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The Supreme has provided alleviation to 5 retired unit members from Odisha's judiciary section who had received excess wage arrears by mistake. (AI image)
Six years aft 5 employees received wage arrears, they were asked to wage them backmost to their department. However, the Supreme Court ruled successful their favour, striking down the demand. This is simply a lawsuit of the Odisha District judiciary department. Wondering wherefore the request was made and what made the apex tribunal onslaught it down? Here are the details:The Supreme Court has provided alleviation to 5 retired unit members from Odisha's judiciary section who had received excess wage arrears by mistake.
The court's verdict said that specified surplus payments cannot beryllium reclaimed from employees if they were not progressive successful immoderate fraudulent activities oregon misrepresentation starring to the incorrect payment.
Demand for repayment of wage arrears: What’s the lawsuit about?
According to an ET report, the lawsuit involves 5 erstwhile employees who worked arsenic Grade-I stenographers and Personal Assistants successful the territory judiciary section of Cuttack, Odisha. Following their retrospective promotion to assorted stenographer grades (I, II, and III), they received monetary benefits successful 2017.
The amounts credited to their accounts were Rs 26,034, Rs 40,713, Rs 26,539, Rs 24,683, and Rs 21,485 respectively, the study said.These monetary benefits, which see wage arrears, were granted based connected the mentation of the Shetty Commission's report, which determined their eligibility for higher wage scales and promotions. The employees received these benefits successful 2017 and subsequently retired from work successful 2020.
Three years post-retirement and six years aft receiving fiscal benefits, the Odisha District judiciary section successful Cuttack issued a betterment bid for the disbursed amount. The section concluded that the exertion of the Shetty Commission's recommendations had been incorrectly interpreted, necessitating the instrumentality of the arrears.The Cuttack Judiciary section issued directives connected September 8 and 12 of 2023, instructing 5 retired unit members to instrumentality the excess wage arrears they had received.The retired employees, who were not fixed an accidental to contiguous their case, filed a writ petition successful the Odisha High Court. The tribunal dismissed their petition done a judgement bid dated November 9, 2023, according to the ET report.Subsequently, these retired employees appealed to the Supreme Court, wherever they received a ruling successful their favour connected April 4, 2025.
What were the arguments of the 2 counsels?
The counsel for the employees presented their lawsuit successful the Supreme Court, arguing that the fiscal benefits were received without immoderate fraudulent actions oregon misrepresentation connected their part. The counsel contended that attempting to retrieve funds 3 years post-retirement was some unlawful and arbitrary. It was highlighted that the Odisha High Court had overlooked established ineligible precedents acceptable by the Supreme Court, which deemed specified recoveries from retired low-wage workers arsenic legally invalid.The Cuttack judiciary department's typical countered successful the Supreme Court by asserting that the retired unit were not eligible for the received fiscal benefits.
They noted that some the District Judge of Cuttack and the High Court of Orissa had confirmed this done administrative channels, frankincense validating the betterment process.The department's counsel further explained that the fiscal benefits linked to retrospective promotion came with circumstantial conditions. These included an statement to refund immoderate excess payments, supported by written undertakings from the employees.
Based connected these agreements, the counsel argued that the employees were not successful a presumption to contention the betterment of incorrectly disbursed payments.
Judgment (2025 INSC 449): Supreme Court’s ruling explained
According to the ET report, successful the judgement (2025 INSC 449) of April 4, 2025, Justices PS Narasimha and Prashant Kumar Mishra clarified that their deliberation did not interest the validity of retrospective promotion and fiscal benefits granted to the retired employees connected May 10, 2017.The superior absorption was connected determining whether it was due to retrieve amounts fixed to the appellants during their work play aft retirement, peculiarly without providing them an accidental for a hearing.The Supreme Court referenced respective established precedents, including "Sahib Ram vs. State of Haryana (1995) Supp (1) SCC 18, Shyam Babu Verma vs. Union of India (1994) 2 SCC 521, Union of India vs.
M. Bhaskar (1996) 4 SCC 416 and V. Gangaram vs. Regional Jt. Director (1997) 6 SCC 139" and the caller "Thomas Daniel vs. State of Kerala & Ors. (2022) SCC online SC 536".The Court reaffirmed its accordant presumption that excess payments cannot beryllium recovered if they resulted from leader errors successful calculation oregon mentation of rules, alternatively than worker fraud oregon misrepresentation. This applies to overpayment of some emoluments and allowances.The apex tribunal clarified that providing alleviation against betterment stems from judicial discretion and equity considerations, alternatively than an employee's inherent rights. This discretionary powerfulness aims to shield employees from undue hardship that mightiness originate from betterment orders.Regarding the lawsuit astatine hand, the tribunal noted that the retired unit members were employed arsenic stenographers during the play erstwhile the disputed 'illegal payment' was disbursed to them.The tribunal observed that records did not bespeak immoderate fraudulent enactment oregon misrepresentation by the employees. Additionally, the tribunal pointed retired the important clip spread betwixt the outgo made successful 2017 and the betterment bid issued successful 2023, with the employees having retired successful 2020 during this interval.The apex tribunal noted that it was undisputed that the retired unit members were not fixed immoderate accidental to contiguous their lawsuit earlier the betterment directive was issued.ET quoted the Supreme Court judgement arsenic saying: "The appellants (retired employees) having superannuated (retired) connected a ministerial station of Stenographer were admittedly not holding immoderate gazetted station arsenic specified applying the rule enunciated by this Court successful the supra quoted judgment, the betterment is recovered unsustainable."Decision: "For the aforestated, we are of the considered presumption that the entreaty deserves to beryllium allowed.
Accordingly, we let the entreaty and acceptable speech the bid of the High Court, and successful consequence, the orders dated September 12, 2023 and September 8, 2023 by which the appellants were directed to deposit the excess drawn arrears are acceptable aside."
What does the ruling mean for employees?
A spouse astatine Khaitan & Co, Vaibhav Bhardwaj, explained to ET that the Supreme Court has reinforced the established ineligible stance regarding the retrieval of surplus wage oregon payments from employees erstwhile determination is nary grounds of deception oregon mendacious representation. "The Supreme Court acceptable speech the betterment orders, holding that it would beryllium inequitable and unjust to compel betterment successful specified circumstances. The Court observed that employees, peculiarly those successful the little rungs of service, typically expend their net successful the mean people of beingness and are improbable to clasp funds received years earlier. Therefore, betterment aft a agelong delay, particularly post-retirement, would origin undue hardship,” Vaibhav Bhardwaj told ET.Bhardwaj added, "The judgment, grounded successful equitable principles, emphasises that the determination to retrieve indispensable equilibrium the hardship to beryllium inflicted connected the worker against the employer's close to reclaim the excess sum paid. It further clarifies that betterment from retired employees, employees who received the excess outgo much than 5 years anterior to the bid of recovery, oregon those who served bona fide successful a higher station aft being wrongly promoted, is impermissible successful law.
This ruling is important arsenic it reinforces the extortion of employees, peculiarly retired persons, against retrospective and inequitable administrative actions, thereby strengthening the rule of fairness successful employment."
