Delhi District Court
L.G. Electronics India Pvt. Ltd vs Provident Fund Inspector on 26 April, 2018
L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector
CA No: 440300/16
IN THE COURT OF SHRI HARISH DUDANI
SPECIAL JUDGE, (PC ACT) (CBI)-1
DISTRICT COURTS(SW), DWARKA, NEW DELHI.
In the matter of :-
CR No. : 440300/16
1. L.G. Electronics India Pvt. Ltd.
A Wing, Third Floor,
D-3, District Centre,
Saket, New Delhi-110017.
2. Anil Singh
S/o Sh. B.P. Singh
General Manager
M/s L.G. Electronics India Pvt. Ltd.,
A Wing, Third Floor,
D-3, District Centre,
Saket, New Delhi- 110017.
......... Revisionists
VERSUS
Provident Fund Inspector
O/o Regional Provident Fund Commissioner,
EPFO Complex,
Plot No. 23, Sector-23,
Dwarka, Delhi- 110075.
.......Respondent
CR No. 440300/16
Date of Institution 04.05.2016
Reserved for orders on 12.04.2018
Judgment announced on 26.04.2018
CR No:440300/16 page 1 of 28 DOJ 26.04.2018
L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector
CA No: 440300/16
JUDGMENT
1. This is a revision petition under Section 397 Cr.P.C. against the impugned order dated 09.10.2015 passed by Ld. ACMM(SW), Dwarka Courts whereby Ld. ACMM has been pleased to order for issuance of summon to the accused persons (revisionists herein).
2. Briefly stated facts relevant for the disposal of the revision petition are as under:
3. The present revision petition arises out of Complaint Case No. 75/15, under Section 190 Cr.P.C. r/w Section 14-AC of The Employees' Provident Funds and Miscellaneous Provisions Act,1952 (herein after called EPF Act & MP Act 1952) for commission of offences in contravention of Para 36(6) r/w Para 76(b) of the Employees' Provident Funds Scheme, 1952 (herein after called EPF Scheme 1952) titled as Provident Fund Inspector v. L.G. Electronics & Anil Kumar.
4. In the complaint dated 22.09.2015 under Section 190 Cr.P.C., the complainant (respondent herein) has stated that complainant is appointed as Provident Fund Inspector and now designated as Enforcement Officer and accused no. 2(revisionist no. 2 herein) is the GM of accused no.1 i.e. the company/establishment (revisionist no. 1) and the employees Provident Funds & CR No:440300/16 page 2 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 Miscellaneous Provisions Act-1952 and Employees Provident Fund Scheme-1952 are applicable to the said establishment and the establishment has been allotted Code No. DSNHP0019501 and accused no. 2( revisionist no. 2) being the person in-charge of accused no. 1 is responsible for the day to day conduct and business and is liable to comply with all the provisions of the said Acts and the Schemes framed there under in respect of accused no. 1.
5. It is further stated in the complaint that Employees' Provident Fund Organization is a statutory body under the Ministry of Labour & Employment and is under the statutory obligation to implement the provision of EPF & MP Act-1952 and the mandate of this body is to provide social security benefits to the employees of the establishment covered under EPF &MP Act-1952. It is stated in the complaint that the covered establishment is required to deposit contributions as specified under the Act, file statutory returns and also produce all the relevant records before the Authority for the purpose of verifying compliance of the said Act. It is further stated in the complaint that vide letter no. Coord./40(24)2010/DGP/Review Meeting/11387 dated 22.06.2015, a direction was issued by the Central Provident Fund Commissioner for seeding of KYC details CR No:440300/16 page 3 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 against the UAN alloted to the employees of establishment covered under the EPF & Misc. Provision Act-1952 and Area Enforcement Officer and other officers were also deputed for the guidance of accused persons.
