# Ram Nakshtra Sharma v. State of U.P. and Ors

- **Citation:** (2013) 2 ILRA 1139
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2013-07-19
- **Case number:** Civil Misc. Writ Petition No. 38790 of 2013
- **Bench:** Sudhir Agarwal
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/ram-nakshtra-sharma-v-state-of-u-p-and-ors-42579
- **Pages:** 7

## Headnote

Constitution of India, Art. 226-Service Law-
Recovery of excess payment-pay scale
wrongly fixed Rs. 3200-4900 instead of
3050-4590-contention that petitioner being
no instrumental in getting wrong fixationnot entitled to refund-held-misconceived-in
view of recent case reported in 2012(3)
UPLBEC-2057 in C.P. Uniyal's Case-no such
principle of law-where excess payment
from
public
exchequer
can
not
be
recovered.

Held: Para-21
Every
single
penny
constituting
consolidated fund of India/State comes
from hard earned money of tax payers and
others. It has to be utilized strictly in the
manner in which the competent authority
i.e., the legislature has resolved and
decided. No amount of public exchequer
can be allowed to be squandered as a
matter of charity or otherwise to be
retained by a Government servant who is
not entitled to obtain such money but by
another Government Servant has been
allowed
to
withdraw
from
public
exchequer, may be, by his mistake or may
be collusive mistake or otherwise.

Case Law discussed:
1979 ALJ 1184; 1994(2) SCC 521; 1995
Suppl.(1) SCC 149; 1997(1) SC 353; 2002(3)
SCC
302;

2006(10)
SCALE
1999;
2006(1)UPLBEC 399; AIR 1993 SC 1903; AIR
2000 SC 2709; AIR 2000 SC 1557; (2006) 11
SCC 709; 2010(1) SCC 440; 1995 (Supp. (1)
SCC 18; 2012 (3) UPLBEC 2057; [(2009) 2
SCC 117]; [(2010) 14 SCC 323]; (2009) 3 SCC
475; Special No. 503 of 2008; 2004(1) ESC
(Allahabad) 455; AIR 1978 SC 78.

## Text

2 All] Ram Nakshtra Sharma Vs. State of U.P. and Ors.

1139

60. In the overall facts and
circumstances
of
the
case,
without
entering into the controversy of the
maintainability of the revision before the
court below, since I am of the opinion that
the plaintiff/respondent are entitle to
implead transferee pendente lite in the
instant case, I decline to exercise the
discretionary jurisdiction in the matter for
the above reason alone.

61. In view of the aforesaid facts and
circumstances, the writ petition fails and is
dismissed with no orders as to costs.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 19.07.2013

BEFORE
THE HON'BLE SUDHIR AGARWAL, J.

Civil Misc. Writ Petition No. 38790 of 2013

Ram Nakshtra Sharma
 ...Petitioner
Versus
State of U.P. and Ors.
 ...Respondents

Counsel for the Petitioner:
Sri Kshetresh Chandra Shukla, Sri Ratan
Kumar Singh
Counsel for the Respondents:
C.S.C.

Constitution of India, Art. 226-Service Law-
Recovery of excess payment-pay scale
wrongly fixed Rs. 3200-4900 instead of
3050-4590-contention that petitioner being
no instrumental in getting wrong fixationnot entitled to refund-held-misconceived-in
view of recent case reported in 2012(3)
UPLBEC-2057 in C.P. Uniyal's Case-no such
principle of law-where excess payment
from
public
exchequer
can
not
be
recovered.

Held: Para-21
Every
single
penny
constituting
consolidated fund of India/State comes
from hard earned money of tax payers and
others. It has to be utilized strictly in the
manner in which the competent authority
i.e., the legislature has resolved and
decided. No amount of public exchequer
can be allowed to be squandered as a
matter of charity or otherwise to be
retained by a Government servant who is
not entitled to obtain such money but by
another Government Servant has been
allowed
to
withdraw
from
public
exchequer, may be, by his mistake or may
be collusive mistake or otherwise.

