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Maharashtra State Power Generation Company Limited, through its Asst. General Manager (HR), Chandrapur Thermal Power Station, Chandrapur v/s Prabhakar


Company & Directors' Information:- MAHARASHTRA STATE POWER GENERATION COMPANY LIMITED [Active] CIN = U40100MH2005SGC153648

Company & Directors' Information:- S L S POWER CORPORATION LIMITED [Active] CIN = U40109AP2005PLC047008

Company & Directors' Information:- GENERAL POWER COMPANY PRIVATE LIMITED [Active] CIN = U40108DL2002PTC115834

Company & Directors' Information:- N M S POWER PRIVATE LIMITED [Active] CIN = U51109WB1999PTC089747

Company & Directors' Information:- P. R. POWER GENERATION COMPANY PRIVATE LIMITED [Strike Off] CIN = U40300MH2012PTC237443

Company & Directors' Information:- S V G POWER PRIVATE LIMITED [Active] CIN = U40300AP2012PTC084435

Company & Directors' Information:- INDIA THERMAL POWER LIMITED [Active] CIN = U04010MH1993PLC171444

Company & Directors' Information:- MAHARASHTRA POWER COMPANY PRIVATE LIMITED [Strike Off] CIN = U40101PN2000PTC014584

Company & Directors' Information:- V. D. POWER GENERATION INDIA PRIVATE LIMITED [Active] CIN = U40106MP2019PTC048249

Company & Directors' Information:- S AND S POWER PRIVATE LIMITED [Active] CIN = U40109PY2004PTC001824

Company & Directors' Information:- V Z POWER GENERATION COMPANY PRIVATE LIMITED [Strike Off] CIN = U40100GJ2004PTC044903

Company & Directors' Information:- S & O POWER PRIVATE LIMITED [Active] CIN = U40107MH2010PTC206447

Company & Directors' Information:- J R J POWER PRIVATE LIMITED [Active] CIN = U40300GJ2015PTC082396

    Writ Petition No. 6642 of 2019

    Decided On, 27 October 2020

    At, In the High Court of Bombay at Nagpur

    By, THE HONOURABLE MR. JUSTICE MANISH PITALE

    For the Petitioner: A.M. Ghare, Advocate. For the Respondent: S.S. Ghate, Advocate.