6. It is further stated in the complaint that reminder through e-mail, SMS and telephone were issued to achieve the target of 80% of KYC by 31 st August, 2014 and directions were issued to the accused persons to collect and upload Aadhaar Number of the employees failing which a declaration be obtained from the employees that they do not have Aadhaar Card but despite specific directions, the accused persons have failed to upload the required details of Aadhaar Number of employees in contravention of the provision under para 36(6) of the EPF Scheme-1952.
7. It is further stated in the complaint that a show cause notice dated 29.07.2015 was issued to the accused for non-compliance of the said provision but despite receipt of show cause notice, the accused persons have failed to comply with the said show cause notice and are guilty of offence in contravention of the provision of Para 36(6) of the EPF Scheme-1952 read with Para 76(b) punishable under Section 14(2) of the EPF &MP Act, 1952.
CR No:440300/16 page 4 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16
8. Vide order dated 09.10.2015 Ld. Trial Court was pleased to order for issuance of summon to the accused persons.
9. Aggrieved by the impugned order dated 09.10.2015, accused persons /revisionists have filed the present revision petition.
10. It is stated in the revision petition that the impugned order passed by Ld. Trial Court is based on surmises and conjectures and is contrary to the facts. It is stated in the revision petition that Ld. Trial court has failed to appreciate the fact that as per order dated 22.06.2015 issued by Central Provident Fund Commissioner "Failure to adhere to the directions beyond wage month of September, 2015, will amount to non- compliance to the directions and defaulting establishment shall be liable for action as per Employees Provident Fund and Miscellaneous Provisions Act, 1952 and the Schemes framed thereunder" and no offence can be committed before passing of wage month of September 2015. It is stated in the revision petition that the show cause notice was issued by the Department in the Month of July, 2015 itself and sanction for prosecution was obtained by the Department in August 2015 and the Department filed the prosecution on 22.09.2015 though the wage month of September, 2015 has not passed and thus the CR No:440300/16 page 5 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 prosecution is bad and liable to be set aside. It is further stated in the revision petition that in the absence of sanction for prosecution qua revisionist no.1, the revisionist no. 2 cannot be prosecuted alone. It is further stated in the revision petition that the office of the revisionists is situated at Saket, New Delhi and the revisionists were required to upload the Data from there and thus the Saket courts have only the jurisdiction to try the alleged offence. The revisionists have prayed for setting aside the impugned order dated 09.10.2015.
11. Reply to the revision petition has been filed on behalf of respondent wherein it is stated that present petition is liable to be dismissed as the petitioners have not complied with the guidelines / order dated 22.06.2015 passed by the Central Provident Fund Commissioner and there was never any intention on the part of the petitioners to comply with the directions even after passing of the wage month of September, 2015. It is further stated in the reply filed on behalf of the respondent that the present petition is liable to be dismissed as the same is barred by the law of limitation. It is further stated by the respondent in the reply that the complaint, against which the present revision petition was filed for non-compliance of the order of the CPFC dated 22.06.2015 and previous directions, whereby CR No:440300/16 page 6 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 certain directions were issued regarding entire process of seeding of KYC details against the UAN alloted to the employees of establishment covered under the EPF & Misc. Provision Act - 1952. It is further stated in the reply filed on behalf of the respondent that as per the directions dated 22.06.2015, the establishments were required to seed the aforesaid details against the UAN within one month from the receipt of the UAN and guidelines regarding submission of the Bank Accounts details of members of the Fund had already been issued vide circular No. Coord/40/(24)/2010/DPG Review Meeting /16136 dated 17.09.2014, wherein the employer was required to furnish the information regarding core banking account with IFSC code in respect of existing members by 15.10.2014 and to provide the core banking account with IFSC code in respect of previous members by 31.10.2014 and the same was intimated to all the employers through bulk email but the petitioners had failed to do so and further directions were issued to all the employers including the petitioners vide letter dated 22.06.2015. It is further stated in the reply that the petitioners have not complied with the directions issued by the respondent, therefore, mere error in quoting the date of circular as wage month of the September, 2015 does not give any cause of action to the petitioners to CR No:440300/16 page 7 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 approach the court and with a view to escape the liability of making statutory compliance. It is further stated that cause of action has taken place at the office of the respondent situated at Dwarka hence the court at Dwarka has the territorial jurisdiction to entertain the complaint and it is prayed that present petition be dismissed.
