Centre cannot stop funds to states under MGNREGS eternally: Calcutta high court | Kolkata

The Calcutta high court on Thursday observed that the central government cannot stop funds to West Bengal under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) eternally.

“Eternally you cannot stop, unless this act is scrapped. If it is scrapped, well and good. You can stop the fund till a complaint (of misappropriation of funds) is enquired into,” observed a bench headed by Chief Justice TS Sivagnanam of Calcutta high court.

The court was hearing a petition on the Centre freezing funds under the MGNREGS since March 2022 citing Section 27 of the MGNREG Act, 2005.

Ashoke Kumar Chakraborty, additional solicitor general, told the court that Section 27 of the 2005 Act says that in the event of any corruption is found, the centre can stop payment.

“Funds have been stopped for misutilization,” he said.

Also Read: MGNREGS funds to West Bengal halted over irregularities

“Three years have gone. Not a single penny has come to West Bengal,” said senior advocate Kalyan Banerjee.

“Under section 27 the Centre can stop funds for a reasonable period. They can’t stop it for eternity” Bikash Ranjan Bhattacharya, senior advocate who represented the petitioner, told the court.

“A plain reading of section 27 (2) clearly indicates that there cannot be an indefinite withholding of the implementation of the scheme on the ground that a complaint has been received. The Act contemplates that appropriate remedial measures, for the implementation of the scheme, has to be taken within a reasonable period of time,” the division bench stated.

The Centre had stopped sending funds under the scheme to the state since March 2022.

Data placed in the Lok Sabha in August 2023 reveals that the Centre had released ₹11,454 crore for West Bengal in 2020-21 and ₹7,507 crore in 2021-22 under the MGNREGS.