WP(C)/5808/2012 of M/S.ACCENTIA Technologies LTD. v. the Regional Provident Fund Commissioner

THE REGIONAL PROVIDENT FUND COMMISSIONER, EMPLOYEES PROVIDENT FUND ORGANIZATION, REGIONAL OFFICE, BHAVISHYANIDHI BHAVAN, PATTOM, THIRUVANANTHAPURAM-695 004.

THE EMPLOYEES PROVIDENT FUND APPELLATE TRIBUNAL, NEW DELHI-110 001. BY SMT.T.N.GIRIJA, S.C. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 08-03-2012, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C).NO.5808/2012-A: APPENDIX PETITIONER'S EXHIBITS: EXT.P1: PHOTOCOPY OF THE JUDGEMENT DATED 20/1/2009 IN WPC.2078/2009 PASSED BY THIS HON'BLE COURT. EXT.P2: PHOTOCOPY OF THE ORDER NO.KR/16436/RO/TVM/PD/NS/2011 DATED 22/2/2012 PASSED BY THE IST RESPONDENT. EXT.P3: PHOTOCOPY OF THE APPEAL MEMORANDUM NO.239(7)/2012 FILED BEFORE THE 2ND RESPONDENT DATED 28/2/2012. EXT.P4: PHOTOCOPY OF THE APPLICATION FOR STAY FILED ALONG WITH EXT.P3 DATED 28/2/2012. EXT.P5: PHOTOCOPY OF THE PETITION FOR WAIVER OF REMITTANCE FILED ALONG WITH EXT.P3 DATED 28/2/2012. EXT.P6: PHOTOCOPY OF THE ORDER DATED 29/2/2012 IN ATA.239(7)/2012 BY THE 2ND RESPONDENT. RESPONDENTS' EXHIBITS: NIL. //TRUE COPY// P.A. TO JUDGE. Prv. P.N.RAVINDRAN,J. ----------------------------------- W.P.(C) No.5808 of 2012 --------------------------------------- Dated this the 8th day of March, 2012 JUDGMENT The petitioner is a company incorporated under the Companies Act, 1956 and is running an establishment at Technopark, Thiruvananthapuram, an establishment covered under the provisions of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter referred to as the Act for short) and the Schemes framed thereunder.

By Ext.P2 order passed on 22.2.2012, the Assistant Provident Fund Commissioner, Thiruvananthapuram levied the sum of Rs.4,19,078/- as damages under section 14B of the Act on the ground that there was delay on the part of the petitioner in remitting the contributions during the period from March 2010 to February 2011. Aggrieved by Ext.P2, the petitioner filed Ext.P3 appeal [ATA No.239(7)2012] before the Employees Provident Funds Appellate Tribunal. Along with the appeal he also filed an application for waiver of pre-deposit. The Employees Provident Fund Appellate Tribunal took up the appeal and the W.P.(C) No.5808 of 2012 2 accompanying application for waiver of pre-deposit for consideration on 29.2.2012 and passed Ext.P6 order directing the appellant to deposit the sum of Rs.1,00,000/- with the Regional Provident Fund Commissioner, Thiruvananthapuram within four weeks. The Appellate Tribunal also directed that upon such deposit, the operation of the impugned order shall stand stayed. The Appellate Tribunal also directed that the case will posted to further hearing and orders on 9.8.2012. Ext.P6 is under challenge in this writ petition. 3. I heard Sri.M.G.Karthikeyan, learned counsel appearing for the petitioner and Smt.T.N.Girija, learned standing counsel appearing for the first respondent. The stipulation regarding pre-deposit is contained in section 7(O) of the Act which reads as follows: "7-O. Deposit of amount due, on filing appeal.- No appeal by the employer shall be entertained by a Tribunal unless he has deposited with it seventy-five per cent of the amount due from him as determined by an officer referred to in section 7A: Provided that the Tribunal may, for reasons to be recorded in writing, waive or reduce the amount to be deposited under this section." W.P.(C) No.5808 of 2012 3 Rule 7 of the Employees' Provident Funds Appellate Tribunal (Procedure) Rules, 1997 also contains a similar provision. The said rule is extracted below: "7. Fee, time for filing appeal, deposit of amount due on filing appeal. - 1) Every appeal filed with the Registrar shall be accompanied by a fee of Rupees Five hundred to be remitted in the form of Crossed Demand Draft on a nationalised bank in favour of the Registrar of the Tribunal and payable at the main branch of that Bank at the station where the seat of the said Tribunal situate. (2) Any person aggrieved by a notification issued by the Central Government or an order passed by the Central Government or any other authority under the Act, may within 60 days from the date of issue of the notification/ order prefer an appeal to the Tribunal: Provided that the Tribunal may, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal within the prescribed period, extend the said period by a further period of 60 days: Provided further that no appeal by the employer shall be entertained by a Tribunal unless he has deposited with the Tribunal a Demand Draft payable in the Fund and bearing 75 per cent of the amount due from him as determined under section 7A: Provided also that the Tribunal may for reasons to be recorded in writing, waive or reduce the amount to be deposited under section 7-O." W.P.(C) No.5808 of 2012 4

On a plain reading of section 7 of the Act and rule 7 of the Employees' Provident Funds Appellate Tribunal (Procedure) Rules, 1997, it is evident that it is only in cases were the appeal is from an order passed under section 7A of the Act that the appellant is bound to deposit 75% of the amount assessed by way of pre-deposit. Neither section 7 of the Act nor rule 7 of the Employees' Provident Funds Appellate Tribunal (Procedure) Rules, 1997 stipulates that an appeal from an order passed under section 14B of the Act should also be accompanied by deposit of 75% of the damages levied under section 14B of the Act. If section 7A and rule 7 referred to above are applied to appeals arising from orders passed under section 14B of the Act, in a given case where the damages levied is less than 75% of the amount determined under section 7A of the Act, the appellant will have to deposit 75% of the amount assessed under section 7A which, in my opinion, cannot be said to be the intention of the Parliament. I am therefore, of the considered opinion that the direction issued by the Employees' Provident Funds Appellate Tribunal in Ext.P6 cannot be sustained. W.P.(C) No.5808 of 2012 5 I accordingly allow the writ petition, set aside Ext.P6 to the extent it directs the appellant to deposit the sum of Rs.1,00,000/- by way of pre-deposit and dispose of the writ petition with a direction to the Employees' Provident Funds Appellate Tribunal to dispose of the appeal expeditiously, without insisting on pre-deposit and with a further direction to the first respondent and other officers of the Employees Provident Fund Organisation to await the outcome of the appeal before enforcing Ext.P2 order. Sd/- P.N.RAVINDRAN JUDGE /TRUE COPY/ P.A. To JUDGE vpv