Employees not at fault if employer grants more terminal benefits than they are entitled to

The Gujarat High Court set aside an order to recover Rs 63,878 from an ex-employee


When the Ahmedabad Municipal Corporation directed a former employee to repay Rs 63,878 which was paid to him as terminal benefits, by mistake, at a higher pay scale than he was entitled to, the Gujarat High Court set aside the order.

Justice Biren Vaishnav maintained that the employee was not paid more than what he is entitled by any fault of his. He had not made any mistake or indulged in any fraud. The money had been granted to him without him being aware that it was more than what he was entitled to. Hence, the Corporation cannot hold him responsible for receiving an excess amount, and then expect him to return the amount.

The Court ordered the Ahmedabad Municipal Corporation to refund the amount of Rs.63,878 to the employee within ten weeks from the date of receipt of the writ of the order of this court.

Back in 2016 too, in a similar case, the High Court had been approached by the Ahmedabad Municipal Corporation, which had tried to recover money from the pension of certain employees, as it had made a mistake in fixation of pay as per the pay-scale. It wanted recover the excess amount without allow the said employee an opportunity of hearing. At the time, it was held that such recovered were wrong as per law.

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