Case Law discussed:
1979 ALJ 1184; 1994(2) SCC 521; 1995
Suppl.(1) SCC 149; 1997(1) SC 353; 2002(3)
SCC
302;

2006(10)
SCALE
1999;
2006(1)UPLBEC 399; AIR 1993 SC 1903; AIR
2000 SC 2709; AIR 2000 SC 1557; (2006) 11
SCC 709; 2010(1) SCC 440; 1995 (Supp. (1)
SCC 18; 2012 (3) UPLBEC 2057; [(2009) 2
SCC 117]; [(2010) 14 SCC 323]; (2009) 3 SCC
475; Special No. 503 of 2008; 2004(1) ESC
(Allahabad) 455; AIR 1978 SC 78.

(Delivered by Hon'ble Sudhir Agarwal, J.)

1. The writ petition is directed
against the order dated 30.05.2013 passed
by Director, Horticulture and Food
Processing, U.P., Lucknow pointing out
that petitioner's pay w.e.f. 01.01.1996 was
wrongly fixed in the same of Rs. 32004900 inasmuch as he was earlier in the
pay scale of Rs. 950-1500 for which
revised pay scale was Rs. 3050-4590,
w.e.f. 01.01.1996. The petitioner having
been given wrong pay scale and excess
salary, the same was liable to be
recovered and hence direction has been
issued to Deputy Director, Horticulture to
recover aforesaid amount.

2. It is contended that excess
payment cannot be recovered from
petitioner since there is no fraud or
misrepresentation on his part. He placed
reliance on a Division Bench decision of
1140 INDIAN LAW REPORTS ALLAHABAD SERIES [2013

this Court in B.N. Singh Vs. State of
U.P. and another 1979 ALJ 1184. The
other decisions are of Apex Court in
Shyam Babu Verma & Anr. Vs. Union
of India & Ors. 1994(2) SCC 521,
Gabriel Saver Fernandes & Ors. Vs.
State of Karnataka & Ors 1995
Suppl.(1) SCC 149, Mahmood Hasan
Vs. State of U.P. JT 1997(1) SC 353,
State of Karnataka & Anr. Vs.
Mangalore University Non-Teaching
Employees' Association & Ors. 2002(3)
SCC 302, Purushottam Lal Das & Ors.
Vs.
State
of
Bihar
&
Ors.
2006(10)SCALE 1999 and a Full Bench
judgment of this Court in Surya Deo
Mishra
Vs.
State
of
U.P.
2006(1)UPLBEC 399, besides some
other judgments of this Court largely
following above cited decisions. .

3. Some of the authorities cited by
learned counsel for the petitioner has been
considered by the Apex Court in cases
where a different view has been taken. I
first propose to refer all these decisions
which have come to my notice wherein a
view otherwise has been taken and
recovery of excess payment from the
concerned officials has been upheld since
they include a very recent one.

4. The first is State of Haryana and
others Vs. O.P. Shrama and others AIR
1993 SC 1903. There an ad hoc interim
relief was granted in 1972 by the
Government on slab basis pending fixation
of additional dearness allowance. No
formula with reference to cost of living was
adopted while granting ad hoc relief. When
the formula for grant of additional dearness
allowance of the cycle of increase by 8
points in the Consumer Price Index was
adopted by the State Government, it realised
that the ad-hoc interim relief was in excess
by Rs. 9.40 to Rs. 45 per month depending
on the pay-slab of a Government servant. It
then decided to adjust increase rather than
order lump sum recovery of the excess
amount, in subsequent emoluments, payable
to the employees, instead of recovering
entire amount. Such order was passed in
March 1974. The Court did not find order
bad, illegal, arbitrary, unreasonable or
unfair. It held that the Government has
rightly chosen to recover excess amount in a
phased manner.

5. In Union of India Vs. Smt. Sujatha
Vedachalam and another AIR 2000 SC
2709, an employee was working as Senior
Clerk (Accounts) in the pay scale of
Rs.1400-2600. On his personal request, he
was transferred from Nagpur to Bangalore.
One of the conditions of transfer was that the
employee shall technically resign from the
post held at Nagpur and join as Direct
Recruit on the post of Clerk at Bangalore. At
the time of transfer, basic pay drawn by the
employee at Nagpur in the cadre of Senior
Accountant, was Rs. 1260/-. When the
employee joined on the lower post of clerk,
by mistake, her salary was fixed at basic pay
of Rs.1250/- per month instead of Rs. 1070/-.
On detection of mistake, pay was refixed at
the stage of Rs. 1070/- by order dated
1.12.1995. The order(s) of recovery and
refixation were challenged before Central
Administrative Tribunal. Employee's claim
was
allowed
by
the
Tribunal
and
Government's Writ Petition was dismissed
by High Court. The Apex Court relying on
its earlier decision in Comptroller &
Auditor General of India Vs. Farid Sattar,
AIR 2000 SC 1557, set aside both the
judgments and upheld G.O. of refixation and
recovery, with the only indulgence that
excess pay may be recovered in easy
instalments. The Court herein upheld
recovery and permitted instalments.
2 All] Ram Nakshtra Sharma Vs. State of U.P. and Ors.

