1 2025:CGHC:26428 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPS No. 477 of 2024 1 - Smt. Susheela Lakra W/o Late Shri Rajaram Lakra Aged About 40 Years R/o Village- Kunkuri Kala, Tahsil- Batauli, District : Surguja (Ambikapur), Chhattisgarh ... Petitioner(s) versus 1 - State Warehousing Corporation Through Managing Director, Head Office, Naya Raipur, District : Raipur, Chhattisgarh 2 - Manager (Account) Chhattisgarh State Ware Housing Corporation, Naya Raipur, District : Raipur, Chhattisgarh 3 - Gratuity Branch Chhattisgarh State Ware Housing Corporation, Naya Raipur, District : Raipur, Chhattisgarh ... Respondent(s) (Cause-title taken from Case Information System) For Petitioner(s) : Mr. Shubham Tripathi, Advocate For Respondent(s) : Mr. Anumeh Shrivastava, Advocate and Mr. Anuroop Pandy, Advocate for their respective respondents Hon'ble Shri Justice Amitendra Kishore Prasad Order on Board 20/06/2025 1. An unfortunate widow is seeking the indulgence of this Court under its extraordinary jurisdiction in the present matter. After the 2 death of her husband, the respondents are illegally recovering an amount of Rs. 11,92,085/- in respect of a shortage of paddy, and that too by relying on a proposal dated 31.02.2025, applied with retrospective effect. 2. By way of this writ petition, the petitioner has prayed for following reliefs: “10.1 That, the Hon'ble Court may be allow the petition and quash the impugned order dated 13/12/2023 (ANNEXURE P/1) and direct the respondent to immediately provide the retiral dues of Late Rajaram Lakra to the petitioner with the 10% compound interest. 10.2 That, any other relief which this Hon'ble Court deems fit and proper may also kindly be granted to the petitioner in the interest of justice along with cost of the petition.” 3. Facts of the case, in a nutshell, are that the late husband of petitioner, Rajaram Lakra, was employed with the respondent department as a Technical Assistant (Class III), and he served diligently for over twelve years. At the time of his demise on 20th February, 2023, he was posted at the Warehousing Corporation Branch in Village Dakuwa, Rajpur, District Balrampur. Following his untimely death, the petitioner and her two children have been left as dependents, entitled to the retiral benefits accrued by the deceased during his long service. After the death of her husband, the petitioner submitted a formal application on 3rd April, 2023 to the respondent No. 1, seeking release of the retiral dues payable to her late husband. Despite this, the respondent failed to release 3 the said dues, compelling the petitioner to approach this Hon’ble Court through a writ petition. The writ petition filed by the petitioner was disposed of vide order dated 20th November, 2023, wherein the Court directed the respondents to consider and decide the pending representation submitted by petitioner and release the retiral dues expeditiously, preferably within three weeks. Following the directions of this Hon’ble Court, the respondent issued a communication dated 13th December, 2023, informing the petitioner that under the provisions of the State Warehousing Corporation Stock Regulation Rules, specifically Chapter 4, Section 22(2)(ii) and Section 22(1)(e), an amount of Rs. 11,92,085/- has been deducted from the retiral benefits payable to the petitioner. It is pertinent to note that this deduction was made pursuant to a new proposal by the Warehousing Corporation dated 31st March 2023, which was submitted after the death of the husband of petitioner. This new proposal introduced revised criteria for calculating shortages and losses, under which the respondent erroneously computed the recoverable amount as Rs. 11,92,085/-, which has been directed to be recovered from the retiral dues of petitioner. The petitioner challenges this deduction as unjustified and illegal, emphasizing that the criteria for calculating such shortages were altered posthumously and that the amount calculated is not only excessive but also not supported by any prior departmental proceeding or charge against the deceased employee during his 4 service. The petitioner, therefore, contends that the recovery is wrongful and the withholding of her husband’s retiral dues is arbitrary and contrary to the applicable rules and principles of natural justice. 4. Learned counsel for the petitioner submits that the impugned action of the respondent in recovering an amount of Rs. 11,92,085/- from the retiral dues of the deceased husband of the petitioner is wholly unjustified and illegal in law. It is a settled principle that any proposal or criteria relating to storage loss which has been settled or introduced only after the death of the husband of the petitioner cannot, in any manner, be applied retrospectively to affect the rights of the petitioner. Prior to the death of the husband of petitioner, no notice, charge-sheet, or any form of show-cause notice was served upon him, nor was any departmental proceeding was initiated against him regarding any alleged shortage or financial liability. This omission clearly indicates that the respondent did not consider or notify any claim of loss against him during his lifetime, thereby depriving the petitioner of any opportunity to defend or contest such allegations. Moreover, the provisions of Rule 22 of the Chhattisgarh State Warehousing Corporation Stock Regulation, 1962, under which the respondent claims the right to recover this amount, do not, either expressly or by implication, empower the respondent to withhold or recover such amounts from the retiral dues after the 5 death of an employee, especially when no prior due process was followed. The recovery action is therefore arbitrary, malafide, and contrary to the principles of natural justice and statutory provisions. The conduct of respondent in unilaterally deducting the said amount from the retiral benefits without initiating any departmental enquiry or serving a proper notice violates the established service rules and renders the impugned order unsustainable in law. Further, it is submitted that the withholding of retiral dues, including gratuity and provident fund, without lawful authority, causes irreparable hardship to the petitioner and her dependents, who are entitled to these dues as a matter of right and equity. Additionally, learned counsel for the petitioner contended that in the event this Court deems any amount payable by the deceased employee as recoverable, the respondent ought to be directed to pay interest on the withheld amount from the date of death of the husband of petitioner, that is, 20th February 2023, until the date of actual payment, as per the principles of equity and fairness. In light of the above, it is prayed that the impugned order of recovery be quashed and set aside, and the respondent be directed to release the entire retiral dues along with applicable interest to the petitioner forthwith. 