Kerala High Court
M/S.Prakash Cashew Company vs The Assistant Provident Fund ... on 3 November, 2022
Author: P.V.Kunhikrishnan
Bench: P.V.Kunhikrishnan
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE P.V.KUNHIKRISHNAN
THURSDAY, THE 3RD DAY OF NOVEMBER 2022 / 12TH KARTHIKA, 1944
WP(C) NO. 6844 OF 2011
PETITIONER:
M/S.PRAKASH CASHEW COMPANY,
KAITHAKODE, KUNDRA, KOLLAM, REPRESENTED BY PROPRIETOR
B.JAYAPRAKASH.
BY ADVS.
SRI.T.M.CHANDRAN
SRI.JOSEPH ALBIN NEDUNTHALLY
SRI.V.A.SASIDHARAN
RESPONDENTS:
1 THE ASSISTANT PROVIDENT FUND COMMISSIONER,
KOLLAM.
2 THE EMPLOYEES PROVIDENT FUND APPELLATE TRIBUNAL,
MINISTRY OF LABOUR AND EMPLOYMENT, 4TH FLOOR, SCOPE
MANOR, LAXMI NAGAR DISTRICT CENTRE, DELHI-110 092.
3 EMPLOYEES PROVIDENT FUND ORGANIZATION,
REPRESENTED BY REGIONAL PROVIDENT FUND COMMISSIONER-II,
SUB REGIONAL OFFICE, PONNAMMA CHAMBERS, PARAMESWAR
NAGAR, KOLLAM-691001.
4 RECOVERY OFFICER,
EMPLOYEES PROVIDENT FUND ORGANIZATION, SUB REGIONAL
OFFICE, PONNAMMA CHAMBERS, PARAMESWAR NAGAR,
KOLLAM-691001.
BY ADV SRI.PIRAPPANCODE V.S.SUDHIR,SC,EPF
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
03.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
2
P.V.KUNHIKRISHNAN, J.
------------------------------
W.P.(C).No. 18033 of 2011
----------------------------------------------
Dated this the 01st day of November, 2022
JUDGMENT
The above writ petition is filed with the following prayers:
"(i) issue a writ of mandamus or any other appropriate writ, order or direction, quashing Exhibits P1 and P5
(ii) that the petitioner be granted such further reliefs as are appropriate and incidental to the Writ Petition.
(iii) issue a writ of certiorari or any other appropriate writ to quash Exhibits P1, P1 (b) and Exhibit P5 orders.
(iv) issue appropriate writ or order granting an effective opportunity to contest the enquiry proceeding under Section 7A of the Act and to produce necessary documents in the said enquiry and to adduce evidence;
(v) to pass an order for keeping all proceeding in abeyance including the recovery proceedings in pursuance of Ext.P1, P1(b) and P5 orders;
(vi) allow the Writ Petition with costs and grant such other reliefs as this Honourable Court 3 deems fit and just."[SIC]
2. The petitioner is the proprietor of M/s.
Prakash Cashew Company, Kaithakode, Kundara, Kollam engaged in the Cashew industry after employing both permanent and excluded employees.
It is a covered establishment as per the Employees Provident Fund and Miscellaneous Provisions Act, 1952 and the Schemes (for short 'the Act'). An enquiry under Section 7A was initiated against the petitioner which resulted in Ext.P1 order. It is the specific case of the petitioner that the Proprietor of the petitioner Company was hospitalized and undergone a major operation on 7.8.2008 and advised rest for a period of 3 months and hence he could not attend the enquiry nor engage a representative to represent in the Section 7-A enquiry. It is the case of the petitioner that the employer was not given adequate opportunity to prove the actual wages. Consequently Ext.P1 order was passed. Thereafter the petitioner filed a Review 4 Petition to review Ext.P1 as per Section 7B of the Act.
The Review Petition was also dismissed as evident by Ext.P1(b). Challenging the same, the petitioner filed Ext.P4 appeal as per Section 7I of the Act. The appeal is also dismissed as per Ext.P5 order. According to the petitioner, Section 7A enquiry was conducted mainly based on the report of the Enforcement Officer. It is the specific case of the petitioner that the same was not furnished to the petitioner. The petitioner produced Ext.P6 series to show the contribution paid towards the ESI corporation. Ext.P7 series is the contribution paid by the petitioner towards the Provident Fund dues. The petitioner submitted that the documents produced will reveal that the petitioner has remitted a sum of Rs. 23,62,760/- against the due amount of Rs. 19,43,238/- and thereby the petitioner has paid an excess amount of Rs. 4,19,522/-.
