VICHITRA CONSTRUCTION PVT LTD Vs. EMPLOYEES PROVIDENT FUND APPELLATAE TRIBUNAL
LAWS(DLH)-2007-9-48
HIGH COURT OF DELHI
Decided on September 07,2007

VICHITRA CONSTRUCTION PVT.LTD Appellant
VERSUS
EMPLOYEES PROVIDENT FUND APPELLATAE TRIBUNAL Respondents

JUDGEMENT

HIMA KOHLI, J. - (1.) In the present writ petition, the petitioner has assailed the impugned order dated 19th September, 2005 passed by the Regional Provident Fund Commissioner (RPFC), New Delhi levying a penalty of Rs. 2,18,636/- on the petitioner on account of failure to remit the EPF contributions payable for the period from 12/1995 to 4/2004 in time, as also the order dated 24th October, 2005 passed by the Employees Provident Fund Appellate Tribunal (hereinafter referred to as `the Appellate Tribunal') upholding the order dated 19th September, 2005 passed by the RPFC.
(2.) In a nutshell, facts of the case are that proceedings were initiated by the RPFC against the petitioner under Section 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (for short `the Act') on the grounds of failure on the part of the petitioner to remit the EPF contributions in time. These proceedings were initiated to determine the dues payable by the petitioner vide summons dated 8th April, 2005, for the period from 12/1995 to 4/2004 The petitioner was called upon to represent itself. After taking six dates, on 29th July, 2005, submission was made on behalf of the petitioner that some photocopies of the bank challans had been obtained, however, further time was sought to consolidate them before making submissions. Subsequently, none appeared on three dates before the RPFC and when the petitioner appeared thereafter, a submission was made that it had not been able to trace out the records for the last 10 years. It was stated on behalf of the petitioner that a show cause notice was not issued to it within three years of default, nor was any warning issued. Therefore, after such a prolonged period of delay, the notice for determining the dues for a period of 10 long years was not permissible in law. After hearing the petitioner, the RPFC passed the impugned order dated 19th September, 2005 observing therein that the petitioner had not categorically pointed out the exact period for which the record was unavailable and could not be granted a blanket relief for the entire period of 10 years. While holding that the petitioner was a habitual a defaulter, the RPFC observed that it did not deserve any leniency and was liable to receive maximum penalty. Thus interest under Section 7Q as well as damages under Section 14B of the Act were imposed upon the petitioner in respect of five accounts amounting to a total of Rs.2,18,636/- for the period from 12/1995 to 4/2004
(3.) Aggrieved by the aforementioned impugned order dated 19th September, 2005, the petitioner filed an appeal before the Appellate Tribunal stating inter alia that the petitioner was not given reasonable and sufficient time to represent its case before the RPFC and that imposing damages for a period of 10 years on the basis of non-availability of records was unjustified and a presumption of waiver ought to have been drawn against the RPFC. It was also submitted that despite repeated requests, the petitioner was not provided with copies of challan forms for the alleged period nor were any records shown to the petitioner and as the concerned person looking after the records had left the services of the petitioner, it could not verify/check the allegation of default of belated PF dues for the period in question. It was also argued that interest under the provision of Section 7Q is included in damages chargeable under Section 14B of the Act and therefore once damages are imposed under Section 14B of the Act, interest cannot be additionally imposed under Section 7Q of the Act as it would amount to double jeopardy. It was also urged that by levying maximum rate of damages upon the petitioner, the RPFC had failed to exercise the discretion vested in him under Section 14B of the Act and paragraph 32A of the Employees' Provident Funds Scheme, 1952 (hereinafter referred to as `the Scheme') that relates to recovery of damages for default in payment of any contribution.;


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