G. George Paracken, Member (J).
1. The applicant is aggrieved by the impugned Annexure A/1 letter of the respondents dated 30.8.2011 informing him that his letter dated 6.12.2010 regarding recovery of excess payment on withdrawal of NFSG was examined in consultation with its Legal Advisor who opined that the Honble Supreme Court decision in Syed Abdul Qadir and ors. vs. State of Bihar and ors. in Civil Appeal Nos.3351-3354 of 2003 dated 16.12.2008 is not relevant and therefore recovery of excess payment have to be effected from him. He has therefore been directed to deposit the excess payment amounting to Rs.70,248/- along with upto date interest.
2. The brief facts of the case are that the applicant during the period from October 1992 to 31.4.1996 served as Joint Commissioner (Administration) in Kendriya Vidyalaya Sangathan (œKVS? for short) in the pay scale of Rs.4500-150-5700 (pre-revised) on deputation basis. On his reversion, he was posted back to his parent cadre, namely, the Defence Headquarters. Again in the month of June, 1997, he applied for the post of Additional Central Provident Fund Commissioner (for short œACPFC?) in the scale of pay of Rs.4500-5700 in the office of respondent no.2 on deputation basis. On his selection, he assumed the charge of the aforesaid post in EPFO w.e.f. 21.11.1997. His deputation period was till 31.10.2001. Before he assumed the said charge, the recommendations of the Vth CPC were accepted by the Government w.e.f. 1.1.1996. In order to implement the aforesaid recommendations in the respondents Corporation, a sub-Committee was formed and the applicant was nominated as Member Secretary. On the recommendations of the sub-Committee, functional pay scale of Rs.16400-450-20000 was granted to nine serving ACPFCs, one Financial Advisor and Chief Accounts Officer (FAandCAO) substituting the initial pay scale of Rs.14300-400-18300. Subsequently, on 17.4.2000 the Ministry of Labour observed that the decision of EPFO to grant the aforesaid scale of pay Rs.16400-450-20000 was contrary to Para 22A of the Employees Provident Fund Scheme 1952 (hereinafter referred to as œEPF Scheme?) and directed the respondents to keep that decision in abeyance. Even though the respondents tried to convince the Ministry of Labour justifying the aforesaid scale of pay to the applicant and other similarly placed persons, the Ministry of Finance did not agree. Therefore, some of the similarly placed officers approached this Tribunal vide OA No.463/2001 (titled K.B. Yadav and others vs. Union of India and others) challenging the denial of the aforesaid functional scale of pay of Rs.16400-450-20000 to them. The applicant was not a party in the said proceedings. However, the said OA was dismissed on 17.9.2001. Thereafter, though they have challenged the aforesaid decision of this Tribunal in the Honble High Court of Delhi vide Writ Petition (Civil) No.6867/2001, they did not succeed. The High Court dismissed the said Writ Petition vide Order dated 3.2.2010. In the meantime, the applicant was repatriated to his parent department, i.e., Ministry of Defence w.e.f. 1.11.2001 and he continued to serve there till 31.3.2010 on which date he got superannuated. However, respondent no.2, vide its letter dated 18.3.2010, requested the respondent no.1 to give effect to the recovery of the excess amount along with interest from him. The said letter was served upon him on 29.3.2010 i.e. just two days before his retirement. He immediately made a representation on 30.3.2010 to the respondent no.2 wherein he submitted that he had no contribution or role for the grant of higher pay scales to the 9 posts of Additional CPFC and FAandCAO and as per the law laid down by the Apex Court in the catena of decisions, recovery is not justified. He has also made a request to his parent department not to give effect to any recovery in terms of the aforesaid letter of the respondent no.2. However, his parent department put a condition precedent that he should execute an undertaking on a non-judicial stamp paper duly attested by a Notary Public to the effect that the decision of respondent no.2 would be binding upon him. On the basis of the aforesaid affidavit, the respondent no.2 asked the applicant to deposit Rs.70,248/- with upto date interest vide letter dated 17.8.2010. The applicant again made a representation on 6.12.2010 contending that his earlier representation dated 30.3.2010 was not examined by the respondent no.2 in terms of the Apex Court in the case of Syed Abdul Qadir and ors. vs. State of Bihar and ors. (supra). In response to the above representation, the respondent no.2 vide its impugned letter dated 30.8.2011 informed him that the matter was examined in consultation with the Legal Advisor and his request was not acceded to.