According to the petitioner, even then the recovery proceedings is initiated. Hence this writ petition is filed challenging Exts.P1, P1(b) and P5.
53. Heard counsel appearing for the petitioner and the Standing counsel appearing for the respondents.
4. Counsel appearing for the petitioner reiterated his contentions raised in this writ petition.
The counsel takes me through Exts.P1, P1(b) and P5 and submitted that, no opportunity was given to the petitioner to adduce evidence and to cross examine the Enforcement Officer who submitted the report.
The Standing counsel on the other hand submitted that sufficient opportunity was given to the petitioner to adduce evidence. The Standing counsel submitted that a bare perusal of Ext.P1 order itself will show that, on several days the case was posted and the petitioner refused to appear before the Court. The Standing counsel also submitted that the medical certificate produced by the petitioner is dated 10.04.2012 and there is no sufficient materials in Ext.P1(a) medical certificate to show that the Proprietor of the Company was laid up during the 6 period. The Standing counsel submitted that, even in the absence of the petitioner, the authority considered all the relevant materials and thereafter decided the matter and there is nothing to interfere with the impugned order. Moreover, the Standing counsel also submitted that the petitioner has not raised the point that he was not given proper opportunity to adduce evidence before the authorities concerned. This is disputed by the counsel appearing for the petitioner and submitted that specific contention was raised in Ext.P4 appeal memorandum.
5. This Court considered the contentions of the petitioner and the respondents. It is true that a perusal of Ext.P1 will show that the case was posted on several occasions to adduce evidence. It will be better to extract the relevant portion of Ext.P1:
"The Establishment M/s. Prakash Cashew Company, Kaithakode, Kundara, Kollam is covered under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 under code No. KR/16433. The employer of the establishments 7 defaulted in the payment of various dues fully under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and Schemes framed there under, for the period from 02/2004 to 04/2008. In spite of repeated requests made by this Office as well as the Enforcement Officer, the establishment has not remitted the dues fully towards the Employees' Provident Funds. The employer has thus violated the provisions contained in Para 30 and 38 of Employees' Provident Fund Scheme, 1952 and rendered himself liable for penal action as provided under Section 14(2) of the Act read with Para 76(d) of the Scheme, 1952.
In order to determine the dues, a notice was issued by this office to the employer on 24.07.08 by Registered Post fixing an inquiry on 07.08.2008 under Section 7 A of the Act, wherein production of necessary records and appearance in person or through duly authorized representative was insisted upon.
On 07-08-2008, none attended for hearing but a letter dated Nil received on 07-08-2008 requesting for an adjournment, as the employer has been hospitalized. Considering his request the case was adjourned to 10-09-2008.
On 10-09-2008, none attended the hearing and no representation has been received and the case was again adjourned to 20-10-2008. However a Telegram dated 09-09-2008 has been received on 11-09 2008 requesting further adjournment.8
On 20-10-2008, none attended and no representation has been received.
Even though the inquiry has been adjourned as requested by the employer, the employer or his authorised representative has failed to attend the hearing and to produce the records called for vide notice dated 24-07-2008. The Enforcement Officer during his inspection visit to the establishment has also reported that the establishment has not produced the records and reported that (i) there is huge variation between the wages reported to ESIC and EPF (ii) the employer is not remitting the Provident Fund Contributions on the actual full wages paid to the employees. (iii) The employer is submitting NIL returns to the EPF, whereas he has remitted ESIC Contributions for the same period etc. and the Enforcement Officer has reported the balance outstanding wages based on the salary for the month of 05/2008.
It is also reported that the Trade Union conveners have complained that the contributions furnished in the Form 23 slips are much less than the actual contributions deducted from the wages of employees. On comparison of leave book with form 3A in respect of KR/16433/266, it is seen that the wages furnished in the form 3A is only 21.6% of the actual wages, furnished in the leave book.
I therefore determine the outstanding dues for the period from 02/2004 to 04/2008 on the basis of the dues reported by Enforcement Officer reserving 9 the right to assess the escaped dues if any as and when the original records of the establishment are verified by the Enforcement Officer.
6. Thereafter, a review petition was filed and the same was dismissed as per Ext.P1(b) order. In Ext.P1(b) order, it is stated that the petitioner has not made any request for cross examination of the Enforcement Officer. It is also stated in Ext.P1(b) that sufficient opportunities were provided to the employer to represent his side and he has not participated in the inquiry, inspite of repeated adjournments. A perusal of Ext.P1(b) will show that Sri.Anil Narayan, authorized representative of the establishment attended the hearing with authorization letter from the petitioner. He requested for a copy of all the Inspection Reports and documents based on which the enquiry under Section 7A was initiated. But a perusal of Ext.P1(b) will show that, since such a request is not made from the petitioner, the same is rejected. Ext.P5 is the order passed in the appeal. In paragraph 13 of 10 Ext.P5 order, it is stated that the appellant participated in the proceeding under section 7A. But never asked to supply the copy of the Enforcement Officer's report.
