2025:HHC:31959 IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA CWP No.13027 of 2025 Date of Decision: 11.09.2025 __________________________________________________________ Kailash Chand …….Petitioner Versus Himachal Pradesh Housing & Urban Development Authority ….Respondent __________________________________________________________ Coram: Hon’ble Mr. Justice Sandeep Sharma, Judge. Whether approved for reporting? 1 For the Petitioner: Mr. Rajesh Kumar, Advocate. For the Respondent: Mr. Rohan Tomar, Advocate. __________________________________________________________ Sandeep Sharma, Judge (oral): Petitioner herein is aggrieved of communications dated 23.01.2025 (Annexure P-6) and 10.06.2025 (Annexure P-7), issued under the signatures of Chief Accounts Officer, HIMUDA, Shimla, addressed to Branch Manager, UCO Bank Nigam Vihar, Shimla, requesting therein to transfer sum of 7,58,280/- in the bank account of ₹ the petitioner on account of leave encashment, but while doing so, aforesaid authority further directed Bank to transfer sum of 1,24,646/- ₹ from total amount of 7,58,280/- payable to the petitioner on account of ₹ leave encashment to the bank account of the HIMUDA on account of certain recoveries from the petitioner. 2. Petitioner herein, who was appointed on daily wage basis as Beldar on 14.11.1987, was regularised in the year 2000. In the year 2007, petitioner was promoted to the post of Clerk on the 1Whether the reporters of the local papers may be allowed to see the judgment? 2025:HHC:31959 -2- recommendations made by Departmental Promotion Committee, meeting of which was held on 31.05.2012. Subsequently, petitioner was further promoted to the post of Senior Assistant on ad hoc basis in the pay band of 10300+34800 + 3800/- Grade Pay vide office order dated ₹ ₹ 11.07.2012. After promotion, petitioner was ordered to be posted at HIMUDA Head Office, as a result thereof, he was relieved from the HIMUDA Division, Dharamshala, on 31.07.2012. Though in the year 2012, petitioner joined as Senior Assistant in HIMUDA Head Office, Shimla, but vide order dated 20.02.2015, he was ordered to be reverted to the post of Clerk. Some of similar situate persons, who were also demoted, approached this Court by way of Civil Writ Petition and their reversion was stayed. In the writ petition filed by other persons, their reversion from the post of Senior Assistant to the post of Clerk was set aside vide judgment dated 28.07.2020. Aforesaid judgment passed by learned Single Judge further came to be upheld by the Division Bench of this Court as well as Hon’ble Apex Court. 3. On 30.11.2024, petitioner was again promoted to the post of Senior Assistant on the recommendations made by Departmental Promotion Committee and ultimately, he superannuated from the service on 30.11.2024. After his retirement, vide communication dated 23.01.2025, respondents while releasing the retiral benefits of the petitioner, ordered deduction of sum of 1,24,646/- from the leave ₹ encashment of the petitioner. On inquiry, it came to be transpired to the 2025:HHC:31959 -3- petitioner that vide communication dated 23.01.2025, Chief Accounts Officer, HIMUDA though had directed Branch Manager, UCO Bank Nigam Bihar to transfer sum of 7,58,280/- in the bank account of the ₹ petitioner through RTGS on account of leave encashment, but vide same communication, sum of 1,24,646/- was ordered to be deducted from ₹ the aforesaid amount, as a result thereof, petitioner got sum of 6,33,634/- out of total sum of 7,58,280/- on account of leave ₹ ₹ encashment. 4. In nutshell, grouse of the petitioner, as has been highlighted in the petition and further canvassed by Mr. Rajesh Kumar, learned counsel representing the petitioner is that since amount, if any, received by the petitioner in excess was not on account of his misrepresentation, coupled with the fact that amount, sought to be recovered, is being recovered after retirement of the petitioner, prayer made on behalf of the petitioner for setting aside the recovery deserves to be allowed in terms of mandate contained in the judgment passed by Hon’ble Apex Court in State of Punjab and Others Vs. Rafiq Masih (White Washer) and Others, (2015) 4 SCC 334. 5. Pursuant to notice issued in the instant proceedings, respondent has filed reply, wherein facts, as have been noticed hereinabove, have not been disputed, rather, attempt has been made to refute the claim of the petitioner on the ground that at the time of demotion of the petitioner from the post of Senior Assistant to Clerk, 2025:HHC:31959 -4- refixation was done, which was never challenged by the petitioner, but since he on account of his wrong promotion to the post of Senior Assistant had received amount in excess, no illegality can be said to have been committed by the respondent while ordering recovery of the same. Mr. Mr. Rohan Tomar, learned counsel representing the respondent though fairly admitted that amount, sought to be recovered, was not paid to him on his misrepresentation, but he stated that once such fact is quite apparent from the record that petitioner was not entitled to amount, which is now sought to be recovered, prayer made on behalf of the petitioner deserves to be rejected. 