1141

6. Next is Col. (Retd.) B.J. Akkara
Vs. Government of India (2006) 11 SCC
709 wherein the law relating to recovery of
excess payment from employees was
considered. The Court held that cases
wherein excess payment has not been
allowed to be recovered from employees' are
not founded because of any right in the
employees but in equity and in exercise of
judicial discretion to relieve employees from
the hardship that may be caused, if recovery
is implemented. Such a discretion is
exercised by the Court and one of the reasons
therefore, has been, as that the employee was
receiving excess payment for a long period
and utilising the same, genuinely believing
that he is entitled to it, but where the
employee had knowledge that the payment
so received was in excess of what was due
and the error was detected within a short
period of wrong payment, Court would not
give relief against such recovery. It is said
that these matters lie in the realm of judicial
discretion of the Court.

7. Then comes Registrar Cooperative
Societies Vs. Israil Khan and others
2010(1) SCC 440 wherein recovery of
excess amount paid to employees of
cooperative society was challenged relying
on Apex Court's decision in Sahib Ram Vs.
State of Haryana 1995 Supp.(1) SCC 18
and Shyam Babu Verma Vs. Union of
India (Supra). A two Judges Bench of Apex
Court,
consisting
of
Hon'ble
R.V.
Raveendran and Hon'ble P. Sathasivam said
in para 6 of the judgment that there is no
principle that any excess payment to an
employee should not be recovered back by
the employer. The Court observed that in
certain cases merely a judicial discretion has
been exercised by Apex Court to refuse
recovery of excess wrong payments of
emoluments/allowances from employees on
the ground of hardship where the following
conditions were fulfilled:

(a) The excess payment was not
made on account of any misrepresentation
or fraud on the part of employee; and

(b) 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.

8. Now very recently, the Apex
Court in Chandi Prasad Uniyal and
others vs. State of Uttarakhand and
others, 2012(3) UPLBEC 2057 has said
that there is no such principle of law that
wrong payment made to an employee can
be recovered only in those cases where he
is guilty of fraud and misrepresentation,
and not otherwise. The Court has
distinguished all its earlier decisions in
Shyam Babu Verma Vs. Union of India
(Supra), Sahib Ram v. State of
Haryana (Supra), State of Bihar v.
Pandey Jagdishwar Prasad [(2009) 2
SCC 117] and Yogeshwar Prasad and
Ors v. National Institute of Education
Planning and Administration and Ors.
[(2010) 14 SCC 323]. In paragraphs 9,
15, 16 and 18 of the judgment the Court
has said:

"9. We are of the considered view,
after going through various judgements
cited at the bar,hat 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."
1142 INDIAN LAW REPORTS ALLAHABAD SERIES [2013

"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 situation. 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 of
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."

"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
appellant's salary in twelve equal monthly
instalments starting form October 2012.
The appeal stands dismissed with no order
as to costs. IA nos. 2 and 3 are disposed
of."

9. The Apex Court further held that
decision
in
Shyam
Babu
Verma
(Supra),
Sahib
Ram
(Supra),
Yogeshwar Prasad (Supra), etc. are all
decided on their own facts and do not lay
down any principle of law, restraining
recovery of excess payment of salary from
the concerned employee. On the contrary, in
para 17 of the judgment the Court said that
except few instances pointed out in Syed
Abdul Qadir and others vs. State of Bihar
and others (2009) 3 SCC 475) and in Col.
B.J. Akkara (Supra), excess payment due
to wrong/irregular pay fixation can always be
recovered.

10. There is a Division Bench
jujdgment of this Court also in State of
U.P. & others Vs. Vindeshwari Prasad
Singh (Special Appeal No.503 of 2008),
decided on 28th July, 2009. The Court
formulated two questions, as under:
2 All] Ram Nakshtra Sharma Vs. State of U.P. and Ors.