3. The applicant has challenged the aforesaid impugned order in this Original Application on the ground that benefits of financial upgradation granted to him was turned down by the respondent no.2 on its own and he had no role to play. He has also pointed out that the aforesaid functional pay scale granted to him and other similarly placed persons was by a conscious decision of the Committee Chaired by the Secretary, Ministry of Labour and recommended by the Central Board of Trustees of EPF which was chaired by the Labour Minister. Therefore, the mandatory benefits of higher pay derived for a short period by him was not attributable to any omission or commission of the applicant much less any fraud or misrepresentation.
4. The applicant has also relied upon the judgment of the Apex Court in the case of Syed Abdul Qadir and ors. vs. State of Bihar and ors. (supra) wherein it has been held as under:-
œ27. This Court, in a catena of decisions, has granted relief against recovery of excess payment of emoluments/allowances if (a) the excess amount was not paid on account of any misrepresentation or fraud on the part of the employee and (b) if such excess payment was made by the employer by applying a wrong principle for calculating the pay/allowance or on the basis of a particular interpretation of rule/order, which is subsequently found to be erroneous. The relief against recovery is granted by courts not because of any right in the employees, but in equity, exercising judicial discretion to relieve the employees from the hardship that will be caused if recovery is ordered. But, if in a given case, it is proved that the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or in cases where the error is detected or corrected within a short time of wrong payment, the matter being in the realm of judicial discretion, courts may, on the facts and circumstances of any particular case, order for recovery of the amount paid in excess. See Sahib Ram vs. State of Haryan a, 1995 Supp. (1) SCC 18, S hyam Babu Verma vs. Union of India , [1994] 2 SCC 521; Union of India vs. M. Bhaskar , [1996] 4 SCC 416; V.Ganga Ram vs. Regional Jt., Director, [1997] 6 SCC 139; Col. B.J. Akkara [Retd.] vs. Government of India and Ors . (2006) 11 SCC 709; Purshottam Lal Das and Ors., vs. State of Bihar, [2006] 11 SCC 492; Punjab National Bank and Ors. Vs. Manjeet Singh and Anr. , [2006] 8 SCC 647; and Bihar State Electricity Board and Anr. Vs. Bijay Bahadur and Anr ., [2000] 10 SCC 99.
28. Undoubtedly, the excess amount that has been paid to the appellants teachers was not because of any misrepresentation or fraud on their part and the appellants also had no knowledge that the amount that was being paid to them was more than what they were entitled to. It would not be out of place to mention here that the Finance Department had, in its counter affidavit, admitted that it was a bona fide mistake on their part. The excess payment made was the result of wrong interpretation of the rule that was applicable to them, for which the appellants cannot be held responsible. Rather, the whole confusion was because of inaction, negligence and carelessness of the officials concerned of the Government of Bihar. Learned counsel appearing on behalf of the appellants-teachers submitted that majority of the beneficiaries have either retired or are on the verge of it. Keeping in view the peculiar facts and circumstances of the case at hand and to avoid any hardship to the appellants-teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellants-teachers should be made.
29. Learned counsel also submitted that prior to the interim order passed by this Court on 7.4.2003 in the special leave petitions, whereby the order of recovery passed by the Division Bench of the High Court was stayed, some instalments/amount had already been recovered from some of the teachers. Since we have directed that no recovery of the excess amount be made from the appellant teachers and in order to maintain parity, it would be in the fitness of things that the amount that has been recovered from the teachers should be refunded to them.
