Safiya Malik

The High Court of Tripura has ruled in favour of an appellant challenging the withdrawal of her pay increments, directing the respondents to ensure due process and adherence to principles of natural justice. The court, while setting aside the reduction of the appellant’s salary, upheld the decision barring the recovery of the amounts already paid.

The appellant, Mousumi Bhattacharjee, was initially engaged on a contingent basis in Tripura Markfed on January 11, 1993. Over the years, she continued to serve in various capacities before being regularized as a Junior Assistant on December 28, 2012. Her employment history included continuous service in administrative roles, where she performed clerical and supervisory duties. On November 1, 2019, she submitted a representation requesting two advance increments based on her past experience, citing long years of service and prior recommendations within the organization.

In its meeting held on July 1, 2020, the Board of Directors of Tripura Markfed approved her request for advance increments, which led to an increase in her basic pay. However, after an internal audit, the respondents determined that these increments had been granted improperly without sufficient legal backing. Consequently, in a Board meeting held on January 19, 2024, a resolution was passed to withdraw the increments. The respondents followed up with a memorandum dated February 17, 2024, which reduced the appellant’s basic pay from Rs. 34,100/- to Rs. 31,400/-, effective from July 1, 2023. Additionally, the respondents-initiated steps to recover the excess amount paid to the appellant.

Aggrieved by this decision, the appellant filed a writ petition seeking relief against the pay reduction and recovery efforts. She challenged the memorandum dated February 17, 2024, and sought the restoration of her pay to Rs. 34,100/-, in addition to an injunction against the recovery of any amount deemed as excess payment.

The learned Single Judge, in its judgment dated July 5, 2024, partially allowed the writ petition. The court restrained the respondents from recovering the already disbursed amounts but upheld the decision to withdraw the increments, leading to the present appeal before the Division Bench.

During the appeal proceedings, the appellant’s counsel contended that the increments had been consciously granted by the Board of Directors of Tripura Markfed in its meetings held on March 4, 2020, and July 1, 2020. The counsel further argued that the withdrawal of increments and the subsequent reduction of pay were undertaken arbitrarily, without issuing a prior show-cause notice, thereby violating the principles of natural justice.

It was submitted that the appellant had not committed any fraud or misrepresentation. The increments were granted following due administrative process, and any subsequent withdrawal of those benefits required a hearing and justification. The appellant’s counsel stated that abrupt reduction in pay adversely impacted an employee’s financial stability, particularly in cases involving long-serving employees in Group-C positions.

On the other hand, the respondents' counsel argued that since public funds were involved, the petitioner was not legally entitled to financial benefits without proper authorization. The counsel maintained that the withdrawal of increments did not necessitate a prior notice and contended that the audit findings established that the increments had been erroneously granted.

The respondents relied on the Supreme Court’s ruling in Raj Kumar Soni & Anr. v. State of U.P. & Anr., arguing that an employer is entitled to rectify errors in pay fixation, provided the increments were granted without legal sanction. It was also contended that administrative errors in pay fixation did not create a vested right in favor of an employee, and rectification of such errors was within the purview of the employer’s authority.

The Additional Government Advocate appearing for the State respondents argued that the decision to withdraw the increments was justified, as the recovery pertained to pay fixation adjustments rather than a one-time financial settlement or retirement benefits. The respondents also asserted that in similar cases, courts had previously upheld recovery where pay benefits had been granted erroneously due to clerical errors.

After considering the arguments and examining  the case records, the Division Bench of the High Court of Tripura noted that the appellant had not been given an opportunity to be heard before the decision to reduce her pay was made. The court observed that such a decision, taken without adherence to the principles of natural justice, could not be sustained in law.

The High Court ruled that any withdrawal of financial benefits, particularly where the benefits had been in effect for a significant period, necessitated a due process, including notice and an opportunity for the affected employee to present their case. Accordingly, the portion of the Single Judge’s order that upheld the reduction of the appellant’s pay was set aside.

However, the High Court upheld the portion of the judgment that barred the respondents from recovering the excess amount already disbursed. The court directed the respondents to examine the appellant’s case afresh and make a decision following the law and principles of natural justice before taking any final steps regarding her pay scale.

Additionally, the court ruled that until a lawful decision was rendered after providing the appellant an opportunity to be heard, no further recovery should be made from her salary.

With these directions, the appeal was disposed of, and all pending applications were closed.

Case Title: Mousumi Bhattacharjee v. The State of Tripura & Ors.
Case Number: WA No. 94 of 2024
Bench: Justice T. Amarnath Goud and Justice Biswaijit Palit

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