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Judgment
Kh. Nobin Singh, J.—Heard Shri M. Hemchandra, learned counsel appearing for the petitioners in W.P. (C) No. 61 of 2015 and W.P. (C) No. 325 of 2015, Shri H.S. Paonam, learned Senior Counsel assisted by Shri S. Gunabanta, learned counsel appearing for the petitioners in W.P. (C) No. 209 of 2015; Shri S. Rupachandra, learned ASG appearing for the respondent No. 4 in W.P. (C) No. 61 of 2015 and W.P. (C) No. 209 of 2015, Shri S. Suresh, learned counsel appearing for the respondent No. 4 in W.P. (C) No. 325 of 2015 and Shri K. Jagat, learned Government Advocate appearing for the State Respondents.
The subject matter in issue relates to the validity and correctness of certain portion in the last para of the impugned Government orders dated 28-11-2014 issued by the Principal Secretary (Finance), Government of Manipur directing to release arrear pension/family pension for the period from April, 2005 to December, 2006 (21 months) after making full recovery of excess drawal. Since the above three writ petitions arise out of identical sets of facts, the same are being disposed of by this common judgment and order.
3.1. The petitioners in writ petitions being W.P. (C) No. 61 of 2015 and W.P. (C) No. 209 of 2015 are some of the retired Head Pandits/Head Masters of LP Schools/Primary Schools/JB Schools under the Zone-I, II, III, IV, Sadar Hills, Chandel and Ukhrul enjoying pension after their retirement from service. The writ petition being W.P. (C) No. 325 of 2015 is filed by the All Manipur Retired LP/JB/Primary Head Pandit/Head Master Association and its members are also the retired Head Pandits/Head Masters of the LP Schools/Primary Schools/JB Schools of their respective schools under Zone-I, II, III, IV and Sadar Hills, Government of Manipur.
3.2. With reference to and pursuant to various orders passed by the Hon''ble Gauhati High Court in W.P. (C) No. 1167 of 2005, W.P. (C) No. 846 of 2005 etc. as regards the release of pension to retired teachers, on 08-03-2006 the Commissioner (Finance), Government of Manipur issued a letter to the effect that while releasing the arrear pension/family pension to the petitioners, recovery of excess payment may be made as per rules. The relevant portion of the said letter dated 08-03-2006 is reproduced herein below:--
"Recovery of excess payment made to the retired teachers in form of higher pension may also be made as per rules and suitable orders may be passed accordingly at the time of release of pensions."
3.3. All Manipur Retired Lower Primary/Primary JB Schools Head Pandit/Head Master Association filed a writ petition being W.P. (C) No. 447 of 2007 praying for the release of arrear pension of its members which was disposed of on 29-08-2008 by the Hon''ble Gauhati High Court, Imphal Bench with the following direction:--
"Be that as it may, I am of the firm view that the government may recover the excess amount, if any drawn by any of them, in accordance with law and rules but on the ground of an investigation their arrear pension should not be withheld for a long period.
That being the situation, the respondents are directed to pay the arrear pension to the members of the petitioner association for the period from April, 2005 to December, 2006, calculating on the basis of the substantive pay of the teachers, within a period of 2 (two) months from the date of receipt of a copy of this order. The petitioner association is directed to furnish a copy of this order to the respondents at the earliest."
Being aggrieved by the said court''s order dated 29-08-2008, the State Respondents preferred a writ appeal being W.A. No. 5 of 2008 which was disposed of on 03-03-2009 modifying it to the extent that the respondents shall pay the arrear pension for the period from April, 2005 to January, 2006.
3.4. In a writ petition being W.P. (C) No. 954 of 2006 filed by an individual Head Pandit wherein the said letter dated 08-03-2006 was challenged, the learned Single Judge, Hon''ble Gauhati High Court, relying on the decision rendered by the Hon''ble Supreme Court in the case of Syed Abdul Qadir and Others Vs. State of Bihar and Others, , was pleased to pass an order dated 26-10-2009 quashing the offending portion of the said letter whereby recovery of excess payment had been ordered by the Commissioner (Finance), Government of Manipur.
