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Calcutta High Court says rent for overstaying can be deducted from gratuity

Justice Shampa Dutt heard the appeal of Eastern Coalfields Limited against an order of release of employee’s gratuity despite the illegal stay in the official quarters. 

Calcutta High Court employee quarter after retirementThe Calcutta High Court noted that the employee retired in June 2022 but still staying in the company allotted quarter. (AI-generated image)
Written by: Richa Sahay
4 min readNew DelhiApr 6, 2026 09:42 AM IST First published on: Apr 3, 2026 at 11:40 AM IST

Calcutta High Court news: The Calcutta High Court recently delivered a firm ruling against the unauthorised occupation of official quarters by retired employees and held that Eastern Coalfields Limited (ECL) is entitled to deduct penal rent from an employee’s gratuity if they refuse to vacate company accommodation after superannuation

Justice Shampa Dutt observed that tolerating such conduct would encourage misuse and deprive serving employees of the accommodation they are entitled to.

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The high court was hearing a plea filed by Eastern Coalfields Limited challenging orders passed by the controlling authority and appellate authority under the Payment of Gratuity Act, 1972, which had directed the release of gratuity to the said employee.

Richa Sahay is a Legal Correspondent for The Indian Express ... Read More

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