Jharkhand High Court
Bokaro Karamchari Panchayat vs Steel Authority Of India Ltd on 14 August, 2023
Bench: Shree Chandrashekhar, Anubha Rawat Choudhary
IN THE HIGH COURT OF JHARKHAND AT RANCHI
(Letters Patent Appellate Jurisdiction)
LPA No. 669 of 2019
Bokaro Karamchari Panchayat, a Registered Union affiliated to Hind
Mazdoor Sabha having its Office at Sector-III/D, Qr. No. 565, Bokaro Steel
City, P.O., P.S. B.S. City, District- Bokaro, through its General Secretary
Ramakant Verma, aged about 68 years, Son of Late Phulchand Verma,
Resident of Sector-III/D, Qr. No. 391, P.O. & P.S. Bokaro Steel City,
District- Bokaro ......Appellant
Versus
1. Steel Authority of India Ltd., a Government of India Company Registered
under S. 617 of the Indian Companies Act, 1956, having its Registered office
at Ispat Bhawan, Lodhi Road, New Delhi, having its unit at Bokaro by the
name of Bokaro Steel Plant, Bokaro Steel City, District- Bokaro, through its
Deputy General Manager (Law) Sri P.S. Dviwedi, Bokaro P.O. & P.S. - B.S.
City, District- Bokaro ... Petitioner/Respondent no. 1
2. Union of India, Ministry of Labour through its Secretary, having its office
at Shram Bhawan, Rafi Marg, P.O. & P.S. Rafi Marg, New Delhi
3. Employees Provident Fund Organization through its Regional Provident
Fund Commissioner, having its Regional Office at Bhagirathi Complex, near
Circuit House, Karamtoli, P.O. & P.S. Lalpur, District- Ranchi.
4. Mahila Kalyan and Manav Utthan Sansthan, a welfare organization duly
registered under Societies Registration Act, having its office at Sector 4/A,
Bokaro Steel City, P.O. & P.S. B.S. City, District- Bokaro, through its
Secretary Bijay Kumar Choudhary, Bokaro
5. Assistant Provident Fund Commissioner (Compliance), Bhagirathi
Complex, near circuit House, Karamtoli, P.O. & P.S. Lalpur, District- Ranchi
... Respondents/Respondents
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CORAM: HON'BLE MR. JUSTICE SHREE CHANDRASHEKHAR
HON'BLE MRS. JUSTICE ANUBHA RAWAT CHOUDHARY
For the Appellant : Mr. Saibal Kumar Laik, Advocate
For the SAIL : Mr. Saket Upadhyay, Advocate
: Ms. Sonal Jaiswal, Advocate
For the Resp. No. 2 : Mrs. Bakshi Vibha, CGC
: Mr. Devanand Kumar, CGC
For the Resp. Nos. 3 & 5 : Mr. PAS Pati, Advocate
---------------
JUDGMENT
14th August 2023 Per, Shree Chandrashekhar, J.
Bokaro Karamchari Panchayat through its General Secretary has filed the present Letters Patent Appeal to challenge the order dated 07 th 2 LPA No. 669 of 2019 August 2019 passed in W.P.(L) No. 5415 of 2010 by which an order passed under section 7-B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (in short Provident Funds Act) has been set-aside by the writ Court.
2. The only ground urged on behalf of the Steel Authority of India Limited (in short "SAIL") to support the writ Court's order is that the order passed under section 7-B of the Provident Funds Act was without jurisdiction inasmuch as the Assistant Provident Fund Commissioner has exercised the powers under section 7-B which power is not vested in him. Mr. Saket Upadhyay, the learned counsel for the respondent-SAIL would submit that once an inquiry was made to determine the liability under the Provident Funds Act in the garb of exercise of the powers of review, the Assistant Provident Fund Commissioner could not have reopened the issue and fixed liability upon the SAIL.
3. Briefly stated, on a complaint made by the Bokaro Karamchari Panchayat making an allegation that the employer's contribution under the Provident Funds Act is not being deposited by the Mahila Kalyan and Manav Utthan Sansthan (in short "Sansthan") a proceeding by the Assistant Provident Fund Commissioner vide proceeding no.JH/RO/RNC/CC/10521/2003/3151 dated 04th August 2003 was initiated and, accordingly, the Area Enforcement Officer was directed to submit a confidential inquiry report. Simultaneously, notice was issued to the Secretary of the Sansthan to produce the relevant records. It further appears that the Factory Inspector also made an official inquiry and found 170 workers there. Later on, the number of workers exceeded more than 200 persons and a list thereof was prepared.