A perusal of Ext.P5 will show that the petitioner never appeared, but only requested for adjournment. It is an admitted fact that the petitioner was not able to appear for Section 7A enquiry. According to the petitioner, there is payment in excess of the demand and the petitioner is entitled to refund certain amount and submitted several documents to substantiate the case. I don't want to make any observation about the merit of the case. In the peculiar facts and circumstances of the case, I think an opportunity can be given to the petitioner to contest the matter once again by producing adequate materials to substantiate the case. To facilitate the authorities to pass fresh order, Exts.P1, P1(b) and P5 can be set aside. The 1 st respondent will pass fresh orders after giving an opportunity of hearing to the petitioner. Now it is submitted that the report of the Enforcement Officer is 11 already produced in this writ petition in the counter affidavit. The 1st respondent will furnish the documents which they are going to rely to the petitioner before proceeding with Section 7A enquiry.
Therefore, this writ petition is disposed of in the following manner:
i) Exts.P1, P1(b) and P5 are set aside.
ii) The 1st respondent is directed to reconsider the matter after giving an opportunity of hearing to the petitioner, as expeditiously as possible.
iii) The 1st respondent will furnish the documents which the 1st respondent is going to rely to the petitioner before proceeding with Section 7A enquiry.
Sd/-
P.V.KUNHIKRISHNAN
DM JUDGE
12
APPENDIX OF WP(C) 6844/2011
PETITIONER ANNEXURES
ANNEXURE I TRUE COPY OF INTERIM ORDER DATED
9.3.2011.
ANNEXURE II TRUE COPY OF JUDGMENT DATED
27.5.2011 IN W.A.526/2011.
EXHIBIT P1 A TRUE COPY OF THE CERTIFICATE DATED
10.4.2012 ISSUED BY DR.R.P.MADHAVAN. EXHIBIT P1 A TRUE COPY OF THE ORDER DATED 9.2.2009.
EXHIBIT P1 TRUE COPY OF THE PROCEEDINGS OF THE 1ST RESPONDENT DATED 20.10.2008. EXHIBIT P2 TRUE COPY OF THE COMBINED CHALLAN ISSUED FROM THE OFFICE OF THE 1ST RESPONDENT ON 9.12.2009.
EXHIBIT P3 TRUE COPY OF THE CHEQUE OF CATHOLIC SYRIAN BANK LTD. CHINNAKKADA BRANCH DATED 30.4.2010.
EXHIBIT P4 A TRUE COPY OF THE MEMORANDUM OF APPEAL DATED 18.3.2008 (WITHOUT DOCUMENTS).
EXHIBIT P5 A TRUE COPY OF THE ORDER DATED 13.1.2011.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.1.2005 FOR RS.7551/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.8470/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.11048/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.1.2005 FOR RS.11138/-.
EXHIBIT P6 TRUE COPY OF THE CHALLAN DATED 23.3.2004 FOR RS.16,942.
13EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 6.5.2004 FOR RS.13978/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 2.6.2004 FOR RS.7505/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 26.6.2004 FOR RS.11575/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.12460/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10..2004 FOR RS.14280/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.7842/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.11438/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.10046/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 12.5.2005 FOR RS.18348/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.10368/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.11020/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.11967/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.8051/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.11050/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 21.4.2006 FOR RS.13519/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 21.4.2006 FOR RS.15245/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 14 21.4.2006 FOR RS.13413/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 21.4.2006 FOR RS.14135/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 4.8.2006 FOR RS.11110/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 4.8.2006 FOR RS.12840/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 10.10.2006 FOR RS.9965/-.
EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.10047/-.
EXHIBIT P6AA A TRUE COPY OF THE CHALLAN DATED 10.10.2006 FOR RS.10537/-.
EXHIBIT P6AB A TRUE COPY OF THE CHALLAN DATED 1.1.2007 FOR RS.21124/-.
EXHIBIT P6AC A TRUE COPY OF THE CHALLAN DATED 1.1.2007 FOR RS.12888/-.
EXHIBIT P6AD A TRUE COPY OF THE CHALLAN DATED 31.7.2007 FOR RS.37372/-.
