MS INDRA v. THE GOVT OF NCT OF DELHI & ANR.

Judgment

#1. This writ petition is filed by a widow who is in receipt of family pension. Her grievance arises out of deductions effected from that pension towards recovery of what the Respondents term as excess payment. Her case is that the alleged excess did not arise from any misrepresentation, concealment or other act on her part, but from the Respondents’ own processing of the pension. She further states that the recovery was initiated unilaterally, without prior notice or disclosure of the basis on which it was sought to be made, and that the deductions have operated with particular W.P.(C) 4502/2021 Page 1 of 16 severity because they are being made from family pension. Factual background

#2. The Petitioner’s husband, late Sh. Shiv Narayan, entered government service on 15th October, 1980 as an LDC. He died in harness on 6th June, 2003 while serving as a UDC in the Election Department under the SDM, South-West Delhi, at the DC Office, Kapashera, New Delhi.

#3. Following his death, family pension was sanctioned in favour of the Petitioner through PPO No. 69674-03-0121-1 issued by PAO No. 1, Government of NCT of Delhi, to be disbursed through the State Bank of India, Kapashera Branch. The PPO record shows that the Petitioner was entitled to family pension at the enhanced rate of Rs. 2,650 from 7th June, 2003 to 6th June, 2010, and thereafter at the normal rate of Rs. 1,590 from 7th June, 2010 till death or remarriage, whichever occurred earlier.

#4. The matter took a turn when the Petitioner noticed a substantial reduction in the pension credited to her account. Upon enquiry, she was furnished a copy of letter No. CPPC/MISC/2017/1530 dated 4th May, 2017 issued by SBI’s Centralised Pension Processing Centre to the Kapashera Branch. That communication stated that excess pension had been paid on account of a “wrong ENHANCE DATE” and quantified the excess at Rs. 2,51,616. It also recorded that recovery had been fed in the pension software at the rate of Rs. 3,200 per month and asked the branch to recover the amount from the pensioner and inform her accordingly.

#5. The May 2017 slip also reflects the “Enhanced End Date of Family” as 6th June, 2013, which does not match the PPO, under which the enhanced- rate period ended on 6th June, 2010. This inconsistency in the bank- generated record is a circumstance to which the Court will revert in the later W.P.(C) 4502/2021 Page 2 of 16 part of this judgment.

#6. SBI’s case is that a revised PPO dated 4th October, 2019 was subsequently received from the Central Pension Accounting Office, following which the Petitioner’s pension was recalculated, the alleged excess payment was recomputed at Rs. 3,60,279/-. SBI states that the monthly recovery was revised to Rs. 4,399/-, and its records reflect recovery through 82 instalments, proposed to continue up to 29th February, 2024. The later pension slips and the deduction-history printout do show deductions of Rs. 4,399/- in November 2019 and January 2021, and also reflect the revised recovery entry on which SBI places reliance.

#7. The Petitioner thereafter caused a legal notice dated 3rd February, 2021 to be issued to PAO No. 1 and SBI. PAO No. 1 replied on 11th February, 2021, stating that it had no role in the disbursal of pension or in the impugned recovery and that the matter fell within the domain of the pension-disbursing bank. No substantive reply from SBI to that notice has been placed on record by the Petitioner.

#8. The Petitioner’s case, in essence, is that any excess payment, if made, arose entirely from the Respondents’ own error in processing the pension and not from any act, omission, misrepresentation or concealment on her part. She furnished no false information and played no role in the alleged overpayment. Her further case is that the recovery from family pension was commenced unilaterally, without prior notice, and has operated with serious hardship upon a widow surviving on limited means.

#9. The Petitioner further states that, as a senior citizen dependent on family pension, the deductions have placed her under serious financial strain, compelled her to raise loans, and left her struggling to maintain W.P.(C) 4502/2021 Page 3 of 16 herself with dignity.

#10. As regards the alleged undertaking relied upon by SBI, the Petitioner’s case is that her signatures were obtained on routine papers when the family pension formalities were being completed; that she did not consciously furnish any undertaking authorising recovery of future excess; and that, in any event, such a document cannot displace the equitable principles which restrain recovery from retirees or pensioners where the excess payment has arisen without fault on their part.

#11. SBI, in response, does not dispute that excess payment was made. Its case is that the error surfaced during internal audit and was later reflected in a further recalculation of pension. According to SBI, the Petitioner continued to receive family pension beyond what the system ought to have

permitted, first because of the wrong enhancement date and later on account of revised pension processing following the 7th CPC exercise. On that basis, SBI submits that it was bound to recover the excess and restore the amount to the Government Treasury.

#12. It is further submitted that the recovery was not effected in one lump sum but through instalments. Initially, a monthly deduction of Rs. 3,200 was made from May 2017. Later, upon recalculation, the monthly deduction was revised to Rs. 4,399. It also relies on the pension slips and the software- generated recovery history to show that the recovery mechanism was system-driven and stood reflected in the pension account.

#13. The bank’s principal legal plank, however, is the undertaking dated 5th January, 2004, bearing the Petitioner’s signature as “Indra”, by which the signatory agrees to refund, or permit adjustment of, any amount not due. SBI states that this undertaking is sufficient in law to sustain the recovery and W.P.(C) 4502/2021 Page 4 of 16 takes the case outside the line of authority which restrains recovery on equitable considerations.

#14. SBI also relies on the RBI circular dated 17th March, 2016 and the Master Circular dated 1st July, 2017 governing disbursement of Government pension through agency banks. The substance of those circulars is that excess or wrong payment made to a pensioner may first be adjusted against the credit available in the account and, if that is insufficient, may be recovered from future pension in instalments, ordinarily up to one-third of the net pension plus relief, unless the pensioner gives written consent for a higher instalment. The circulars also contemplate that the pensioner be informed of the details of the overpayment and the mode of recovery.

#15. On the strength of these materials, SBI submits that the Petitioner cannot invoke equity to resist repayment of money which was not lawfully due to her. It contends that the payments were made from Government funds, the excess came to light upon audit and recalculation, the recovery was structured through instalments, and the undertaking independently authorises such recovery. It is on that footing that SBI places reliance on Chandi Prasad Uniyal & Ors. v. State of Uttranchal,1 High Court of Punjab and Haryana & Ors. v. Jagdev Singh2 and Union of India & Ors. v. Sujatha Vedachalam (Smt) and Anr.3

#16. Respondent No. 1, Government of NCT of Delhi, takes a narrower position. Its case is that, while it issued the PPO, it had no role in the actual disbursal of family pension or in the impugned recovery. It further relies on the Office Memorandum dated 16th May, 2018, issued by the Central