High Court of KeralaSingle Judge2013-03-04Writ petition disposed of; recovery of excess p...

V.G. Rani v. State of Kerala and Ors.

Case / Petition Number:WP(C).No. 20140 of 2009 (J)

Neutral Citation:/

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: C.K. Abdul Rehim
Judgment Date: 2013-03-04
Court Decision / Holding: Writ petition disposed of; Exhibit P3 notice directing recovery of excess payments quashed to the extent of excess recovery. Respondents are directed to re-fix the petitioner’s pay and allowances after cancelling the higher grade with prospective effect; future pay and retiral benefits will depend on the re-fixation.
Final Disposition: Writ petition disposed of; recovery of excess payments quashed to the extent of the excess; pay re-fixation to be undertaken with prospective effect; future benefits depend on re-fixation.

Parties to the Case

Appellants / Petitioners

V.G. RANI, SENIOR CLERK OCHANTHURUTH SERVICE CO-OPERATIVE BANK LTD NO.72 OCHANTHURUTH PO, KOCHI 682 508

Respondents

State of Kerala represented by Secretary, Co-operation (C) Department Government Secretariat, Thiruvananthapuram
Joint Registrar, Co-operative Societies (General) Ernakulam
OCHANTHURUTH SERVICE CO-OPERATIVE BANK LTD.NO.72 represented by its Secretary OCHANTHURUTH PO, KOCHI 682 508

Legal Representation & Advocates

Counsels for Petitioners

• Sri V.G. Arun
• Sri T.R. Harikumar

Counsels for Respondents

• Sri D. Somasundaram (Special Government Pleader)
• Sri H.B. Shenoy
• Sri B.Ashok Shenoy
• Smt. Lakshmi B. Shenoy
• Sri Abu Mathew
• Sri Sobhan George

Case Synopsis & Summary

This writ petition challenges the recovery of amounts paid as a one-time bound higher grade to the petitioner, who had a career in the Ochantthuruth Service Co-operative Bank Ltd. She joined as a Junior Clerk in 1980, was promoted to Senior Clerk in 1982, and became Accountant in 1985, but was reverted in 1986 on medical grounds. She continued as Senior Clerk and, in 1992, was granted a one-time higher grade under Government Exhibit P1 guidelines presuming stagnation for higher grade in the cadre of Senior Clerk. In 2004, the bank informed the petitioner that the higher grade granted earlier was by mistake and advised recovery of the excess payments. The petitioner challenged this sequence, contending that the notice and the actions were improper and that the appeal under Section 83(1)(j) of the Co-operative Societies Act was filed in time after receiving the decision of the 2nd respondent. The 2nd respondent conducted a hearing in 2007 but the decision communicated by the 3rd respondent was inconsistent with the guidelines; the 1st respondent dismissed the appeal as time-barred. The court held that the petitioner is not entitled to the higher grade, given the lack of stagnation and the promotion to Accountant in 1985, and that the recovery was improper only to the extent of excess payments due to a government mistake. It quashed the recovery notice accordingly and directed re-fixation of pay and allowances with prospective effect, leaving future entitlements contingent on this re-fixation.

Provisions of Law Cited

Co-operative Societies Act, Section 83(1)(j)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioner contends that the appeal under Section 83(1)(j) of the Co-operative Societies Act was filed within the time limit after receiving a copy of the 2nd respondent's decision; she asserts that the findings in Exhibits P4 and P6 regarding delay are incorrect and that the higher grade was granted under Exhibit P1 guidelines. She seeks reconsideration on merits and challenges recovery as unjust, arguing there was no misrepresentation by the petitioner and that the government’s delay should not negate her entitlement; the matter involves regularisation of a higher grade (though the court ultimately found no entitlement).

Contentions of Respondents

The respondents contend the higher grade was granted by mistake; those who relinquished promotion are not eligible for higher grade; the 1st respondent's appeal was time-barred and delay cannot be condoned; recovery for the excess payment arises from an audit objection; the petitioner's entitlement to the higher grade is not sustainable under Exhibit P1 and the accompanying Note (4).

