Mekha Ram VS State of Rajasthan

Mekha Ram VS State of Rajasthan - Supreme Court Case

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS. 2229-2234 OF 2022

Mekha Ram and Others Etc. Etc. …Appellants

Versus

State of Rajasthan and Others Etc.Etc. …Respondents

WITH

CIVIL APPEAL NOS. 2235-2249 OF 2022

CIVIL APPEAL NOS. 2250-2251 OF 2022

CIVIL APPEAL NO. 2252 OF 2022

CIVIL APPEAL NOS. 2253-2256 OF 2022

J U D G M E N T

M.R. SHAH, J.

1. Feeling aggrieved and dissatisfied with the impugned common

judgment and order dated 06.05.2016 passed by the Division Bench of

the High Court of Judicature for Rajasthan, Jaipur Bench Jaipur in D.B.

Special Appeal (Writ) No. 1883/2014 and other connected appeals, by

which the Division Bench of the High Court has allowed the said appeals

and has quashed and set aside the respective judgments and orders

passed by the learned Single Judge of the High Court and held that the

three years Nursing Course by the in-service candidates could not be

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treated as a period on deputation and be treated only on leave whatever

due to the candidates and consequently has reserved the liberty in

favour of the State to recover the excess amount paid to the original writ

petitioners treating the period of training as a period of leave permissible

to him/her in easy equal installments, the original writ petitioners have

preferred the present appeals.

2. That the original writ petitioners are working either as ANM

(Auxiliary Nursing & Midwifery) or Lab Technician, Multi-Purpose Worker,

Accounts Clerk or other similarly situated posts. They are the members

of the Rajasthan Medical & Health Subordinate Service Rules, 1965.

They applied for the course of General Nursing Training which is of three

years duration and is regulated according to the General Nursing

Training Course Rules, 1990 (hereinafter referred to as the ‘Rules

1990’).

2.1 That all the original writ petitioners submitted their applications, in

the prescribed proforma as in-service candidates, seeking admission to

the course of General Nursing as envisaged under Rule 9 of the Rules

1990. That all the in-service candidates were required to be considered

eligible to seek admission provided they fulfilled the criterion for

admission and eligibility under Rule 11 of the Rules 1990. All the original

writ petitioners submitted their applications for seeking study leave

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knowing it fully well that joining three years Nursing Course cannot be

treated on deputation for the in-service candidates. All the original writ

petitioners completed their course or some of them were either doing

their internship or a few, after completion of their internship, filed writ

petitions before the learned Single Judge of the High Court and prayed

that the study leave sanctioned to them by the competent authority may

be treated as on deputation. That the learned Single Judge allowed the

batch of writ petitions with the following directions:

“Looking to the aforesaid, these writ petitions are being disposed of with

the following directions:

1. Respondents are directed to comply with the observations and

expectations of the Hon’ble Apex Court as given in the case of

Sushil Sharma (supra) [State of Rajasthan vs. Sushil Sharma, Civil

Appeal No. 5283/2001, dated 10.08.2001], thereby, they will not

allow benefit of deputation allowance to anyone in violation of rule

112 read with rule 97 of the RSR. This is irrespective of the

categories of the post in the respondent department;

2. If there is shortage of Junior Specialist, endeavour should be to

amend the Rules so that direct recruitment can be made, as

presently aforesaid post is filled up by promotion only. However, on

the pretext of shortage of Junior Specialist, respondents cannot be

allowed to violate or circumvent the rules. This is more so when it

goes even against the observations and expectations of the Hon’ble

Apex Court in the case of Sushil Sharma (supra). The respondents

will accordingly allow study leave and benefit thereupon as per rule

111 and 112 read with rule 97 of the RSR;

3. Since for many posts, benefit of study leave with full salary has been

allowed, hence, to avoid discrimination, respondents have agreed to

extend similar benefit to the petitioners also, however, arrangement

aforesaid would be limited to those who have already joined the

training course of GNM and now onwards nobody would be allowed

study leave benefit in violation of the provision of RSR;

4. Compliance of the aforesaid order may be made within a period of

one month from the date of receipt of copy of this order.”