4. In the proceeding before the Assistant Provident Fund Commissioner, an objection was raised on behalf of the Sansthan that it has been established for helping widow, helpless orphan and old age people and destitutes.
5. The objections raised on behalf of the Sansthan are recorded in the proceeding dated 02nd March 2001, as under:
"Sri S.K. Sukla, Secretary of the establishment appeared on behalf of establishment.
The constitution of the establishment is available in the file and the aim of the establishment is to help widows/helpless/orphans/old people/destitutes financially. There is no fixed time for the widows to come to the establishment.3 LPA No. 669 of 2019
They are at liberty to come the establishment at their sweet will. There is no compulsion to attend establishment and make attendance. The establishment is meant for social purpose and to help the old widows financially economically for their livelihood. As such Sri Sukla stated that there is no servant and master relation.
Sri Sukla further submitted copy of order from under Secretary to the Govt. of Bihar vide 3005597 (not legible) which exempts the establishment from the Industrial dispute Act, 1947 Rule (not legible). Hence no dispute can be raised under the Industrial Dispute Act, 1947 because the establishment does fall under the purview of Industry. As such he further stated that there is no existence of servant and master relation between the workers and employer.
Sri Sukla is directed to submit a certificate to the effect the establishment does not hold the right of rejection of the gloves which are prepared by the widows/destitutes so that case can be decided during next date of hearing which is fixed to 20.4.2001.
Sd/- 02.03.2001 (Xavier Toppo) APFC"
6. Later on, the Assistant Provident Fund Commissioner having regard to the certificate produced on behalf of the Sansthan that the management of SAIL does not hold the right of rejection of the gloves manufactured by widows/destitutes, came to a finding that the provisions under the Provident Funds Act are not applicable to the Sansthan.
7. On 08th June 2001, the Assistant Provident Fund Commissioner has drawn the following proceeding:
"Sri S. K. Ssukla, Secretary of the establishment appeared on behalf of establishment. He was directed to submit a certificate that the management does not hold the right of rejection of gloves prepared by the widows/destitutes on earlier date of hearing i.e. 02.03.2001 which he submitted today which is taken on record.
In view of proceeding carried out above, I am of the opinion that EPF & MP Act, 52 is not applicable to the establishment. Necessary instruction to the establishment be issued accordingly.
Sd/- 08.06.2001 (Xavier Toppo) APFC"
8. However, on the basis of further inquiries conducted by him, the Assistant Provident Fund Commissioner passed an order under section 7-A of the Provident Funds Act fixing liability upon the Sansthan.
9. The proceeding dated 4th August 2003 reads as under:
"OFFICE OF THE REGIONAL PROVIDENT FUND COMMISSIONER REGIONAL OFFICE, RANCHI No. JH/RO/RNC/CC/10521/2003/3151 DATE: 4/8/03 In the matter of proceedings held under section 7-A of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 for determination of the dues payable by M/s Mahila Kalyan & Manav Utthan Sansthan (Dasthana Kendra), Sector-IV-A, Bokaro Steel City under the said Act of the schemes framed thereunder for the period 06/98 to 09/2001.
1. Whereas the provisions of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 apply to M/s Mahila Kalyan & Manav Utthan Sansthan (Dasthana 4 LPA No. 669 of 2019 Kendra), Sector-IV-A, Bokaro Steel City and its employers failed to pay the dues payable under the said Act and schemes framed thereunder for the period stated above therefore occasion had arisen for me to determine the quantum of dues payable by them for the said period. As required 7A Notice of the Act, a registered notice No. 2698 dated 21.03.2002 was sent to the employer calling upon him/ them to represent his case before me in the above matter on 04.04.2002 at 11.00 A.M. Further, the hearing was also adjourned to 23.04.2002, 22.05.2002, 20.06.2002, 10.07.2002, 19.08.2002, 16.09.2002, 18.10.2002, 14.11.2002, 07.01.2003, 23.01.2003, 24.02.2003, 26.03.2003, 21.04.2003, 21.05.2003 and 23.06.2003.
2. Sri T. Ahmed, Secretary appeared on 23.04.2002, 22.05.2002, 16.09.2002, 14.11.2002 and 23.01.2003. Thereafter none appeared on behalf of the establishment.
