Full Judgment
D.G.R. Patnaik, J.
1. Prayer in this writ application as made by the petitioner is for issuance of a writ quashing part of the Memo No. 130 dated 24.01.2003 (Annexure-4 series) issued under the signature of the Financial Controller, Bihar State Electricity Board, Patna whereby and whereunder a direction has been issued to make payment of gratuity to the petitioner after deducting a sum of Rs. 29,777/-on account of excess payment. Further prayer has been made for a direction commanding upon the respondents to pay the arrears of salary as per revised pay scale with effect from April, 1997 to February, 1998 and also to pay the arrear of pension as per the new revised scales of pay due from 01.03.1998 to 03.04.2001 as also to pay the available dearness allowance with a further direction that the amount deducted from the gratuity should be paid along with interest @ 9% per annum.
2. The petitioner retired from service under respondent B.S.E.B. from the Dhanbad Circle on 28.02.1998. When his post retirement dues were not being paid, he moved the High Court by filing a writ application vide W.P.(S) No. 1709 of 2002 which was disposed of by this Court by its order dated 14.03.2002 directing the petitioner to file a representation before the concerned authorities and with a corresponding direction to the concerned authorities to decide the claim of the petitioner within a period of one month from the date of receipt of the representation. When despite submitting his representation, no decision was taken by the concerned authorities, the petitioner filed a contempt petition vide Contempt (Civil) No. 553 of 2002. On considering the show cause replies of the respondents and taking into account that certain amount was paid by Cheque dated 28.12.2003, the contempt petition was disposed of on 06.01.2004 without any further action against the opposite parties. The petitioner thereafter filed a miscellaneous petition seeking modification of the order and after hearing the parties, the Court directed the respondents to pay the petitioner a sum of Rs. 48,652.50.
Though the aforesaid amount was paid by the respondents towards payment of gratuity and the same was received by the petitioner on protest, the petitioner raised a further demand of Rs. 12,406.44 along with interest @ 9% per annum, as according to his calculation, the total payable amount of gratuity was Rs. 64,870.25.
Though part of the amount of gratuity was paid to the petitioner but vide the impugned order dated 24.01.2003, the respondent Board directed the Electrical Executive Engineer, Dhanbad to deduct a sum of Rs. 29,777/-from the payable gratuity of the petitioner on account of excess payment made to the petitioner.
3. The grievance of the petitioner is that during the tenure of his service, no demand was made by the respondents authorities towards refund of any excess payment of salary nor was any proceeding initiated against him on this issue and nor was any prior notice served upon him to explain as to why the purported deduction should not be made, and yet, the respondents authorities have proceeded to deduct the amount from his payable gratuity. Shri R.S. Mazumdar, learned Counsel for the petitioner would argue that though the respondents have claimed that certain excess payment of salary was made to the petitioner by mistake but it was never alleged that the purported mistake was on account of any fraud or misrepresentation on the part of the petitioner and neither was any proceeding initiated against the petitioner during the tenure of his service. Furthermore, no notice was served upon the petitioner prior to the recovery sought to be made. Learned Counsel submits that the recovery of the purported excess payment from the retiral benefits of the petitioner is totally against the settled principle of law. Learned Counsel in this context refers to and relies for support on the full Bench decision of this Court in the Case of Laxman Prasad Gupta v. State of Jharkhand 2007 Vol. 4 JLJR Page 459.
4. A counter affidavit has been filed on behalf of the respondent Nos. 1 to 4 namely Bihar State Electricity Board. It is sought to be explained that during the petitioner's tenure in service, a departmental proceeding was initiated against him and at the conclusion of the proceeding, it was decided to impose a punishment of deduction of 5% from the pension of the petitioner. Subsequently in course of verification of the petitioner's service book, it was detected by the department that some excess payment was made to the petitioner due to wrong pay fixation and it was found that a sum of Rs. 29,777/-was paid in excess to the petitioner. Hence the D.C.R. Gratuity was sanctioned to the petitioner after deducting the aforesaid amount on account of excess payment. It is further stated that since the petitioner had opted pension from Electricity Supply Division, Dhanbad, his pension is being paid by the Jharkhand State Electricity Board under whose administrative control, the petitioner had retired.
