High Court reprimanded the attitude of the company, said – bonded labor is not to be relieved

**Kerala High Court** ruled on February 17, 2026 that an employer cannot refuse an employee’s resignation citing financial constraints, as forcing them to continue working against their will amounts to **bonded labour**, which is prohibited under **Article 23** of the Indian Constitution. Justice **N. Nagresh** (also spelled Nagaresh in some reports) delivered the judgment in **Grivas Job Panakkal v. Traco Cable Co. Ltd. and Others** (WP(C) No.: Related petitions heard together).

The petitioner, **Grivas Job Panakkal**, who was the Company Secretary in **Traco Cable Company Limited** (a PSU of the State of Kerala), resigned on March 18, 2024 due to non-payment of salary from October 2022, financial constraints and to take care of his ailing mother. The company rejected the resignation, citing its dire financial straits and his essential role (as CS appointments are filed with the Registrar of Companies, which prohibits new hires without legal forms). It issued memos directing them to return to work and initiated disciplinary action.

The Court held that employers must accept a resignation in accordance with the terms of employment, unless certain exceptions apply: not serving the notice period, withdrawing ‘in the heat’, or pending serious disciplinary action involving material misconduct/financial loss. There was nothing like that here. Justice Nagaresh said: “Financial issues or financial emergency cannot be a reason to compel a company secretary to work for an incorporated company against his will and without his consent.” The disciplinary action was considered an attempt to violate his right to resign.

Refusal amounts to bonded labor under Article 23. The court quashed the rejection memo and disciplinary notices, and directed the company to accept the resignation depending on its financial position, relieve Panakkal within two months, and settle the salary arrears, leave surrender benefits, and terminal dues “as soon as possible.”

Bar & Bench, Live Law, Verdict, The Indian Express and others have reported on the judgment. This decision strengthens employee freedom and prohibits forced labor even in distressed PSUs.