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2.2 That thereafter the State preferred intra-court appeals before the

Division Bench. The Division Bench permitted the State to file review

applications. The State filed review applications before the learned

Single Judge, which came to be dismissed. Subsequently, the State

again filed intra-court appeals before the Division Bench against the

judgment(s) and order(s) passed by the learned Single Judge, allowing

the writ petitions and holding that the original writ petitioners are entitled

to treat their period of training as the period on leave permissible to

him/her. By the impugned common judgment and order, the Division

Bench of the High Court has allowed the intra-court appeals and while

approving the earlier decision of the learned Single Judge has held that

the period spent on training course by the in-service candidates shall not

be treated as a period on deputation and be treated only on leave

whatever due to the candidates. That as during the pendency of the

intra-court appeals, under threat of the contempt of the judgment and

order passed by the learned Single Judge, the original writ petitioners

were paid the amount and holding that the period of training is to be

treated as period on leave permissible to him/her, the Division Bench

also directed that the State shall be at liberty to recover the excess

amount paid to the original writ petitioners during their period of training

as a period of leave permissible to him/her in easy equal installments.

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2.3 Feeling aggrieved and dissatisfied with the impugned common

judgment and order passed by the Division Bench of the High Court

reserving liberty in favour of the State to recover the excess amount

paid, the original writ petitioners have preferred the present appeals.

3. At the outset, it is required to be noted that this Court issued notice

in the present special leave petitions/appeals limited to the aspect of the

recovery of the amounts from the original writ petitioners, as directed in

the impugned judgment and in the meanwhile directed stay of recovery.

In that view of the matter, the only issue which is now required to be

considered is, whether there shall be recovery of the amounts from the

original writ petitioners, as directed in the impugned judgment and order

passed by the Division Bench of the High Court.

4. Shri R.K. Singh, learned Advocate appearing on behalf of the

original writ petitioners has heavily relied upon the decision of this Court

in the case of State of Punjab v. Rafiq Masih, reported in (2015) 4 SCC

334. Relying upon the aforesaid decision, it is vehemently submitted that

as observed and held by this Court, recovery from the employees

belonging to Class III and Class IV service (Group C and Group D

service) is impermissible.

4.1 Learned counsel appearing on behalf of the original writ petitioners

has prayed and submitted that as the respective original writ petitioners

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are serving on Class III and Class IV posts, the amount already paid in

excess may not be recovered by the State. In the alternative, it is prayed

that the original writ petitioners may be given reasonable monthly

installments to repay the amount which is paid in excess to them.

5. Dr. Manish Singhvi, learned Senior Advocate appearing on behalf

of the State has submitted that the decision of this Court in the case of

Rafiq Masih (supra), which has been relied upon by the learned counsel

appearing on behalf of the original writ petitioners, is not applicable to the

facts of the case on hand. It is submitted that in the aforesaid case the

amount was paid to the employees mistakenly by the State/State

authorities which was sought to be recovered and under those

circumstances this Court observed and held that the recovery of the

excess amount paid is impermissible in case of employees belonging to

Class III and Class IV service (Group C and Group D service). It is

submitted that in the present case, it is not the case where the amount in

excess was paid mistakenly by the State or the State authorities. Rather

the excess amount was paid pursuant to the order passed by the learned

Single Judge, under the threat of the contempt proceedings, which order

has now been set aside by the Division Bench. It is submitted that once

the order passed by the learned Single Judge, pursuant to which the

original writ petitioners were paid the amount, came to be set aside by

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the Division Bench, the necessary consequences shall follow and on the

principle of restitution, the State shall be entitled to recover the amount

paid in excess.

