SHYAM GLASS WORKS Vs. STATE OF UTTAR PRADESH

JUDGEMENT

(1.) This petition is directed against the proceedings taken by the Regional Provident Fund Commissioner for levy of damages and other charges as well as recovery of the same under section 14-B of the Employees Provident Fund Act, 1952.

(2.) The petitioner company committed default in making its contribution towards provident fund dues of its employees during the period April, 1962 to September, 1967. The petitioner company had deposited the provident fund dues but the deposit was made after the expiry of the prescribed date. On 18th September, 1968 the Accounts Officer acting on behalf of the Regional Provident Fund Commissioner, U.P., Kanpur, issued a notice to the petitioner in respect of levy of damages under Section 14-B of the Employees Provident Fund Act, 1952. The notice stated that as the petitioner had deposited the provident fund dues after the expiry of the prescribed date it was liable to pay a sum of Rs. 14,256.85 paise as damages under section 14-B of the Act and Rs. 361.94 as administrative charges. The petitioner was directed to show cause within ten days of the receipt of the notice as to why the State Government should not be requested to impose damages upto 25 per cent on the belated payments made by the petitioner. The notice was accompanied by a statement giving details of the damages proposed to be imposed. Under some misconception of law the petitioner made a representation to the Central Government on 12.10.1968 against the proposed imposition of damages. The Central Government by its letter dated 30th November, 1968 directed the petitioner to approach the State Government. The petitioner thereupon made a representation to the State Government setting out the details of the circumstances under which it could not remit the provident fund dues in time, but prior to that the State Government by its order dated 12th February 1969, sanctioned the levy of damages and administrative charges as proposed by the Regional Provident Fund Commissioner. The petitioner's representation was rejected by the State Government on 17th December, 1970. Intimation of the same was not given to the petitioner, instead the State Government informed the Regional Provident fund Commissioner about the rejection of the petitioner's representation. The Regional Provident Fund Commissioner by his letter dated 18.1.1971 informed the petitioner that his representation had been rejected by the State Government. The petitioner was directed to deposit the damages as imposed against it within fifteen days. The petitioner failed to deposit the damages. Thereupon the Regional Provident Fund Commissioner issued a certificate to the Collector, Aligarh, on I4th June, 1971, for the recovery of the amount of damages as arrears of land revenue from the petitioner. The petitioner thereupon filed this petition challenging the validity of the levy and assessment of damages and the recovery proceedings. Sri G. P. Bhargava, learned counsel for the petitioner, challenged the validity of the levy and assessment of the damages and its recovery on the following grounds :

(3.) Section 14-B of the Act confers power on the appropriate Government to levy and recover damages for committing default in making the deposit of provident fund dues. The Act does not prescribe any period or limitation for the levy or recovery of damages from the defaulter. The petitioner placed reliance on M/s. Amin Chand & Sons v. State of Punjab and others(A.I.R. 1965 Punjab 441) where a learned single Judge of the Punjab High Court held that the damages should be levied immediately after the default and if the levy is delayed the employer may legitimately come to the conclusion that the Government had decided not to exercise its discretion to levy damages. To choose a date for levy of damages was held arbitrary. This view was however not accepted by our court in the Regional Provident Fund Commissioner v. M/s. Allahabad Canning Company(Since reported in 1978 (36) FLR 468 DB (Special Appeal No 21 of 1976), decided on January 4, 1978. A Division Bench of this Court disapproved the view of the Punjab High Court as taken in M/s. Amin Chand & sons case. The Division Bench held that section 14-B of the Act does not provide any limitation for taking action against the erring employers for not depositing the provident fund dues In the absence of bar of limitation there was no principle of law which debarred the Provident Fund Commissioner or the State Govt. from exercising their statutory powers under section 14-B of the Act. We find no reason to take a different view.