In Brief
Medical officers and dentists working as specialists in Madhya Pradesh received pay benefits under a 2009 circular that was later withdrawn in 2012 as unauthorised. The State sought to recover the amounts paid, plus interest. The Supreme Court held that while the circular could be withdrawn, the State was not justified in recovering the excess payments with interest from employees who received the benefits in good faith. The Court recognised that the error originated with the government, not the employees, and that recovery would unfairly burden some retired doctors. The appeals were partly allowed: no recovery is permitted, but future pay and pensions are to be calculated as if the circular was never issued.
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