Cited Precedents (2)

Case Name	Citation	Treatment	Explanation
Aleyamma Varghese v. Secretary, General Education Department	2007 (3) KLT 700 (SC)	Positive	Cited to support the principle that excess amounts paid due to government error should not be recovered.
Narayanan v. State of Kerala	2008 (3) KLT 188	Positive	Referenced for the same protective principle against recovery of erroneously paid amounts; apex court guidance followed.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR.JUSTICE C.K.ABDUL REHIM** **MONDAY, THE 4TH DAY OF MARCH 2013/13TH PHALGUNA 1934** **WP(C).No. 20140 of 2009 (J) ---------------------------** ## **PETITIONER(S): --------------** **V.G.RANI, SENIOR CLERK OCHANTHURUTH SERVICE CO-OPERATIVE BANK LTD NO.72 OCHANTHURUTH PO, KOCHI 682 508.** **BY ADVS.SRI.V.G.ARUN SRI.T.R.HARIKUMAR** **RESPONDENT(S):** **--------------** **1. STATE OF KERALA, REPRESENTED BY SECRETARY, CO-OPERATION (C) DEPARTMENT GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM.** **2. JOINT REGISTRAR, CO-OPERATIVE SOCIETIES (GENERAL) ERNAKULAM.** **3. OCHANTHURUTH SERVICE CO-OPERATIVE BANK LTD.NO.72, REPRESENTED BY ITS SECRETARY OCHANTHURUTH PO, KOCHI 682 508.** **R1 & R2 BY SPL. GOVERNMENT PLEADER SRI.D.SOMASUNDARAM R,R3 BY ADVS. SRI.H.B.SHENOY SRI.B.ASHOK SHENOY SMT.LAKSHMI B.SHENOY SRI.ABU MATHEW SRI.SOBHAN GEORGE** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 04-03-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **WP(C).No. 20140 of 2009 (J)** ## **APPENDIX** ## **PETITIONERS' EXHIBITS** **EXT. P1 COPY OF THE GOVERNMENT ORDER G.O.(MS) 39/91/CO-OP. DATED 27.04.1991 EXT. P2 COPY OF THE NOTICE ISSUED BY THE 3RD RESPONDENT DATED 12.2.2008. EXT. P3 COPY OF THE ORDER IN CRP(C) 4473/2007 DATED 20.09.2007. EXT. P4 COPY OF THE COMMUNICATION NO. 544/C-2/09/CO-OP. DATED 12.02.2009 EXT. P5 COPY OF THE APPLICATION SUBMITTED BY THE PETITIONER BEFORE THE SECRETARY, KERALA STATE CO-OPERATIVE SECTION. EXT. P6 COPY OF THE COMMUNICATION NO. 3896/C-2/09/CO-OP. DATED 03.04.09** ## **RESPONDENTS' EXHIBITS : NIL** **/TRUE COPY/** **P. A. TO JUDGE** **Pn** ## **C.K. ABDUL REHIM, J. -----------------------------------W.P.(C). No. 20140 of 2009** **-----------------------------------------Dated this the 4[th] day of March, 2013** ## **JUDGMENT** The petitioner entered service of the 3[rd] respondent society as Junior Clerk on 17.11.1980. She was promoted as Senior Clerk with effect from 01.08.1982 and thereafter promoted as Accountant on 01.08.1985. But the petitioner was thereafter reverted to the post of Senior Clerk with effect from 25.04.1986, on the basis of request made by her on medical grounds. She is continuing in the post of Senior Clerk from that date onwards and is due to retire during the year 2015. 2. While working in the post of Senior Clerk the petitioner was found eligible for grant of one time bound higher grade, on her completion of 10 years. She was granted the said benefits with effect from 01.08.1992, following Exhibit P1 guidelines issued by the Government, prescribing norms for grant of higher grade to employees of Co-operative institutions. But during the year 2004, the 3[rd] W.P.(C). No. 20140 of 2009 -2- respondent issued notice to the petitioner informing that the grant of higher grade was by way of mistake and the benefits paid need to be recovered. The petitioner made a request to the 3[rd] respondent not to cancel the higher grade. On the basis of such request, the Managing Committee of the 3[rd] respondent society took a resolution to approach the Assistant Registrar of Co-operative Societies to seek permission to regularise the higher grade granted. But the Assistant Registrar had rejected the request. Thereafter the 3[rd] respondent took up the matter with the 2[nd] respondent. The 2[nd] respondent conducted a hearing on the matter on 15.09.2007. According to the petitioner, no decision was communicated to the petitioner. But Exhibit P2 notice was issued by the 3[rd] respondent informing that the request submitted before the 2[nd] respondent was rejected. The 3[rd] respondent Bank was directed to recover the amounts paid in excess as pointed out in the concurrent audit. The petitioner applied and obtained Exhibit P3, copy of the W.P.(C). No. 20140 of 2009 -3- proceedings issued by the 2[nd] respondent. It is stated therein that, the petitioner got promotion as Accountant while working as Senior Clerk and continued therein from 01.08.1985 to 25.04.1986. Therefore the higher grade allowable under Exhibit P1, which is intended to be given for those who become stagnated in the same cadre, cannot allowed. 