The Calcutta High Court has ordered the central government to resume the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme in West Bengal, effective August 1, 2025. This decision comes after nearly three years of suspension due to allegations of corruption and financial irregularities in the disbursement of central funds.

The order was issued by a division bench comprising Chief Justice T. S. Sivagnanam and Justice Chaitali Chatterjee (Das), following a series of hearings on a petition filed by the Paschim Banga Khet Mazdoor Samity, a farmers' body. The petition challenged the non-payment of dues to daily wage laborers, citing embezzlement of funds.

While directing the resumption of the scheme, the court has granted the Union government the authority to impose specific conditions, restrictions, and regulations in West Bengal. These measures, which may not be applied in other states, are intended to prevent any recurrence of the irregularities that led to the initial suspension. The court has clarified that the central government can continue its investigations into alleged corruption in all districts of the state. It also suggested that the Centre can send money directly to the account of a specific person through the central portal and carry out necessary surveillance to prevent corruption.

Chief Justice Sivagnanam emphasized that the MGNREGA scheme should not be indefinitely suspended. He noted that the central government has sufficient means to investigate any irregularities in wage disbursement. "The scheme does not envisage a situation where it would be put to cold storage for eternity," he stated, adding that a distinction should be made between past actions and future implementation. The court underscored that resuming the scheme is in the public interest and aligns with the purpose for which the legislation was enacted.

The suspension of MGNREGA funds has been a contentious political issue in West Bengal since 2022, with the ruling Trinamool Congress (TMC) accusing the Bharatiya Janata Party (BJP) of deliberately depriving the poor in the state. TMC leaders and Members of Parliament have staged demonstrations in Delhi to protest the withholding of funds. West Bengal received ₹7,507.80 crore under MGNREGA in 2021-22 but has not received any central funds since then. The Union Ministry of Rural Development reportedly stopped the funds on December 24, 2021, without initially citing a reason.

The state government has alleged that the Centre withheld wages for the scheme, while the central government claims there was widespread corruption in its rollout in Bengal. The Calcutta High Court has scheduled a further hearing on the matter after August 15, 2025.