Judgment Text

1. Heard finally with the consent of learned counsel appearing for the rival parties.2. By this writ petition, the employer has approached this Court challenging an order passed by the Industrial Court, whereby a Complaint filed by the respondent – employee has been allowed and the employer has been restrained from recovering certain excess payments made to the respondent.3. The respondent, being a project affected person whose land was acquired by the petitioner power generation company for a project, was given employment in the year 1985 with the petitioner. In due course of time, upon clearing the requisite examination, the respondent was recruited on the post of Lower Division Clerk in the year 1993. The petitioner – Company issued an office order dated 02/05/2003, granting deemed date for increment payable to the respondent and another employee, with a stipulation that they would not claim any change in seniority. The pay was fixed in the case of respondent from 19/09/1985. Accordingly, from the date of this order, the respondent started receiving higher amount towards salary.4. On 18/01/2006, the petitioner – Company issued another office order, thereby staying the said earlier office order dated 02/05/2003 with retrospective effect in the case of the respondent and the other employee. It was further stipulated in the said order that the excess payments made to the respondent under the office order dated 02/05/2003, shall be recoverable in 10 equal monthly installments from the salary of the respondent from February, 2006.5. Aggrieved by the aforesaid action of the petitioner – Company, the respondent filed a complaint bearing Complaint (ULP) No. 12/2006, before the Industrial Court, Maharashtra, (Chandrapur Bench). The respondent challenged the subsequent office order dated 18/01/2006 and claimed that the petitioner – Company had indulged in unfair labour practices as stipulated under Items 5 and 9 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971. The petitioner – Company opposed the reliefs claimed by the respondent in the aforesaid Complaint.6. By judgment and order dated 09/04/2007, the Industrial Court partly allowed the Complaint of the respondent but dismissed the claim of the respondent regarding fixation of his pay as Lower Division Clerk from the date of his joining i.e. 26/03/1985. The Industrial Court held that the petitioner – Company was not entitled to recover the excess payments made to the respondent and accordingly, restrained the respondent from making such recovery.7. Aggrieved by the said judgment and order of the Industrial Court, only partly allowing the Complaint, the respondent filed Writ Petition No. 2010/2007, before this Court. The respondent claimed that the petitioner – Company was not entitled to issue the subsequent office order dated 18/01/2006 and that he was entitled to fixation of pay as Lower Division Clerk from the date of his joining service i.e. 26/03/1985. In this Writ Petition, on 11/03/2008, this Court granted Rule and confirmed an order of status quo granted on 03/05/2007. As a consequence, the petitioner – Company continued to pay the enhanced amount to the respondent.8. On 30/07/2015, the Writ Petition was finally heard and it was dismissed. This Court held that the respondent was inadvertently given some benefits and when it was found that he did not fulfill the eligibility criteria, that benefit was withdrawn, which could not be said to be change in service conditions of the respondent, necessitating any prior notice.9. Thereafter, despite dismissal of the Writ Petition on 30/07/2015, the petitioner – Company continued to pay the enhanced amount to the respondent. It was after more than three years, on 03/11/2018, that the petitioner – Company for the first time, issued an order directing that since the Writ Petition had been dismissed, the excess payments being paid to the respondent would be recovered. It was stated that the respondent would receive only 1/4th amount of salary and if further recovery remained, it would be deducted from the terminal benefits of the respondent. This was reiterated in the communications dated 19/11/2018 and 27/11/2018, issued by the petitioner – Company.10. The respondent again approached the Industrial Court by filing Complaint bearing Complaint (ULP) No. 69/2018, under the provisions of the aforesaid Act, claiming that the action of the petitioner – Company in seeking to make huge deductions from his salary and terminal benefits, when he was on the verge of retirement, amounted to unfair labour practice. The respondent also brought on record the fact that he was suffering from health ailments, that his son was handicapped, whose education would be adversely affected if the recovery was permitted and further that his wife was also suffering from various health problems. On this basis, the respondent sought quashing of the said orders / communications sent by the petitioner – Company in November, 2018. The respondent also filed an application for grant of interim relief in the said Complaint.11. The petitioner – Company filed its reply opposing grant of reliefs to the respondent. It was claimed that when the Writ Petition filed by the respondent was dismissed by this Court on 30/07/2015, the petitioner – Company was clearly entitled to recover all the excess amounts paid to the respondent during the pendency of the Writ Petition and thereafter. It is relevant that on 04/01/2019, just before filing of the Complaint by the respondent, the petitioner – Company issued another communication to him stating that an amount of Rs.5,90,352.00, was recoverable from him.12. On 13/03/2019, the Industrial Court granted interim relief in favour of the respondent and directed the petitioner – Company not to recover any amounts on the basis of the aforesaid orders / communications dated 03/11/2018, 19/11/2018, 27/11/2018 and 04/01/2019, during pendency of the Complaint.13. On 23/09/2019, the Industrial Court passed the impugned judgment and order allowing the Complaint of the respondent and setting aside the aforesaid orders / communications issued by the petitioner – Company. The Industrial Court placed reliance on various judgments, including judgment of the Hon’ble Supreme Court in the case of State of Punjab and Others Vs. Rafiq Masih (White Washer) and Others (2015) 4 SCC 334. It was held that recovery of amounts sought to be undertaken by the petitioner – Company, only 10 months prior to the retirement of the respondent rendered the aforesaid action unsustainable. It was held that if such recovery was permitted it would be iniquitous and unfair.14. The petitioner – Company filed the present Writ Petition, challenging the said judgment and order of the Industrial Court. While issuing notice in the present Writ Petition, this Court directed that the respondent