Extremely Arbitrary To Seek Refund of Payments Mistakenly Made to Employee For Period In Excess of 5 Years: Delhi HC Grants Relief To Professor’s Widow
The Delhi High Court allowed a writ petition filed by the wife of a late College Professor and reiterated that if the payment is made for a period in excess of 5 years, even though it would be open to the employer to correct the mistake, it would be extremely iniquitous and arbitrary to seek a refund of payments mistakenly made to the employee.
The Writ Petition before the High Court was preferred on behalf of the Petitioner under Article 226 of the Constitution for a direction to the Respondents to release an amount of Rs 9 lakh withheld by Respondent No. 4/Shri Guru Teg Bahadur Khalsa (Evening) College (later re-named as Shri Guru Nanak Dev Khalsa College) from the leave encashment due to Petitioner’s husband.
The Single-Judge Bench of Justice Jyoti Singh said, “While on one hand, Petitioner is struggling to cope up with the mental trauma of having lost her husband and the younger son in a short span of one month in 2021, on the other hand, she is being made to run from pillar to post to seek release of leave encashment payable to her husband.”
Advocate Neha Rathi represented the Petitioner while Advocate Garima Sachdeva represented the Respondent.
The petitioner’s husband, in this case, joined the Department of Mathematics in the College in the academic year 2005-2006, when it gained the status of a full-fledged day College. Petitioner’s husband passed away in the year 2021 due to COVID-19 infection and in the same month, she also lost her son being infected by the same virus. The petitioner was also exposed to COVID-19 infection in May/June, 2020 and was hospitalised but she recovered later. The Petitioner made a representation to the Principal to release the retirement benefits of her husband and furnished all requisite documents in this regard. This was followed by several reminders but no payment was made till July, 2021 when only the provident fund dues were released.
The College took a stand that it did not have the funds to release the gratuity and leave encashment. The Petitioner was also informed that a sum of Rs.9 lakh was to be recovered from the leave encashment payable to Petitioner’s husband as per the University’s communication since this money was an excess payment received by him from 2001 onward. The Petitioner represented once again to waive the recovery and filed RTI applications from time to time seeking information of the status of her case from the Ministry of Finance and the University. She received a letter from DoE stating that no letter had been received by them for exemption of recovery of excess amount in respect of her husband. Thereafter, Petitioner sent several letters but only to be told that the request of the College for waiver was still under consideration, compelling her to approach the High Court.
It was the case of the Petitioner that the amount outstanding towards gratuity had been paid to the Petitioner and the only surviving dispute was with respect to refund of Rs 9 lakh withheld by the College from leave encashment payable to Petitioner’s husband.
On a perusal of the facts of the case, the Bench held, “While on one hand, Petitioner is struggling to cope up with the mental trauma of having lost her husband and the younger son in a short span of one month in 2021, on the other hand, she is being made to run from pillar to post to seek release of leave encashment payable to her husband.”
From the chronology of the case, it was also clear that no decision had been taken till date on the proposal sent by the College for waiver of recovery of Rs 9 lakh and as a result, leave encashment was withheld from May 9, 2021, when the husband of the Petitioner expired.
In the counter affidavit filed by the College, it was stated that cases of fixation of pay of all the teaching faculty by 7th CPC were sent to the University in June, 2018. Approval for fixation of pay for all teachers was received, save and except, 13 teachers and the name of the Petitioner’s deceased husband was included in the list of 13.It was further stated that proforma for re-fixation of his pay was sent to the University and the University approved revised pay fixation with a direction to rectify the service book with recovery of overpayment, if any.
“It is thus evident that benefit of stepping up was given to Sh. R.K. Gupta w.e.f. 19.05.2001 and it was only on 16.08.2021 that approval was given for re-fixation. This action is not only belated but post the death of the Petitioner’s husband and few months short of his superannuation. Naturally, Petitioner’s husband could not contest this approval and the consequences that his leave encashment has been withheld and recovery is sought to be made for payments made in excess of 05 years”, the Bench said.
It further held, “Therefore, if the mistake of making a wrongful payment is detected within 05 years, employer will be entitled to recover the same, however, if the payment is made for a period in excess of 05 years, even though it would be open to the employer to correct the mistake, it would be extremely iniquitous and arbitrary to seek a refund of payments mistakenly made to the employee.”
Reliance was placed upon the judgment of the Apex Court in State of Punjab and Others v. Rafiq Masih (White Washer) and Others, (2015) wherein it has been observed that if the mistake of making a wrongful payment is detected within 5 years, the employer will be entitled to recover the same, however, if the payment is made for a period in excess of 5 years, even though it would be open to the employer to correct the mistake, it would be extremely iniquitous and arbitrary to seek a refund of payments mistakenly made to the employee.
It was also noticed that the College and University had consistently sent a proposal in favour of the Petitioner for waiver of the recovery and rightly so. “The recovery on account of alleged excess payment to Petitioner’s husband due to stepping up of his pay is legally impermissible as it is in excess of 05 years from the date of approval for recovery and is also iniquitous and harsh in the present case, given the aforementioned circumstances”, the Bench clarified.
Thus, allowing the writ petition, the Bench held that the recovery of Rs 9 lakh was impermissible in law. The Bench also directed the College to release the leave encashment dues to the Petitioner within a period of 6 weeks along with interest.
Cause Title: Smt. Draupati Devi v. Union of India and Ors (2024:DHC:9452)
Appearance:
Petitioner: Advocates Neha Rathi, Kamal Kishore & Kajal Giri
Respondents: Senior Panel Counsel Garima Sachdeva, Govt. Pleader Archana Surve, Advocates Divyanshi Maurya, Aishwarya Malhotra, Hardik Rupal, Advocate Mohinder J.S. Rupal