12. I have heard Ld. Counsel for the parties and perused the records.
13. The contention of Ld. Counsel for the revisionists is that as per order dated 22.06.2015 the compliances as mentioned in the said order were to be carried out by the wage month of September 2015 and the respondent issued show cause notice dated 29.07.2015 before waiting for the period of compliance as mentioned in the order dated 22.06.2015, consequently the sanction for prosecution dated 26.08.2015 is bad in the eyes of law. Ld. Counsel for the respondent has further contended that the sanction for prosecution dated 26.08.2015 has been accorded only against revisionist no. 2. It is further contended on behalf of revisionists that in the complaint , the address of the accused persons i.e. the present revisionists has been mentioned is of Saket and in the circumstances the District Court at Saket has the jurisdiction to entertain CR No:440300/16 page 8 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 the complaint.
14. Ld. Counsel for the respondent has contended that there is no force in the contention of revisionist that as per order dated 22.06.2015, the compliances as mentioned in the said letter were to be done by the wage month of September 2015 and the show cause notice dated 29.06.2015 and the sanction dated 27.08.2015 are bad in the eyes of law. Ld. Counsel for the respondent has further contended that prior to the directions of order dated 22.06.2015, directions were issued by which the respondent was to achieve the target of 80% of KYC by 31.08.2014 and there was no intention on the part of the revisionists to comply with the directions even after passing of the wage month of September 2015. Ld. Counsel for respondent has contended that revisionists have not complied with the previous directions also and in the circumstances, it is not open for the revisionist to plead that they cannot be prosecuted for non compliance of directions as contained in order dated 22.06.2015 as the period prescribed for the compliance of the said directions was still available to them.
15. Ld. Counsel for the respondent has contended that the office of respondent is situated in Dwarka and UAN has been allotted from Dwarka Office and show CR No:440300/16 page 9 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 cause notice has been issued from Dwarka Office and sanction for prosecution has also been accorded from the said office and Court at Dwarka has territorial jurisdiction to entertain and try the complaint and there is no force in the contention of the revisionist that Court at Saket has the jurisdiction to try the present complaint. Ld. Counsel for the respondent has further contended that there is no force in the contention of the revisionist that sanction for prosecution has been accorded in respect of accused no. 2 Anil Singh only and accused no. 1 ( revisionist no.1 herein) cannot be prosecuted.
16. Ld. Counsel for the respondent has relied upon decision of Hon'ble Supreme Court in Anil Hada v. Indian Acrylic Limited, Crl. Appeal no. 1258-63 of 1999.
17. The contention of the revisionists is that by the sanction order dated 26.08.2015 only sanction for prosecution against accused no. 2 Sh. Anil Singh has been accorded and in the circumstances, the proceedings against accused no. 1 ( revisionist no. 1 herein) are bad in the eyes of law.
18. The order for sanction of prosecution dated CR No:440300/16 page 10 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 26.08.2015 reads as :-
EMPLOYEES' PROVIDENT FUND ORGANISATION (Ministry of Labour & Employment, Govt. of India) Regional Office : Delhi(South) EPFO Complex, Plot No.23, Sector23, Dwarka, New Delhi110 075.
DL/19501/CIV/prosecution Dated : 26.08.15 Sanction for Prosecution In exercise of powers conferred on me by subsection (1) of section 14AC of the employees' Provident Funds & Miscellaneous Provisions Act, 1952 (Act 19 of 1952) (hereinafter referred to as the Act) Act read with Government of India, Department of Labour and Employment Notification No. S.O.549(E) dated 16th October, 1973, I, J. K. Pandey, Regional Provident Fund Commissioner Delhi (South) am satisfied, after going through the records of M/s L. G. Electronics India (P) Ltd., A Wing, 3 rd Floor, D3, District Centre, Saket New Delhi110017 that they have failed upload Bank A/c details in respect of each UAN allotted to the members within the stipulated time, thus in contravention of Para 36(6) of the EPF Scheme 1952 which is punishable under Section 14(2) of the Act.