3. Being aggrieved by Exhibit P3 the petitioner preferred an appeal before the 1[st] respondent under Section 83 (1) (j) of the Co-operative Societies Act. But the appeal was rejected without consideration, stating that it is time barred, and that the Government have no power to condone the delay. Eventhough the petitioner submitted a further request before the honourable Minister for co-operation, through Exhibit P5 the same was rejected through Exhibit P6 assigning the very same reason. The petitioner is challenging Exhibits P4 and P6 in this writ petition. 4. Heard; counsel appearing for the petitioner and W.P.(C). No. 20140 of 2009 -4- the Special Government Pleader, Co-operative Department, and also the counsel appearing for the 3[rd] respondent Bank. According to the petitioner, the appeal before the 1[st] respondent under Section 83 (1) (j) was filed within the time limit prescribed, after she had received copy of the decision rendered by the 2[nd] respondent. Therefore it is contended that the findings in Exhibits P4 and P6 that there occurred delay in filing the appeal, is not true and correct. Therefore the counsel pressed for a direction to the 1[st] respondent to reconsider the matter and to dispose of the appeal on merits. But, I take note of the fact that the petitioner is not entitled for the higher grade, even on the basis of Exhibit P1 Government Order prescribing the guidelines. Note (4) of Clause III in Exhibit P1 specifically provides that, employees who relinquishes claim for promotion are not eligible for benefit of higher grade. It is not disputed that the petitioner was promoted to the post of Accountant, with effect from 01.08.1985. It is also not in dispute that she had continued W.P.(C). No. 20140 of 2009 -5- as Accountant till 25.04.1986. It is on the basis of her request that the reversion was effected. As such, the benefit of higher grade cannot be granted because there was no stagnation in the cadre of Senior Clerk. Going by the guidelines, it is clarified that the higher grade is not admissible with respect to those who relinquishes promotion. Hence I find that no purpose will be achieved by directing the Government to consider the appeal on merits. 5. However, question arises as to whether the recovery of arrears is justified or not. It is true that the higher grade was permitted to the petitioner with effect from 01.08.1992. Till the year 2004 there was no objection raised either by the 3[rd] respondent or by the 2[nd] respondent. The higher grade was admitted all along for the purpose of computing benefits due to the petitioner. It is only during the year 2004 that this was objected. Even thereafter proceedings for approval of the resolution adopted by the 3[rd] respondent society to regularise the higher grade was W.P.(C). No. 20140 of 2009 -6- pending consideration before the 2[nd] respondent up to September, 2007. The notice intimating steps for recovery was issued to the petitioner only on 12.12.2008. Eventhough higher grade was allowed on the basis of a mistake, there was absolutely no misrepresentation from the side of the petitioner. She has not submitted any false information in this regard. The recovery steps was initiated only on the basis of an audit objection raised after a long period of time. In such case when there is absolutely no fault on the part of the employee, the State should have acted more magnanimously and not resorted to recovery proceedings. The above position has been clarified by the honourable Supreme Court in **Aleyamma Varghese** v. **Secretary, General Education Department (2007 (3) KLT 700 (SC))** and in **Narayanan** v. **State of Kerala (2008 (3) KLT 188)** . Following the decision of the honourable apex court, this court had observed that, in a case where there is wrong fixation due to mistake on the W.P.(C). No. 20140 of 2009 -7- part of the Government, the excess amount should not be recovered. 6. Considering the facts and circumstances as narrated above and also considering the legal position stands settled, the writ petition is disposed of quashing Exhibit P3 notice to the extent it directs recovery of the excess payments made to the petitioner. It is left open to the respondents to re-fix the pay and allowances due to the petitioner, after cancelling the higher grade granted in the post of Senior Clerk, with prospective effect. 7. Needless to observed that payment of future pay and allowance as well as retiral benefits due to the petitioner will be depend upon such re-fixation to be made. The respondents shall take necessary steps in this regard at the earliest possible. Sd/- ## **C.K. ABDUL REHIM, JUDGE** /True copy/ P. A. to Judge Pn