In a significant ruling, the Allahabad High Court, Lucknow Bench, upheld the recovery of excess payments made under the Modified Assured Career Progression Scheme (MACPS) from several retired employees of the Ministry of Information and Broadcasting. The Division Bench comprising Justice Rajan Roy and Justice Om Prakash Shukla ruled that the pensioners were pre-informed about possible recovery in the event of overpayments, nullifying any claims against the recovery process.
Background of the Case
The case revolved around employees of the Ministry of Information and Broadcasting who had received financial benefits under the MACPS despite having already availed three promotions under the earlier Assured Career Progression Scheme (ACPS). The audit raised objections to these payments, declaring them erroneous. Upon discovery, the Ministry initiated recovery proceedings, leading to deductions from the employees’ post-retirement dues.
Multiple writ petitions were filed challenging the recovery, with Writ-A No. 6056 of 2024 treated as the lead case. The petitioners in this case included the Union of India, represented by Deputy Solicitor General S.B. Pandey, and counsels Ashwani Kumar Singh and Varun Pandey. The private respondents—retired employees including Arun Prakash Srivastava, Harish Chandra, and Anil Kumar Arora—were represented by advocate Savita Jain.
Legal Issues Involved
The core issues before the court included:
1. Legitimacy of Recovery Post-Retirement: The employees argued that recovery from their retirement benefits violated the principle of non-recovery outlined in earlier judgments, such as Rafiq Masih vs. State of Punjab (2015), where the Supreme Court held that recovery from retired employees or those nearing retirement is impermissible.
2. Undertaking by Employees: The government, however, argued that the payments were made subject to audit verification. In fact, a clause in the payment orders stipulated that any excess amount detected through audit would be recoverable.
3. Effect of the Jagdev Singh Judgment: The government relied on the Supreme Court’s judgment in Jagdev Singh (2016), which allowed recovery when an employee had been notified in advance about potential overpayments and had agreed to such recovery by undertaking.
Observations and Ruling of the Court
The court, in its detailed judgment, agreed with the government’s position. The judges emphasized that the employees had been aware of the audit objections and, in some cases, even requested the authorities to finalize their pension after accounting for these objections.
The court quoted, “The respondents had notice of the fact that any excess payment made would be liable to be recovered or refunded.” It further clarified that the principle laid down in Rafiq Masih does not apply here, as the employees were already bound by the undertakings and conditions mentioned in the original orders.
In one instance, involving Anil Kumar Arora (Writ-A No. 7231 of 2024), the court noted that even though the pay refixation occurred after his retirement, the recovery was valid because the conditions for recovery were communicated prior to his superannuation.
Quashing of Tribunal’s Decision
The employees had previously approached the Central Administrative Tribunal (CAT), which ruled in their favor by directing the Ministry to refund the recovered amounts. However, the High Court set aside the Tribunal’s decision, stating, “The Tribunal ignored the factual matrix and the binding precedent set in the Jagdev Singh judgment.”
Court’s Final Decision
The court dismissed all writ petitions filed by the employees and upheld the government’s recovery actions. It observed, “The excess payment had already been recovered prior to the filing of the Original Applications, and the same cannot be refunded.”
With this ruling, the Allahabad High Court has reaffirmed that recoveries from employees are permissible when due notification and undertakings are in place, even in cases involving post-retirement recoveries.
