Excess Payment Made To Govt Employee Without His Fault Can't Be Recovered From His Leave Encashment Benefits After Retirement: Orissa High Court

The Orissa High Court has held that excess payment made to a government employee cannot be recovered by the employer from his 'leave encashment benefits' after his retirement, especially when it is apparent that the excess payment was erroneously made by the employer without any fault on the part of the employee. Granting relief to a former Mail Man in the postal department, the Division Bench of Chief Justice Chakradhari Sharan Singh and Justice Sangam Kumar Sahoo held – “It is no more res integra that the government cannot be allowed to recover excess payment of emoluments/allowances if the said payment was made by the employer by applying a wrong principle for calculating the pay or on the basis of erroneous interpretation of the rules.” Background The Opposite Party was appointed as a Mail Man in the postal department on 17.01.1984. After his retirement, the petitioner-authorities withheld his leave encashment benefit with the purpose that the excess payment that was made to the opposite party can be recovered from such benefit as was due to him after his retirement. Furthermore, the Court was of the considered opinion that when the petitioner-authorities erred in granting excess payment to the employee, without having any fault on his part, the petitioners cannot be allowed to recover the same amount from his leave encashment benefits.