MATOSHRI MUDRNALAYA Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) BY this petition filed under Article 227 of the Constitution of India and section 482 of the Code of Criminal Procedure, the prosecutions against petitioners Nos. 1 to 3 instituted by the second respondent, Inspector of the Office of the Regional Provident Funds Commissioner at Bombay have been challenged.

(2.) MR. Bhonsale, learned Counsel appearing in support of the petition has challenged the legality and validity of the institution of the said prosecutions being Criminal Case No. 762 of 1978 to 768 of 1978 on two grounds. In the first instance, Mr. Bhonsale has pointed out that the provisions of section 7 (a) of the Employees Provident Fund Act, contemplate the holding of an enquiry which requirement, according to Mr. Bhonsale, is mandatory and has not been complied with. Secondly, Mr. Bhonsale submits that in a case where a serious dispute arises with regard to the institution of prosecutions under the Act, and where the party has represented that no such action is warranted through a representation addressed to the Central Government, that the commencement of a prosecution before the representation is decided would be premature.

(3.) AS far as the first submission of Mr. Bhonsale is concerned, where it is the case of Mr. Bhonsale that no such enquiry was at all held, Mr. Mehta, learned Counsel appearing on behalf of the second respondent has drawn my attention to the affidavit in reply that has been filed wherein the department has taken up the contention that such an enquiry was in fact held. Mr. Mehta has also drawn my attention to the fact that there are certain references in the record to the effect that the matter had been enquired into prior to the institution of the prosecution. Unfortunately, a scrutiny of the record does not indicate that the concerned authority, after considering the matter, recorded a finding that the objections raised by the present petitioners viz. , that they did not employ more than 20 persons and that the provisions of the Act do not apply to them is not tenable and that, consequently, they are liable to be proceeded against. In the absence of such a finding by the authority, which would be a condition precedent in a case of the present type, where the very applicability of the Act has been disputed by the petitioners, the institution of the prosecution cannot be said to have been legal. Section 7 (1) is a mandatory requirement but merely because there is some reference in the record to the effect that the Inspector had carried out certain inspections and that certain discussions had taken place at the departmental level, it would not be possible to hold that there has been due, proper and adequate compliance with the provisions of section 7 (a ). The consequences being penal in nature, the provisions of the Act will have to be very strictly construed and consequently, Mr. Bhonsale is fully justified in his submission that the prosecutions that were commenced in the present set of cases are liable to be quashed on this ground alone.