Retrospective reduction of pay scale of government employee and recovery thereof illegal: Supreme Court

Jagdish Prasad Singh Vs State of Bihar and Others (Supreme Court of India)

Supreme Court held that that any decision taken by the State Government to reduce an employee’s pay scale and recover the excess amount cannot be applied retrospectively and that too after a long time gap. Accordingly, action directing reduction of pay scale and recovery of the excess amount is grossly arbitrary and illegal.

Facts- Appellant was appointed to the post of Supply Inspector in the Government of Bihar in the year 1966. After serving for 15 years, he received his first time bound promotion as Marketing Officer and was put in Junior Selection Grade w.e.f. 1^st April, 1981. Upon completing 25 years in service, the appellant was further promoted to the post of Senior Selection Grade, Marketing Officer-cum-Assistant District Supply Officer (ADSO) w.e.f. 10^th, March 1991 in the pay scale of Rs.2000-3800.

Accountant General, State of Bihar, raised an objection dated 28^th January, 2003, regarding the promotion accorded to the appellant on 10^th March, 1991 with a further remark that the promotion given to the appellant on 10^th March, 1991 would become ineffective after 1^st January, 1996 in view of the Government Resolution dated 8^th February, 1999 and, thus, the pay scale of the appellant would have to be revised and reduced to match that of the lower post, i.e., the Marketing Officer.