5.1 Reliance is placed on the decision of this Court in the case of

Indore Development Authority v. Manohar Lal, reported in (2020) 8 SCC

129 (paragraphs 334 to 336) and the decision of this Court in the case of

South Eastern Coalfields Ltd. v. State of M.P., reported in (2003) 8 SCC

648 (paragraphs 25 to 30), on the principle of restitution.

5.2 Making the above submissions and relying upon the aforesaid

decisions, more particularly the decisions of this Court on the principle of

restitution, learned Senior Advocate appearing on behalf of the State has

submitted that in the facts and circumstances of the case, the Division

Bench of the High Court has not committed any error in permitting the

State to recover the excess amount paid. However, the learned Senior

Advocate has fairly stated that the original writ petitioners may be given

reasonable installments, which even the Division Bench has observed in

the impugned judgment.

6. We have heard the learned counsel for the respective parties at

length.

At the outset, it is required to be noted that in the present case the

amount paid in excess to the appellants was not due to any mistake on

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the part of the State/State authorities. The excess amount has been paid

pursuant to the order passed by the learned Single Judge, which has

been subsequently set aside by the Division Bench. Therefore, on

quashing and setting aside the judgment and order passed by the

learned Single Judge under which the original writ petitioners were paid

the excess amount, the necessary consequences must follow.

Therefore, considering the fact that the amount already paid in excess

was not paid by the State mistakenly but was paid pursuant to the order

passed by the learned Single Judge which has been set aside

subsequently, the decision of this Court in the case of Rafiq Masih

(Supra) shall not be applicable. The said decision of this Court may be

applicable only in a case where the amount has been paid by the

State/State Authorities mistakenly and it is found that there was no fault

and/or any misrepresentation on the part of the employee and that the

concerned employee is not found responsible for such excess amount

paid mistakenly. The amount paid in excess pursuant to the order

passed by the learned Single Judge which has been set aside by the

Division Bench has to be refunded and/or returned by the original writ

petitioners which the State is entitled to recover from them on the

principle of restitution.

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6.1 At this stage, the decision of this Court in the case of Indore

Development Authority (supra) on principle of restitution is required to be

referred to. In the said decision, a Constitution Bench of this Court after

considering the earlier decision in the case of South Eastern Coalfields

(supra) and other decisions on the principle of restitution, has observed

and held in paragraphs 335 to 336 as under:

In re : Principle of restitution

“335. The principle of restitution is founded on the ideal of doing complete

justice at the end of litigation, and parties have to be placed in the same

position but for the litigation and interim order, if any, passed in the matter.

In South Eastern Coalfields Ltd. v. State of M.P. [South Eastern Coalfields

Ltd. v. State of M.P., (2003) 8 SCC 648], it was held that no party could

take advantage of litigation. It has to disgorge the advantage gained due

to delay in case lis is lost. The interim order passed by the court merges

into a final decision. The validity of an interim order, passed in favour of a

party, stands reversed in the event of a final order going against the party

successful at the interim stage. Section 144 of the Code of Civil Procedure

is not the fountain source of restitution. It is rather a statutory recognition

of the rule of justice, equity and fair play. The court has inherent

jurisdiction to order restitution so as to do complete justice. This is also on

the principle that a wrong order should not be perpetuated by keeping it

alive and respecting it. In exercise of such power, the courts have applied

the principle of restitution to myriad situations not falling within the terms of

Section 144 CPC. What attracts applicability of restitution is not the act of

the court being wrongful or mistake or an error committed by the court; the

test is whether, on account of an act of the party persuading the court to

pass an order held at the end as not sustainable, resulting in one party

gaining an advantage which it would not have otherwise earned, or the

other party having suffered an impoverishment, restitution has to be made.

Litigation cannot be permitted to be a productive industry. Litigation cannot

be reduced to gaming where there is an element of chance in every case.

