Karnataka HC strikes down govt notification reducing education assistance funds for children of construction workers

He also argued against the position of the Karnataka Building and Other Construction Workers Welfare Board that funds were not available, stating that Rs 6,700 crore had been deposited with it, which was deposited in fixed deposit funds against Supreme Court orders, while there was also overspending on administrative expenses.

The counsel for the Board argued that the expenditure was mostly in assistance for construction workers and their children. Past expenditure for Indira Canteens and MGNREGA had been stopped, and current expenditure was only for worker welfare. It was also submitted that since the petitioners had been paid the contested amount according to the court’s interim order, the petition should be disposed of.

Relying on Comptroller and Auditor General of India (CAG) and RTI reports, which had been placed on record, the bench questioned the expenditure of the Board. It observed, “Glaring wasteful expenditure is spending Rs 7 crore on MGNREGA software; spending Rs 18 crore on Indira canteen expenses and several other wasteful expenditures and on unauthorised holding training scheme the expenditure that is shown is Rs 745 crore. ….. The tax liability that could be avoided was Rs 3,548 crore. Who is responsible? It is the callousness of officers of the Board who have not applied for tax exemption…. the non-availability of funds to be the reason for bringing in the amendment to the notification is absolute gibberish.”

The court observed while the government could bring in a fresh notification to vary the amount of assistance, the welfare of workers and their families had to be kept in mind. Further, the Board was directed to dispense assistance for the years 2020 -2023, while the CAG was directed to complete an audit of the Board’s funds within three months.