6. Having heard learned counsel representing the parties and perused material available on record, this Court finds that pursuant to recommendations made by the Departmental Promotion Committee, petitioner was promoted to the post of Senior Assistant vide order dated 11.07.2012 in the pay-scale of 10300-34800 + GP 3800/-. Pursuant to ₹ ₹ aforesaid order, petitioner kept on discharging the duties of Senior Assistant w.e.f. 11.07.2012 till passing of order dated 20.02.2015, whereby he was ordered to be reverted to the post of Clerk. Other similar situate persons approached this Court by way of writ petition, which was allowed vide judgment dated 28.07.2020. Reversion of similar situate persons were held bad by the learned Single Judge of this Court vide judgment, detailed hereinabove, which was further upheld up to the Hon’ble Apex Court. 2025:HHC:31959 -5- 7. Pursuant to judgment passed by the Hon’ble Apex Court, petitioner again came to be promoted to the post of Senior Assistant w.e.f. 26.08.2017, but fact remains that prior to his demotion to the post of Clerk, petitioner kept on discharging the duties of Senior Assistant w.e.f. 31.07.2012 till 20.02.2015 and thereafter, reversion of the petitioner along with other similar situate persons were held to be bad. Amount, if any, received by the petitioner in excess on account of his alleged wrong promotion to the post of Senior Assistant cannot be permitted to be recovered, especially when there is nothing to suggest that amount sought to be recovered was ever received by the petitioner on his misrepresentation. 8. Firstly respondents themselves on the basis of recommendations made by Departmental Promotion Committee promoted the petitioner to the post of Senior Assistant and thereafter vide order dated 20.02.2015, reverted him back to the post of Clerk. At the cost of repetition, it may be noticed that ultimately pursuant to the judgment passed by this Court, which was further upheld up to the Hon’ble Apex Court, petitioner along with other similar situate persons again came to be promoted to the post of Senior Assistant, may be w.e.f. 26.08.2017, but since w.e.f. 31.07.2012 till 20.02.2015, petitioner had discharged the duties of Senior Assistant and during this period, he had also received salary attached to the post of Senior Assistant, amount, otherwise sought to be recovered, cannot be recovered at this belated 2025:HHC:31959 -6- stage, especially when there is nothing in the reply of the respondent to suggest that amount sought to be recovered was ever received by the petitioner on his misrepresentation. 9. Hon’ble Apex Court in Rafiq Masih (supra) has categorically held that recovery from Class-III and Class-IV employee is wholly impermissible, especially after retirement. Moreover, amount sought to be recovered never came to be received by the petitioner on account of misrepresentation or fraud. Legal position as detailed hereinabove is not disputed by learned counsel representing the respondent. Relevant para of the afore judgment reads as under: “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 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 2025:HHC:31959 -7- harsh or arbitrary to such an extent, as would far outweigh the equitable balance of the employer's right to recover. 13. We are informed by the learned counsel representing the appellant- State of Punjab, that all the cases in this bunch of appeals, would undisputedly fall within the first four categories delineated hereinabove. In the appeals referred to above, therefore, the impugned orders passed by the High Court of Punjab and Haryana (quashing the order of recovery), shall be deemed to have been upheld, for the reasons recorded above.” 10. Learned Counsel for the petitioner, while relying upon the judgment passed by the Hon’ble Apex Court in Civil appeal No.7115 of 2010 titled as Thomas Daniel v. State of Kerala, submitted that although the Kerala High Court had directed recovery of the excess amount from the Death-cum-Retirement Gratuity (DCRG) of the appellant, but Hon’ble Apex Court, after considering various precedents, overruled this view and held that recovery from the appellant is impermissible in the absence of any misrepresentation or fault on the part of the employee. Drawing the same analogy, this Court is of the considered view that the sum of 1,24,464/- cannot be recovered from ₹ the leave encashment of the petitioner, particularly in view of the fact that the petitioner has already retired from service. 11. Consequently, in view of the detailed discussion made herein above as well as law taken into consideration, this Court finds merit in the present petition and accordingly, same is allowed. Impugned communications dated 23.01.2025 and 10.06.2025 (Annexure P-6 and P-7) are quashed and set aside with the further direction to respondent to refund sum of 1,24,646/- to the petitioner forthwith. ₹ 2025:HHC:31959 -8- The present petition is disposed in the above terms, so also the pending miscellaneous application(s), if any. (Sandeep Sharma), Judge September 11, 2025 (Rajeev Raturi)