One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.

Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.

Mr. X worked for XYZ Pvt Ltd, a company based in City A. After resigning from his position, the company refused to release his Full and Final (FnF) settlement, which included his remaining salary and other dues. Despite verbal assurance that the process would take maximum 45 days, over 60 days had passed without any resolution. Additionally, Mr. X discovered that the company had been deducting TDS from his salary throughout the financial year but failed to deposit it with the tax authorities, effectively committing TDS fraud. The company’s offer letter contained no written policy regarding FnF settlement timelines, leaving Mr. X in a vulnerable position. This case highlights the common exploitation faced by employees when companies violate labor laws and employment regulations.

Advice in Such Cases

Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation to come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

• Send a formal legal notice to the company demanding immediate release of dues
• File a complaint with the Labour Commissioner for violation of payment of wages
• Report TDS fraud to Income Tax Department for immediate action
• Maintain detailed records of all salary slips and communications with the company

Applicable Sections of Law

This case involves violations under multiple legal provisions. Under the Bharatiya Nyaya Sanhita (BNS), Section 318 deals with cheating and dishonestly inducing delivery of property, which applies to withholding legitimate dues. Section 61 covers criminal breach of trust, relevant for TDS fraud. The Bharatiya Nagarik Suraksha Sanhita (BNSS) provides procedural framework for filing complaints. Additionally, the Payment of Wages Act, 1936, and Income Tax Act, 1961, are specifically applicable for wage disputes and TDS violations respectively.

If You Are the Complainant

• File a formal complaint with the Labour Commissioner within the stipulated time period
• Submit TDS fraud complaint to Income Tax Department with supporting documents
• Send legal notice through registered post demanding immediate settlement
• Approach Industrial Tribunal if the company falls under specific categories
• Consider filing criminal complaint for cheating and breach of trust if amounts are substantial

If You Are the Victim

• Preserve all employment documents, salary slips, and email communications as evidence
• Calculate exact dues including interest and penalties as per applicable laws
• File complaint with Employees Provident Fund Organization if PF dues are pending
• Report to Registrar of Companies if company is violating corporate governance norms
• Consider approaching consumer forum if the delay causes financial hardship

How the Police Behave in Such Cases

Police typically treat employment disputes as civil matters initially and may be reluctant to register FIR. However, when TDS fraud is involved, they take it more seriously as it involves tax evasion. Officers usually advise parties to resolve through labor courts first. In cases involving substantial amounts or clear evidence of criminal intent, police may register complaints under BNS provisions for cheating and breach of trust.

FAQs People Normally Have

Can I file criminal case for non-payment of salary? Yes, if there’s dishonest intention and substantial amount involved, criminal complaint can be filed.

What if my company claims financial difficulties? Financial difficulties don’t excuse violation of statutory obligations like salary payment and TDS deposit.

How can I prove TDS fraud? Salary slips showing TDS deduction and Form 26AS showing no deposit constitute primary evidence.

What compensation can I claim? You can claim pending dues plus interest, compensation for harassment, and damages for mental agony.

What Evidence Is Required?

• Employment offer letter and resignation acceptance
• Complete salary slips showing TDS deductions
• Form 26AS from Income Tax Department
• Email communications regarding FnF settlement
• Bank statements showing salary credits
• Written company policies if available
• Witness statements from colleagues if necessary

How Long Will the Investigation Take?

Labour department complaints typically take 3-6 months for resolution. Income Tax Department investigations for TDS fraud can take 6-12 months depending on complexity. Criminal complaints may take longer, often 1-2 years for completion. Civil remedies through labor courts usually resolve within 6-18 months. Timeline varies based on cooperation from company and strength of evidence presented.

Advocate Sudhir Rao, Supreme Court of India