1143

"(i) Whether any financial benefit
given to an employee by mistake without
any misrepresentation or fraud on his part
can be recovered from him later on after
his superannuation from service?

(ii) Whether before directing for
recovery of the amount paid in excess, the
employee concerned is required to be
given notice and opportunity of hearing?"

11. Having said so, the Court said:

"Having given my most anxious
consideration, neither on first principle
nor precedent, I am prepared to accept the
broad submission that excess amount paid
to an employee by mistake cannot be
recovered after his superannuation only
on the ground that while obtaining
monetary benefit, it has not made false
representation or played fraud."

12. Further, the Court referred to
Section 72 of Indian Contract Act and
thereafter said:

"From a plain reading of the aforesaid
provision it is evident that a person to whom
money has been paid by mistake is obliged to
return the same. In my opinion an employee
not entitled to receive monetary benefit gets it,
it becomes a case of unjust enrichment and
restitution in case of unjust enrichment is an
accepted principle for ensuring justice in
appropriate cases. In my opinion in a case of
mistake clear, plain and simple, excess
amount paid to and employee can be
recovered after retirement despite the fact that
he had not made any misrepresentation or
played fraud. There is no legal impediment in
ordering for recovery from a retired employee
such monetary benefits, which he had
received on account of mistake and not
entitled to such benefits. However, I would
hasten to add that a mistake, pure and simple
though justifies recovery of excess amount
paid but in a case in which two interpretations
are possible and one was consciously
approved and benefit given to an employee by
the competent authority but such decision in
the ultimate analysis and long process of
reasoning, later on is found incorrect, it may
be possible to correct the same at a latter stage
but the amount already paid in the light of the
earlier decision is not fit to be recovered. In
other wards, excess payment is made upon
reasonably possible view taken by competent
authority without fraud or misrepresentation,
the excess payment cannot be recovered.
Excess payment is possible to be made by the
order of the employer. It is also possible by
interim or final order of the Court, which
ultimately is found to be erroneous. In case of
former, a recovery is permissible under the
condition enumerated above. However, in
latter case, it depends upon the facts and
circumstances of each case and it is primarily
within the discretion of the Court." (emphasis
added)

13. On the second question, however,
the Division Bench said that an opportunity
before making recovery is must. The Court
also relied upon an earlier Division Bench
Judgement in Union of India Vs. Rakesh
Chandra Sharma and others 2004 (1)
ESC (Allahabad) 455, observing that there
is no law of universal application, restraining
the employer from recovering the extra
amount paid to an employee beyond
entitlement. The Court also observed that
rectification
of
mistake
is
not
only
permissible
but
desirable
otherwise
system/requirement of auditing of accounts
would be rendered nugatory.

14. These authorities clearly show
that there is no right of petitioner in law
or
otherwise
that
admitted
excess
1144 INDIAN LAW REPORTS ALLAHABAD SERIES [2013

payment
wrongly
made
cannot
be
recovered. As a matter of right, petitioner
cannot contend that though he had been
paid certain amount wrongly in excess to
what was due to him, yet it cannot be
recovered by the administration.

15. In the present case it is not the
contention and neither there is any pleading
nor actually argued that before passing
impugned order no opportunity was afforded
to petitioner. There is no challenge to the
impugned order on the ground that it is in
violation of principle of natural justice. The
only argument advanced is that since
petitioner himself is not guilty of any fraud
or misrepresentation in fixation of his pay in
a higher pay scale as a result thereof having
been paid extra amount or excess salary over
and above to which he was entitled,
therefore, the excess amount paid to him
cannot be recovered.

16. The above argument also presupposes an admission on the part of
petitioner that he was not entitled to pay
scale of Rs. 3200-4900. It is not the case
that petitioner was not aware or would not
have been aware as to what would have
been the correct pay scale which he would
have been entitled to, but he continued to
receive salary. If the fixation has been
made in a lower pay scale, it has always
been seen that employee concerned
immediately raises a protest that he is
being paid wrong amount or lesser
amount but when an employee receive
more than the amount to which he was
entitled, he does not inform the authorities
concerned or bring this fact to their
notice. It shows a tacit acquiescence on
the part of petitioner in the wrong
committed by administration to which he
was the beneficiary and became part and
parcel to the administration in this regard.