5. On the other hand, learned counsel for the respondents opposes the submission made by learned counsel for petitioner and would submit that the allegations made by the petitioner with regard to 6 the wrongful calculation of storage loss and the legality of the recovery from retiral dues are wholly misconceived and devoid of merit, and the action on the part of respondent has been in strict accordance with law, established procedures, and applicable regulatory framework. The loss amount of Rs. 11,92,085/-, which the petitioner disputes, has not been arbitrarily determined but has been meticulously calculated on the basis of the norms laid down by the Government of India concerning permissible storage loss and gain in agricultural commodities such as wheat and rice. These norms are rooted in scientific parameters and have been circulated through official communications dated 22.10.2021 and 19.06.2023, which are part of a binding framework applicable to all warehousing operations. Pursuant to these norms, a properly constituted committee was formed under order dated 05.12.2023, comprising technical experts and departmental officers, to assess the extent of loss attributable to the tenure of the deceased employee, Late Shri Rajaram Lakra. After detailed analysis of stock records, depot-wise reports, and other relevant data, the committee issued a comprehensive report dated 11.12.2023, affirming a quantifiable storage loss of Rs. 11,92,085/- during the period the deceased employee was in charge of the concerned godowns. On the basis of the findings of committee, a recovery order dated 13.12.2023 was issued, directing deduction of the loss amount from the retiral dues, which is well within the legal framework provided under Chapter 4, Rule 22 of the Chhattisgarh 7 State Warehousing Corporation Staff Regulations, 1962. Contrary to the claims of petitioner, Rule 22 clearly provides for recovery of losses sustained by the Corporation due to stock mismanagement or loss caused during service of an employee, and the regulatory scheme does not become inapplicable merely because the employee has passed away prior to the issuance of the show- cause notice. While Clause 22(2)(iv) prescribes issuance of notice to the concerned employee, such procedural formality cannot be insisted upon when the employee is no longer alive. The fundamental obligation of the State to safeguard public money, particularly when a concrete financial loss has been duly established, cannot be defeated on the ground that the employee expired before formal initiation of proceedings. The law permits recovery from the estate or legal heirs of a deceased employee where the employer has suffered demonstrable loss directly linked to the tenure of employee. It is also noteworthy that the Corporation, while exercising fairness and good faith, has already released retiral dues amounting to Rs. 16,18,490/- to the legal heirs of the deceased, as substantiated by the cheque. Therefore, only the loss amount has been retained, and that too after following due administrative procedure supported by Central Government guidelines and Board resolutions dated 02.03.2022 and 31.03.2023. It is reiterated that the respondent has acted with procedural propriety and legal justification, and the recovery in question is not only legally sustainable but also morally and 8 financially imperative, as public funds are involved. Accordingly, the impugned recovery order dated 13.12.2023 is entirely in consonance with the applicable rules, regulations, and public interest, and the same deserves no interference by this Court. 6. I have heard learned counsel for the respective parties and also perused the documents annexed along with the record. 7. Rule 22 of the Chhattisgarh State Warehousing Corporation Stock Regulation, 1962, provides for the recovery of losses caused by employees during their tenure of service. However, it simultaneously mandates essential procedural safeguards, including issuance of notice to the concerned employee and an opportunity to respond to the allegations. In the present case, the deceased employee was neither served with any notice nor was any departmental proceeding initiated against him during his lifetime with respect to the alleged shortages or financial loss. Furthermore, the policy revision, which alters the criteria for calculating the storage loss, was introduced only after the demise of the employee. This retrospective application of the new criteria is fundamentally unfair and violates the established principles of natural justice. The respondents have failed to provide any cogent justification for the non-initiation of departmental proceedings prior to the employee’s death or for the application of a policy that was not in effect during his service period. The deduction of a substantial sum from the retiral dues without any prior hearing or 9 opportunity to contest the claim is, therefore, arbitrary, unjust, and legally untenable. While the State indeed has a legitimate and pressing interest in safeguarding public funds, any such recovery must strictly adhere to statutory provisions and the principles of natural justice, which are conspicuously absent in the present case. The petitioner, as the widow and legal representative of the deceased employee, is entitled to receive the retiral benefits due without any unlawful or unjust deductions, particularly, in the absence of any adjudication or departmental inquiry against the deceased during his lifetime. 8. In view of the above, the impugned order (Annexure P/1) dated 13/12/2023 is hereby set aside. The respondent department is directed to release and disburse all pending retiral dues payable to the petitioner including but not limited to Provident Fund, Gratuity, Leave Encashment, and any other terminal benefits preferably within a period of three months from the date of receipt of a copy of this order. without deducting the amount claimed under Annexure P/1. 9. Accordingly, this writ petition is disposed of to the extent indicated herein-above. Sd/- (Amitendra Kishore Prasad) Judge Saxena ABHIGYA SAXENA Digitally signed by ABHIGYA SAXENA