NIA Can't Recover Salary Paid To Public Prosecutor During Deputation Based On Later Pay Re-Fixation: Kerala High Court

A Division Bench of Justice Devan Ramachandran and Justice Basant Balaji made the observation while allowing an Original Petition filed by a person who had served as an Assistant Public Prosecutor under the State of Kerala before being appointed on deputation as Public Prosecutor with the National Investigation Agency (NIA).

The dispute arose on NIA's decision to re-fix the petitioner's pay and seek recovery of amounts allegedly paid in excess during his deputation between 2011 and 2014.

The petitioner initially approached the Central Administrative Tribunal against the orders, but the original application was rejected and the Tribunal had directed the Authorities to re-fix the scale and pay after affording him an opportunity of being heard. Hence, he approached the High Court.

The petitioner relied upon the NIA's deputation notification dated July 5, 2010. Clause 65 of the notification stipulated that personnel deputed to the NIA would continue to draw the basic pay being drawn in their parent department, along with allowances admissible to Central Government employees.

The petitioner's basic pay in the State scale was Rs.20,740. A notional increment of Rs.500 was added, resulting in a pay fixation of Rs.21,240. The NIA later contended that his pay ought to have been fixed at Rs.15,600, relying on an option certificate allegedly indicating that he had opted for the Central scale of pay.

The High Court rejected the contention that the alleged option could, by itself, determine the petitioner's entitlement.

It considered an Office Memorandum issued by the Department of Personnel and Training, particularly Clause 5.1(ii)(b), which provides for addition of one increment to the pay in the parent cadre where the pay structure or dearness allowance pattern of the deputation post is dissimilar from that of the parent organisation.

The Court held that the employee's pay and allowances could not be regulated by the option alone but had to be determined by the relevant stipulations contained in the governing documents. The deputation notification and the Government of India's Office Memorandum therefore had to be considered.

“...when Annexure A3 is unmistakable that the candidate will benefit from the pay in the parent scale complemented by all the allowances in the Central pay, we fail to comprehend how the NIA can then rely upon a subsequent option stated to have been made by him, albeit in which he has not exercised his desire to continue to be in either of the pay scales.” Court noted.

The Court found force in the petitioner's contention that, having been offered deputation on the terms contained in the NIA notification, there was no basis to deprive him of the benefit of those terms by subsequently relying on an ambiguous option document.

The Court also expressed concern over the manner and timing of the re-fixation. Although the petitioner had been on deputation from 2011 to 2014, the authorities subsequently issued orders re-fixing his pay and raised recovery demands in January 2015. The Court observed that it was difficult to understand why the alleged error had not been rectified while the petitioner was still in service, and noted that the delay remained unexplained.

The High Court thus set aside the Central Administrative Tribunal's order as well as the NIA's orders re-fixing the petitioner's pay. It further directed that no recovery could be pursued against the petitioner on the basis of the disputed demands.

Case Title: Arjun Ambalapatta v Union of India and Ors.

Case No: OP(CAT) 45/ 2023

Citation: 2026 LiveLaw (Ker) 483

Counsel for Petitioner: Niharika Hema Raj, K.S. Prenjith Kumar (CGC), N.K. Subramanian