17. There is one more aspect to
which this Court would like to consider
this matter.

18. The excess money received by
petitioner is not anybody's private money
but it has come from the coffer of public
exchequer.
It
is
a
public
money
contributed by tax payers and hard earned
money of public at large. If an excess
money is allowed to be retained by a
person who is not authorised, that would
result in denying user and consumption of
that money other than the purpose for
which it is meant.

19. Administration, whether in
executive or judiciary, holds public funds in
trust and with responsibility of spending it
strictly in the manner they are required to do
so and not to enrich anyone or waste money
by its unmindful, unauthorised and illegal
acts. If any such thing has happened even if
unknowingly
and
indeliberately,
the
administration is legally, morally and by any
standard of civilised society, is bound to
restore back such wasteful expenditure to the
public exchequer so that it may thereafter be
utilised in the manner and for the purpose, so
prescribed. Any attempt on the part of
administration to allow an employee to retain
certain money, which the Administration has
wrongly paid to him, though the employee
was not entitled to the same, or, any act on
the part of administration, in not realising the
said amount from the employee, is liable to
be treated as breach of trust. Such decision
would amount to not only waste of public
money but also an attempt to perpetuate an
illegal act. It is not a private property to
which one can show any attitude of charity
and so called broad heart and magnanimity.
This would be against any principle of
administrative law. Simultaneously, an
employee if retains something which he did
2 All] Shri Jamil Ahmad Vs. State of U.P. and Ors.

1145
not owe, he being also equally responsible to
the public and public fund holding an office
of trust, is bound to return/refund it.

20. In P.K. Chinnaswamy Vs.
Government of Tamilnadu and others
AIR 1978 SC 78, the Apex Court said that
every public officer is a trustee and in respect
of the office he holds and the salary and other
benefits which he draws, he is obliged to
render appropriate service to the State.
Conversely, it would also be true that a
Government official would be entitled to
payment of only that amount, which he is
entitled towards salary etc. under the relevant
provisions, applicable to him, in the context
of his status, position, rank , etc. If he has
received or paid even by mistake, certain
amount to which he was not entitled, it
would amount to excess drawl of money
unauthorisedly from public exchequer to
which every Government official is a trustee
and,
therefore,
whether
mistaken
or
otherwise, no one is entitled to retain such
unauthorised money belonging to public
exchequer but, is under a legal and ethical
obligation to return/refund the same, so that,
it may be utilized for the purpose, it is made
and decided by the competent authorities in
budgetary allocation.

21. Every single penny constituting
consolidated fund of India/State comes from
hard earned money of tax payers and others.
It has to be utilized strictly in the manner in
which the competent authority i.e., the
legislature has resolved and decided. No
amount of public exchequer can be allowed
to be squandered as a matter of charity or
otherwise to be retained by a Government
servant who is not entitled to obtain such
money but by another Government Servant
has been allowed to withdraw from public
exchequer, may be, by his mistake or may be
collusive mistake or otherwise.

22. This Court also tried to find out as
to from which budgetary allocation excess
money was paid to the employee and to which
it can be adjusted. Since the allocated money
is already identified and beyond that nothing
could have been paid by anybody, no
authority can be allowed to retain any amount
which he has received unauthorisedly or on
account of mistake of administration. It shall
also amount to financial indiscipline and
misuse of public fund. In the context of above
decisions, we are clearly of the view that
various
authorities
cited
by
the
representationists concerned would not help
them to claim that excess amount paid should
not be recovered from them.

23. In view of above and the
authorities of Apex Court, as discussed
above, the judgments cited at the Bar by
petitioner in support of his contention, in
my view, would not help him and I am
bound by the authorities of Apex Court
which have come up in the recent past and
have considered most of the judgments
cited at Bar by petitioner.

24. In view of above, I do not find
any reason to interfere. The writ petition
lacks merit. Dismissed.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 26.07.2013

BEFORE
THE HON'BLE TARUN AGARWALA, J.

Civil Misc. Writ Petition No.40376 of 2013

Shri Jamil Ahmad

 ...Petitioner
Versus
State of U.P. and Ors.
 ...Respondents

Counsel for the Petitioner:
Sri S.K. Dwivedi