Decided on April 08,1970



- (1.) THE respondent-plaintiff Khambatta was employed as a dredging master and engineer in respect of the dredgers owned by the appellant, the Madras Port Trust. In 1961, some charges of misappropriation were framed against him for not properly accounting for certain materials entrusted to him during the period 1956 to 1959 and he was removed from service. The respondent-plaintiff was a subscriber to the provident fund and on his removal from service the question came up for consideration whether he was entitled to be paid the entire provident fund amount standing to his credit, made up of his own contributions together with interest thereon amounting Rs. 8,14375, the Board's contribution together with interest thereon amounting to Rs. 9,015-60 and the special contribution made by the Board to the provident fund. But so far the special contribution is concerned, Regulation 11 of the Madras Port Trust Regulations relating to provident fund and gratuity hereinafter referred to as the Regulations, provides that it shall not ordinarily be credited to the provident fund account of an employee who has been discharged from misconduct. Hence the Chairman of the Port Trust by his order Exhibit B-8 held that no special contribution to the provident fund would be due to the plaintiff and this finding was accepted by the trial court and there is no appeal by the respondent-plaintiff against it.
(2.) THERE is no dispute that the respondent plaintiff is entitled to his own contributions to the provident fund together with interest thereon. The Chairman of the Port Trust had suggested in his order Exhibit B-8 that the question as to what should be done with the Board's contribution of Rs. 9,015-60 in view of the estimited loss of Rs. 35,000 caused by the respondent plaintiff might be considered by the Committee which consisted of the Chairman of the Port Trust and two other members. It is cleat from the minutes of the proceedings of the Committee of the Board held on 5th October 1961 (Exhibit B-9) that the chairman represented that this was a very bad case and that the committee decided to withhold the Board's contribution to the provident fund account of the respondent plaintiff. Aggrieved with this order, the respondent plaintiff filed the suit O. S. No. 1521 of 1962 on the file of the City Civil Court, Madras and the learned Fourth Asst. Judge, who tried the suit, upheld his contention that Regulation 20 (a) of the Regulation on which the Madras Port Trust relied, did not empower the Port Trust to withhold the Board's contribution to the provident fund account of the subscriber in the event of removal of a subscriber from service, unlike in the case of a dismissal from service. Aggrieved with this decision, the Madras Port Trust has preferred this appeal.
(3.) THE short point for consideration in this appeal is whether in the circumstances of the case stated earlier, the Madras Port Trust is entitled to withhold its own contribution to the provident fund account of the respondent-plaintiff. It is the common case of both parties that the provisions of the Provident Funds Act of 1925 apply to the employees of the Madras Port Trust. In fact, the Madras Port Trust has made Regulations relating to the provident fund, and gratuity as contemplated in the Provident Funds Act. Regulation 20 (a) of the Regulations is the only relevant provision to be considered and it is as follows: When a subscriber's account is closed, either (i) on the dismissal of a subscriber for dishonesty, disobedience, insubordination, neglect of duty, desertion, or any other form of misconduct or on his being found guilty of any criminal offence, or (ii) on his resignation from service within five years from the date of his joining the fund, the Board may withhold all or any part of the amount standing to his credit in the contribution account and pay him only the balance, if any, together with the amount deposited by him as subscription and interest thereon. ;

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