30. In the result, the appeals are allowed in part, the impugned judgment so far as it relates to the direction given for recovery of the amount that has been paid in excess to the appellants œteachers is set aside and that part of the impugned judgment whereby it has been held by the Division Bench that the amended provisions of FR.22-C would apply to the appellants-teachers is upheld. We direct that no recovery of the excess amount, that has been paid to the teachers of Secondary Schools, be made, irrespective of the fact whether they have moved this Court or not. We also direct that the amount that has been recovered from some of the teachers, after the impugned judgment was passed by the High Court, irrespective of the fact whether they have moved this Court or not, be refunded to them within three months from the date of receipt of copy of this judgment.?
5. He has also relied upon the various other judgments of the Apex Court such as Yogeshwar Prasad and ors. Vs. National Inst., Edu. Planning and Admn. and ors. in Civil Appeal No.288-289 of 2005 decided on 21.10.2010. The relevant part of the said judgment is as under:-
œWe have heard the learned counsel for the parties. In view of our judgment in Civil Appeal Nos.288-289 of 2005, the appellants in this appeal were fully justified in getting the benefit of the revised pay scale of Rs.1640-2900 from 01.01.1986. In the instant case the appellants have already received the benefit of the revised pay scale. The question which arose for consideration was whether the respondents can recover the additional amount paid to the appellants. In our considered view, the appellants in this appeal were fully justified in getting the benefit of the revised pay scale. Even otherwise also the additional amount cannot be recovered from them. Mr.Amarendra Sharan, learned senior counsel appearing for the appellants in this appeal, submitted that the benefit of igher pay scale granted to appellants cannot be recovered in view of the series of the judgments of this Court. He placed reliance on a three judge Bench judgment of this Court in Shyam Babu Verma and Ors. Vs. Union of India and Ors., (1994) 2 SCC p.521 para 11, which reads as under :
œAlthough we have held that the petitioners were entitled only to the pay scale of Rs.330-480 in terms of the recommendations of the Third Pay Commission w.e.f. January 1, 1973 and only after the period of 10 years, they became entitled to the pay scale of Rs.330-560 but as they have received the scale of Rs.330-560 since 1973 due to no fault of theirs and that scale is being reduced in the year 1984 with effect from January 1, 1973, it shall only be just and proper not to recover any excess amount which has already been paid to them. Accordingly, we direct that no steps should be taken to recover or to do adjust any excess amount paid to the petitioners due to the fault of the respondents, the petitioners being in no way responsible for the same.?
This judgment has been followed in the subsequent judgment of this Court in Sahib Ram Vs. State of Haryana and Ors., (1995) Suppl.1 SCC p.18 para 5, which reads as under:
œAdmittedly the appellant does not possess the required educational qualifications. Under the circumstances the appellant would not be entitled to the relaxation. The Principal erred in granting him the relaxation. Since the date of relaxation the appellant had been paid his salary on the revised scale. However, it is not on account of any misrepresentation made by the appellant that the benefit of the higher pay scale was given to him but by wrong construction made by the Principal for which the appellant cannot be held to be at fault. Under the circumstances the amount paid till date may not be recovered from the appellant. The principle of equal pay for equal work would not apply to the scales prescribed by the University Grants Commission. The appeal is allowed partly without any order as to costs.?
Mr. Sharan also cited another relatively recent judgment of this Court in the case of State of Bihar and Ors. Vs. Pandey Jagdishwar Prasad, (2009) 3 SCC p.117 para 19 which reads as under:
œIt is not needed for this Court to verify the veracity of the statements made by the parties. If at all the respondent entered the second date of birth at a subsequent period of time, the authorities concerned should have detected it and there should have been a detailed enquiry to determine whether the respondent was responsible for the same. It has been held in a catena of judicial pronouncements that even if by mistake, higher pay scale was given to the employee, without there being misrepresentation or fraud, no recovery can be effected from the retiral dues in the monetary benefit available to the employee.?
In view of a series of judgments of this Court, the appellants are otherwise entitled to the revised pay scale. The amount paid to the appellants-employees pursuant to the grant of higher pay scale should not be recovered unless it was a case of mis-representation or fraud. Admittedly, neither mis-representation nor fraud can be attributed to the appellants in C.A.NO.209/2007. In this view of the matter, respondent no.1-Institute would be restrained from recovering any amount which has already been paid to the appellants in C.A.NO.209/2007.
