We have received the Interim Order issued by Sole Arbitrator in a cased pertaining to default in a PERSONAL Loan Case of one of our employees (respondent). Company has been made Garnishee in the said order.
The contents of the Interim Order is summarized below
1) The company has been made Garnishee and directed to stop payment to the employee to the tune of INR 1,21,564.18
2) Company has been directed to :-
Quote
"remit monthly salary of the respondent (after deducting First Rs. 1,000/- and two-third of the Salary) before this tribunal on or before 15th of every month till the amount is recovered".
Unquote
3) Further, the matter is now posted on 04 Jun 22 at Chennai and the order states
Quote
"for the garnishee to comply with the order of the Tribunal and for further proceedings and to give another opportunity for the respondent to appear...."
Unquote
My Doubts are as follows:-
A) Is the order binding on the company especially when the company has not signed anywhere on the loan application; neither as guarantor; nor agreeing to deduct from his salary and pay the bank?
The only connection to the company is the payslip that the employee submitted and employment details he has probably filled in the loan application form.
B) The order is dated 02 May 22 and we received it today, 20 May 22. So essentially the first recovery and remittance from our side which could have been done by 15 May 22 (for salary of Apr 22) is already over; and now we can comply only from Salary of May 22 and remit recovered amount before 15 Jun 22. How do I make a response to the Order?
C) How should the recovery be done for a fictitious GROSS salary of INR 10,000/-.
c1) Calculation 1.
Gross: 10000
Deductions permitted (i.e salary payable to respondent) : 1000 + 2/3rd of 10000 (6666.67) = 7666.67
Amount to be remitted to Claimant : 10000 - 7666.67 = 2333.33
c2) Calculation 2.
Gross: 10000
Deductions permitted (i.e salary payable to respondent) : 1000 + 2/3rd of (10000-1000) (i.e 6000) = 7000.00
Amount to be remitted to Claimant : 10000 - 7000 = 3000
Which case is the correct calculation?
Should the recovered amount be fixed irrespective of LOPs and consequent reduction in GROSS PAYABLE?
D) What should we do if the employee resigns or absconds?
Request valuable inputs from learned members.
Thanks & Regards
Arun
The contents of the Interim Order is summarized below
1) The company has been made Garnishee and directed to stop payment to the employee to the tune of INR 1,21,564.18
2) Company has been directed to :-
Quote
"remit monthly salary of the respondent (after deducting First Rs. 1,000/- and two-third of the Salary) before this tribunal on or before 15th of every month till the amount is recovered".
Unquote
3) Further, the matter is now posted on 04 Jun 22 at Chennai and the order states
Quote
"for the garnishee to comply with the order of the Tribunal and for further proceedings and to give another opportunity for the respondent to appear...."
Unquote
My Doubts are as follows:-
A) Is the order binding on the company especially when the company has not signed anywhere on the loan application; neither as guarantor; nor agreeing to deduct from his salary and pay the bank?
The only connection to the company is the payslip that the employee submitted and employment details he has probably filled in the loan application form.
B) The order is dated 02 May 22 and we received it today, 20 May 22. So essentially the first recovery and remittance from our side which could have been done by 15 May 22 (for salary of Apr 22) is already over; and now we can comply only from Salary of May 22 and remit recovered amount before 15 Jun 22. How do I make a response to the Order?
C) How should the recovery be done for a fictitious GROSS salary of INR 10,000/-.
c1) Calculation 1.
Gross: 10000
Deductions permitted (i.e salary payable to respondent) : 1000 + 2/3rd of 10000 (6666.67) = 7666.67
Amount to be remitted to Claimant : 10000 - 7666.67 = 2333.33
c2) Calculation 2.
Gross: 10000
Deductions permitted (i.e salary payable to respondent) : 1000 + 2/3rd of (10000-1000) (i.e 6000) = 7000.00
Amount to be remitted to Claimant : 10000 - 7000 = 3000
Which case is the correct calculation?
Should the recovered amount be fixed irrespective of LOPs and consequent reduction in GROSS PAYABLE?
D) What should we do if the employee resigns or absconds?
Request valuable inputs from learned members.
Thanks & Regards
Arun