would be entitled to receive monetary benefits pursuant to his superannuation on 30/09/2019, except an amount of Rs.5,90,352/-, since the said amount was claimed by the petitioner-Company as recoverable from the respondent. As a result, the said amount was not disbursed to the respondent towards leave encashment.15. Mr. A.M. Ghare, learned counsel appearing for the petitioner – Company, submitted that the Industrial Court erred in granting relief to the respondent by relying upon the judgments of the Hon’ble Supreme Court, including judgment in the case of State of Punjab and Others Vs. Rafiq Masih (White Washer) and Others (supra), because the facts in the present case were clearly distinguishable. It was submitted that the position of law enunciated under the said judgments applied to the case of the respondent till his initial Complaint was allowed by the Industrial Court, but, thereafter, the excess payments were made to him due to the order of status quo granted by this Court. It was submitted that when the Writ Petition filed by the respondent stood dismissed on 30/07/2015, the order of status quo merged into the final order and, therefore, the excess amounts paid to the respondent became clearly recoverable. It was submitted that even if there was delay on the part of the petitioner – Company in initiating recovery towards the end of 2018 and beginning of 2019, the excess amounts paid under the order of status quo of this Court were recoverable from the respondent once the Writ Petition stood dismissed. The learned counsel appearing for the petitioner – Company invited attention of this Court to the judgment of the Hon’ble Supreme Court in the case of State of Punjab and Others Vs. Rafiq Masih (White Washer) and Others (supra) to distinguish the facts of the present case and he further relied on the judgment in the case of High Court of Punjab and Haryana and others Vs. Jagdev Singh (2016) 14 SCC 267, to submit that the impugned order deserved to be set aside.16. On the other hand, Mr. S.S. Ghate, learned counsel appearing for the sole respondent submitted that the order passed by the Industrial Court was fully justified and the case of the respondent clearly fell in the categories identified by the Hon’ble Supreme Court in its judgment in the case of State of Punjab and Others Vs. Rafiq Masih (White Washer) and Others (supra), while stipulating that the employers would not be justified in seeking recovery of excess amounts paid to the employees. It was submitted that the petitioner – Company woke up for the first time in November 2019 to claim recovery of excess amounts paid to the respondent, even when the Writ Petition filed by the respondent had been dismissed as far back as on 30/07/2015. It was further submitted that the petitioner – Company itself continued to pay the enhanced amount for more than 3 years to the respondent, despite dismissal of the Writ Petition, which was a significant factor. It was further submitted that the respondent undisputedly belonged to Class III service, that he was due to retire in about 10 months from the initiation of recovery and that in any case looking to the health condition of the respondent and his wife and the fact that their son was handicapped, the recovery of amounts would be iniquitous, harsh and arbitrary. It was pointed out that the respondent was entitled only to gratuity and payment towards leave encashment and that there was no scheme for pension payable to the respondent. In this situation, it was submitted that this Court may not invoke writ jurisdiction and the order passed by the Industrial Court may be confirmed.17. Heard learned counsel for the rival parties. Perused material on record, as also the judgments brought to the notice of this Court. Certain admitted facts need to be appreciated in the present case, before applying the position of law as laid down by the Hon’ble Supreme Court. It is an admitted position that the first Complaint filed by the respondent before the Industrial Court was partly allowed and it was held that the petitioner – Company was not entitled to recover the excess payments made to the respondent on the basis of the initial office order dated 02/05/2003. This was because such excess payments were made on the basis of the said office order issued by the petitioner – Company itself and there was no question of the respondent having wrongly claimed the same or that he had made any misrepresentation for claiming the same. Yet, the Industrial Court dismissed the claim of the respondent for fixation of pay as Lower Division Clerk from the date of his joining service. It is also an admitted position that when challenge was raised by the respondent to the dismissal of the aforesaid claim, this Court while granting Rule continued the order of status quo. As a consequence, the petitioner – Company continued to pay the excess amounts to the respondent. It is also an admitted position that the Writ Petition ultimately stood dismissed after about 8 years on 30/07/2015.18. The record also shows that the petitioner – Company did take any immediate steps upon dismissal of the Writ Petition on 30/07/2015. The petitioner – Company admittedly continued to pay the excess amounts to the respondent even after dismissal of the Writ Petition. It was only on 03/11/2018, i.e. more than 3 years and 3 months of dismissal of the Writ Petition that the first order / communication was issued by the petitioner – Company to the respondent, claiming that the excess amount was now recoverable. Subsequent orders were issued on 19/11/2018, 27/11/2018 and 04/01/2019 to claim that amount of Rs.5,90,352/- was recoverable from the respondent and that the same would be deducted from his salary and terminal benefits. It is also an admitted position that the respondent was due for superannuation on 30/09/2019, thereby showing that the aforesaid orders / communications issued in November, 2018 and January 2019, were issued when the respondent was on the verge of retirement. The respondent had placed on record the difficulties being faced by him due to his health condition and that of his wife and that their son was handicapped and undertaking education.19. In the backdrop of the above mentioned admitted facts on record, the position of law as enunciated by the Hon’ble Supreme Court needs to be appreciated. In the case of State of Punjab and Others Vs. Rafiq Masih (White Washer) and Others (supra), the Hon’ble Supreme Court took into consideration various judgments on the question of entitlement of employers to recover excess amounts paid to the employees. The Hon’ble Supreme Court found that excess amounts should not be recoverable where such amounts were paid not because of any misrepresentation by an employee. It was held that if such amounts were paid by mistake, no recovery could be made from the