Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2026 Supreme(Online)(Raj) 13614

HIGH COURT OF RAJASTHAN (JAIPUR BENCH)
Inderjeet Singh, Ashok Kumar Jain, JJ
Union Of India – Appellant
Versus
Gauri Shankar – Respondent
D.B. Civil Writ Petition No. 18057/2025|D.B. Civil Writ Petition No. 17763/2025|D.B. Civil Writ Petition No. 18077/2025|D.B. Civil Writ Petition No. 18078/2025|D.B. Civil Writ Petition No. 18079/2025|D.B. Civil Writ Petition No. 18082/2025|D.B. Civil Writ Petition No. 18083/2025|D.B. Civil Writ Petition No. 18089/2025|D.B. Civil Writ Petition No. 18096/2025|D.B. Civil Writ Petition No. 18101/2025|D.B. Civil Writ Petition No. 18758/2025|D.B. Civil Writ Petition No. 19160/2025|D.B. Civil Writ Petition No. 19822/2025|D.B. Civil Writ Petition No. 19823/2025|D.B. Civil Writ Petition No. 19825/2025|D.B. Civil Writ Petition No. 19829/2025|D.B. Civil Writ Petition No. 19857/2025|D.B. Civil Writ Petition No. 19858/2025|D.B. Civil Writ Petition No. 19862/2025|D.B. Civil Writ Petition No. 19868/2025|D.B. Civil Writ Petition No. 19872/2025|D.B. Civil Writ Petition No. 20424/2025|D.B. Civil Writ Petition No. 10/2026

Advocates:
For the Appellants/Petitioners: Bharat Vyas, Rahul Kamwar, Shubham Rohilla, Lakshya Sharma, Anima Chaturvedi
For the Respondents: Brijesh Kumar Jatti

An employer is not vicariously liable for an employee's unauthorized private collection of funds in direct violation of mandatory digital payment protocols; however, courts may permit affected individuals to re-submit payments to ensure the realization of essential welfare benefits.

Headnote:(A) Indian Penal Code, 1860 - Sections 420, 409, 467, 468, 471 and 120-B - Offenses relating to cheating, criminal breach of trust, forgery and criminal conspiracy - Misappropriation of public funds - Vicarious liability of the employer for the unauthorized act of an employee - Mandatory payment procedures via government digital portals - Doctrine of vicarious liability requiring participation or authorization by higher management - Right of the beneficiary to re-deposit or correct contributions made through unauthorized channels to avail benefits. (Paras 3, 7, 8)

Facts of the case:
Petitioners, representing a government department, challenged an order passed by an administrative tribunal which held them vicariously liable for the misappropriation of contributions made by pensioners for a government health scheme. The pensioners had paid their contributions in cash or via unauthorized channels to a clerk or third-party kiosk operators, which were never deposited into the government account. The department, upon realizing the fraud, had initiated criminal proceedings against the involved individuals and argued that since the payments were not made through the mandated online portal, the department could not be held responsible.

Findings of Court:
The court clarified that the responsibility for ensuring payments are made through the prescribed official digital portal lies with the beneficiaries. The department is not vicariously liable for the unauthorized acts of an employee or third parties who collected cash improperly. However, in the interest of justice and to prevent undue hardship to the pensioners, the court allowed them an opportunity to re-deposit the required contributions, excluding interest or penalties, after adjustment of any funds previously proven to have been deposited into the government account.

Issues: The main issues were whether the department is vicariously liable for the embezzlement committed by a clerk who collected contributions in cash, contrary to mandatory digital payment rules, and whether the affected pensioners should be granted an opportunity to rectify their payment mode to regain eligibility for the scheme.

Ratio Decidendi: Vicarious liability for the acts of an employee arises only when the act is performed within the scope of official duty or with the employer's authorization. Collecting cash despite a circular mandating online portal payments is a personal act by the employee and does not bind the employer. Nevertheless, to provide substantive justice, the court may allow affected parties to cure their procedural errors to access essential welfare services.

