M/S Asl Advanced Systems Pvt Ltd vs The Regional Provident Fund on 7 February, 2014

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Karnataka High Court

M/S Asl Advanced Systems Pvt Ltd vs The Regional Provident Fund on 7 February, 2014

Bench: Ram Mohan Reddy

                              1
                                            WP 38039/10

IN THE HIGH COURT OF KARNATAKA AT BANGALORE

   DATED THIS THE 07TH DAY OF FEBRUARY 2014

                        BEFORE

  THE HON'BLE MR. JUSTICE RAM MOHAN REDDY

         WRIT PETITION No.38039/2010 (L-PF)

BETWEEN:

M/s ASL Advanced Systems Pvt. Ltd.,
Formerly known as
(Aerospace Systems Pvt. Ltd.)
No.70/1, Millers Road,
Bangalore-560 052,
Represented by it's
Director M.R.Seetharaman.
                                              Petitioner
(By Sri K. Kanikaraj, Adv.)

AND:

The Regional Provident Fund
Commissioner, Karnataka,
No.13, Rajaram Mohan Roy Road,
Bangalore-560 025.
                                            Respondent
(By Smt. Sumangala A. Swamy, Adv.)

      This writ petition is filed under Articles 226 and
227 of the Constitution of India praying to quash the
order passed by the EPF Tribunal, Delhi dated
22.10.2010, Annexure-A and consequently hold the
order dated 05.02.2004, Annexure-L passed by
respondent herein, directing the petitioner to pay an
amount of Rs.6,96,337/- as damages as not liable to
paid, etc.
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                                                  WP 38039/10

      This writ petition coming on for orders this day, the
Court made the following:

                         ORDER

Petitioner establishment, aggrieved by the order dated 05.02.2004, Annexure-L of the respondent/ Regional Provident Fund Commissioner directing payment of Rs.6,96,337/- as penal damages under Section 14-B of The Employees' Provident Fund and Miscellaneous Provisions Act, 1952 and the order dated 22.10.2010, Annexure-A of the Employees Provident Fund Appellate Tribunal, Delhi in ATA No. 241(6)/2004, has presented this petition.

2. The short question that arise for decision making is:

"Whether the appellate Tribunal and the respondent authority were justified in not considering mitigating circumstances and the provisions of Section 14-B r/w paragraph 32-A of the scheme of 1952, indicating the extent to which penal damages could be imposed for non-payment of contribution within the time stipulated, while directing payment of penal damages amounting to 100% of the delayed payment of contribution?

3 WP 38039/10

3. Regard being had to the decision of the learned single Judge of this Court in The Regional Provident Fund Commissioner and another vs. M/s Kaytee Switchgear Ltd. in W.P. No.588/2012 and connected matters dated 21st August 2012 that discretion vests with the Commissioner to consider the mitigating circumstances and pass speaking order supported by reasons in the matter of levy of damages, this petition deserves to be allowed and the question answered in the negative i.e., the respondent was not justified in not exercising discretion in the matter of levy of damages.

4. The petition is allowed. The orders of the appellate tribunal and that of the respondent, supra, are quashed and the proceeding remitted to the authority, for consideration afresh and to pass order strictly in accordance with law and in the light of the observations made supra, after extending reasonable opportunity of hearing to the parties.

Sd/-

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