In the result, the impugned judgment is set aside and Civil Appeals Nos.288-289 of 2005 and Civil Appeal No.209 of 2007 are allowed and disposed of. However, the benefit of this order would be confined to the appellants in Civil Appeals Nos.288-289 of 2005 and Civil Appeal No.209 of 2007.
In the facts and circumstances of these cases, we direct the parties to bear their own costs.
6. The respondents in their reply have stated that Central Board has the power to make appointments only in relation to the posts carrying the maximum scale of pay of Rs.14300-18300 as per para 22A of the EPF Scheme which reads as under:-
œ22A. Appointment of officers and employees of the Central Board: the power of appointment vested in the Central Board under sub-section (3) of Section 5D of the Act shall be exercised by the Board in relation to posts carrying the maximum scale of pay of Rs.14300-18300.
They have also stated that the applicant, being the Additional Central Provident Fund Commissioner (Personnel and Training) and also the Member Secretary of the sub-Committee which has considered the grant of pay scales, was instrumental in the entire process and was very much aware of the fact that excess amount was being paid to him and other similarly placed persons. They have also stated that this Tribunal vide its Order dated 17.9.2001 in the OA No.463/2001 and the Honble High Court of Delhi vide its Order dated 3.2.2010 dismissed the Writ Petition No.6867/2001 have also not allowed their claim for the higher pay scale. Further they have stated that the judgment of the Apex Court in the case of Syed Abdul Qadir and ors. vs. State of Bihar and ors. (supra) relied upon by the applicant is not relevant in this case. In this regard, they have relied upon the following para of the said judgment:-
27. But, if in a given case, it is proved that the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or in cases where the error is detected or corrected within a short time of wrong payment, the matter being in the realm of judicial discretion, courts may, on the facts and circumstances of any particular case, order for recovery of the amount paid in excess?
7. The counsel for the respondents has also relied upon recent judgment of the Apex Court in the case of Chandi Prasad Uniyal and Ors. Vs. State of Uttarakhand and Ors., 2012 (7) SCALE 376. The relevant part of the said order reads as under:-
9. We are of the considered view, after going through various judgments cited at the bar, that this court has not laid down any principle of law that only if there is misrepresentation or fraud on the part of the recipients of the money in getting the excess pay, the amount paid due to irregular/wrong fixation of pay be recovered.
10. Shyam Babu Verma case (supra) was a three-Judge Bench judgment, in that case the higher pay scale was erroneously paid in the year 1973, the same was sought to be recovered in the year 1984 after a period of eleven years. The court felt that the sudden deduction of the pay scale from Rs.330-560 to Rs.330-480 after several years of implementation of said pay scale had not only affected financially but even the seniority of the petitioners. Under such circumstance, this Court had taken the view that it would not be just and proper to recover any excess amount paid.
11. In Sahib Ram case (supra), a two-Judge Bench of this Court noticed that the appellants therein did not possess the required educational qualification and consequently would not be entitled to the relaxation but having granted the relaxation and having paid the salary on the revised scales, it was ordered that the excess payment should not be recovered applying the principle of equal pay for equal work. In our view, this judgment is inapplicable to the facts of this case. In Yogeshwar Prasad case (supra), a two-Judge Bench of this Court after referring to the above mentioned judgments took the view that the grant of higher pay could not be recovered unless it was a case of misrepresentation or fraud. On facts, neither misrepresentation nor fraud could be attributed to appellants therein and hence, restrained the recovery of excess amount paid.
