High Court of KeralaSingle Judge2019-10-26Writ petition allowed; recovery orders quashed ...

Vijayan K.N. and Others v. Kerala Water Authority

Case / Petition Number:WP(C).No.9032/2014(D)

Neutral Citation::null

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: P. V. ASHA
Judgment Date: 2019-10-26
Court Decision / Holding: Writ petition allowed; Exts. P5–P8 to the extent they directed recovery of adhoc allowances already paid are set aside.
Final Disposition: Writ petition allowed; recovery orders quashed to the extent of recovering adhoc allowances already paid; Exts. P5–P8 partially set aside.

Parties to the Case

Appellants / Petitioners

VIJAYAN K.N.; B. SREEDEVI; C.K.ARAVINDAKSHAN; SIMON K.L.; RANJAN JACOB; PRABHAVATHY M.F.

Respondents

KERALA WATER AUTHORITY represented by its Managing Director, Jala Bhavan, Thiruvananthapuram; Executive Engineer, Water Supply Division, KWA, Kochi; Assistant Executive Engineer, Water Supply Sub Division, KWA, Puthencruz; Resident Audit Officer, KWA, Office of the Principal Accountant General (General and Social Sector Audit), Kerala

Legal Representation & Advocates

Counsels for Petitioners

• S.P. Aravindakshan Pillay
• S.A. Anand
• K.A. Balan
• Princy P. Varghese
• N. Santha

Counsels for Respondents

• George Mathew, Sr. Adv. (SC), KWA
• P. Benjamin Paul, Sr. Adv. (SC), KWA

Case Synopsis & Summary

Vijayan K.N. and five other unskilled workers of the Kerala Water Authority challenged Exts. P5 to P8, which initiated recovery proceedings for adhoc allowances paid after their regularisation as permanent staff from 30.06.2004. The petitioners had been employed as Shift Mazdoors/Shift Assistants since 1985 and regularised on the World Bank project, continuing to receive adhoc allowances ostensibly to compensate for the loss of privileges after regularisation. The 4th Respondent Audit Officer objected to continued payment, and Exts. P5–P8 were issued in 2014. The petitioners argued that although the payments were not their entitlement post-regularisation, they had accepted the amounts and should not be liable to refund, particularly since the employer’s mistake enabled the payments. They invoked the Supreme Court decision in State of Punjab v. Rafiq Masih (White Washer), which discusses when recoveries of excess payments may be impermissible, including circumstances where recovery would be harsh or inequitable. The respondents contended that regularisation merged adhoc allowances into salary and that recovery was legitimate to rectify erroneous payments. The Kerala High Court agreed with the petitioners, holding that Exts. P5–P8 to recover the already paid adhoc allowances were liable to be set aside, and the writ petition was allowed, effectively quashing recovery actions related to the adhoc payments.

Legal Doctrines & Maxims

Recovery of erroneous payments is not universally permissible; courts consider equity and hardship (as per Rafiq Masih para 12).
Enumerated circumstances from Rafiq Masih (i)-(v) where recovery may be impermissible, e.g., for Class-III/IV staff, near retirement, long overpayments, misassignment of duties, or where recovery would be inequitable.

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners contended that they were regularised as permanent staff but continued to receive adhoc allowances. They argued that since the employer’s mistake enabled these payments and they had no obligation to repay, they cannot be compelled to refund. They cited Rafiq Masih to emphasize that recovery of excess payments is not automatic and must be weighed against equity, hardship, and the nature of service (Class IV) of the staff.

Contentions of Respondents

The respondents argued that regularisation integrated the adhoc allowances into salary, and the audit objections were valid. Once regularised, the benefits were subject to standard terms, and recovery of overpayments was legitimate to correct erroneous payments already made. They contended that the payments were admissible only provisionally and not after regularisation and reflected these in the audit notes.

Cited Precedents (1)

Case Name	Citation	Treatment	Explanation
State of Punjab v. Rafiq Masih (White Washer)	2015 (1) KLT 429 (SC)	Positive	The court relied on Rafiq Masih para 12 to illustrate permissible and impermissible recoveries, guiding its conclusion that recovery in these circumstances would be inequitable.

