Criminal Trident Pack: IPC, CrPC and IEA by Sr. Adv. G.S Shukla and Adv. Raghav Arora
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BDRchandan (HEAD-HR)     20 September 2011

Subsistence allawance

Respected Consultants,


Recently we  had suspended an employee due to liquor consumption on duty and later he denies for medical test in hospital.


During his suspended pending enquiry, we were giving him subsistence allowance and enquiiry was going on.


Now enquiry has been completed, we have fulfilled all legal requirements, issued him Enquiry report, and he gave his comment but we are not satisfied with all this.


We are planning to dismiss him from services. His current subsistence alloowance is due can we adjust loan given to him from allowance.


Pl advise. 


 7 Replies

K C S Kutty, Pune (Faculty )     22 September 2011

Subsistence allowance is paid to keep the workman alive.  The dictionary meaning of "subsistence"

is "state of having just enough money to stay alive".  Hence deducting loan dues from subsistence 

allowance is not legally correct.

BDRchandan (HEAD-HR)     22 September 2011

Thanks Mr. Kutty,

Sandeep Khangaokar (Branch Manager)     22 September 2011

Hello all,

I recently left my job owing to mental harressment from my MD of the company. I did not realise in the heat of the moment that my salary could be put on hold due to such an impulsive act. but, later i emailed and informed them that i am ready to complete any and every formality required by the company on my part. on which they only asked me to come to the branch and stay 4 hours a day for few days until i complete my hand-over procedure, which i did!. now even after this there is no reply from their end regarding my salary and other due's, Its been 21 days already. Company is black listed already in the market for varied reasons including the one i am suffering from, this has happened with N number of x-staff but no body wants to agitate, maximum people let-go their SAL just like that? it surprises me and it encourages the company to go on with the crime!!! How do i recover it?? and also want to teach her (MD) a it possible??


To the best of my mind, during suspension of any employee, any type of loan can never be recovered because the subsistence allowance is being paid for fulfilment of the needs of the family members of the employee but in case the company is going to terminate any employee, the loan can be adjusted from the arrears to be paid to the concerned employee. But, if the loan amount is more than that of the amount to be paid to the employee then what the company will do in that case.

K C S Kutty, Pune (Faculty )     24 September 2011

Sudhir Sir, If the employee is to dismissed also, subsistence allowance to be paid as long as he is on suspension at the prescribed rates without making deductions. for recovery of dues, the same can be recovered from the employee in cash against cash receipt. Subsistence allowance can be paid in cash and then the amount can be recovered.

darshana sawant (associate consultant)     01 October 2011

I differ on your views.  After dismissal, the suspension will come to an end.  In case the employee has given an undertaking to the company, while seeking loan that the outstanding loan amount can be recovered from his legal dues, same can be done post dismissal, but express authority of the employee for deduction is must.

K C S Kutty, Pune (Faculty )     03 October 2011

My answer is to the question whether recovery can be made from subsistence allowance. I have not mentioned anything about the "legal dues".

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