Result: Writ petitions allowed; tribunal order set aside; relief granted to respondents to re-deposit contributions within 90 days.

Table of Content
1. the conflict between vicarious liability of the employer and unauthorized payment channels used by pensioners. (Para 1 , 2 , 3 , 4)
2. failure to follow mandatory government payment protocols (bharat kosh) negates vicarious liability for misappropriated funds. (Para 5 , 6 , 7 , 8)
3. equity-based resolution allowing pensioners to re-deposit contributions to access cghs benefits. (Para 9 , 10 , 11 , 12 , 13)

1. These writ petitions were filed by the petitioners-the non applicants, aggrieved from the order dated 28.02.2025 passed in the original application Nos. 488/2022, 489/2022, 490/2022, 491/2022, 551/2022, 552/2022, 553/2022, 554/2022, 555/2022, 556/2022, 557/2022, 558/2022, 559/2022, 560/2022, 561/2022, 562/2022, 563/2022, 564/2022, 565/2022, 566/2022, 567/2022, 568/2022 and 569/2022, 312/2023 & 315/2023 wherein the following order was passed, after clubbing the matters:-

13. In the light of above, we hereby quash and set aside the impugned Notice dated 22.08.2022 (Annexure A/1 - OA No. 488/2022) and, accordingly, hold the applicant entitled to avail CGHS facilities as per the Index Card issued on 01.12.2021 (Annexure A/3 - OA No. 488/2022) upto "Lifetime" by the Government of India, Ministry of Health and Family Welfare, Central Government Health Scheme.

14. In view of the above observations and directions, we also hereby quash and set aside all the impugned Notices / Communications, if any, made in the similar respective OAs (as mentioned above) and, accordingly, hold all the applicants entitled to avail CGHS facilities as per their respective Index Cards issued by the Government of India, Ministry of Health and Family Welfare, Central Government Health Scheme.

15. The loss caused to the public exchequer by the employees of the department cannot be made good from the victims but has to be recovered by the department from its own employees who caused it.

16. In one of the earlier OA No. 507/2024 (Meeta Bhasin vs. VOI & Ors.) related to the CGHS, Jaipur, we had directed the Respondent No. 1. to look into the state of affairs in CGHS Jaipur relating to the transfer / posting of the applicant therein and the posting / appointment of new Additional Director, CGHS, Jaipur but noting seemed to have been done for reasons best known.

But now since the public exchequer has suffered and the humble pensioners have been made victims, we go extra mile and direct Respondent No. 1 to inquire into the matter, from an officer not below the rank of Additional Secretary and fix the responsibility and attribute quantum of loss and recover the same from those employees of the department who defrauded the retired CGHS card holders and caused loss to Bharat Kosh, within a period of three months from the date of receipt of certified copy of this order.

A certified copy of this order be sent directly to Respondent No. 1.

17. With these observations and directions, all the Original Applications are allowed on similar terms. There shall be no order as to costs.

2. Learned ASG appearing on behalf of the petitioners placed reliance upon the circular dated 21.07.2020 and submitted that all kinds of contributions of CGHS beneficiaries are collected and deposited through the Bharat Kosh Portal (online mechanism). He further submitted that, except the Bharat Kosh Portal, no other method was used to collect contribution from any beneficiary, including the respondent(s)-pensioners. He further submitted that the respondent(s)-applicant(s) had contacted a clerk named "Shambhu" and allegedly gave him cash for deposit towards their CGHS contribution, but as per the complaint and inquiry conducted by the non-applicants (writ-petitioners), the amount allegedly given to Shambhu was not deposited in the Government account. He further submitted after receipt of the complaints against Shambhu, the Additional Director under the CGHS Scheme has filed FIR No. 442/2022 on 20.09.2022 at Police Station Vidyadhar Nagar, District Jaipur City (North), under S

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