THE MADHYA PRADESH FINANCIAL CODE ... - Mptreasury.org

THE MADHYA PRADESH FINANCIAL CODE 

VOLUME II 

Appendix 2 

(See Note 2 below Rule 25) 

Recovery from pension of losses caused to Government by a 

Government servant while in service 

The following instructions and those contained in the Annexure to this appendix 

should be observed in dealing with pension cases – 

(1) No pension case should be forwarded unaccompanied by a certificate to 

the effect that no enquiries are pending against the officer concerned 

which may result in orders to recover amounts or value of property lost 

from him. 

(2) When an officer is retiring, care should be taken to see that all recoveries 

due from him are mad before the pension is sanctioned, and particular 

care should be exercised in checking stock, articles and moneys for which 

he is responsible. All shortages and suspected defalcations must also be 

reported at once. 

(3) An indemnity bond in the subjoined form should be taken from an officer 

where checking of stock, etc., cannot be completed for some time and 

retirement cannot be delayed and it should be made clear to the officer 

that if he does not make good the loss, a civil suit would be filed against 

him to enforce the bond. Where pension has already been sanctioned, civil 

suits should, if necessary, be filed in cases where the sums involved are 

large and negligence or fraud can be established. 

Indemnity Bond 

Whereas I (name) ………………….. am holding the office of ……………. Under the 

Government of Madhya Pradesh; 

And whereas in pursuance of the orders of Government contained in …………………… I 

am retiring/proceeding on leave preparatory to retirement from Government service, 

and accordingly handing over charge of my said officer to ……………..; 

And whereas it is not possible for Government or my successor fully and adequately 

to examine the accounts of all moneys belonging or due to Government for the 

custody or recovery of which I am responsible or to check the stock of Government 

Appendix 2 1 of 4 

Recovery from pension of losses caused to Government by 

a Government servant while in service


VOLUME II 

property in my charge within the time available before the date on which I am to be 

relieved of my said office. 

And whereas it is incumbent upon me truly and faithfully to account for all the 

moneys and property aforesaid and to indemnify Government for any loss or damage 

which may have happened or been sustained during my tenure of the said office and 

which shall be discovered after my; relief therefrom. 

NOW IT IS HEREBY AGREED AND DECLARED by me that in case any such loss or 

damage is discovered, and the State Government is satisfied, after giving me an 

opportunity to explain the same and after taking into consideration my explanation in 

respect thereof provided it is submitted within a reasonable time, that the loss or 

damage was due to neglect, failure, misconduct or disobedience on my part, and 

requires me, by notice in writing, to make good that loss or damage, I undertake 

forthwith to do so or to pay such amount by way of compensation for the loss or 

damage as may be specified in that notice. 

I FURTHER AGREE AND DECLARE that if I fail to pay any amount demanded from me 

within a reasonable time, the same may be recovered from me by a civil suit or as 

an arrear of land revenue. 

Government has agreed to bear any stamp duty with which this bond may be 

chargeable. 

Signed by me this ………………………………….……. Day of ……………. 

(Signature) ……………………… 

(Office) ……………….……. 

Annexure 

Instructions in regard to recoveries from pensions issued by the Comptroller and 

Auditor General in consultation with the Government of India and adopted by the 

State Government 





VOLUME II 

1. (a) The term ‘pension’ referred to in these instructions included also a 

compassionate allowance which, although it is of the nature of an ex-gratia 

payment, is really a form of pension. Recoveries from it, once it is sanctioned, 

should accordingly be governed by the same orders as are applicable to ordinary 

pensions. 

(b) These instructions do not apply to recoveries on account of income-tax made 

from pensioners to whom the Indian Income-tax Act, 1922, applies, i.e., if they are 

resident in India as it is obligatory on officers disbursing ‘salaries’ which include 

pensions [section 7 (I), Incometax Act] to make such recoveries on receipt of notices 

under section 46 (5) of the Income-tax Act. 

2. A claim may become known and the question of making recovery may arise – 

(A) when the calculation of pension is being made and before the pension is 

actually sanctioned; or 

(B) after the pension has been sanctioned. 

The claim and the recovery may be one or other of the following – 

(1) Recovery as a punitive measure in order to make good loss caused to 

Government as a result of negligence or fraud on the part of the person 

concerned while he was in service. 

(2) Recovery of other Government dues such as over issue of pay, allowances 

or leave salary, or admitted and obvious dues such as house rent, Postal 

Life insurance premia, outstanding motor car, house building, travelling 

allowance or other advances. 

(3) Recovery of non Government dues. 

3. (1) In cases falling under (A) above, none of the recoveries mentioned in (1) to 

(3) above may be effected by a reduction of the pension about to be sanctioned, 

except in the following circumstances – 

(a) When an officer's service can be held to have been not thoroughly 

satisfactory, a reduction in the amount of pension may be made under Article 

470 (B), Civil Service Regulations, by a competent authority, although no 

direct penal recovery from pension is permissible. 

(b) When the pensioner by request made or consent given has agreed that the 

recovery may be made. If such request is not made or consent is not given by 

the pensioner, even sums admitted due to Government such as house rent 





VOLUME II 

outstanding advances, etc., may not be recovered from pension. In such 

cases, however, the executive authorities concerned would have to consider 

whether they should not try to effect the recovery otherwise than from 

pension, for example, by going to a court of law, if necessary. 

(2) In cases falling under (b) above, none of the recoveries described in clauses 

(1) to (3) may be effected by deduction from a pension already sanctioned 

except at the request or with the express consent of the pensioner. Under Article 

351 of the Civil Service Regulations, future good conduct is an implied condition 

of every grant of a pension and a pension can be withheld or withdrawn in whole 

or in part if the pensioner is convicted of serious crime or is guilty of grave 

misconduct. This, however, refers only to crime or misconduct occurring after the 

pensioner has retired from service, and the rule would not, therefore, cover a 

reduction of pension made for the purpose of retrieving loss caused to 

Government as a result of negligence or fraud on the part of the pensioner 

occurring before he had retired from service. 

In cases where the pensioner does not agree to recovery being made even of 

sums admittedly due to Government, the concluding remarks made under (!) (b) 

above will also be applicable. 

Note – The instructions contained in this paragraph apply also to recoveries of 

over issues of pension. 

4. The above decisions make it specially important to enforce very strictly the rule 

that until it has been established that an officer has no outstanding due to 

Government his last pay or leave salary prior to retirement should not be paid. 

The enhanced importance of this should be impressed upon all audit, or treasury, 

or other disbursing officers, although it must be recognised that some times it 

may not be practicable to ascertain in time all the outstanding due while 

sometimes the dues may exceed the amount of last pay or leave salary. Cases of 

loss to Government such as are here indicated which cannot be made good by 

recovery from pension may be noted in the Appropriation Report, if when they 

occur they seem to be significant.

THE MADHYA PRADESH FINANCIAL CODE ... - Mptreasury.org

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?