employees. Another aspect which was emphasized by the Hon’ble Supreme Court in the said judgment was that when such a question arose before the Court, it was necessary to examine as to whether the recovery of excess amounts could be said to be iniquitous in the facts and circumstances of the case. In that context, the Hon’ble Supreme Court took into consideration various aspects and particularly emphasized on the situation faced by a retired employee or an employee on the verge of retirement. Before giving five instances where it would be impermissible in law for employers to recover excess payments made to the employees, in the context of predicament of a retired employee or an employee on the verge of retirement, the Hon’ble Supreme Court observed as follows :“It cannot be forgotten, that a retired employee or an employee about to retire, is a class apart from those who have sufficient service to their credit, before their retirement. Needless to mention, that at retirement, an employee is past his youth, his needs are far in excess of what they were when he was younger. Despite that, his earnings have substantially dwindled (or would substantially be reduced on his retirement). Keeping the aforesaid circumstances in mind, we are satisfied that recovery would be iniquitous and arbitrary, if it is sought to be made after the date of retirement, or soon before retirement. A period within one year from the date of superannuation, in our considered view, should be accepted as the period during which the recovery should be treated as iniquitous. Therefore, it would be justified to treat an order of recovery, on account of wrongful payment made to an employee, as arbitrary, if the recovery is sought to be made after the employee’s retirement, or within one year from the date of his retirement on superannuation.”20. Thereafter, the Hon’ble Supreme Court held as follows :18.“It is not possible to postulate all situations of hardship which would govern employees on the issue of recovery, where payments have mistakenly been made by the employer, in excess of their entitlement. Be that as it may, based on the decisions referred to above, we may, as a ready reference, summarise the following few situations, wherein recoveries by the employers, would be impermissible in law:(i) Recovery from the employees belonging to Class III and Class IV services (or Group C and Group D service).(ii) Recovery from the retired employees, or the employees who are due to retire within one year, of the order of recovery.(iii) Recovery from the employees, when the excess payment has been made for a period in excess of five years, before the order of recovery is issued.(iv) Recovery in cases where an employee has wrongfully been required to discharge duties of a higher post, and has been paid accordingly, even though he should have rightfully been required to work against an inferior post.(v) In any other case, where the court arrives at the conclusion, that recovery if made from the employee, would be iniquitous or harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer’s right to recover.”21. Applying the position of law laid down by the Hon’ble Supreme Court in the above-mentioned judgment, it becomes clear that in the facts and circumstances of the present case, it cannot be said that the Industrial Court committed an error in allowing the Complaint of the respondent and setting aside the orders / communications issued by the petitioner – Company for recovery of excess amounts paid to the respondent, when he was admittedly on the verge of retirement. There is no doubt about the fact that the respondent was Class III employee and that when the orders / communications were issued by the petitioner – Company for recovery of amounts, the respondent was on the verge of retirement i.e. he was to retire within 10 months. The record also shows that the respondent and his wife are suffering from health issues requiring medical expenses and further that their son is handicapped, who also needs support. It is also an undisputed fact that upon retirement the respondent is entitled only to amounts towards gratuity, leave encashment and under other such heads and further that there is no pension payable to the respondent. Therefore, the respondent is not receiving any monthly pension after his retirement and his financial needs have to be satisfied only from the amounts received towards gratuity, leave encashment and other such benefits.22. This Court is of the opinion that considering the aforesaid facts, the case of the respondent is covered under categories (i), (ii), (iii) and (v), specified in the above quoted paragraph No.18 of the judgment of the Hon’ble Supreme Court in the case of State of Punjab and Others Vs. Rafiq Masih (White Washer) and Others (supra).23. This Court is of the opinion that the petitioner – Company is not justified in relying upon judgment of the Hon’ble Supreme Court in the case of High Court of Punjab and Haryana and others Vs. Jagdev Singh (supra), because in that case the employee had given a specific undertaking that he agreed to adjustments of excess payment if the pay scale was re-fixed in the future. As regards the contention raised on behalf of the petitioner – Company that even if the excess payments made to the respondent may not be recoverable for the period after dismissal of the Writ Petition because there was delay on the part of the petitioner – Company in initiating the process of recovery, yet, the amounts were recoverable for the period during which the Writ Petition was pending, this Court is of the opinion that the said contention is also unsustainable. The petitioner – Company continued to make excess payments to the respondent due to the interim order passed by this Court in his favour. Although the Writ Petition stood dismissed on 30/07/2015, it is an admitted position that the petitioner – Company continued to pay the excess amounts to the respondent and woke up to issue orders / communications for recovery of amounts more than 3 years and 3 months after dismissal of the Writ Petition. It is not as if the respondent had misrepresented in any manner, which resulted in the petitioner – Company continuing to make the excess payments, even after dismissal of the Writ Petition on 30/07/2015. It is also a fact that no undertaking was ever taken from the respondent while the excess amounts were paid to him.24. In this context, the judgment of the Hon’ble Supreme Court in the case of Maruti Tukaram Bagawe and Others Vs. State of Maharashtra and Another (judgment and order dated 27/02/2020, passed in Civil Appeal No. 1759 of 2020) reported in 2020 SCC Online SC 240, assumes significance. In the said judgment, the Hon’ble Supreme Court held that despite an undertaking given by the employees therein, the employer could not recover excess amounts

