BHARAT SANCHAR NIGAM LIMITED Vs. EMPLOYEES PROVIDENT FUND

JUDGEMENT

(1.) The order dated 27.3.2009, passed by Regional Provident Fund Commissioner, Amritsar (for short, 'the Commissioner') and order dated 13.12.2010, passed by Employees' Provident Fund Appellate Tribunal (for short, 'the Tribunal') have been impugned before this court. Briefly, the pleaded facts are that the Commissioner issued a notice dated 19.12.2008 to the petitioner to show cause as to why interest and damages be riot levied under Sections 7Q and 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (for short, 'the Act') on account of delayed deposit of provident fund dues. The same was replied to by the petitioner vide letter dated 4.2.2009. Vide order dated 27.3.2009, the Commissioner assessed Rs. 7,24,494 on account of interest and damages recoverable from the petitioner. As a consequence of the aforesaid order, the Commissioner withdrew the aforesaid amount on 3.6.2009 from the account of the petitioner maintained with Punjab National Bank, Pathankot. The petitioner filed appeal against the order dated 27.3.2009 before the Tribunal along with an application for stay. Vide order dated 1.7.2009, the Tribunal directed deposit of 30% of the amount assessed. This order was passed by the Tribunal despite the fact that the Commissioner had already withdrawn the entire amount of demand raised against the petitioner from its bank account. The petitioner requested respondent No. 2 for refund of a sum of Rs. 5,07,146 after deducting 30% of the amount already recovered in terms of the interim order dated 1.7.2009 passed by the Tribunal. As no action was taken by the Commissioner on the request made by the petitioner, a sum of Rs. 2,17,348 was deposited to comply with the order dated 1.7.2009, passed by the Tribunal, along with letter dated 15.9.2009 and a further request was made to refund the amount already withdrawn from the bank account of the petitioner. Vide order dated 13.12.2010, the appeal filed by the petitioner was rejected by the Tribunal. It is the aforesaid order, which is impugned before this court.

(2.) Learned counsel for the petitioner submitted that in response to the notice dated 19.12.2008 issued to show cause as to why interest and damages be not levied on the petitioner under Sections 7Q and 14B of the Act on account of delayed deposit of provident fund dues, the petitioner replied back vide letter dated 4.2.2009 specifically pointing out certain errors in the notice and further explaining the reason for delay in deposit of the provident fund dues which, inter-alia, was for the reason that for certain employees the amount was earlier being deposited in GPF scheme of the Central Government, which amount was later on transferred to Employees' Provident Fund Organisation. He further submitted that without considering any of the contentions raised by the petitioner in the reply, the Commissioner, by passing a totally non-speaking order, assessed a sum of Rs. 1,80,479 on account of interest under Section 7Q and a sum of Rs. 5,44,015 as damages under Section 14B of the Act; totaling Rs. 7,24,494. Even before the Tribunal, the issues were raised in detail, however, still the appeal was rejected by a totally cryptic order, which is more in the kind of a precise than a reasoned one. The petitioner is a State owned Corporation. Damages have to be levied only in case it is established that there is some mens rea, which is totally missing in the present case. He further submitted that even though there was no requirement of pre-deposit for entertainment of appeal against an order assessing interest and damages under Sections 7Q and 14B of the Act, but still the Tribunal imposed a condition of deposit of 30% of the demand raised. He prays for setting aside of the order and remanding the case back to the Tribunal for fresh consideration.

(3.) On the other hand, learned counsel for the respondents submitted that coverage of the petitioner-establishment under the provisions of the Act is not in dispute. The delay in deposit of provident fund dues is also not in dispute. Once that is so, as a necessary consequence, in terms of mandatory provisions of the Act, interest and damages were leviable. There is no jurisdiction vested with any authority to waive off the same. The Commissioner has calculated the same strictly as per the rates prescribed in Employees' Provident Fund Scheme, 1952. He further submitted that it was for the petitioner to have pointed out before the Tribunal that the amount of demand raised against it having already been recovered by the Commissioner, prayer for stay had been rendered infructuous. At that time, the Commissioner was not represented before the Tribunal, hence, he was not at fault. The petitioner has to set its own house in order.