3. In view of above, I proceed to determine the dues on the basis of available records and Balance Sheet for the year 98-99 and 99-2000 submitted by the establishment.
ORDER I, XAVIER TOPPO, Asstt. Provident Fund Commissioner, in exercise of the powers conferred upon me under section 7A of the Employees Provident Fund and Misc. Provisions Act, 1952 determine the following sum as dues payable for the period under reference by M/s Mahila Kalyan & Manav Utthan Sansthan (Dasthana Kendra), Sector-IV-A, Bokaro Steel City.
Dues (A) On account of Provident Fund contribution Rs. 11,38,093.00 (Employers and Employees Share) payable into A/C No. 1 (B) On account of Employees Pension Fund Rs. 6,04,998.00 contribution (Employers Share) payable into A/C No. X (C) On account of Employer's contribution Rs. 36,314.00 Employees' Deposit Linked Insurance Scheme payable into A/C No. XXI (D) On account of Administrative charges payable Rs. 79,892.00 under para 38(II) of the E.P.F. Scheme, 1952 payable into A/C No. II (E) On account of Administrative charges payable Rs. 727.00 under Employees Deposit Linked Scheme, 1976 payable under A/C No. XXII (F) TOTAL Rs. 18,60,024.00 In additional to above interest under section 7Q of the Act @ 12% on the amount assessed as on 27.06.2003 is also payable from the date as indicated below and continues to accrue till date of deposit.
Account No. I Account No. II Account No. X Account Account TOTAL No. XXI No. XXII Rs. 468164.00 Rs. 31,880.00 Rs. 248871.00 Rs. 14,938.00 Rs. 299.00 Rs. 7,64,151.00 A total sum of Rs. 2624175.00 (Rupees: Twenty Six Lakh twenty four thousand and one hundred seventy five) only is thus found due from the said establishment for the period 06/98 to 09/2001.
S/d-
13.7.03 (XAVIER TOPPO) ASSTT. PROVIDENT FUND COMMISSIONER JHARKHAND, RANCHI.
1. Copy of the assessment order forwarded to M/s Mahila Kalyan & Manav Utthan Sansthan (Dasthana Kendra), Sector-IV-A, Bokaro Steel City for information. The above dues should be deposited in the State Bank of India immediately, if not already done so and the receipted copies of challans may be sent to the undersigned by name within 15 days of the receipt of this order failing which the amount in default may be recovered in 5 LPA No. 669 of 2019 the manner specified under section 8B to 8-G of the Act.
2. Copy forwarded to (A) Accounts Group- 5 (B) E.D.P. Cell.
(XAVIER TOPPO) ASSTT. PROVIDENT FUND COMMISSIONER JHARKHAND, RANCHI."
10. Aggrieved thereby, the Sansthan filed an application under section 7-B seeking review of the order dated 04th August 2003.
11. The Sansthan has laid its grounds on the basis of the following facts pleaded in paragraph no.8 of the petition seeking review of the 7-A order:
"8. That certain peculiar features of the members who work for the society are as follows:
i. The members are mostly voluntary members who are all widow or destitute who indulge in the stitching for their self help.
ii. There is no fixed clientele of the group consisting of the said volunteers who are all widows and destitute women.
iii. There is no fixed time for the said women folk who are all the ordinary members of the Sansthan for either coming in for rendering their services or going out after rendering the services.
iv. There is no attendance register nor is there any fixed hours of work. The members who want to earn some thing come at their own convenience. v. The Sansthan operates on "no profit no loss" basis. vi. The Govt. of Bihar has been kind enough to grant exemption under ID Act. vii. That the above sansthan is a charitable welfare organization and compassion oriented benign for the sake of helping downtrodden, helpless, destitutes, widows for partial earning for keeping their soul and body together. viii. That the above activity is being run through Volunteers members who would like to join together to help themselves jointly and severally by stitching hand gloves etc. as and when needed by the purchaser from time to time. ix. That the widows or destitutes or helpless or unemployed who stitch the hand gloves etc. have not even casual connections with the petitioner organization nor does any relationship of master and servant or the employer and employee exists.
x. That it is humbly submitted that the members come together but do not work even for hours in one stretch and so resultantly there is no fixed duration of work for stitching or for the above purpose.
xi. That the sole and single objective of this casual gathering is to offer social and economic relief to the widows and those downtrodden who are workless who volunteer themselves to earn bread by stitching hand gloves, etc. xii. That the building/place or precincts for stitching as above has been made available by the Bokaro Steel Plant on charity.
xiii. That in absence of any fixed timing and duration and no schedule working hours the formalities of submission of forms under the Employees provident Fund Act, 1952 is not at all required since the entire establishment does not come under the purview of the Act."
