Case Note & Summary
The petitioner, Kalpana Chandrakant Gorhe, was appointed as an Auxiliary Midwife Nurse on 2 November 1992 with the Aurangabad Municipal Corporation and served continuously until her superannuation on 31 May 2023. Under the service rules, employees were entitled to upgradation/higher pay scale upon completion of seven years of continuous service. The petitioner was granted upgradation with effect from 4 January 1999 by an order dated 26 April 2001, and no objection was raised at that time. After her retirement, the respondent no.2 passed an order dated 10 May 2024 revising the upgradation retrospectively and ordering recovery of alleged excess payment. Consequently, respondent no.3 passed an order dated 6 September 2024 directing recovery of Rs.4,98,368/-. The petitioner challenged these orders by way of a writ petition under Article 226 of the Constitution of India, seeking quashing of the orders, refund of the recovered amount, and issuance of a revised pension payment order reckoning her correct pay scale of Rs.57,500/- instead of Rs.55,800/-. The court held that the impugned orders are unsustainable as they were passed without giving the petitioner an opportunity of hearing, in violation of principles of natural justice. Further, the recovery of excess payment from a retired employee is impermissible when the payment was made due to the employer's mistake and the employee retired on the basis of that pay. The court quashed the impugned orders and directed the respondents to refund the amount already recovered within eight weeks and to issue a revised pension payment order reckoning the petitioner's correct pay scale of Rs.57,500/-.
Headnote
A) Service Law - Recovery of Excess Payment - Recovery from Retired Employee - The court considered whether recovery of alleged excess payment from a retired employee is permissible when the payment was made due to employer's mistake and the employee retired on the basis of that pay - Held that recovery is impermissible as the petitioner had retired and the payment was not due to any misrepresentation by her (Paras 1-10). B) Service Law - Natural Justice - Revision of Upgradation - The court examined whether the respondent could revise the upgradation granted to the petitioner after 22 years without giving her an opportunity of hearing - Held that the impugned orders are violative of principles of natural justice as no show cause notice was issued (Paras 1-10). C) Service Law - Pensionary Benefits - Reduction of Pension - The court considered whether pensionary benefits can be reduced after retirement without following due process - Held that pension is a right and cannot be reduced unilaterally (Paras 1-10).
Issue of Consideration
Whether the impugned orders dated 10.05.2024 and 06.09.2024 revising upgradation and ordering recovery of Rs.4,98,368/- from the petitioner are legal and sustainable
Final Decision
The impugned orders dated 10.05.2024 and 06.09.2024 are quashed and set aside. The respondents are directed to refund the amount already recovered from the petitioner within eight weeks and to issue a revised pension payment order reckoning the petitioner's correct pay scale of Rs.57,500/- instead of Rs.55,800/-.
Law Points
- Recovery of excess payment from retired employees is impermissible if payment was made due to employer's mistake and employee retired on the basis of that pay
- Pensionary benefits cannot be reduced without affording opportunity of hearing
- Upgradation granted under service rules cannot be unilaterally revised after retirement
