Executive Director Warned of Contempt Proceedings if Outstanding Payments Not Settled in a Month
In a recent judgment, the Allahabad High Court has directed the Executive Director of the U.P. State Employees Welfare Corporation to settle all outstanding retiral dues and salary arrears of its employees within a month. The court observed that deductions made under various heads such as "Prostsahan Agrim" and "Tyohar Agrim" were unauthorized and misleading.
The judgment was delivered by Justice Rohit Ranjan Agarwal on February 12, 2026, following a contempt application filed by Satish Kumar Verma against Shri Kamta Prasad, the Executive Director of the Corporation. The court noted the failure of the Corporation to comply with previous orders regarding the payment of dues, despite the dismissal of their appeal in the Special Appeal Defective No. 746 of 2025.
Counsel for the applicant, Kalpnath Tripathi and Rajesh Shankar Srivastava, presented evidence showing that deductions totaling Rs. 4,55,100.38 were made from the applicant's retiral dues, which were initially Rs. 15,71,604. The court found these deductions, including those for GST and audit recovery, to be without legal basis.
Justice Agarwal expressed dismay at the Corporation's handling of funds received from the State Government meant for disbursing retiral dues. The court criticized the Executive Director for not providing accurate figures of outstanding dues and for attempting to mislead the court.
In a stern warning, the court granted a final month's time for the Executive Director to clear all dues without deductions, with a directive to appear in court if the order is not complied with by March 19, 2026. Additionally, the Principal Secretary, Food and Civil Supplies has been tasked with investigating the delay in payments and filing a personal affidavit detailing actions taken against responsible officers.
The court's directive aims to ensure that employees receive their rightful dues without unlawful deductions, highlighting the judiciary's role in upholding employee rights and accountability within public sector organizations.
Bottom Line:
Deduction from retiral dues without any legal provision is not permissible. The Executive Director of U.P. State Employees Welfare Corporation directed to clear all retiral dues and arrears of salary within a stipulated time, failing which contempt proceedings shall ensue.
Statutory provision(s): Contempt of Court Act.