12. In the midst of the proceedings under section 7-B, a notice was issued to the SAIL which denied its liability under the Provident Funds Act by pleading as under:
"3. That in this regard M/s Bokaro Steel Plant says and submits as follows: -
a. Mahila Kalyan and Manav Utthan Sansthan is a registered welfare organization registered under the Societies Registration Act and said 6 LPA No. 669 of 2019 association has been formed to help destitute women and widows by forming self help group and to generate self employment to them in order to help them to sustain their livelihood.
b. That the said society is not run or managed by M/s Bokaro Steel Plant and it has no administrative control over the said society. c. That the Society is governed and run on the basis of the by-laws of the Establishment by which Managing Committee is constituted under the provisions of Clause 6 of the By Laws of the Society by election of the 9 members Managing Committee from amongst the members of the Society and as on today M/s Bokaro Steel Plant has enquired from the Society and it has come to its knowledge that there are 134 existing members who have formed a 9 members Managing Committee from amongst the members of the society namely Dr (Mrs) N. Khanna (President), T. Ahmed (Secretary), Usha Singh, Jyotsna Devi, Balika Devi, Yogendra Singh, Suhana Akhtar, Hiramuni Devi, Shanti Devi.
4. That thus all the Managing Committee members are the members of the Society out of which Dr (Mrs) N. Khanna is the erstwhile employee of the Bokaro Steel Plant and Sri T. Ahmed is currently the only employee of the Bokaro Steel Plant who is in the Managing Committee of the Society as a member of Society.
5. That any employee or officer of the Bokaro Steel Plant can become a member of the society by taking consent from the Management to provide a voluntary service to the sansthan, as a member of sanathan.
6. That in accordance with the service rule of the SAIL, the Officer informs the Management regarding their involvement in doing voluntary service in any organization such as Mahila Kalyan and Manav Utthan Sansthan.
7. That the Management of SAIL/BSL has also shown its corporate social responsibility by giving purchase order to Mahila Kalyan and Manav Utthan Sansthan on preferential basis. The aim of the management for such gracious attitude is a step in the direction of corporate social responsibility to provide social upliftment to the members of Mahila Kalyan and Manav Utthan Sansthan who are all destitute and widow and have no other alternate source of income.
8. That apart from placing purchase order on preferential basis the Management of Bokaro Steel Plant has no other role to play in the management of Society.
9. That Mahila Kalyan and Manav Utthan Sansthan is thus a self help group which is run and managed by its members and merely because the employee of M/s Bokaro Steel Plant joined in the society as its members it does not constitute any liability or any control into the affairs of the society."
13. The Assistant Provident Fund Commissioner allowed the review petition and passed an order on 30th September 2010 by which the SAIL has been held liable to pay provident fund dues and other contributions in respect of the workers associated with the Sansthan.
14. A glance at the order dated 30th September 2010 would disclose that the proceedings under section 7-B stretched over more than thirty dates during which notices were issued to the SAIL and the Panchayat and sufficient opportunity was granted to them.
15. The provisions under section 7-B of the Provident Funds Act read as under:
"7-B. Review of orders passed under section 7-A.--(1) Any person aggrieved by an order made under sub-section (1) of section 7A, but from which no appeal has been preferred under this Act, and who, from the 7 LPA No. 669 of 2019 discovery of new and important matter or evidence which, after the exercise of due diligence was not within his knowledge or could not be produced by him at the time when the order was made, or on account of some mistake or error apparent on the face of the record or for any other sufficient reason, desires to obtain a review of such order may apply for a review of that order to the officer who passed the order:
Provided that such officer may also on his own motion review his order if he is satisfied that it is necessary so to do on any such ground. (2) Every application for review under sub-section (1) shall be filed in such form and manner and within such time as may be specified in the Scheme. (3) Where it appears to the officer receiving an application for review that there is no sufficient ground for a review, he shall reject the application. (4) Where the officer is of opinion that the application for review should be granted, he shall grant the same:
Provided that,--
(a) no such application shall be granted without previous notice to all the parties before him to enable them to appear and be heard in support of the order in respect of which a review is applied for, and
(b) no such application shall be granted on the ground of discovery of new matter or evidence which the applicant alleges was not within his knowledge or could not be produced by him when the order was made, without proof of such allegation.