3.5. The petitioners in W.P. (C) No. 209 of 2015, in two different groups of 50 and 30, approached the Hon''ble Gauhati High Court by way of two writ petitions being W.P. (C) No. 646 of 2011 and W.P. (C) No. 388 of 2012 praying for releasing the arrear pension entitled to by the petitioners for the period from April, 2005 to December, 2006. In view of the law laid down by the Apex Court in Syed Abdul Qadir v. State of Bihar (supra), the Hon''ble Gauhati High Court, Imphal Bench vide its order dated 09-05-2012 was pleased to dispose of the writ petition being W.P. (C) No. 646 of 2011, the operative portion of which is as under:--
"In view of the submission and counter submission made by the learned counsel appearing for both the parties, it is not necessary to keep the matter pending. In the facts and circumstances of the cases, I deem it fit to dispose of the writ petition by directing the State Respondents to release the pension arrears to the petitioners for the period commending from January, 2005 to December, 2006 within a period of 3 (three) months. It shall be open to the State Respondents to deny nor withhold such payments if there is any evidence to show that the excess payment was made due to misrepresentation or fraud committed by the petitioners. It is made clear that if the order of this Court is not complied with within the next 3 (three) months as directed above, the State respondents shall pay interest @ 9% per annum w.e.f. the date the salary pensions were withheld till the actual date of payment."
The other writ petition being W.P. (C) No. 388 of 2012 was disposed of by the Hon''ble Gauhati High Court vide its order dated 07-09-2012, the operative portion of which is as under:--
"It has been stated at the bar that the present writ petition is covered by the decision of this Court passed in W.P. (C) No. 646 of 2011 on 09-05-2012.
Accordingly, the present writ petition is also disposed of in terms of the direction of this Court passed W.P. (C) No. 646 of 2011 on 09-05-2012 and respondents are directed to calculate the entitlement of the petitioners in terms of the aforesaid direction in W.P. (C) No. 646 of 2011 on 09-05-2012."
3.6. However, according to the petitioners, the State Respondents did not implement the said orders and accordingly, the petitioners in W.P. (C) No. 61 of 2015, along with some others, filed a writ petition being W.P. (C) No. 455 of 2012 which was disposed of on 13-05-2013 with the following direction:--
"... in view of the above undisputed facts, respondents are directed to comply the direction of this Court dated 29-08-2008 in M.C. (W.P. (C)) No. 263 of 2008 (Ref:-- W.P. (C) No. 447 of 2007) read with order dated 03-03-2009 in W.A. 5 of 2009 for payment of arrear of pension as directed earlier as expeditiously as possible, preferably within a period of 4 (four) months."
3.7. Since the clear directions of the Hon''ble Gauhati High Court being not implemented or complied with by the State Respondents, a Contempt Petition being C.C. (C) No. 80 of 2012 was filed wherein 3 (three) months time was granted by the Hon''ble High Court for compliance of its orders. Since the State Respondents having failed to comply with it, the petitioners filed a second Contempt Petition being C.C. (C) No. 2 of 2014. According to the petitioners, perhaps on the apprehension of a contempt proceeding being initiated, the State respondents issued the impugned orders dated 28-11-2014, on the purported compliance of the court''s orders dated 09-05-2012 and 13-05-2013 passed by the Hon''ble High Court, wherein the State Government, while directing the respondent No. 4 for releasing the arrear pension, ordered that the payment should be made after recovering the excess amount. Being aggrieved by the impugned Government orders dated 28-11-2014, the present writ petitions have been filed by the petitioners for quashing them.
In order to contest the above writ petitions, the State respondents have not filed any affidavit-in-opposition for the reason best known to them. But two affidavits-in-opposition have been filed on behalf of the respondent No. 4, the Accountant General, Manipur- one in writ petition being W.P. (C) No. 61 of 2015 and another in W.P. (C) No. 325 of 2015 wherein it is stated that the respondent No. 4 had no alternative but to issue revised pension pay order in accordance with the Government orders dated 28-11-2014 and the All Manipur Retired LP/JB/Primary Head Pandit/Head Master Association had consented to the release of arrear pension/family pension for the period from April, 2005 to December, 2006 after making recovery, in instalment as per rules, of excess drawal as is evident from para 6 of the Government order dated 28-11-2014 and accordingly, in respect of a large number of retired teachers, similarly situated with the petitioners, arrears of pension/family pension have already been released by short payment in instalment basis being the recovery of excess amount drawn irregularly. It is further stated that payment of arrear pension as prayed for by the petitioner will amount to unequal treatment amongst the equals and as per the provisions of Rule 70-A of the Manipur Civil services (Pension) Rules, 1977, recovery of any overpayment of pay and allowance and pension benefits including arrear on account of any error or irregularity is permissible.
