Can an employer demand pay in lieu of notice when an employee has a surgery?

My sister underwent two surgeries with a gap of two month between each. Her employer gave her sick leave for the actual surgeries. But when she requested for additional leave on medical grounds (with a medical certificate and copies of her medical paperwork), this was denied. The surgeries medically have a recovery time of at least 3 months, and she has been in and out of procedures since then. Her HR manager called her to office and asked her to resign because they couldn't give her further leave. Since her contract requires a month's notice period and she couldn't serve it, she was aware that they may try to get pay in lieu of notice. And since they refused to retrench her, she mentioned in her resignation letter that she is resigning because they asked her to. Now almost two months later they've sent her a notice asking her to pay Rs 44000 because of not serving her notice. And they've threatened to take legal action if she fails to pay up within 15 days.
The company has all copies of my sisters tests and surgery reports and they are well aware that she cannot sit. They saw the state she was in when she went over to submit her resignation because they asked her to, and verbally assured her that she wouldn't have to pay anything. However, nothing was there in writing.
I'd like to know whether there is anything in the law that protects her in this situation. We've spent lakhs on her surgeries, and she is due for another surgery in a couple of weeks. We cannot afford to pay them. Please advise as to what legal provisions there to avoid litigation. We cannot afford to hire a lawyer either as all funds are going towards the next surgery.

What is described seems to be the most inhuman approach of an employer in the important matter of his human resource management. Better an appeal for waiver of notice clause as a special case be submitted to the CEO of the organization with a simultaneous submission of reply to the notice of legal action explaining the factual position of her inability to comply with the notice condition on her forced resignation. Still they are not relenting, no problem, the legal action can be resisted accordingly as the demand would not stand judicial scrutiny..