Dear Pramod,
There are many ways to deal with such situations like taking help from Labour Department or Income Tax office, but such step will put you at risk, if reference check happens at your next job. There would be chances of negative feed back. Since I have worked closely with corp HR in some of my roles, so have experience, How people respond in such circumstances. Unfortunately, in Big companies, such situations emerges because of Egoistic behaviors of people. Owners/Directors or Heads do not know truth or even if know they just ignore leaving the matter on the mercy of his supervisor or HR. The punishment of incompetency of leaders make junior or middle staff to suffer. Anyway, It would be great, if you just write politely to your boss about your settlement with copy of HR. In case of no response You can send reminder with cc to directors.
Job Market it not so bad, now a days, It is hard to get a job of choice, but not the chances of getting any job. Apply in as much companies as you can do, with good resume. Make personal calls to the persons you know for help. Also use the time to gain more knowledge about your field. Learn as much you can do.
Same situation can be threat for someone and an opportunity for other. Time keep moving Good or Bad, just have faith and face the life with confidence and gracefully.
May Baba Sai Bless You !
om sri sai ram !