Patna High Court bars SBI from recovering Rs 3.51 lakh excess pension from widow

The Patna High Court on 28 October 2026 dismissed an appeal by the State Bank of India and upheld an order that stopped the bank from recovering Rs 3,51,020 in excess family pension from a widow, now 94. The excess was paid because of errors in the bank's own pension records, the court noted.

What Happened

According to the judgment, the widow of a retired Public Works Department road worker in Saran district drew family pension through an SBI branch. The bank's system wrongly recorded her pension as a "regular pension" and carried an incorrect date of birth, so she kept getting old-age increases after the Sixth Pay Commission revision. After correcting the entries, the bank said Rs 3,51,020 had been overpaid from 1 April 2007 to 30 November 2018. In December 2018 it cut her monthly pension from Rs 15,445 to Rs 7,196 and began recovery.

A single judge quashed the recovery on 30 September 2022. In appeal, the bank relied on an undertaking she had signed with her thumb impression to refund any excess. A division bench held that an undertaking does not remove the need to look at the circumstances. The court said she was illiterate, had no role in the wrong classification, was about 89 when recovery began, and depended on the pension for her livelihood, while the error continued for more than eleven years. It held that the hardship to her outweighed the bank's interest in recovery in this case.

What It Means

The court made clear it was not laying down a general rule that excess pension can never be recovered when the paying bank made the error, or that the absence of fraud always bars recovery. Its decision rests on the combined facts of the case: age, illiteracy, no role in the error, the long period and the impact of monthly deductions.

For elderly family pensioners facing a recovery notice over a bank's own mistake, the ruling shows that courts weigh hardship alongside the bank's right to recover. Pensioners with a complaint against a bank can also approach the RBI at https://cms.rbi.org.in.

Source: High Court judgment