I, therefore, on application of my mind and in public interest, hereby accord my sanction for the prosecution of Shri Anil Kumar, Senior G. M., A104, Aashiana Orchid Gamma2, Greater Noida, Uttar Pradesh Pin Code 201306.
[J.K. Pandey] REGIONAL PF COMMISSIONER DELHI (SOUTH) CR No:440300/16 page 11 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16
19. In the complaint under Section 190 Cr.P.C. r/w Section 14-AC of the Employees Provident Fund and Miscellaneous Provisions Act-1952, it is stated that accused no. 2 is the General Manager of accused no.1 ., an establishment within the meaning of the Employees Provident Funds & Miscellaneous Provisions Act-1952 and accused no. 2 is the person in-charge of accused no. 1 and is responsible for the day to day conduct of accused no. 1.
20. Along with the complaint, a copy of Form 5A under Employees' Provident Fund Scheme 1952, Employees' Pension Scheme 1995 and Employees' Deposit Linked Insurance Scheme 1976 has been filed in which the particulars of establishment, particulars of owners and particulars of Manager or occupier have been declared by accused no.1 ( revisionist no. 1 herein) and in the said declaration, the accused no. 2 has been declared as Manager or Occupier.
21. Section 14A of The Employees' Provident Funds and Miscellaneous Provisions Act, 1952 reads as :-
14A. Offences by companies - (1) If the person committing an offence under this Act, the Scheme or the Pension Scheme or the Insurance Scheme is a company, every person, who at the CR No:440300/16 page 12 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.
Provided that nothing contained in this subsection shall render any such person liable to any punishment, if he proves that the offences was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.
(2) Notwithstanding anything contained in subsection (1), where an offence under the Act, the Scheme or the Pension Scheme or the Insurance Scheme has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director of manager, secretary or other officer of the company, such director, manager secretary or other officer shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.
Explanation. For the purposes of this section,
(a) "company" means any body corporate and included a firm and other association of individuals; and
(b) "director", in relation to a fir, means a partner in the firm.
22. In Anil Hada v. Indian Acrylic Limited (supra), Hon'ble Supreme Court referred to decision of State of Madras v. C.V. Parekh and Anr. [1970] 3 SCC 491 wherein it was observed "This argument cannot be accepted, because it ignores the first condition for the applicability of section 10 to the effect that the person contravening the order must be a company itself. In the present case, there is no finding either by the Magistrate or by CR No:440300/16 page 13 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 the High Court that the sale in contravention of clause (5) of the Iron and Steel Control Order was made by the company. In fact, the Company was not charged with the offence at all The liability of the persons in charge of the company only arises when the contravention is by the company itself. Since, in this case, there is no evidence and no finding that the company contravened clause (5) of the Iron and Steel Control Order, the two respondents could not be held responsible." The same provision under the E.C. Act was again considered by this court in Sheoratan Agarwal and another v. State of Madhya Pradesh, AIR (1984) SC I824, In the said decision this court explained the legal principle enunciated in State of Madras V. C.V. Parekh, (supra) that there should be a finding that the contravention was made by the company before convicting me accused and "not that the company itself should have been prosecuted along with the accused". We may say with great respect that me above understanding of the ratio in State of Madras v. C. V. Parekh cannot be taken exception to. Chinnappa Reddy, J., who spoke for the two Judge Bench in Sheoratan Agarwal (supra) further observed as follows:
"Any one or more or all of them may be prosecuted and punished. The company alone may be prosecuted. The conniving officer may individually be prosecuted. One, some or all may be prosecuted. There is no statutory compulsion that the personin charge or an officer of the company may not be prosecuted CR No:440300/16 page 14 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 unless he be ranged alongside the company itself. S.10 indicates the persons who may be prosecuted where me contravention is made by the company. It does not lay down any condition mat the personincharge or an officer of the company may not be separately prosecuted if the company itself is not prosecuted. Each or any of them any be separately prosecuted or along with the company."