There is no much dispute or controversy as regards the facts of the present cases. Having come to the notice of the State Government that excess payment of pay and allowances, pension, family pension, gratuity and commutation of pension had been made in the non-existent pay scale for the posts of Head Pandit/Head Master of LP Schools, the State Government stopped payment of monthly pension/family pension with immediate effect by issuing messages pending investigation thereof and the letter dated 08-03-2006 was addressed to the Accountant General, Manipur with the instruction for recovery of excess and inadmissible amount drawn by the retired teachers/families of the deceased teachers of LP Schools. Although the petitioners in W.P. (C) No. 61 of 2015 have stated therein that they challenged the said letter dated 08-03-2006 by way of W.P. (C) No. 447 of 2007, it appears from the court''s order dated 29-08-2009 that the said letter dated 08-03-2006 was not challenged by any of the petitioners. However, various writ petitions have been filed by the petitioners, some of which are as shown above, praying for the release of arrear pension/family pension and prior to the filing of the said writ petitions, the Manipur Civil Services (Pension) Rules, 1977 had been amended and Rule 70-A which was inserted, provides that any overpayment of pay and allowances and pension benefits including arrears on account of error or irregularity, shall be recovered or adjusted in the instalments by short payment of pension or family pension. It further appears that the validity and correctness of the said amendment by which Rule 70-A was inserted, was not challenged by any of the petitioners. In the writ petition being W.P. (C) No. 447 of 2007, the learned Single Judge vide its order dated 29-08-2008, was of the view that the State Government might recover the excess amount, if drawn by any of the petitioners therein, in accordance with law. No writ appeal was preferred by the petitioner association against it but on a writ appeal being W.A. No. 5 of 2009 preferred by the State Government, the Hon''ble Gauhati High Court, Imphal Bench vide its order dated 03-03-2009 modified it to the extent that the respondents shall pay the arrear pension to the members of the petitioner association for the period from April, 2005 to January, 2006 calculating on the basis of substantive pay of the teachers. Few months later, the writ petition being W.P. (C) No. 954 of 2006 filed by one retired Head Pandit challenging the offending portion of the letter dated 08-03-2006, was allowed by the learned Single Judge, Hon''ble Gauhati High Court vide its order dated 26-10-2009 by relying upon the decision rendered by the Hon''ble Supreme Court in the case of Syed Abdul Qadir v. State of Bihar (supra) wherein the Hon''ble Supreme Court held that excess payment could not be recovered if the beneficiary had not attributed towards excess payment by way of misrepresentation or fraud. Similarly, in the writ petition being W.P. (C) No. 646 of 2011 filed by 50 petitioners, the learned Single Judge, Hon''ble Gauhati High Court vide its order dated 09-05-2012 and by relying upon the decision rendered by the Hon''ble Supreme Court in the case of Syed Abdul Qadir v. State of Bihar (supra), directed the State respondents to release the pension arrears to the petitioners for the period commencing from January, 2005 to December, 2006 within a period of three months, failing which interest @ 9% be paid thereon. The learned Single Judge made it very clear that it would be open to the State respondents to deny or withhold payment if there was any evidence to show that excess payment was made due to misrepresentation or fraud committed by the petitioners.
From the preceding para, it is clear that it is permissible for the State Government to recover excess payment in accordance with law, i.e., Rule 70-A of the Manipur Civil Services (Pension) Rules, 1977, in the present cases, the validity of which had not been challenged by any of the petitioners. Since the petitioners had not preferred a writ appeal against the order dated 29-08-2008 passed by the learned Single Judge in W.P. (C) No. 447 of 2007 nor had they challenged the validity and correctness of Rule 70-A of the Manipur Civil Services (Pension) Rules, 1977, it can be easily inferred that the State Government is competent in law or has the authority to recover the excess payment which had been made erroneously or irregularly in favour of the employees. But the only case of the petitioners, as submitted by Shri M. Hemchandra, Advocate and Shri H.S. Paonam, Senior Advocate appearing for the petitioners, is that since the overpayment has not been made on account of misrepresentation or fraud being committed by them or it cannot be attributed to them, no recovery of excess payment can be made in view of the law laid down by the Hon''ble Supreme Court in the case of Syed Abdul Qadir v. State of Bihar (supra). Moreover, the learned counsels appearing for the petitioners have relied upon the decision rendered by the Hon''ble Supreme Court in the case of State of Punjab Vs. Rafiq Masih, . Shri S. Suresh, leaned counsel appearing for the respondent No. 4 submitted that no law had been laid down by the Hon''ble Supreme Court in Syed Abdul Qadir v. State of Bihar case (supra) as submitted above and since the relief against the recovery was granted not because of any right in the employees but in equity, exercising discretion to relieve the employees from the hardship that will be caused if the recovery is ordered, it would not apply to the facts of the present cases. According to him, the law has been laid down in the case of Chandi Prasad Uniyal and Others Vs. State of Uttarakhand and Others, as is evident from the decision rendered by the Hon''ble Supreme Court in the case of State of Punjab Vs. Rafiq Masih (White Washer), . His submission has been supplemented by Shri S. Rupachandra, ASG by contending that the financial involvement is about 13 crore and in the event of recovery of excess amount being not allowed by this court, the financial burden of the State Government will be enhanced beyond its capacity.
