Madhya Pradesh High Court
Gajanan Rice Mill vs E.P.F. Appellate Tribunal & Anr. on 2 August, 2022
Author: Sanjay Dwivedi
Bench: Sanjay Dwivedi
1
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE SANJAY DWIVEDI
ON THE 2ND OF AUGUST, 2022
WRIT PETITION No.1297 OF 2000
Between:-
GAJANAN RICE MILL,
THROUGH ITS PROPRIETOR
SHRI BADRI PRASAD
AGRAWAL,
KOTMA, DISTT. SHAHDOL.
.....PETITIONER
(BY SHRI UTTAM MAHESHWARI, ADVOCATE)
AND
1. THE EPF APPELLATE
TRIBUNAL 60, SKYLARK
BUILDING, NEHRU PLACE,
NEW DELHI.
2. REGIONAL PROVIDENT FUND
COMMISSIONER, SUB
REGIONAL OFFICE, SCHEME
NO.5, VIJAY NAGAR,
JABALPUR.
.....RESPONDENTS
(BY SHRI J.K. PILLAI, ADVOCATE)
........................................................................................................................
RESERVED ON : 07.07.2022
DELIVERED ON : 02.08.2022
.......................................................................................................................
This petition coming on for hearing this day, the Court passed the
following:
2
ORDER
With the consent of learned counsel for the parties, the petition is heard finally.
This petition is of 2005 filed under Article 226/227 of the Constitution of India questioning the validity of the order dated 19.11.1999 (Annexure P/40) passed by the appellate authority in an appeal preferred by the petitioner and the same was registered as Case No. ATA-8(35) 99. The appeal was against the order dated 11.06.1999 passed under Section 7B of the of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter referred to as the 'Act of 1952').
2. By the impugned order, the authority acted under the provision of Section 7B of the Act of 1952 determining the provident fund due for the period i.e. January, 1961 to April, 1996 and May, 1996 to April, 1998 and directed that an amount of Rs. 3,31,501.25 has been determined as provident fund due and was required to be paid by the petitioner.
3. Learned counsel for the petitioner is challenging the impugned order mainly on the ground that the provisions of the Act of 1952 are not applicable upon the petitioner and, therefore, the assessment after the date of amendment made on 23.04.1971 could not have been made by the authority. He submits that by way of amendment made, the Proviso attached to Section 1(5) has been deleted.
4. Shri Maheshwari submits that the petitioner's mill had already moved an application on 05.11.1970 intimating respondent No. 2 that in the petitioner mill, the strength of the employees working was reduced to less than 15 and, therefore, applicability of the provisions of Act of 1952 is 3 ceased and no assessment was required. The said application, according to the petitioner, was not answered and in 1994, the assessment was made by the respondent No.2 for the period from January, 1961 to April, 1996. In that assessment order, the petitioner was held liable to pay the dues and accordingly that assessment order was challenged by the petitioner by moving an appeal and that appeal was allowed and the matter was remanded back vide order dated 07.08.1998 asking that the authority shall resolve the dispute with regard to coverage and determination. Thereafter, second assessment was made by the authority for the period i.e. from May, 1996 to April, 1998. Against the said order, the petitioner preferred review petition, which was rejected vide order dated 17.05.1999 (Annexure P/18) and by that order the reviewing authority not only affirmed the second assessment order, but also affirmed the first assessment order and that order was further assailed by the petitioner by filing appeal before the appellate authority and the appellate authority partly allowed the appeal vide order dated 19.11.1999 (Annexure P/40) on the point of computation of dues. However, dismissed the appeal on the point of coverage.
5. Learned counsel for the petitioner submits that the authority failed to consider the impact of intimation given by the petitioner to respondent No. 2 with regard to non-applicability of the Act of 1952 as the strength of the employees in the petitioner mill was reduced to less than 15 and, therefore, they were not under obligation to pay any provident fund under the provisions of the Act of 1952.
6. On the other hand, learned counsel for the respondent No. 2 submits that he is not specifically disputing the application/intimation made by the petitioner on 05.11.1970, but, he submits that the petitioner 4 did not raise any ground with regard to non-applicability of that provision in view of the application submitted by them on 05.11.1970. He further submits that in any of the proceeding the petitioner had not pointed out this aspect that he had already made an application intimating the authority with regard to non-applicability of the provisions of the Act of 1952 and at the time of deciding the appeal first time he produced that letter of intimation, which was taken note of by the appellate authority and the appellate authority finally found that the said application dated 05.11.1970 was not moved in view of the requirement of the Proviso attached to Section 1(5) and, therefore, that application cannot be considered to be a proper intimation and as such the authority rejected the stand taken by the petitioner saying that application was not in consonance with the requirement of the statute and, therefore, the stand of the petitioner was rightly rejected by the appellate authority.
7. Learned counsel for the petitioner submits that when intimation was given to the respondent-authority, it was their duty to make an inspection in accordance with Section 7A of the Act of 1952 or to ascertain the fact whether the stand taken by the petitioner about deduction of Strength of employees less than 15 is correct or not or for that purpose Inspector, which is defined under Section 13, can make an enquiry as per Section 13(2)(a), but that was also not done and first time in the year 1994 the assessment was made by the authority, which was not proper because the provisions of the Act of 1952 were not applicable in the case of the petitioner. He further submits that in absence of any action taken by the authority even after order of remand made by the appellate authority, the respondent No. 2 did not make any enquiry and made the second 5 assessment order, which was not proper on their part and as such the order of appellate authority affirming the first assessment and also the second assessment is not sustainable in the eyes of law and liable to be set aside.