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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 SMT. JUSTICE P.V.ASHA** **SATURDAY, THE 26TH DAY OF OCTOBER 2019 / 4TH KARTHIKA, 1941** ## **WP(C).No.9032 OF 2014(D)** ## **PETITIONER/S:** - **1 VIJAYAN K.N. UNSKILLED WORKER, INDUSTRIAL WATER SUPPLY MAINTENANCE SECTION, KERALA WATER AUTHORITY, CHOONDY, PUTHENCRUZ, VADAYAMPADY P.O., ERNAKULAM DISTRICT.** - **2 B.SREEDEVI UNSKILLED WORKER, INDUSTRIAL WATER SUPPLY MAINTENANCE SECTION, KERALA WATER AUTHORITY, CHOONDY, PUTHENCRUZ, VADAYAMPADY P.O., ERNAKULAM DISTRICT.** **3 C.K.ARAVINDAKSHAN UNSKILLED WORKER, INDUSTRIAL WATER SUPPLY MAINTENANCE SECTION, KERALA WATER AUTHORITY, CHOONDY, PUTHENCRUZ, VADAYAMPADY P.O., ERNAKULAM DISTRICT.** **4 SIMON K.L. UNSKILLED WORKER, INDUSTRIAL WATER SUPPLY MAINTENANCE SECTION, KERALA WATER AUTHORITY, CHOONDY, PUTHENCRUZ, VADAYAMPADY P.O., ERNAKULAM DISTRICT.** **5 RANJAN JACOB UNSKILLED WORKER, INDUSTRIAL WATER SUPPLY MAINTENANCE SECTION, KERALA WATER AUTHORITY, CHOONDY, PUTHENCRUZ P.O., ERNAKULAM DISTRICT.** - **6 PRABHAVATHY M.F, W/O. LATE VIJAYAN K.N, AGED 53 YEARS, RESIDING AT KARUVELIL VEEDU, MONAPPILLIKKARA, PUTHENCRUZ PO.** **IS IMPLEADED AS ADDL.6TH PETITIONER IS IMPLEADED AS PER ORDER DATED 27.9.17 IN IA NO.13531/17** **BY ADVS. SRI.S.P.ARAVINDAKSHAN PILLAY SRI.S.A.ANAND SRI.K.A.BALAN SMT.PRINCY P.VARGHESE** **SMT.N.SANTHA** ## **RESPONDENT/S:** - **1 KERALA WATER AUTHORITY REPRESENTED BY ITS MANAGING DIRECTOR, JALA BHAVAN, VELLAYAMBALAM, THIRUVANANTHAPURAM, PIN 695033.** - **2 EXECUTIVE ENGINEER WATER SUPPLY DIVISION, KERALA WATER AUTHORITY, KOCHI-682014.** - **3 ASSISTANT EXECUTIVE ENGINEER WATER SUPPLY SUB DIVISION, KERALA WATER AUTHORITY, PUTHENCRUZ, ERNAKULAM, PIN 682308.** - **4 THE RESIDENT AUDIT OFFICER KERALA WATER AUTHORITY, OFFICE OF THE PRICIPAL ACCOUNTANT GENERAL (GENERAL AND SOCIAL SECTOR AUDIT), KERALA, THIRUVANANTHAPURAM, PIN 695039.** **R1 BY SRI.GEORGE MATHEW, SC, KERALA WATER AUTHORITY R1 BY SRI.P.BENJAMIN PAUL, SC, KERALA WATER AUTHORITY** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 26.10.2019, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** W.P.(C) No.9032/2014 ## **JUDGMENT** The petitioners, who are/were working as unskilled workers in the Kerala Water Authority, filed this writ petition challenging Exts.P5 to P8 orders by which proceedings were initiated for recovery of the amount paid to them towards additional adhoc allowance. 2. The petitioners, who were working as Shift Mazdoors/Shift Assistants since various dates in 1985, were regularised as unskilled workers on the basis of Ext.P4 order dated 30.06.2004. It is stated that the Kerala Water Authority continued to pay them adhoc allowances as was being paid before their regularisation. The 4th respondent – the Resident Audit Officer objected the continuance of the payment of adhoc allowances even after their regularisation. Petitioners claim that they came to know about Exts.P6 and P7 audit remarks of 2005 and 2006 only when Ext.P5 order was issued by the 3rd respondent on 15.03.2014. By Exts.P6 and P7 the Auditor to the Executive Engineer W.P.(C) No.9032/2014 :4: objected to the payment of adhoc allowance to the employees who were regualrised. Petitioners pointed out that they were not responsible for the payment of adhoc allowances and they have accepted whatever they were paid and even if the payment was erroneous they were not responsible for the same and they are not liable to refund the same. 3. The respondents have filed a counter affidavit stating that petitioners who were working as Shift Mazdoors and Shift Assistants were regualrised/absorbed as permanent staff with effect from 30.06.2004. It is stated that apart from the pay and allowances admissible to the regular staff once the petitioners become regular staff of Water Authority they lose certain privileges such as exemption from stamp duty on execution of deeds, allotment of Government Quarters, pay wards etc. In order to compensate such loss the Commission recommended adhoc allowance and petitioners continue to enjoy the same benefit. It is stated that even though respondents had submitted reply to the audit objection, the same was not accepted and based on W.P.