Retiree wins relief after 30 years, court sets aside recovery order over ‘Rs 3.6 lakh theft’

4 min readNew DelhiJul 2, 2026 07:00 PM IST

The department had ordered the recovery of Rs 3.12 lakh from the petitioner's salary by deducting Rs 2,500 every month starting from April 1996. (AI-generated image)

The Himachal Pradesh High Court has directed the state to refund money recovered from a retired employee with interest, while observing that no departmental inquiry had been completed against him despite the embezzlement allegations.

Justice Jiya Lal Bhardwaj was dealing with the plea of a retired senior assistant in the state Health Department, challenging the recovery orders that hold him liable for alleged embezzlement. The chargesheet had been issued against him before the departmental inquiry concluded.

“The petitioner who got retired from service on April 30, 2006, has been paid the retiral benefits only after the petition instituted by him…,” the June 25 order noted, adding that even then, the payment was made only after the court directed the authorities to release the amount.

The order added that once the petitioner was treated as being on duty, he could not be denied the benefit of promotion merely because he had been suspended and a departmental inquiry was initiated against him, which was never completed. “Since the petitioner has been deprived of his retiral benefits, he is entitled to interest on the said undisputed amount from the date when the same fell due to him,” it stated.

The petitioner was appointed as a clerk in 1966 and was promoted to senior assistant in 1983. On July 25, 1994, a disciplinary enquiry was proposed against him under Rule 14 of the Central Civil Services (Classification, Control and Appeal) Rules, alleging that he was absent from duty from January 2, 1994, and his whereabouts were unknown.

Justice Jiya Lal Bhardwaj said that once the petitioner had been acquitted, the recovery of the allegedly embezzled amount could not have continued.

In January 1995, the petitioner was chargesheeted on two counts – allegedly embezzling Rs 3.62 lakh in family welfare compensation funds while serving as a senior assistant between 1988 and 1991, and issuing a false no-dues certificate in 1992 to a retired dental surgeon despite Rs 2.32 lakh, excluding interest, remaining recoverable from him.

Employee’s claims

The petitioner claimed that he never received the first charge memo dated July 25, 1994. However, he did receive and submit a reply to the second charge memo dated January 23, 1995. The department ordered the recovery of Rs 3.12 lakh from the petitioner’s salary by deducting Rs 2,500 every month starting from April 1996, as per an office order issued on April 2, 1996.

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The petitioner challenged the salary recovery in 1998, but received no response. He made another representation in 2006. In 2011, the department revoked his suspension, treated the suspension period as time spent on duty, and allowed him to claim salary arrears for that period until his retirement on April 30, 2006.

The department also recovered money from his salary without completing a disciplinary inquiry. Though acquitted in the criminal case, his retiral benefits were withheld, forcing him to approach the court.

Petitioner entitled to interest: Order

Once the petitioner had been acquitted, the recovery of the allegedly embezzled amount could not have continued.

As per the records, the petitioner’s suspension had been revoked and the said period was considered as spent on duty.

The authorities failed to release the undisputed amount (retirement benefits) on time and the petitioner was therefore entitled to interest on the same.

Final order

The court quashed the recovery orders against the retired employee, holding that no recovery could be made without concluding a departmental inquiry and after his acquittal in the criminal case. It directed the state to refund the recovered and withheld amounts with 6 per cent interest, pay interest on delayed retiral benefits, consider his promotion, and complete the exercise within three months.

Jagriti Rai works with The Indian Express, where she writes from the vital intersection of law, gender, and society. Working on a dedicated legal desk, she focuses on translating complex legal frameworks into relatable narratives, exploring how the judiciary and legislative shifts empower and shape the consciousness of citizens in their daily lives.

Expertise

Socio-Legal Specialization: Jagriti brings a critical, human-centric perspective to modern social debates. Her work focuses on how legal developments impact gender rights, marginalized communities, and individual liberties.

Diverse Editorial Background: With over 4 years of experience in digital and mainstream media, she has developed a versatile reporting style. Her previous tenures at high-traffic platforms like The Lallantop and Dainik Bhaskar provided her with deep insights into the information needs of a diverse Indian audience.

Academic Foundations:

Post-Graduate in Journalism from the Indian Institute of Mass Communication (IIMC), India’s premier media training institute.

Master of Arts in Ancient History from Banaras Hindu University (BHU), providing her with the historical and cultural context necessary to analyze long-standing social structures and legal evolutions. ... Read More

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embezzlement

Himachal Pradesh High Court

Retirement benefits