If the concept of restitution is excluded from application to interim orders,

then the litigant would stand to gain by swallowing the benefits yielding out

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of the interim order. This Court observed in South Eastern

Coalfields [South Eastern Coalfields Ltd. v. State of M.P., (2003) 8 SCC

648] thus: (SCC pp. 662-64, paras 26-28)

“26. In our opinion, the principle of restitution takes care of this

submission. The word “restitution” in its etymological sense means

restoring to a party on the modification, variation or reversal of a

decree or order, what has been lost to him in execution of decree or

order of the court or in direct consequence of a decree or order

(see Zafar Khan v. Board of Revenue, U.P. [Zafar Khan v. Board of

Revenue, U.P., 1984 Supp SCC 505] ). In law, the term “restitution” is

used in three senses : (i) return or restoration of some specific thing

to its rightful owner or status; (ii) compensation for benefits derived

from a wrong done to another; and (iii) compensation or reparation

for the loss caused to another. (See Black's Law Dictionary, 7th Edn.,

p. 1315). The Law of Contracts by John D. Calamari & Joseph M.

Perillo has been quoted by Black to say that “restitution” is an

ambiguous term, sometimes referring to the disgorging of something

which has been taken and at times referring to compensation for the

injury done:

‘Often, the result under either meaning of the term would be the

same. … Unjust impoverishment, as well as unjust enrichment, is a

ground for restitution. If the defendant is guilty of a non-tortious

misrepresentation, the measure of recovery is not rigid but, as in

other cases of restitution, such factors as relative fault, the agreedupon risks, and the fairness of alternative risk allocations not agreed

upon and not attributable to the fault of either party need to be

weighed.’

The principle of restitution has been statutorily recognised in Section 144

of the Code of Civil Procedure, 1908. Section 144 CPC speaks not only of

a decree being varied, reversed, set aside or modified but also includes an

order on a par with a decree. The scope of the provision is wide enough so

as to include therein almost all the kinds of variation, reversal, setting

aside or modification of a decree or order. The interim order passed by the

court merges into a final decision. The validity of an interim order, passed

in favour of a party, stands reversed in the event of a final decision going

against the party successful at the interim stage. …

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27. … This is also on the principle that a wrong order should not be

perpetuated by keeping it alive and respecting it (A. Arunagiri

Nadar v. S.P. Rathinasami [A. Arunagiri Nadar v. S.P. Rathinasami,

1970 SCC OnLine Mad 63] ). In the exercise of such inherent power,

the courts have applied the principles of restitution to myriad

situations not strictly falling within the terms of Section 144.

28. That no one shall suffer by an act of the court is not a rule

confined to an erroneous act of the court; the “act of the court”

embraces within its sweep all such acts as to which the court may

form an opinion in any legal proceedings that the court would not

have so acted had it been correctly apprised of the facts and the law.

… the concept of restitution is excluded from application to interim

orders, then the litigant would stand to gain by swallowing the

benefits yielding out of the interim order even though the battle has

been lost at the end. This cannot be countenanced. We are,

therefore, of the opinion that the successful party finally held entitled

to a relief assessable in terms of money at the end of the litigation, is

entitled to be compensated by award of interest at a suitable

reasonable rate for the period for which the interim order of the court

withholding the release of money had remained in operation.”

(emphasis supplied)

336. In State of Gujarat v. Essar Oil Ltd. [State of Gujarat v. Essar Oil Ltd.,

(2012) 3 SCC 522 : (2012) 2 SCC (Civ) 182] , it was observed that the

principle of restitution is a remedy against unjust enrichment or unjust

benefit. The Court observed : (SCC p. 542, paras 61-62)

“61. The concept of restitution is virtually a common law principle,

and it is a remedy against unjust enrichment or unjust benefit. The

core of the concept lies in the conscience of the court, which

prevents a party from retaining money or some benefit derived from

another, which it has received by way of an erroneous decree of the

court. Such remedy in English Law is generally different from a

remedy in contract or in tort and falls within the third category of

common law remedy, which is called quasi-contract or restitution.