(5) No appeal shall lie against the order of the officer rejecting an application for review, but an appeal under this Act shall lie against an order passed under review as if the order passed under review were the original order passed by him under section 7A."
16. The authority under the Provident Funds Act can exercise powers under section 7-B on the grounds of (i) discovery of new and important matter (ii) any evidence which was not within the knowledge of the parties even after exercise of due diligence (iii) any evidence which could not have been produced by the parties at the time when the order was made (iv) some mistake or error apparent on the face of the record or (v) for any other sufficient reason. This further appears that the power of review can be exercised by the provident fund authority suo motu provided the authority records his satisfaction that it is necessary to do so. The expression any other sufficient reason in the context of the avowed object behind the Provident Funds Act must be construed liberally. Therefore, on a plain reading of the provisions under section 7-B, there can be no doubt that the powers under section 7-B are very wide and akin to the powers of the Court under Order XLVII Rule 1 of the Code of Civil Procedure.
17. The intention of the legislature in providing such wide powers in the Provident Fund Authority is in tune with the object behind this beneficial legislation. It is well-settled that a non-party who was not heard or could not appear in the original proceeding or feels aggrieved of the order passed in the original proceeding can file a petition for review. However, on a petition under section 7-B filed by a party which was heard and afforded 8 LPA No. 669 of 2019 sufficient opportunity to produce records, a liability under section 7-A cannot be fixed upon a third party by conducting a further inquiry into the matter.
18. In "Lily Thomas v. Union of India" (2000) 6 SCC 224 the Hon'ble Supreme Court has observed that the power of review can be exercised for correction of a mistake but not to substitute a view.
19. In "Lily Thomas" the Hon'ble Supreme Court has observed as under:
"56. It follows, therefore, that the power of review can be exercised for correction of a mistake but not to substitute a view. Such powers can be exercised within the limits of the statute dealing with the exercise of power. The review cannot be treated like an appeal in disguise. The mere possibility of two views on the subject is not a ground for review. ....."
20. In the complaint made by the Panchayat, there was no allegation against the SAIL that it was not depositing the Provident Fund dues and other contributions and, in connection therewith, an inquiry was conducted by the Assistant Provident Fund Commissioner, and by an order dated 04th August 2003 it was held that the Sansthan is liable to deposit contributions under the Provident Funds Act. Now in a petition filed by the Sansthan under section 7-B, the Assistant Provident Fund Commissioner has three options either to (i) reject the review petition (ii) allow the review petition, or (iii) remand the matter for further inquiry under section 7-A. As noticed above, the Sansthan has not even pleaded in the petition under section 7-B that the SAIL is liable to deposit the Provident Fund contributions dues and other contributions. The SAIL which filed its objection to the notice issued to it by the Assistant Provident Fund Commissioner has specifically pleaded that the Sansthan is a self-help group and in discharge of corporate social responsibility it is providing raw materials to the Sansthan free of cost.
21. The aforesaid being the factual scenario, the writ Court rightly held that the order under section 7-B qua the SAIL was without jurisdiction. The Assistant Provident Fund Commissioner could not have embarked on a roving inquiry in exercise of review jurisdiction to invite the parties to produce documents and conduct a fresh inquiry as a result of which liability has been fastened on the SAIL.
22. For the aforesaid reasons, the order dated 30th September 2010 9 LPA No. 669 of 2019 passed under section 7-B must remain confined to the Sansthan and to that extent this order must be held valid. For doing this, we have carefully perused the pleadings of the Panchayat in the present Letters Patent Appeal and are satisfied that the writ Court's order dated 07th August 2019 has been challenged on the ground that the SAIL alone is liable under the Provident Funds Act.
23. Consequently, the order dated 07th August 2019 passed in W.P.(L) No. 5415 of 2010 is modified to the extent that the order dated 30th September 2010 stands affirmed qua the Sansthan.
24. LPA No. 669 of 2019 is disposed of in the aforesaid terms.
(Shree Chandrashekhar, J.) (Anubha Rawat Choudhary, J.) Saurav/Pankaj-