23. In view of the provisions of Section 14A of The EPF & MP Act, 1952 and decision in Anil Hada v. Indian Acrylic Limited (supra), there is no force in the contention of revisionists that there is no valid sanction for prosecution against accused no. 1.
24. The another contention raised on behalf of revisionist is that both the accused persons i.e. both the revisionists are based at Saket , Delhi and District Court Dwarka has no jurisdiction.
25. The contention of Ld. Counsel for the respondent is that office of respondent is situated at Dwarka, New Delhi and all records pertaining to accused persons are being maintained at Dwarka Office and UAN has been allotted from Dwarka Office and the show cause notice and the sanction order has been issued from the Dwarka Office and in the circumstances, Court at Dwarka has jurisdiction to try the present case.
CR No:440300/16 page 15 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16
26. Section 177 to Section 189 of the Code of Criminal Procedure 1973 provide jurisdiction for enquiry and trial of criminal courts.
27. Section 178 , 179 and 180 Cr.P.C. read as :
Section 178. Place of inquiry or trial. -
(a) When it is uncertain in which of several local areas an offence was committed , or
(b) where an offence is committed partly in one local area and partly in another, or
(c) where an offence is a continuing one, and continues to be committed in more local areas than one, or
(d) where it consists of several acts done in different local areas, it may be inquired into or tried by a Court having jurisdiction over any of such local areas.
Section 179. Offence triable where act is done or consequence ensues. - When an act is an offence by reason of anything which has been done and of a consequence which has ensued, the offence may be inquired into or tried by a Court within whose local jurisdiction such thing has been done or such consequence has ensured.
Section 180. Place of trial where act is an offence by reason of relation to other offence.- When an act is an offence by reason CR No:440300/16 page 16 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 of its relation to any other act which is also an offence or which would be an offence if the doer were capable of committing an offence, the first- mentioned offence may be inquired into or tried by a Court within whose local jurisdiction either act was done.
28. In the Trial Court Record, a copy of Form no.5A under Employees' Provident Fund Scheme 1952, Employees' Pension Scheme 1995 and Employees' Deposit Linked Insurance Scheme 1976 submitted by the revisionists has been filed and the said form bears stamp of the office of complainant(respondent herein) in acknowledgment of receipt of the said form, as per which the said form was deposited by the revisionists in the office of respondent at Dwarka which shows that for the purpose of compliance of provisions of Employees' Provident Fund Scheme 1952, Employees' Pension Scheme 1995 and Employees' Deposit Linked Insurance Scheme 1976, the revisionists had submitted to the jurisdiction of respondent at its office in Dwarka, New Delhi. In the circumstances, there is no force in the contention of revisionist that the Courts at Dwarka have no jurisdiction to entertain the present petition.
29. The contention of Ld. Counsel for the CR No:440300/16 page 17 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 revisionists is that as per order dated 22.06.2015, the compliances of the directions as contained in the said order were to be made by the wage month of September 2015 and without waiting for the expiry of the period for the compliance of the directions as mentioned in the order dated 22.06.2015, the respondent issued show cause notice dated 29.07.2015 and the sanction order dated 26.08.2015 in pursuance of the same is without application of mind.
