recovery order is passed, approach a lawyer and ask him to file a writ petition challenging the said order in the High Court. You need seek any permission from the Department for instituting this case. It's just that approach the High Court only once you move a representation before the Department, requesting for recall of the recovery order.

No, expenses incurred by you in pursuing this case, can't be claimed from the Department. However, you request the court that the Department be directed to reimburse you with the cost.

Best,

Vibhanshu

You'll have to file your writ in the Bombay High Court.

1) you don't need department permission to take legal proceedings challenging recovery order issued

2) you can make representations before authorities and rely upon SC judgment quoted herein above

3) you have to incur legal expenses for filing application in court

4) court at most would award you nominal costs

You may please file a civil suit for recovery.

You may send a legal notice to the department before pursuing the case, permission as such is not required.

You can then file a case.

yes in the prayer you can ask the company to pay the legal expenses.

After getting recovery order you should challenge that order before the high court under article 226 of the constitution and no need to get permission of the department for filing of the position. You can proceed directly to the court. 

Hon’ble Supreme Court distinguished the cases like Shyam Babu Verma v UOI, 1994 SCR (1) 700, 1994 SCC (2) 52, Syed Abdul Qadir and Ors. v. State of Bihar and Ors,(2009) 3 SCC 475, Sahib Ram v. State of Haryana,1995 Supp (1) SCC 18 etc., where it had not allowed recovery of excess payment in view of the peculiar facts and circumstances of those cases so as to avoid extreme hardship to the concerned employees, for example, where the employees concerned were mostly junior employees, or they had retired or were on verge of retirement, the employees were not at fault, and recovery which was ordered after a gap of many years would have caused extreme hardship.

As per F. No. 18/26/ 2011-Estt (Pay-I) dt. 06.2.2014, for Recovery of wrongful/excess payments made to Government servants the DOPT instructions:

the issue of recovery of wrongful/excess payments made to Government servants has been examined in consultation with the Department of Expenditure and the Department of Legal Affairs in the light of the recent judgement of the Hon’ble Supreme Court in Chandi Prasad Uniyal And On vs State Of Uttarakh and And Ors, 2012 AIR SCW 4742, (2012) 8 ‘SCC 417, decided on 17th August, 2012.

In view of the law declared by Courts and recently reiterated by the Hon’ble Supreme Court in the above cited case, Chandi Prasad Uniyal And Ors vs State Of Uttarakhand And Ors, 2012 AIR SCW 4742, (2012) 8 SCC 417, the Ministries/Departments are advised to deal with the issue of wrongful/excess payments as follows:

i. In all cases where the excess payments on account of wrong pay fixation, grant of scale without due approvals, promotions without following the procedure, or in excess of entitlements etc come to notice, immediate corrective action must be taken.

Reasons for the decision should be clearly conveyed to enable the employee to represent against the same. Speaking orders may thereafter be passed after consideration of the representations, if any, made by the employee.

Sir still recovery is not ordered and instructions given for recovering from such cases by department. Sir after recovery order what I need to do and is it necessary for me to take prior permission from my department for challenging it's order in court or I can proceed directly to court..? and whether the expenses paid to court can be claimed to department..

You will be issued with a show cause notice before initiating any notice for recovery and your version will be considered or at least you will be given a chance to be heard.

While ordering recovery, all the circumstances of the case should be taken into account. In appropriate cases, the concerned employee may be allowed to refund the money in suitable installments with the approval of Secretary in the Ministry, in consultation with the FA.

If the procedures are not followed properly, you may vent out your grievances directly to the top management or before the labor court or concenred tribunal.