St.Anthony School By Vice Pres vs Employees Provident Fund Organ on 9 July, 2012

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Jharkhand High Court

St.Anthony School By Vice Pres vs Employees Provident Fund Organ on 9 July, 2012

Equivalent citations: 2013 (1) AJR 595

Petitioner is aggrieved by the order dated 08.09.2004 contained at Annexure-4 by which the order imposing damages under Section 14B of Employees Provident Fund and Miscellaneous Provisions Act, 1952 has been passed for the period of March, 1982 to January, 1997 to the tune of Rs. 2,37,955/- against the petitioner-school. The petitioner further prays for quashing the order dated 30.09.2004 issued under the signature of respondent no. 2 whereby the bankers of this petitioner have been asked to pay the amount of Rs. 2,37,955/- under Section 8F of the Act.

According to the petitioner, notice was issued under the provisions 7Q and 14B of the Act dated 09.07.2003 for the payment of interest and damages for belated remittance under the Employees Provident Fund and Miscellaneous Provision Act, 1952. Petitioner filed his show-cause dated 24.09.2003 contained at Annexure-3 giving break up of the details of the remittance for the certain period. Learned counsel for the petitioner submits that by the impugned order contained at Annexure-4, petitioner has been directed to deposit Rs. 2,37,955/- as damages and interest under Section 7Q and 14B of the Act failing which further action will be taken against him for recovering the damages as per law alongwith interest under Section 7Q of the Act.

It is submitted on the part of the petitioner that although the respondents have taken into account the objection of the petitioner and granted certain relief of a sum of Rs. 40,000/- which was proposed under notice Annexure-2, but still a sum of Rs. 2,37,955 has been levied as damages. It is submitted on behalf of the petitioner that the impugned order does not give any break up of the details of the damages levied upon the petitioner for the period in question and it is not clear from the order impugned that which part of the petitioner's objection has been accepted and which part has been overruled, which is necessary to assail the impugned order before appropriate forum. Learned counsel for the petitioner has relied upon a judgment of Patna High Court in a case of The Jamshedpur General Consumers' Central Co- operative Stores, Ltd. and another Vs. The Regional Provident Fund Commissioner reported in 1979 LAB. I C. 317 in which it is observed that Competent Authority is required to pass a speaking order only more so while deciding as to whether for the default in any particular year any penal damages were called for at all and if so to what extent.

The respondents have appeared and filed their counter affidavit. It is submitted on the part of the respondents that a notice was issued on 09.07.2003 containing details of such belated payments in different accounts for which damages were proposed to be levied but the petitioner could not satisfy the authority concerned, thereafter the impugned order has been passed under the relevant provisions of Sections 14B read with para 32A of the scheme under the Act. Moreover, it appears that order is appealable under Section 7-I of the Act 1952 and writ petition should not be entertained.

From the submissions of the parties and after carefully going through the records and impugned order, it appears that the authorities in passing the impugned order seems to have taken into account the submission of the establishment by allowing certain amendment in the amount of dues as submitted by the establishment. However, chart enclosed in the impugned order in respect of the different amounts does not contain any break up of amount as damages in the relevant account for the different period for which petitioner's objection was overruled. The petitioner is required to know the ground and reason for which his objection/show cause reply has not been accepted by the competent authority in order to assail the order before the higher forum/appellate authority enabling the aggrieved persons to agitate the order impugned before higher forum. It is also necessary that while passing the order, the order should show application of mind for the higher forum/appellate authority to appreciate the reasons for passing the impugned order. It would be profitable to quote herein a decision of Hon'ble Supreme Court of India delivered in a case of Kranti Associates Private Limited and Another Versus Masood Ahmed Khan and Others reported in 2010 9SCC 496. Para 47 of the opinion as delivered by Ganguly, J is quoted hereinbelow:-

"47. Summarising the above discussion, this Court holds:

(a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially.

(b) A quasi-judicial authority must record reasons in support of its conclusions.

(c) Insistence on recording of reasons is meant to serve the wider principle of justice that justice must not only be done it must also appear to be done as well.

(d) Recording of reasons also operates as a valid restraint on any possible arbitrary exercise of judicial and quasi-judicial or even administrative power.

(e) Reasons reassure that discretion has been exercised by the decision-maker on relevant grounds and by disregarding extraneous considerations.

(f) Reasons have virtually become as indispensable a component of a decision-making process as observing principles of natural justice by judicial, quasi-judicial and even by administrative bodies.

(g) Reasons facilitate the process of judicial review by superior courts.

(h) The ongoing judicial trend in all countries committed to rule of law and constitutional governance is in favour of reasoned decisions based on relevant facts. This is virtually the lifeblood of judicial decision-

making justifying the principle that reason is the soul of justice.

(i) Judicial or even quasi-judicial opinions these days can be as different as the judges and authorities who deliver them. All these decisions serve one common purpose which is to demonstrate by reason that the relevant factors have been objectively considered. This is important for sustaining the litigants' faith in the justice delivery system.

(j) Insistence on reason is a requirement for both judicial accountability and transparency.

(k) If a judge or a quasi-judicial authority is not candid enough about his/her decision-making process then it is impossible to know whether the person deciding is faithful to the doctrine of precedent or to principles of incrementalism.

(l) Reasons in support of decisions must be cogent, clear and succinct. A pretence of reasons or "rubber-

stamp reasons" is not to be equated with a valid decision-making process.

(m) It cannot be doubted that transparency is the sine qua non of restraint on abuse of judicial powers. Transparency in decision-making not only makes the judges and decision-makers less prone to errors but also makes them subject to broader scrutiny. (See David Shapiro in Defence of Judicial Candor)

(n) Since the requirement to record reasons emanates from the broad doctrine of fairness in decision-making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See Ruiz Torija V. Spain EHRR, at 562 Para 29 and Anya V. University of Oxford, wherein the Court referred to Article 6 of the European Convention of Human Rights which requires, "adequate and intelligent reasons must be given for judicial decisions".

(o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of "due process"."

After having been heard the counsels for the parties and after going through the impugned order, it appears that the competent authority while passing the order has failed to provide reasons and also break up of the amount in question imposed as damages on provisions of 14B of the Act which are necessary in order to enable the petitioner to assail the same before the Higher Forum/Appellate Authority.

In view of the above, the impugned order dated 08.09.2004 is quashed and the consequential order contained at Annexure-6 dated 30.09.2004 is also quashed and the matter is remanded back to the concerned authority i.e. Regional Provident Fund Commissioner-II, Ranchi, Respondent No. 2 to pass a fresh speaking and reasoned order containing necessary details of break up after giving opportunity of hearing to the petitioner within a period of 12 weeks from the date of receipt/production of a copy of this order.

Accordingly, this writ petition is allowed in the aforesaid terms.

(Aparesh Kumar Singh, J.) Kamlesh/

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Jharkhand High Court