30. The case of the complainant (respondent herein) is that vide order no.
Coord./40(24)2010/DPG/Review Meeting/11387 dated 22.06.2015, the accused persons were directed to comply with the directions as contained therein but the accused persons failed to comply with the said directions and consequently show cause notice no. E/DL/19501/C- IV/2015/6184 dated 29.07.2015 was issued and the accused persons failed to submit any reply to the said show cause notice and sanction order dated 26.08.2015 was issued for prosecution of accused persons for commission of offence in contravention of Para 36(6) read with Para 76(b) of the Employees Provident Fund Scheme-1952 punishable under Section 14(2) of the Employees Provident Fund and Miscellaneous Provisions Act, 1952.
CR No:440300/16 page 18 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16
31. The order no. Coord./40(24) 2010/DPG/Review Meeting/11387 dated 22.06.2015 reads as :-
No. Coord./40(24)2010/DPG/Review Meeting/11387 Date: 22.06.2015 ORDER In the matter of : Issue of direction under Para 78(3) of the Employees' Provident Funds Scheme, 1952 for efficient administration of the Scheme.
In view of the direction issued by the Central Government (the Ministry of Labour & Employment, Govt. of India) under Para 78(1) of the Employees' Provident Funds Scheme, 1952, I, K.K. Jalan, Central Provident Fund Commissioner, hereby issue the following directives in exercise of powers delineated under Para 78(3) of the said Scheme :
a) Employer of the establishment covered under the Act is directed to get the declaration in Form No.11(New) from all the employees joining the establishment in a month and eligible to become member of the Fund and upload the same in Universal Account Number(UAN) Portal within 25 days of close of each month.
b) Employer of the establishment covered under the Act is directed to disseminate the UAN generated by EPFO to all his existing employees who are members of the Fund within 15 days from the receipt of UAN and get acknowledgment from them.
c) Employer of the establishment covered under the Act is directed to get the UAN activated by his employees who are members of the Fund within 15 days of such dissemination.
d) Employer of the establishment covered under the Act is directed to duly seed the KYC details of such members (such as bank account details, PAN, AADHAAR, etc.) within one month of the receipt of UAN so as to enable them to avail the services from EPFO.
CR No:440300/16 page 19 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16
e) Employer of the establishment covered under the Act is directed to seed AADHAAR Numbers in respect of the members who have got AADHAAR within one month of receipt of UAN. Wherever the members do not have AADHAAR, the employer is directed to obtain a certificate from such members of the Fund to the effect that they have no AADHAAR within one month of receipt of UAN. As soon as AADHAAR is submitted by any member, the employer is directed to upload the same on the UAN Portal within 15 days of receipt.
f) Employer of the establishment covered under the Act is directed to ensure incorporation of UAN and to seed all relevant information in the claim form before forwarding the same to EPFO.
2. Employer of the establishment is directed to carry out the above instructions as per the schedule prescribed above. Failure to adhere to the directions beyond wage month of September, 2015 will amount to noncompliance to the directions and the defaulting establishment shall be liable for action as per the Employees' Provident Funds & Miscellaneous Provisions Act, 1952 and the Schemes framed thereunder.
[K.K. Jalan] Central Provident Fund Commissioner
32. The aforesaid order dated 22.06.2015 provided that the failure to adhere to the directions beyond wage month of September, 2015 will amount to non- compliance to the directions and the defaulting establishment shall be liable for action as per the Employees' Provident Funds & Miscellaneous Provisions CR No:440300/16 page 20 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 Act, 1952 and the Schemes framed thereunder.
33. As per case of the complainant, for non compliance of the directions as contained in the order dated 22.06.2015, show cause notice dated 29.07.2015 was issued to the accused persons.
34. Show Cause Notice dated 29.07.2015 reads as :
EMPLOYEES' PROVIDENT FUND ORGANISATION (Ministry of Labour & Employment, Govt. of India) Regional Office : Delhi(South) Plot No.23, Sector23, EPFO Complex, Dwarka, New Delhi110 075.