EXHIBIT P6AE A TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.32346/-.
EXHIBIT P6AF A TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.32087/-.
EXHIBIT P6AG A TRUE COPY OF THE CHALLAN DATED 20.5.2008 FOR RS.30469/-.
EXHIBIT P6AH A TRUE COPY OF THE CHALLAN DATED 11.12.2008 FOR RS.42291/-.
EXHIBIT P7 TRUE COPY OF CHALLAN DATED 23.3.2004 FOR RS.2010/-.
EXHIBIT P7A TRUE COPY OF THE CHALLAN DATED 26.4.2004 FOR 3/2004 FOR RS.7/-. EXHIBIT P7B TRUE COPY OF THE CHALLAN DATED 26.6.2004 FOR RS.7/- FOR RS.4/2004..
15EXHIBIT P7C TRUE COPY OF THE CHALLAN DATED 26.6.2004 FOR RS.10591/- FOR RS.5/2004..
EXHIBIT P7D TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.25339/-.
EXHIBIT P7E TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.30642/-.
EXHIBIT P7F TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.80337/- FOR 8/2004.
EXHIBIT P7G TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.44530/-.
EXHIBIT P7H TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.43900/-.
EXHIBIT P7I TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.29751/-.
EXHIBIT P7J TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.33372/-.
EXHIBIT P7K TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.43095/-.
EXHIBIT P7L TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.39291/-.
EXHIBIT P7M TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 3/2005. EXHIBIT P7N TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 4/2005. EXHIBIT P7O TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/-.
EXHIBIT P7P TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 6/2005. EXHIBIT P7Q TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 7/2005. EXHIBIT P7R TRUE COPY OF THE CHALLAN DATED 16 13.12.2005 FOR RS.40383/-.
EXHIBIT P7S TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.29772/-.
EXHIBIT P7T TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.39291/-.
EXHIBIT P7U TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.43075/-.
EXHIBIT P7V TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.12221/- FOR 12/2005.
EXHIBIT P7W TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 1/2006. EXHIBIT P7X TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR THE MONTH 2/2006.
EXHIBIT P7Y TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 3/2006. EXHIBIT P7Z TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 4/2006. EXHIBIT P7AA TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 5/2006. EXHIBIT P7AB TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 6/2006. EXHIBIT P7AC TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 7/2006. EXHIBIT P7AD TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.27998/-.
EXHIBIT P7AE TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.233512/-.
EXHIBIT P7AF TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.28842/-.
EXHIBIT P7AG TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.29301/-.
17EXHIBIT P7AH TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.30352/-.
EXHIBIT P7I TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 1/2007. EXHIBIT P7J TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 2/2007. EXHIBIT P7AK TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.7/- FOR 3/2007. EXHIBIT P7AL TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 4/2007. EXHIBIT P7AM TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 5/2007. EXHIBIT P7AN TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 6/2007. EXHIBIT P7AO TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.5888/-.
EXHIBIT P7AP TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.11956/-
EXHIBIT P7AQ TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.15359/-.
EXHIBIT P7AR TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.11907/-.
EXHIBIT P7AS TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.15014/-.
EXHIBIT P7AT TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.27828/-.
EXHIBIT P7AU TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.28402/-.
EXHIBIT P7AV TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.37372/-.
EXHIBIT P7AW TRUE COPY OF THE CHALLAN DATED 30.7.2007 FOR RS.9780/-.
EXHIBIT P7AX TRUE COPY OF THE CHALLAN DATED 18 30.7.2009 FOR RS.11131/-.
EXHIBIT P8 TRUE COPY OF THE STATEMENT OF ACCOUNT.
EXHIBIT P9 TRUE COPY OF STATEMENT OF ACCOUNT. RESPONDENT EXHIBITS EXHIBIT R1(A) TRUE COPY OF THE ENFORCEMENT OFFICER'S NOTE NO.KR/16433/EO.MPA/08 ALONG WITH HIS INSPECTION REPORT. EXHIBIT R1(B) TRUE COPY OF THE STATEMENT OF ACCOUNT SHOWING THE DETAILS OF DUES ASSESSED VIDE 7A & THE REMITTANCE. EXHIBIT R1(C) TRUE COPY OF THE RELEVANT EXTRACT OF THAT LEAVE BOOK & FORM 3A (MONTHLY WAGES DETAILS FOR THE YEAR 2006- 2007).
EXHIBIT R1(D) TRUE COPY OF THE RELEVANT EXTRACT OF THE STATEMENT SUBMITTED BY THE TRADE UNION CONVENERS.
//TRUE COPY// PA TO JUDGE