The submission of the learned counsel appearing for the respondent No. 4 has some substance to the extent that no law has been laid down in the case of Syed Abdul Qadir v. State of Bihar (supra) by the Hon''ble Supreme Court as to the question whether the amount that has been paid in excess in favour of the employee, can be recovered or not. In the said case, the Hon''ble Supreme Court, relying upon the decisions rendered in Shyam Babu Verma and Others Vs. Union of India (UOI) and Others, and Sahib Ram Vs. State of Haryana and Others, , granted relief against recovery of excess payment in equity keeping in mind the peculiar facts and circumstances of that case so as to avoid any hardship to the appellants therein and held:
"57. 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 v. State of Haryana, Shyam Babu Verma v. Union of India, Union of India v. M. Bhaskar, V. Gangaram v. Director, Col. B.J. Akkara (Retd.) v. Govt. of India, Purshottam Lal Das v. State of Bihar, Punjab National Bank v. Manjeet Singh and Bihar SEB v. Bijay Bhadur.
Undoubtedly, the excess amount that has been paid to the appellant 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 appellant 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 appellant teachers, we are of the view that no recovery of the amount that has been paid in excess to the appellant teachers should be made."
In Chandi Prasad Uniyal case (supra), the Hon''ble Supreme Court considered a specific issue as to whether the appellant therein can retain the amount received on the basis of irregular/wrong pay fixation in the absence of any misrepresentation or fraud on his part. The Hon''ble Supreme Court, after taking into consideration its earlier decisions including that of Syed Abdul Qadir v. State of Bihar case (supra), came to the conclusion that even if by mistake of the employer, the amount was paid to the employee and on a later date if the employer after proper determination of the same discovered that the excess payment was made by mistake or negligence, the excess amount so made could be recovered and held:
"14. We are concerned with the excess payment of public money which is often described as "taxpayers'' money" which belongs neither to the officers who have effected overpayment nor to the recipients. We fail to see why the concept of fraud or misrepresentation is being brought in in such situations. The 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 the 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 the 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.
We are, therefore, of the considered view that except few instances pointed out in Syed Abdul Qadir case and in Col. B.J. Akkara case, the excess payment made due to wrong/irregular pay fixation can always be recovered.
The 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 that the excess payment made be recovered from the appellant''s salary in twelve equal monthly instalments starting from October 2012."
The difference of views expressed by the Hon''ble Supreme Court in Shyam Babu Verma v. Union of India and Sahib Ram v. State of Haryana cases (supra) on the one hand and in Chandi Prasad Uniyal case (supra) on the other hand was referred to a bench of three Judges in the case of State of Punjab & ors. v. Rafiq Masih & ors. (supra) and Rakesh Kumar v. State of Haryana & ors., reported in (2014) 8 SCC 892 for adjudication thereon and in the case of State of Punjab & ors. v. Rafiq Mashi & ors. (supra), the Hon''ble Supreme Court has admittedly observed about the law having been laid down in Chandi Prasad Uniyal case. However, the Hon''ble Supreme Court, while noticing that in the decisions of Shyam Babu Verma v. Union of India and Sahib Ram v. State of Haryana cases (supra), directions were issued in exercise of powers under Article 142 of the Constitution and in Chandi Prasad Uniyal case (supra), the Hon''ble Supreme Court, laying down the law, had dismissed the petition under Article 136 of the Constitution and after examining the powers of the Supreme Court under Article 136 and 142 of the Constitution of India, was of the opinion that the decisions based on different scales of Article 136 and 142 of the Constitution of India could be not best weighed on the same grounds of reasoning and that there was no conflict in the views expressed in the first two judgments and the later judgments and without answering the reference, the matters were sent back to the Division Bench for appropriate disposal.