No.E/DL/19501/CIV/2015/ 6184 Dated : 29 JUL 2015 SHOW CAUSE NOTICE Whereas a direction was issued under Para 78(3) of the Employees' provident Funds Scheme, 1952 for efficient administration of the Scheme dated 22.06.2015 detailing therein that:
1. The employer of the establishment covered under the Act is directed to disseminate the UAN generated by EPFO to all his existing employees who are members of the Fund within 15 days from the receipt of UAN and get acknowledgment from them.
2. The Employer of the establishment covered under the Act is directed to get the UAN activated by his employees who are members of the Fund within 15 CR No:440300/16 page 21 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 days of such dissemination.
3. The Employer of the establishment covered under the Act is directed to duly seed the KYC details of employees who have been allotted UAN (such as bank account details, PAN, AADHAAR, etc.) within one month of the receipt of UAN so as to enable them to avail the services from EPFO.
4. The Employer of the establishment covered under the Act is directed to seed AADHAAR Nos. in respect of the members who have got AADHAAR within one month of receipt of UAN. Wherever the members do not have AADHAAR, the employer is directed to obtain a certificate from such members of the Fund to the effect that they have no AADHAAR within one month of receipt of UAN. As soon as AADHAAR is submitted by any member, the employer is directed to upload the same on the UAN Portal within 15 days of receipt.
Whereas only 4804 KYC details have been uploaded by your establishment against 4685 UAN allotted & out of that only 2407 cases of Bank Account Number with IFSC Code and 21 Aadhaar Card number uploaded till date and thus you have failed to comply with the above direction issued under Para 36(6) of the EPF Scheme 1952.
You being proprietor/ Partner/ Director / Managing Director / Manager / Secretary being responsible for compliance of the above Provisions of the EPF & MP Act 1952 as laid down under section 2(e) of the Act, are called upon to show cause why prosecution should not be launched against CR No:440300/16 page 22 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 you as well as the company for contravening the above provisions of the Employees' Provident Fund and Misc. Provisions Act 1952 and the Schemes framed thereunder.
If no reply is received within three days from the date of receipt of this "notice" it will be presumed that no reply is intended in the matter and proposal for prosecution will be initiated without further notice.
[Narender Kr. Singh] Regional Provident Fund Commissioner R.O. Delhi (South) To Sh. Soonhwang Kwon (M.D.) C/o M/s L. G. Electronics India P. Ltd. A Wing, 3rd Floor, D3, District Centre, Saket, New Delhi110017.
35. The plea which has been raised by the accused persons (revisionists herein) is that as per order dated 22.06.2015 they were to comply with the directions as contained in the said order by the wage month of September 2015 and in case of their failure to comply with the said directions beyond the wage month of September, 2015, they were liable to be prosecuted.
36. The contention of complainant(respondent herein) is that the revisionists have not complied with the directions as contained in the order dated 22.06.2015 till CR No:440300/16 page 23 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 date and there has never been any intention on the part of the revisionist to comply with the directions even after passing of the wage month of September, 2015.
37. In the order dated 22.06.2015, it is specifically mentioned that "Failure to adhere to the directions beyond wage month of September, 2015, will amount to non-compliance to the directions and defaulting establishment shall be liable for action as per Employees Provident Fund and Miscellaneous Provisions Act, 1952 and the Schemes framed thereunder" .
38. Show Cause notice dated 29.07.2015 mentions that a direction was issued under para 78(3) of the Employees' Provident Fund Scheme, 1952 for efficient administration of the Scheme dated 22.06.2015 and only 4804 KYC details have been uploaded by the accused persons against 4685 UAN allotted and out of that only 2407 cases of Bank Account Number with IFSC Code and 21 Aadhaar Card number uploaded till date and thus the accused persons have failed to comply with the above directions issued under Para 36(6) of the EPF Scheme 1952. Hence, as per show cause notice dated 29.07.2015, the same was issued to the accused persons for failure in compliance of the directions as contained in the order dated 22.06.2015.
