Quick answer
The Finance Ministry’s Department of Expenditure says that once a Certificate of Correctness of Pay is issued after audit, no recovery of any nature may be made from the employee for the period it covers; any loss is to be recovered from the office that approved the certificate. Its OM dated 29 September 2026 also orders audit of every pay fixation within three months and a full check of service records 48 months before retirement. Confirmed (DoE OM) Related: N.K. Mishra case: upgraded pay scales for Accounts staff (DoE OM).
Key points
- Order: Department of Expenditure OM No. 09(01)/2026-E.II(A)(5270509) dated 29.09.2026, posted on doe.gov.in on 13 October 2026.
- Audit deadline: every pay fixation order (promotion, ACP/MACP, financial upgradation, increment or other revision) to be audited within three months of issue or by the end of the financial year, whichever is later.
- Retirement check: employees due to retire within four years get an immediate comprehensive review; a final verification and certificate are mandatory 48 months before retirement.
- Protection: after the Certificate of Correctness of Pay, no recovery from the employee for the certified period; responsibility shifts to the PAO / CCA / CA.
- Scope: the instructions are issued to offices under the Department of Expenditure’s own administrative control; the OM is addressed to all Secretaries and Financial Advisers of Ministries.
Last updated: 20 October 2026
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Why the Finance Ministry issued this OM
The OM says the Department of Expenditure receives “a large number of proposals seeking waiver of recovery of excess payments”, mostly from wrong pay fixation, increments and ACP/MACP benefits, and that in most cases the excess is detected only on the verge of retirement. Confirmed By then the Supreme Court’s Rafiq Masih judgment and DoPT’s OM No. 18/03/2015-Estt (Pay-I) dated 02.03.2016 usually bar recovery, so Ministries end up seeking waivers. The new framework, worked out with the Controller General of Accounts, aims to catch mistakes early, so that excess payment is not discovered in an employee’s last year of service.
What the OM orders: the nine instructions
| # | Instruction | What it means for you |
|---|---|---|
| i | Audit every pay fixation order within 3 months of issue or by the end of the financial year, whichever is later. Regular promotion orders to be marked to the Departmentalised Accounts Organisation. | Errors in promotion, MACP or increment fixation should surface within months, not decades. |
| ii | Verify qualifying service periodically under Rule 30 of the CCS (Pension) Rules, 2021 and fix gaps in service records promptly. | Ask your office to confirm your qualifying service is verified. |
| iii | For employees due to retire within the next four years, review all pay fixations, upgradations, service books, qualifying service and emoluments immediately, per DoPT OM dated 03.10.2022. | If you retire by 2030, your records should be reviewed now. |
| iv | Head of Office to complete verification under Rule 57 before forwarding pension papers. | Fewer last-minute pension objections. |
| v | Rectify deficiencies found in audit immediately and prevent recurrence. | Mistakes are to be corrected when found. |
| vi | Every Ministry to set up a monitoring mechanism and review audit status, especially for those nearing retirement. | Accountability inside each Ministry. |
| vii | Internal Audit Wing / PAO to issue a formal audit certificate; CCA/CA to issue the certificate of correctness of pay fixation. Later errors fix responsibility on the PAO and/or CA/CCA. | Keep a copy of each certificate with your service book. |
| viii | Mandatory comprehensive validation and certificate 48 months before retirement; later errors fix administrative and financial accountability on the PAO/CCA/CA. | Around four years before retirement, ask for this certificate. |
| ix | After the Certificate of Correctness of Pay, no recovery of any nature from the employee for the certified period; loss recovered from the office that approved the certificate. | Your main protection against surprise recovery. |
Worked example: how the certificate protects you
Suppose an employee in Level 6 got a MACP upgradation in 2027 and the pay was fixed one cell too high, giving about ₹1,500 a month extra. Illustration
- Under the new OM: the fixation must be audited by about mid-2027 (three months) or 31 March 2028 (end of that financial year), whichever is later. If the audit misses the error and the CCA/CA issues the Certificate of Correctness of Pay, the employee cannot be asked to repay for the certified period; the loss is to be recovered from the certifying office.
- The old pattern: the same error, found only at pension verification in, say, 2035, would mean about eight years of excess pay (roughly ₹1.4 lakh before DA) and a recovery or waiver fight at retirement.
The figures are only an illustration of the timeline, not an official calculation.
When recovery is already barred: the 2016 DoPT rules
The OM builds on DoPT’s 02.03.2016 OM, which, following the Supreme Court in State of Punjab vs Rafiq Masih, lists situations where recovery of excess payment is impermissible: Existing rule
- from employees in Group C and Group D services;
- from retired employees, or those due to retire within one year of the recovery order;
- where the excess was paid for more than five years before the recovery order;
- where an employee was wrongly made to work on a higher post and paid for it;
- where recovery would be so harsh or arbitrary that it outweighs the employer’s right to recover.
Who this affects
The instructions in paragraph 3 are formally issued to the Department of Expenditure’s own departments, attached and subordinate offices (such as CGA and CPAO), while the OM itself is addressed to all Secretaries and Financial Advisers of Ministries and Departments. Confirmed Expect other Ministries to adopt it. For pensioners, the immediate gain is fewer last-minute recoveries from gratuity and arrears for employees retiring from now on.
What to do now
- Check that your last pay fixation (promotion, MACP or increment) has been audited, and ask for the audit certificate.
- If you retire within four years, ask your Head of Office about the comprehensive review under instruction (iii).
- Recheck your own fixation: our 7th and 8th CPC salary calculator and the pay matrix table help, and the pension calculator shows what correct pay means for your pension.
- Keep copies of every certificate with your service book. See also our commutation of pension guide.
Source: Ministry of Finance, Department of Expenditure, OM No. 09(01)/2026-E.II(A)(5270509) dated 29.09.2026 (doe.gov.in page, OM PDF); DoPT OM No. 18/03/2015-Estt (Pay-I) dated 02.03.2016 (PDF).
Last updated: 15 October 2026
Recovery of excess payment OM 2026: FAQs
Can the government recover excess pay after the pay fixation is certified?
Under the DoE OM dated 29 September 2026, once a Certificate of Correctness of Pay is issued, no recovery of any nature may be effected from the employee for the period covered. Any loss is to be recovered from the office that approved the certificate.
Within how many months must pay fixation be audited?
Within three months of the pay fixation order or by the end of the financial year, whichever is later.
What is the 48-month verification before retirement?
The Internal Audit Wing or Pay & Accounts Office must carry out a comprehensive validation of service records and emoluments and issue a formal certificate 48 months before the employee retires.
Does this OM apply to all central government employees?
The instructions are issued to offices under the Department of Expenditure’s administrative control, and the OM is addressed to all Secretaries and Financial Advisers. Other Ministries are expected to follow it, but check your own department’s orders.
When is recovery of excess payment not allowed at all?
Under DoPT OM dated 02.03.2016 (Rafiq Masih judgment): from Group C and D employees, from retirees or those retiring within a year, where the excess was paid for over five years, where the employee did higher-post duties, or where recovery would be iniquitous.