All those matters which were sent back to the Division Bench for disposal as aforesaid, came to be decided by the Hon''ble Supreme Court in the case of State of Punjab Vs. Rafiq Masih, after considering the issue whether all the private respondents, against whom an order of recovery (of excess amount) has been made, should be exempted in law, from the reimbursement of the same to the employer. In order to lay down the parameters of fact situations, the Hon''ble Supreme Court examined a large number of judgments rendered earlier by it and after having examined them, the Hon''ble Supreme Court was of the view that the benefits against recovery could not extend to an employee merely because he was not an accessory to the mistake committed by the employer or merely because the employee did not furnish any factually incorrect information on the basis whereof the employer committed the mistake of paying excess amount or merely because the excessive payment was made to the employee in the absence of any fraud or misrepresentation at the behest of the employee. The Hon''ble Supreme Court further held that the orders passed by the employer seeking recovery of monetary benefits wrongly extended to the 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 and in other words, interference would be called for, only in such cases where it would be iniquitous to recover the payment made. After having examined the factual situations in respect of Syed Abdul Qadir v. State of Bihar, Shyam Babu Verma v. Union of India, Sahib Ram v. State of Haryana cases (supra) and B.J. Akkara v. Government of India case in the light of what had been held as shown above, the Hon''ble Supreme Court was of the opinion that such recovery of excess payment would be iniquitous and arbitrary and therefore would also breach the mandate contained in Article 14 of the Constitution. However, the Hon''ble Supreme Court was conscious of the fact that it would not be possible to postulate all situations of hardship which would govern employees on the issue of recovery, where payments had mistakenly been made by the employer, in excess of their entitlement and based on the decisions referred to above, the Hon''ble Supreme Court summarised few situations into four categories wherein recoveries by the employers would be impermissible in law.
From the perusal of the various decisions of the Hon''ble Supreme Court as stated above, it is seen that any amount paid to or received by an employee without the authority of law, can always be recovered from him except in cases of extreme hardships where it would be iniquitous and arbitrary when the recovery is sought to be made by the employer. Now, the question that arise for consideration is as to whether the present cases would fall within the four categories as summarized by the Hon''ble Supreme Court in the case of State of Punjab Vs. Rafiq Masih, . In the present cases, it is not in dispute that the petitioners who were working as Head Pandits/Head Masters of LP/JB Schools at the relevant time, had retired long back and therefore, this court is of the view that the petitioner''s cases would definitely fall under the category (ii), of the said fact situations, which has been summarised based on the case of Syed Abdul Qadir case (supra), in respect of which the Hon''ble Supreme Court has now observed that it would be justified to treat an order of recovery, on account of wrongful payment made to an employee, as arbitrary, if the recovery is sought to be made after the employee''s retirement, or within one year from the date of his retirement on superannuation. In other words, the issue involved herein is covered by the said recent decision of the Apex Court. The contention of Shri S. Rupachandra, ASG cannot be countenanced for the reason that the financial problem cannot be a ground to deny fundamental rights under Article 14 of the Constitution of India. The period for which the recovery of excess amount sought to be made appears to be from April, 2005 to December, 2006. However, in the order dated 03-03-2009 passed by the Hon''ble Gauhati High Court, Imphal Bench in W.A. No. 5 of 2009, the period for payment of arrear pension is shown to be from April, 2005 to January, 2006 whereas the learned Single Judge in its order dated 09-05-2012 passed in W.P. (C) No. 646 of 2011 has recorded the period commencing from January, 2005 to December, 2006. Therefore, it is not clear to this court as to what is the exact period for which the arrear pension/family pension is claimed to be released by the State Government. But this court may not go into that controversy in view of the fact that in the impugned Government orders dated 28-11-2014, it is specifically ordered that the Accountant General, Manipur shall issue revised pension pay order on the basis of the substantive pay to the petitioners with effect from April, 2005 to December, 2006.
It is submitted by Shri K. Jagat, learned Government Advocate that a writ Appeal being Misc. Case (W.A) No. 143 of 2009 preferred against the order dated 26-10-2009 passed by the learned Single Judge in W.P. (C) No. 954 of 2006, is pending for adjudication by this court. However, in view of the law having been settled by the Hon''ble Supreme Court in State of Punjab Vs. Rafiq Masih, , the issues involved herein can be decided and there is no need for this court to await the outcome of the said writ appeal pending for more than five years.
In view of the above observations and for the reasons stated hereinabove, the present writ petitions are allowed and accordingly, the portion in the last para of the Government orders dated 28-11-2014, impugned herein, by which the full recovery of the excess amount drawn irregularly has been ordered, is quashed and set aside with the direction that the respondents shall release the arrear pension/family pension to the petitioners for the period from April, 2005 to December, 2006 within a period of three months from the date of receipt of a copy of this judgment and order. There shall be no order as to costs.