CR No:440300/16 page 24 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16
39. Respondent has filed reply to the revision petition and in para 3 of reply on merits, the respondent has submitted that the present complaint has been filed against the revisionists for non compliance of order of the CPFC dated 22.06.2015 and previous directions whereby certain directions were issued detailing wherein the entire process for seeding of KYC details (i.e. Bank Account, Aadhar Numbers etc.,) against the UAN allotted to the employees of establishments covered under the EPF & Misc. Provision Act-1952 and prior to the aforesaid directions, certain similar directions/orders were issued.
40. It is to be noted that in the show cause notice dated 29.07.2015 it is nowhere mentioned that in addition to the directions as issued vide order dated 22.06.2015 any directions were issued by any previous order and the accused persons have failed to comply with the same. In Para C of REPLY TO THE GROUNDS, in its reply, the respondent has stated that UAN were allotted to the establishment w.e.f. January 2014 and thus as per the said directions, the establishments were required to seed the aforesaid details against the allotted UAN within one month from the receipt of UAN and as per para (2) of the directions dated 22.06.2015, the employer of the establishment were directed to carry out the instructions as per the schedule prescribed above.
CR No:440300/16 page 25 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16
41. In Para C of the Reply To The grounds, in the reply the respondent has further stated as :
............... It is further submitted that even till date the petitioners have not complied with the directions issued by the respondent department, therefore, mere error in quoting the date of circular as wage month of September, 2015 does not give any cause of action to the petitioner to approach this Hon'ble Court. It is pertinent to mention herein, however, summoning order has been passed in October, 2015. It is also submitted that had there been an intention on the part of the petitioners to update UAN of its employees, the petitioners after wage month September 2015 would have completed the process of updation of UAN in respect of allotted members. .............................
42. Hence, the plea which has been raised on behalf of respondent is that there is error in the circular/order dated 22.06.2015 in quoting the date of wage month of September, 2015. Although the respondent has pleaded that there is an error in the order dated 22.06.2015 wherein it is mentioned that failure to adhere to the directions beyond wage month of September, 2015, will CR No:440300/16 page 26 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 amount to non-compliance to the directions as contained in the order dated 22.06.2015 but the respondent has not pleaded that in order to rectify the said error, any corrigendum or further orders were issued . As per order dated 22.06.2015 the revisionists were informed that failure to adhere to the directions beyond wage month of September 2015 will amount to non compliance of directions as contained in the order dated 22.06.2015. The show cause notice dated 29.07.2015 has been issued by the respondent for non compliance of directions as contained in the order dated 22.06.2015 by which the revisionists were directed to comply with the directions as contained in the said order dated 22.06.2015 and by which the revisionists were informed that failure to adhere the directions beyond wage month of September 2015 will amount to non compliance of the said directions. The show cause notice dated 29.07.2015 has been issued by the respondent without waiting for passage of the period of wage month of September, 2015 as mentioned in the order dated 22.06.2015 i.e. without giving opportunity to the revisionists to comply with the same within the stipulated period i.e. wage month of September, 2015. Consequently, the sanction for prosecution dated 26.08.2015 accorded by Regional Provident Fund Commissioner has been issued in a CR No:440300/16 page 27 of 28 DOJ 26.04.2018 L.G. Electronics India Pvt. Ltd. & Anr.
v. Provident Fund Inspector CA No: 440300/16 mechanical manner.
43. In view of the aforesaid discussion, the revision petition is allowed and the impugned order dated 09.10.2015, thereby summoning the accused persons(revisionists herein), is set-aside. The bail bond furnished under section 437A Cr. PC shall subsist for a period of six months from today.
44. TCR be sent back to the court concerned along with copy of this judgment. Revision file be consigned to record room.
Announced in the open (HARISH DUDANI) Court on 26.04.2018 Special Judge (PC Act) CBI-I Dwarka Courts, New Delhi.
Digitally signed by HARISH HARISH DUDANI
DUDANI Date:
2018.04.26
16:36:53 +0530
CR No:440300/16 page 28 of 28 DOJ 26.04.2018