Shivani Joshi vs. State Bank Of INDIA And Another
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The petitioner, Shivani Joshi, is seeking to set aside an order dated 09.01.2020, by which the respondent-bank recovered Rs. 1,79,121/- from her family pension. Her deceased husband, a former employee of the Indian Navy, received pension through the State Bank of India. After his death on 08.12.2019, the petitioner began receiving family pension. The bank claimed an excess payment of Rs. 1,79,121/- was made to the deceased employee between 01.07.2014 and 30.11.2019 and proceeded to recover this amount from the petitioner's family pension. The petitioner argued that the excess payment occurred during her husband's lifetime and cannot be recovered from her family pension. The bank asserted its right to recover the excess payment from the legal heirs based on an undertaking furnished by the deceased employee.
Held
The Court held that the respondent-bank cannot recover the alleged excess pension payment from the petitioner's family pension. The Court reasoned that while the deceased employee might have furnished an undertaking, such an undertaking, in the absence of a specific statutory provision, cannot create a liability for the legal heirs. The Court referred to the Supreme Court's decision in State of Punjab Vs. Rafiq Masih (White Washer) etc., which outlines circumstances where recovery of excess payments is impermissible, and noted that the principle extends to legal heirs. The Court also cited Shabina Abraham and others vs. Collector of Central Excise and Customs, emphasizing that even tax cannot be recovered from legal heirs of a proprietorship concern without a statutory provision. The Court observed that banks are often at fault for such excess payments and that recovery from widows is inappropriate. The Court allowed the petition and directed the respondent-bank to re-credit the recovered amount of Rs. 1,79,121/- to the petitioner within two months.
Key Issues
1. Whether the respondent-bank can recover alleged excess pension payments made during the lifetime of the deceased employee from the family pension of the petitioner, his legal heir, in light of the Supreme Court's decision in State of Punjab Vs. Rafiq Masih (White Washer) etc. and the absence of a specific statutory provision creating such liability for legal heirs? The petitioner contended that the excess payment was made during her husband's lifetime and recovery from her family pension is impermissible. She relied on the principle that pension is a constitutional right and that recovery from legal heirs is not permissible without a statutory provision, citing Shabina Abraham and others vs. Collector of Central Excise and Customs. The petitioner also highlighted that the Union of India conceded that no recovery can be effected from legal heirs. The respondent-bank argued that it had the right to recover the excess payment from the legal heirs based on an undertaking furnished by the deceased employee. The respondent-UOI initially stated no recovery could be made from legal heirs but later, through the bank's counsel, raised the issue of the undertaking.
AI-generated summary — verify with the full judgment below
CWP-12431-2022 1 2024:PHHC:037864
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
201
CWP-12431-2022
Date of Decision: 15.03.2024
SHIVANI JOSHI
…PETITIONER Versus STATE BANK OF INDIA AND ANOTHER --- RESPONDENTS
CORAM: HON'BLE MR. JUSTICE JAGMOHAN BANSAL
Present: Mr. Anupam Singla, Advocate
for the petitioner.
Mr. Nitin Kumar, Advocate
for respondent Nos. 1 and 2-SBI.
Mr. Karan Kumar Jund, Senior Panel Counsel
for respondent No. 3-UOI.
****
JAGMOHAN BANSAL, J. (Oral)
The petitioner through instant petition under Articles 226/227 of the Constitution of India is seeking setting aside of order dated 09.01.2020 (Annexure P-1) whereby respondent has recovered a sum of Rs. 1,79,121/- from the family pension of the petitioner.
The husband of the petitioner was working with Indian Navy. He retired from Indian Navy on 31.07.2011 and as per applicable rules, started getting pension from Government of India. The payment was made through respondent-State Bank of India. The said employee passed away on 08.12.2019 and thereafter, the petitioner-wife of deceased employee started getting family pension. The respondent after death of aforesaid employee Anju Goel 2024.03.15 17:40 I attest to the accuracy and integrity of this document Chandigarh
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came to know that bank had made excess payment of Rs. 1,79,121/- during 01.07.2014 to 30.11.2019. The respondent has recovered aforesaid amount from the family pension of the petitioner.
Mr. Anupam Singla, counsel for the petitioner would submit that respondent made alleged excess payment during the life time of petitioner’s husband and respondent cannot recover alleged amount from the family pension.
Mr. Karan Kumar Jund, Senior Panel Counsel, submits that no recovery of excess payment can be made from LRs of deceased employee.
Learned counsel for the respondent-bank asserts that a sum of Rs. 1,79,121/- has been recovered from family pension.
Faced with statement made by learned counsel for the respondents-UOI, Mr. Nitin Kumar, Advocate submits that deceased employee had furnished undertaking and as per said undertaking, bank can recover excess payment even from legal heirs.
The respondent-bank is claiming that they have right to recover 2024.03.15 17:40 I attest to the accuracy and integrity of this document Chandigarh
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circumstances enumerated in the judgment are not conclusive. The circumstances where the Court has categorically held that no recovery shall be effected are reproduced as below :
“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 hereinabove, 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 service (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 Anju Goel 2024.03.15 17:40 I attest to the accuracy and integrity of this document Chandigarh
CWP-12431-2022 4 2024:PHHC:037864
outweigh the equitable balance of the employer's right to recover.” (emphasis supplied)
In the case in hand, the respondent-UOI has conceded that no constitutional right in terms of Article 300-A of Constitution of India. It is apt to notice that prior to omission of clause (f) of article 19(1) of the Constitution of India, it was considered as fundamental right.
This Court everyday is getting similar cases where there is excess payment on account of mistake on the part of bank. The employer i.e. Union of India or State Government is not at fault whereas it is bank who is at fault and claiming that excess payment has been made on account of its mistake. There is no case wherein it has been found that mistake was on the part of employee. In every case, there is mistake on the part of bank. The bank has initiated recovery even from the widow. It ill behoves the banks. Anju Goel 2024.03.15 17:40 I attest to the accuracy and integrity of this document Chandigarh
CWP-12431-2022 5 2024:PHHC:037864
In the backdrop, this Court is of the considered opinion that the present petition deserves to be allowed and accordingly allowed. The respondent-bank shall re-credit the aforesaid amount within two months from today. (JAGMOHAN BANSAL)
JUDGE 15.03.2024 Anju
Whether speaking/reasoned Yes Whether reportable Yes
Anju Goel 2024.03.15 17:40 I attest to the accuracy and integrity of this document Chandigarh
Reproduced from the public record of the Punjab and Haryana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.