12. We may in this respect refer to the judgment of two-Judge Bench of this Court in Col. B.J. Akkara (retd.) case (supra) where this Court after referring to Shyam Babu Verma case, Sahib Ram case (supra) and few other decisions held as follows:
œSuch relief, restraining recovery back of excess payment, is granted by courts not because of any right in the employees, but in equity, in exercise of judicial discretion, to relieve the employees, from the hardship that will be caused if recovery is implemented. A Government servant, particularly one in the lower rungs of service would spend whatever emoluments he receives for the upkeep of his family. If he receives an excess payment for a long period, he would spend it genuinely believing that he is entitled to it. As any subsequent action to recover the excess payment will cause undue hardship to him, relief is granted in that behalf. But where the employee had knowledge that the payment received was in excess of what was due or wrongly paid, or where the error is detected or corrected within a short time of wrong payment, Courts will not grant relief against recovery. The matter being in the realm of judicial discretion, courts may on the facts and circumstances of any particular case refuse to grant such relief against recovery.?
13. Later, a three-Judge Bench in Syed Abdul Qadir case (supra) after referring to Shyam Babu Verma, Col. B.J. Akkara (retd.) etc. restrained the department from recovery of excess amount paid, but held as follows:
œUndoubtedly, the excess amount that has been paid to the appellants - teachers was not because of any misrepresentation or fraud on their part and the appellants also had no knowledge that the amount that was being paid to them was more than what they were entitled to. It would not be out of place to mention here that the Finance Department had, in its counter affidavit, admitted that it was a bona fide mistake on their part. The excess payment made was the result of wrong interpretation of the rule that was applicable to them, for which the appellants cannot be held responsible. Rather, the whole confusion was because of inaction, negligence and carelessness of the officials concerned of the Government of Bihar. Learned Counsel appearing on behalf of the appellants-teachers submitted that majority of the beneficiaries have either retired or are on the verge of it. Keeping in view the peculiar facts and circumstances of the case at hand and to avoid any hardship to the appellants-teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellants-teachers should be made.
(emphasis added)?
14. We may point out that in Syed Abdul Qadir case such a direction was given keeping in view of the peculiar facts and circumstances of that case since the beneficiaries had either retired or were on the verge of retirement and so as to avoid any hardship to them.
15. We are not convinced that this Court in various judgments referred to hereinbefore has laid down any proposition of law that only if the State or its officials establish that there was misrepresentation or fraud on the part of the recipients of the excess pay, then only the amount paid could be recovered. On the other hand, most of the cases referred to hereinbefore turned on the peculiar facts and circumstances of those cases either because the recipients had retired or on the verge of retirement or were occupying lower posts in the administrative hierarchy.
16. We are concerned with the excess payment of public money which is often described as tax payers money which belongs neither to the officers who have effected over-payment nor that of the recipients. We fail to see why the concept of fraud or misrepresentation is being brought in such situations. Question to be asked is whether excess money has been paid or not may be due to a bona fide mistake. Possibly, effecting excess payment of public money by Government officers, may be due to various reasons like negligence, carelessness, collusion, favouritism etc. because money in such situation does not belong to the payer or the payee. Situations may also arise where both the payer and the payee are at fault, then the mistake is mutual. Payments are being effected in many situations without any authority of law and payments have been received by the recipients also without any authority of law. Any amount paid/received without authority of law can always be recovered barring few exceptions of extreme hardships but not as a matter of right, in such situations law implies an obligation on the payee to repay the money, otherwise it would amount to unjust enrichment.
17. We are, therefore, of the considered view that except few instances pointed out in Syed Abdul Qadir case (supra) and in Col. B.J. Akkara (retd.) case (supra), the excess payment made due to wrong/irregular pay fixation can always be recovered.
18. Appellants in the appeal will not fall in any of these exceptional categories, over and above, there was a stipulation in the fixation order that in the condition of irregular/wrong pay fixation, the institution in which the appellants were working would be responsible for recovery of the amount received in excess from the salary/pension. In such circumstances, we find no reason to interfere with the judgment of the High Court. However, we order the excess payment made be recovered from the appellants salary in twelve equal monthly installments starting from October 2012. The appeal stands dismissed with no order as to costs. IA Nos.2 and 3 are disposed of.