8. Learned counsel for the respondent No.2 opposed the submission made by the learned counsel for the petitioner and contesting the matter mainly on the ground that the application dated 05.11.1970 intimating the authority about non-applicability of the provision of the Act of 1952 cannot be considered to be a proper application for two reasons. First, the application does not fulfill the requirement of Proviso attached to Section 1(5) of the Act of 1952 because it does not disclose proper information and, therefore, the same cannot be considered to be an application as required under the said Proviso and the second aspect of the matter is that the submission of application was also denied by the respondent because they were not assured whether that was given or not. He submits that from the conduct of the petitioner it can be presumed that the said application was never submitted, because it was never pointed out by the petitioner at any level of the dispute, and, at last, before the appellate authority, on the date of final arguments, the said application was brought to the notice of the appellate authority and that authority considered that application and given a proper finding thereof and ultimately rejected the appeal. He submits that the application has rightly been rejected by the authority because that does not contain the exact date when it was made and the date from which the employees in the petitioner mill were reduced to less then 15. He submits that considering the above, the petition deserves to be dismissed.
69. Considering the submissions made by the counsel for the parties and perusal of record, I am of the opinion that if the submission of the petitioner is considered that they send the letter/application Annexure-P-23(A) dated 05.11.1970 as per amendment made in Section 1(5) of the Act of 1952, it reveals that the letter/application has been sent through registered post. The registry slip is also annexed but that does not clearly indicate that the letter dated 05.11.1970 has been sent through registered post and as such, the respondents have also not specifically accepted the receipt of that application.
10. On perusal of the said letter/application, it is clear that there is no quarrel with regard to the fact that the letter/application does not contain the details of required information as to from what date the petitioner's organization was working with less than 20 employees. It can be easily gathered that the application has been drafted in a very careless manner not considering the seriousness of the provision which specifically provides that the application must contain some general information indicating the date and the fact that application should have been made within a period of one month from the date of cessation. The stand taken by the counsel for the respondents not only in their reply but during the course of arguments that though they are not acknowledging the receipt of that application but even otherwise that application does not fulfill the requirement of the provision of Section 1(5) of the Act of 1952. I find substance in the submission made by the counsel for the respondents that the said letter/application if claiming exemption with regard to applicability of provisions of the Act of 1952 then they must disclose the exact date and proper figure of the strength of their employees but 7 admittedly that has not been done. Not only this, the petitioner has never disclosed this fact at any stage of litigation that they have already claimed exemption in view of the amended provisions of the Act of 1952 but only at the time of appeal, the letter dated 05.11.1970 was produced before the appellate authority, that too, along with a photocopy of receipt of post office and its genuineness was also objected by the respondents. It also creates doubts about sending the letter/application dated 05.11.1970 and its genuineness. No reason was assigned by the petitioner even during the course of arguments as to why they did not produce the said letter/application before the authority in any of the proceeding.
11. The appellate authority in its order has considered the letter/application dated 05.11.1970 qua the requirement of provision of Section 1(5) of the Act of 1952 wherein the proviso clearly provides the actual date from when establishment is seeking exclusion from applicability of provisions of the Act of 1952 on the ground that strength of the employee was less than 20. The appellate authority dealing with aforesaid requirement has observed as under:-
"The reading of unamended provision of section 1(5) shows that "as per substantive rule the establishment which was once covered was to continue to be covered notwithstanding that number of persons employed therein at any time fell below 20". As an exception it was provided that when at any time for one year the strength fall below 15 the employer may cease to comply with the provisions of this Act and any scheme framed therein with effect from the beginning of the month following the expiry of the said period of one year. But this provision was further, encumbered with liability the employer were providing "but he shall within one month of the day such cessation intimate, by registered post for there of to such authority as may be specified by the appropriate government in this 8 behalf. In the present case the letter dated 5.11.70 does not give the date from which the strength of the employees fell below 15. If it is presumed that it fell below 15 neither from the date on which he stopped provident fund contributions or one year from before that, the appellant has failed to inform the authority within one month as required in this proviso. To my mind, in view of this above facts the appellant is not entitled for the benefits of the proviso of section 1(5) of the Act. I am unable to agree with the submission of the learned counsel for the appellant that if the strength fall below 15 automatically the coverage will become voluntary and in that case this voluntary coverage can be stopped at any time. To my mind this submission is not legally correct. The coverage of the appellant even if initially it was voluntary, become statutory after starting compliance and it shall remain statutory till it is terminated legally."
12. Looking to the submissions made by the counsel for the parties and opinion given by the appellate authority for not giving benefit of amended provisions and the petitioner's establishment was not found excluded from applicability of the provisions of Act of 1952, it is clear that nothing illegal has been committed by the appellate authority while passing impugned order dated 19.11.1999. Thus, interference in the the impugned order is unwarranted. The petition, in my opinion, is without any substance and it deserves to be dismissed and accordingly, it is dismissed.
Parties shall bear their own costs.
(SANJAY DWIVEDI) JUDGE Raghvendra ac/-
ANIL CHOUDHARY 2022.08.02 16:48:37 +05'30'