5. A counter affidavit has also been filed on behalf of the respondent J.S.E.B. stating therein that the petitioner's pension and gratuity has been sanctioned by the Bihar State Electricity Board, Patna and since the petitioner had drawn some amount in excess on account of salary, the excess paid amount has been deducted from petitioner's gratuity as per order of the Bihar State Electricity Board, Patna. It is further stated that the total payable gratuity has been paid to the petitioner in two installments, the first installment of Rs. 48,652.75 and the second installment of Rs. 16,217.50. Furthermore, arrears of pension for the period from March, 1998 to April, 2001 amounting to Rs. 21,641/-besides revised leave encashment amounting to Rs., 4,419/-, interest amount of Rs. 16,664/-as well as arrears of dearness allowance have already been paid to the petitioner. In addition, the P.R.C. arrears amounting to Rs. 12,118/- has also been paid to the petitioner on 24.01.2006 besides the G.P.F. payable to him.
6. The gist of the rival submissions is that a sum of Rs. 29,777/- has been deducted by the respondents vide the impugned order, from the gratuity payable to him on account of excess payment of salary. Admittedly, prior to making the aforesaid deduction, no proceeding was initiated against the petitioner nor was any notice served upon him to enable him to explain as to why the proposed deduction should not be made. It is not alleged that the purported mistake in the excess payment of salary was occasioned due to any fraud or misrepresentation practiced by the petitioner.
7. The question raised is whether the respondents can under the aforesaid facts and circumstances, recover any amount from the gratuity of the petitioner after his retirement from service.
8. A similar issue came up for decision before the Full Bench of this Court in the case of Laxman Prasad Gupta (supra). The facts of the case in Laxman Prasad Gupta's case was similar to the case of the petitioner in the instant case. Certain excess payment of salary made to Laxman Prasad Gupta was sought to be adjusted from his retiral benefits after re-fixing his pay on the lower side than the pay actually received by him at the time of retirement. Before proceeding to make the recovery from the retiral benefits, no proceeding was initiated nor was the employee served with any notice giving him any opportunity to explain. After referring to several judgements and placing reliance on the judgements of the Supreme Court in the case of Saheb Ram v. State of Haryana 1995 Suppl (1) SCC 18 and also on another judgement of the Supreme Court in the case of Bihar State Electricity Board v. Vijay Bahadur : (2000)10SCC99 , the full Bench observed that the State Government has jurisdiction to recover its dues from the pension and gratuity of the retired employee only under certain conditions as contemplated under Section 43(b) of the Bihar Pension Rules. Since neither the State Government nor the competent authority had initiated any proceeding under Section 43(b) of the Bihar Pension Rules while the petitioner was in service, and further in the light of absence of any material to show that the excess amount was received by the petitioner by misrepresentation, collusion, fraud or negligence on his part, the said excess amount cannot be recovered out of the retiral dues after retirement, without following the procedure contemplated under Rule 43 of the Bihar Pension Rules.
9. The judgement in the case of Laxman Prasad Gupta squarely covers the case of the petitioner in the instant case. Since admittedly no proceeding under Section 43(b) of the Bihar Pension Rules was initiated against the petitioner and neither was any notice served upon the petitioner to explain as to why the proposed deduction from the gratuity should not be made, the respondent B.S.E.B. did not have authority to recover the excess payment from the petitioner's gratuity. The action of the respondents for recovery of the amount from the retiral dues of the petitioner is not valid in law.
10. In the light of the above discussion, this writ application is allowed. The respondents shall pay to the petitioner the deducted amount of Rs. 29,777/-together with interest @ 9% per annum from the date when the deduction was made, till final payment.