Kerala High Court
M/S. Christava Mahilalayam vs The Regional Provident Fund ... on 27 January, 2020
Author: V Raja Vijayaraghavan
Bench: V Raja Vijayaraghavan
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT
THE HONOURABLE MR. JUSTICE RAJA VIJAYARAGHAVAN V
MONDAY, THE 27TH DAY OF JANUARY 2020 / 7TH MAGHA, 1941
WP(C).No.1990 OF 2020(W)
PETITIONER :
M/S. CHRISTAVA MAHILALAYAM,
THOTTUMUGHAM P.O., ALUVA-683 105,
REPRESENTED BY ITS SECRETARY, SMT. MARY JACOB.
BY ADV. SRI.ASHER REVI JOB
RESPONDENT:
THE REGIONAL PROVIDENT FUND COMMISSIONER-II,
EMPLOYEES PROVIDENT FUND ORGANIZATION,
REGIONAL OFFICE, 36/685 A,
BHAVISHYANIDHI BHAVAN, KALOOR, KOCHI-682 017.
SRI THOMAS MATHEW NELLIMOOTTIL
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
27.01.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WP(C).No.1990 OF 2020(W) 2
JUDGMENT
M/s Christava Mahilalayam, the petitioner herein, runs two schools, one of which is a Higher Secondary School affiliated to the Kerala State Board of Secondary Education and the other is a public school affiliated to the Central Board of Secondary Education, New Delhi. The establishments are covered under the provisions of Employees Provident Funds and Miscellaneous Provisions Act, 1952 ('EPF Act' for short). The establishments defaulted in remitting the contributions and accumulations payable under the EPF Act and the sundry schemes formulated under that Statute. Separate orders were passed by the respondent to show cause against the imposition of damages as envisaged under Section 14B of the EPF Act and interest under Section 7Q of the Act. Against the order passed under Section 14B, the petitioner has preferred an appeal before the appellate authority. Challenge in this petition is the order dated 9.12.2019 as per which interest has been levied under Section 7Q of the EPF Act for belated remittances for the period from 1.6.2006 to 31.3.2019, the amount which has been ordered to be paid is Rs.94,658/-.
2. Sri.Asher Revi Job, the learned counsel appearing for the WP(C).No.1990 OF 2020(W) 3 petitioner, submits that Ext.P1 order cannot be sustained. According to the learned counsel, the School employs permanent teachers as well as temporary teachers and contends that in the case of teachers employed temporarily, the amount paid to them on their rejoining the academic year cannot be considered as basic wages as it is not an emolument earned by them while on duty, or on leave, or on holidays in accordance with the terms of the contract of employment. According to the learned counsel, the said payment is only a goodwill payment at the volition of the petitioner.
3. Sri.Thomas Mathew Nellimoottil, the learned Standing Counsel appearing for the respondent has refuted the submissions. According to the learned counsel, the EPF Act is a beneficial social legislation to ensure health and other benefits of the employees and the employer under the EPF Act is under statutory obligation to make the deposit that is due from him. Section 7Q of the EPF Act provides for interest for belated payment and it is basically a compensation for payment of interest to the affected employee. He would point out that the contentions advanced by the petitioner in this Writ Petition was not raised before the respondent when he was heard before levying of interest under Section 7Q of the EPF Act. He would take great exception WP(C).No.1990 OF 2020(W) 4 on the failure to produce the statement filed by the petitioner before the respondent, wherein, the contention taken in this writ petition was not taken.
4. I have considered the submissions advanced.
5. There is no dispute that the petitioner's establishment is covered under the EPF Act, 1952 and they are required to pay the provident fund contributions, the pension fund contributions, the administrative charges and other accumulations. From Ext.P1, it is evident that the remittances for the period from 1.6.2006 till 31.3.2019 were paid belatedly. Under Section 7Q the employer is liable to pay simple interest at the rate of 12% p.a. or at any such higher rate on any amount due from the employer from the date on which the amount has become so due till the date of its actual payment. A reading of Section 2(f) would show that if a person is employed, though casually and for a very short period of time, but in connection with the process which are integral and connected with the operations of the establishment, then he shall be an employee entitled to coverage under the EPF Act. In the same manner, 'basic wages' as defined under Section 2(b) means all emoluments which are earned by an employee while on duty or on leave or on holidays with wages in either case in accordance with the terms of WP(C).No.1990 OF 2020(W) 5 the contract of employment. The contention of the petitioner is that the amount which is paid to the temporary teaching staff on their rejoining on the new academic year cannot be treated as basic wages. A conjoint reading of Section 2(b) and 2(f) of the EPF Act would show that the said contention cannot be sustained.
6. There is yet another matter. I find that the Director of the petitioner had appeared for enquiry before the respondent and had submitted a statement. The said statement is not produced before the Court. From Ext.P1 it appears that in the said statement it was stated that delay was mainly due to payment of salary arrears for the vacation months of April and May, which were actually paid after reopening of the School. This is clearly at variance to the contentions advanced in this Writ Petition.
7. The petitioner is under an unqualified statutory obligation to pay the dues on time and their failure to pay within the stipulated period would make them liable to pay interest. The EPF Act is a beneficial social legislation to ensure health and other benefits of the employees and the employer under the Act is under statutory obligation to make the deposit due from him. The provision has been made to secure just and humane conditions of work as has been opined by the Hon'ble Supreme Court in WP(C).No.1990 OF 2020(W) 6 Regional Provident Fund Commissioner v. Hoogly Mills Company Ltd.1. The employer cannot be permitted to adopt subterfuges to evade payment of contribution.
Having considered all the relevant facts, I find no reason to interfere with the impugned order in exercise of powers under Article 226 of the Constitution of India.
This Writ Petition will stand dismissed.
Sd/-
RAJA VIJAYARAGHAVAN V JUDGE NS 1 [2012[(2) SCC 489] WP(C).No.1990 OF 2020(W) 7 APPENDIX PETITIONER(s) EXHIBITS:
EXHIBIT P1 A TRUE COPY OF THE ORDER DATED
9.12.2019 PASSED BY THE RESPONDENT.
RESPONDENT(S) EXHIBITS: NIL