State of H.P. & others vs Sh. Sita Ram & another

Facts in issue, succinctly stand extracted by the learned Single Judge, in the following words:

"Petitioner No.1 was engaged on daily wage basis on 1.1.1989 and petitioner No.2 was engaged on 1.1.1990. Though the petitioners had completed more than ten years service but were not regularized as per law laid down by Hon''ble Supreme Court in Mool Raj Upadhyay''s case. They approached this Court by way of CWP No. 5459/2011. It was disposed of on 19.7.2011. In sequel to the directions issued by this Court, petitioners were conferred with work charge status with effect from 1.1.1999 and 1.1.2000, respectively and they were regularized on 15.1.2003 and 16.1.2003. Fact of the matter is that petitioner No.1 had completed ten years on 31.12.1998 and petitioner No.2 on 31.12.1999. Petitioners were also paid arrears amounting to Rs.2,37,351 and Rs. 1,75,394/-, respectively. Petitioners have now been served with a recovery notice dated 13.8.2013. It is specifically averred in reply that decision has been taken to effect recovery of arrears from the petitioners on the basis of letters dated 1.3.2013 and 8.3.2013, respectively."

It is not in dispute that arrears amounting to Rs.2,37,351 and Rs.1,75,394/-, respectively stood disbursed to the petitioners (respondents herein).

Status of the employees is not in dispute. The only issue which requires consideration is as to whether the amount so disbursed in excess could have been recovered from the employees or not. Finding the amount paid in excess, not to be as a result of any misrepresentation or fraud on the part of the employees, by relying upon the decision rendered by the apex Court in State of Punjab & others etc. vs. Rafiq Masih (White Washer) etc., AIR 2015 SC 696, learned Single Judge quashed the impugned notice of recovery.

While assailing the findings, our attention is invited to a subsequent decision rendered by the apex Court in High Court of Punjab & Haryana & others vs. Jagdev Singh, AIR 2016 SC 3523.

Having considered rival contentions, we do not find any reason to interfere with the impugned judgment. It cannot be disputed that the State which, otherwise is duty bound to do so, did not take appropriate action of conferring the status of work charge employees. The employees were forced to litigate and only when this Court interfered, respondents-department (appellants herein) released the monetary benefits. It is also not in dispute that at no point of time, employees indicated the amount due and payable by the State. In fact, there is neither any representation, much less misrepresentation nor any fraud exercised by the employees. They were not even aware of payment of any excess amount till such time it was sought to be recovered with the issuance of notice (Annexure P-3). The recovery was sought to be effected on the basis of administrative instructions as also decision rendered by the apex Court in Jai Dev Gupta vs. State of Himachal Pradesh & another, AIR 1998 SC 2819, restricting the release of arrears only for a period of three years. But then subsequently the said decision stands clarified and the directions modified.

Also the apex Court in Jagdev Singh (Supra), after considering the ratio of law laid down in Rafiq Masih (Supra) itself clarified that recovery of amount so disbursed in excess could be effected only where at the first instance, at the time of release of payment, it already stands clarified or brought to the notice of the employee that any payment found to have been made in excess would be required to be refunded.

In the instant case recovery is sought to be effected from the employees who can be categorized in Class-IV services. Also this Court is of the view that recovery, if made from the employees, would be iniquitous, harsh and arbitrary to such an extent that it would far overweigh the equitable balance of the employer''s right to recover. This we say so in view of the facts stated herein above.

Also, before us, it is fairly stated that the employees were never put to notice of the factum of disbursement of amount, in excess of their entitlement. Hence, for all the aforesaid reasons, present apeal, devoid of any merit is dismissed. Pending application(s), if any, also stand disposed of accordingly.