(C) No.9032/2014 **==> picture [19 x 8] intentionally omitted <==** instructions issued by the 4[th] respondent, proceedings were initiated against petitioners for recovery of the allowance the petitioners received. It is stated that though the petitioners were eligible for additional allowance while they were working on provisional basis, once they were regularized such allowance became part of their salary. 4. It is seen that petitioners got the benefits which were not admissible to them. At the same time it was on account of a mistake committed by the employer that they happened to enjoy such benefits. Unskilled workers are class IV employees. It is pointed out that one of the petitioners is no more. Two of them already retired and the remaining petitioners are due to retire. 5. Learned counsel for the petitioners relying on the judgment in _**State of Punjab vs. Rafiq Masih (White Washer) : 2015 (1) KLT 429 (SC)**_ argued that even assuming that petitioners were not eligible for the adhoc allowance, they, being the employees in the lowest strata of the Kerala Water Authority, benefits W.P.(C) No.9032/2014 **==> picture [19 x 8] intentionally omitted <==** already granted to them are not liable to be recovered. I find force in the contention raised by the petitioners. Paragraph 12 of the judgment in _**Rafiq Massi**_ reads as follows: _12. 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 herein 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 employees belonging to Class-III and Class-IV service (or Group 'C' and Group 'D' service)._ _(ii) Recovery from retired employees, or employees who are due to retire within one year, of the order of recovery._ _(iii) Recovery from employees, when the excess payment has been made for a period in excess of five year, before the order of recovery is issued._ _(iv) Recovery in cases where an employee has wrongfully been required to discharge duties of a higherpost, 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._ Respondents do not have a case that adhoc allowance was paid to the petitioners after getting any undertaking from them agreeing for repayment in the event of it being found excess. In the said circumstances, I am of the view that the orders Exts.P5 W.P.(C) No.9032/2014 **==> picture [19 x 8] intentionally omitted <==** to P8 to the extent those orders objected to the payment effected and directed recovery of the adhoc allowance already paid to the petitioners, are liable to be set aside. Ordered accordingly. The Writ Petition is accordingly allowed . ## **Sd/-** **P.V.ASHA** **JUDGE** rkc ## **APPENDIX** ## **PETITIONER'S/S EXHIBITS:** **EXHIBIT P1 EXHIBIT-P1: TRUE COPY OF THE ORDER NO.E1.3/83 DATED 19.09.1985 OF THE ASSISTANT EXECUTIVE ENGINEER, KERALA WATER AUTHORITY, WORLD BANK PROJECT, PUTHENCRUZ. EXHIBIT P2 EXHIBIT-P2: TRUE COPY OF THE ORDER NO.E3/83 DATED 08.10.1985 OF THE ASSISTANT EXECUTIVE ENGINEER, KERALA WATER AUTHORITY, WORLD BANK PROJECT, PUTHENCRUZ.** **EXHIBIT P3 EXHIBIT-P3: TRUE COPY OF THE ORDER NO.E3/83 DATED 10.10.1985 OF THE ASSISTANT EXECUTIVE ENGINEER, KERALA WATER AUTHORITY, WORLD BANK PROJECT, PUTHENCRUZ. EXHIBIT P4 EXHIBIT-P4: TRUE COPY OF THE ORDER NO.KWA/JB/E1-4334/VOL.II/92 DATED 10.08.2004 OF THE 1ST RESPONDENT. EXHIBIT P5 EXHIBIT-P5: TRUE COPY OF THE ORDER NO.A2/967/98-99/VOL.II DATED 15.03.2014 OF THE 3RD RESPONDENT. EXHIBIT P6 EXHIBIT-P6: TRUE COPY OF THE LETTER NO.RAO/KWA/II/2-1/120/TR430 DATED 29.11.2005 OF THE 4TH RESPONDENT ADDRESSED TO THE 2ND RESPONDENT. EXHIBIT P7 EXHIBIT-P7: TRUE COPY OF THE LETTER NO.RAOII/KWA/V/2-1/(9/03)/149/TV-59 DATED 14.02.2006 OF THE 4TH RESPONDENT ADDRESSED TO THE 2ND RESPONDENT. EXHIBIT P8 EXHIBIT-P8: TRUE COPY OF THE LETTER NO.A1285/2010 DATED 11.02.2014 OF THE 2ND RESPONDENT.**