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paid, because the High Court itself had directed that payment of excess amounts be made to the employees till the Administrative Tribunal in a pending application filed by the employees decided upon the validity of the Government Resolution withdrawing the benefit of excess payments given to the employees therein. The Tribunal in the said case ultimately upheld the Government Resolution and the right of the employer to withdraw the benefit of excess payments to the employees, yet, the Hon’ble Supreme Court held that excess payments made to the employees during the pendency of the application before the Tribunal could not be recovered. In the present case, the petitioner – Company continued to make excess payments to the respondent due to the order of status quo passed in favour of the respondent and, therefore, till this Court ultimately dismissed the Writ Petition and upheld the order of the Industrial Court, the excess payment was being made on the basis of an express interim order granted by this Court. These facts coupled with absence of an undertaking taken from the respondent by the petitioner – Company demonstrates that the contentions raised on behalf of the petitioner – Company cannot be accepted.25. In any case, this Court has come to a considered conclusion that it would be wholly iniquitous, harsh and arbitrary to permit the petitioner – Company to make recovery of excess amounts from the respondent, considering the financial needs of the respondent upon retirement, particularly when he is to look after his handicapped son. This Court is of the opinion that if recovery is made from the respondent, the same would be iniquitous, harsh and arbitrary to such an extent, as would far outweigh the equitable balance of the employer’s right to recover.26. In view of above, this Court finds that the approach adopted by the Industrial Court cannot be found fault with and that the impugned order does not deserve any interference.27. Accordingly, the Writ Petition is dismissed.28. Consequently, the petitioner – Company is directed to release the amount of Rs.5,90,352/- to the respondent forthwith.29. Needless to say, all other benefits payable to the respondent shall be paid immediately, if not already disbursed.30. The Writ Petition stands disposed of. No costs.
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