Dear Jyotsna Giri,
An employee in your company abandoned his duties. Upon his abandonment, your company "released" from his duties. However, before releasing him, did you conduct the domestic enquiry? If not enquiry, then did you issue him a show-cause notice? What was his reply?
Probably, your company has given short shrift to provisions of the Industrial Standing Order Act. His peremptoriness is because of this shortcut.
Mental depression can happen because of many reasons. How can he attribute it only to his work activities? Any kind of leniency will send a wrong signal to all other employees and it could become just a trend to abandon the duties and then raise the quaint claims.
You can write to him that all the claims have no legal validity, and he must return the company's assets. If he refuses to do so, a police complaint will be filed against him. He should be prepared to face the consequences.
Thanks,
Dinesh Divekar