8. In the rejoinder, the learned counsel for the applicant has submitted that he has absolutely no role to play in the decision making of the sub-Committees recommendations to grant the higher pay scale. He was only holding the post of Additional Central Provident Fund Commissioner (Personnel and Training) re-designated as Central Provident Fund Commissioner (Human Resources) and virtue of holding of said post, he was made a Member Secretary of the sub-Committee Central Board of Trustees, EPF which was constituted for examining representations of employees of EPFO regarding grievances/anomalies in the implementation of Vth Central Pay Commissions pay scales. The said Committee was headed by the Secretary, Ministry of Labour himself and other members were the representatives of the Central Government, State Governments, Employers and Employees (Central Trade Unions) representatives. He has further stated that contention of the respondents that he was instrumental in granting the higher pay scale to him and other similarly placed nine persons is nothing but a bald insinuation which is totally incorrect.
9. We have heard Shri M.S. Ramalingam, learned counsel for the applicant and Ms. Aparna Bhat, learned counsel for the respondents.
10. It is seen that after the acceptance of the Vth Central Pay Commissions recommendations w.e.f. 1.1.1996, the Ministry of Labour issued directions to the EPFO to implement the revised pay scales and constitute a Committee to hear the grievances of the staff. It is in consonance with the directions of the Ministry of Labour, the Executive Committee of the Central Board of Trustees of EPFO decided to constitute a sub-Committee to go into these aspects. It was a high level committee headed by the Secretary, Ministry of Labour himself. The said Committee also represented by the officers of the associations and staff unions and federation of EPFO, as its Members. It is only after a detailed study, the sub-Committee recommended the functional pay scale of Rs.16400-450-20000 to nine serving ACPFC and one FA and CAO substituting the initial pay of Rs.14300-400-18300. We, therefore, do not agree with the contention of the respondents that the applicant was instrumental in getting the aforesaid higher pay scale recommended by the sub-Committee just because he was its Member - Secretary. Further, it is seen that the main objection of the respondents was that the Executive Committee had no power to grant the functional pay scale of Rs.16400-450-20000. According to them, the Executive Committee have the power to make appointments in relation to the posts carrying the maximum scale of pay of Rs.14300-18300 as per para 22A of the EPF Scheme. Therefore, the reason for granting the higher pay scale even according to the respondents was not on the basis of any mis-representation or any malafide on the part of any of the Members of the said sub-Committee, including the applicant.
11. However, it is a fact that this Tribunal as well as the Honble Delhi High Court did not approve the aforesaid higher functional pay scale and thereafter, the respondents have recovered the amount of excess payment granted to nine serving officers. The applicant was not a party in the said proceedings before this Tribunal and the High Court. At the relevant time, he was on deputation with the respondent no.2. The respondents did not take any action to recover the amount for over eight years from the date he has been repatriated to his parent office on 1.11.2001. It is also seen that notice of recovery has been served on the applicant just two days before his date of retirement. As held by the Apex Court in the case of Chandi Prasad Uniyal and Ors. Vs. State of Uttarakhand and Ors., (supra), it is a matter of extreme hardship to have any pensioner to part with an amount of Rs. 70,248/- from his retiral dues. In fact, that was the reason why the Apex Court in the case of Syed Abdul Qadir and others (supra) ordered that no recovery should be made against the appellants.. Again, the consideration on the part of the Apex Court in the case of Col. B.J. Akkara [Retd.] was also the hardship that would cause if recovery was implemented.
12. In the above facts and circumstances of the case, we find merit in the contention of the applicant. Accordingly, this OA is allowed and we set aside the impugned Order No.ASD-I/3(8)92 dated 30.8.2011 in so far as it requires the applicant to deposit the alleged excess payment amounting to Rs.70,248/- along with up-to-date interest. We also hold that the said amount with interest is not recoverable from the applicants retiral dues. Consequently, we direct the respondents to repay the amount, if any, recovered from the applicants retiral dues and to release the amount, if any, is withheld from retiral dues of the applicant forthwith. The respondents shall also pass appropriate orders in implementation of the aforesaid directions, preferably within a period of one month from the date of receipt of a certified copy of this order.
13. There shall be no order as to cost.