62. If we analyse the concept of restitution, one thing emerges clearly

that the obligation to restitute lies on the person or the authority that

has received unjust enrichment or unjust benefit (see Halsbury's

Laws of England, 4th Edn., Vol. 9, p. 434).”

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In the said decision, it is further observed and held that the

restitution principle recognizes and gives shape to the idea that

advantages secured by a litigant, on account of orders of court, at his

behest, should not be perpetuated.

6.2 In the case of Ouseph Mathai v. M. Abdul Khadir, reported in

(2002) 1 SCC 319, it is observed and held that after the dismissal of the

lis, the party concerned is relegated to the position which existed prior to

the filing of the petition in the court which had granted the stay.

6.3 Even otherwise, no one can be permitted to take the benefit of the

wrong order passed by the court which has been subsequently set aside

by the higher forum/court. As per the settled position of law, no party

should be prejudiced because of the order of the court.

7. Even, Section 144 of the Code of Civil Procedure provides for

restitution. Section 144 of the CPC reads as under:

“144. Application for restitution – (1) Where and insofar as a decree or an

order is varied or reversed in any appeal, revision or other proceeding or is

set aside or modified in any suit instituted for the purpose, the Court which

passed the decree or order shall, on the application of any party entitled in

any benefit by way of restitution or otherwise, cause such restitution to be

made as will, so far as may be, place the parties in the position which they

would have occupied but for such decree or order or such part thereof as

has been varied, reversed, set aside or modified; and, for this purpose, the

Court may make any orders, including orders for the refund of costs and

for the payment of interest, damages, compensation and mesne profits,

which are property consequential on such variation, reversal, setting aside

or modification of the decree or order.

Explanation – For the purposes of sub-section (1) the expression “Court

which passed the decree or order shall be deemed to include,

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(a) Where the decree or order has been varied or reversed in exercise of

appellate or revisional jurisdiction, the Court of first instance;

(b) Where the decree or order has been set aside by a separate suit, the

Court of first instance which passed such decree or order;

(c) Where the Court of first instance has ceased to exist or has ceased to

have jurisdiction to execute it, the Court which, if the suit wherein the

decree or order was passed were instituted at the time of making the

decree or order was passed were instituted at the time of making the

application for restitution under this section, would have jurisdiction to

try such suit.

2. No suit shall be instituted for the purpose of obtaining any

restitution or other relief which could be obtained by application under subsection (1).”

8. In the present case, the order passed by the learned Single Judge

has been set aside by the Division Bench of the High Court and therefore

by applying Section 144 CPC also, the amount paid pursuant to the

order passed by the learned Single Judge which has been set aside by

the Division Bench is required to be refunded/returned by the original writ

petitioners.

Therefore, in the facts and circumstances of the case, narrated

hereinabove, the Division Bench of the High Court is absolutely justified

in reserving liberty in favour of the State to recover the amount paid in

excess to the original writ petitioners. It is required to be noted that even

while reserving liberty to recover the amount paid in excess, the Division

Bench has observed that the same be recovered in easy equal

installments.

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9. In view of the above and for the reasons stated above, the Division

Bench of the High Court has not committed any error in reserving liberty

in favour of the State to recover the amount paid in excess to the original

writ petitioners. However, at the same time, considering the prayer made

on behalf of the original writ petitioners to recover the amount in easy

equal installments, we direct that whatever amount is paid in excess to

the original writ petitioners, pursuant to the order passed by the learned

Single Judge, be recovered from the original writ petitioners in thirty-six

equal monthly installments, to be deducted from their salary commencing

from April, 2022.

10. The instant appeals are accordingly disposed of in the aforesaid

terms. No costs.

………………………………J.

[M.R. SHAH]

NEW DELHI; ………………………………J.

MARCH 29, 2022. [B.V. NAGARATHNA]

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