- (1.) In these two writ applications common questions of law are involved. The principal questions of law which arise for consideration are these: whether in the exercise of powers under section 14B of the Employee's Provident Fund and Miscellaneous Provisions Act, 1952 and para 32A of the Employee's Provident Fund Scheme, 1952, the court or the Central Provident Fund Commissioner or any other officer authorised by the Central Government by notification in the official gazette can reduce the damages specified in paragraph 32A recoverable for a particular period for delay? If the answer to the question is yes, what are the factors to be considered by the court or the authorities in reducing the damages?
(2.) In these cases the Central Board has approached this court alleging that the appellate tribunal had no power to reduce the damages. Section 14B of the said Act provides that where an employer make default inter alia, in the payment of any contribution to the fund or in the transfer of accumulation, the Central Provident Fund Commissioner or such other officers as may be authorised by the Central Government may recover from the employer such damages not exceeding the amount of arrears, as he may think fit to impose. Section 14B of the Employee's Provident Fund and Miscellaneous Act, 1952 enacts as follows: " 14B. Power to recover damages---- Where an employer makes default in the payment of any contribution to the Fund the (pension) Fund or the Insurance Fund or in the transfer of accumulations required to be transferred by him under sub-section (2) of section 15 (or sub-section (5) of section 17) or in the payment of any charges payable under any other provision of this Act or of (any scheme or insurance scheme) or under any of the conditions specified under section 17 (the Central provident Fund Commissioner or such other officer as may be authorised by the Central Government, by the Central Government, by notification in the Official Gazette, in this behalf may recover (from the employer by way of penalty such damages, not exceeding the amount of arrears, as may be specified in the Scheme)." Provided that before levying and recovering such damages, the employer shall be given a reasonable opportunity of being heard. Provided further that the Central Board may reduce or waive the damages levied under this section in relation to an establishment which is a sick industrial company and in respect of which a scheme for rehabilitation has been sanctioned by the Board for Industrial and Financial Reconstruction established under section 4 of the Sick Industrial Companies (special provisions) Act, 1985 (1 of 1986), subject to such terms and conditions as may be specified in the scheme." Paragraph 32 (A) of the EPF Scheme, 1952 was inserted on 16th August, 1991 with effect from 1st September, 1991. It was again amended in 2008. After amendment, damages have been computed in the form of interest on the annual arrear. It is as follows: "32A. Recovery of damages for default in payment of any contribution. (1) where an employer makes default in the payment of contribution to the Fund, or in the transfers of accumulations required to be transferred by him under Sub-section (2) of section 15 or sub-section 17 or in the payment of any charges payable under any other provisions of the act or scheme or under any of the conditions specified under section 17 of the Act Central Provident Fund Commissioner or such other officer as may be authorized by the Central government, by notification in the Official Gazette, in this behalf may recover from the employer by way of penalty, damages at the given below: Period of default: Rate of damages (% of arrears per annum) (a) Less than two months 05 (b) Two months and above 10 But less than four months (C) Four months and above 15 But less than six months (d) Six months and above 25"
(3.) Now, the question which falls for considerations is whether after introduction of para 32 (A) by amendment made on 16th August, 1991 with effect from 1st September, 1991, the Provident Fund Commissioner or the Tribunal has any power to reduce this rate or amount? According to the petitioner they have no such power. Damages have been fixed by statute. The figure is certain. The adjudicator, whether it is the Commissioner or the Appellate Authority or the High Court has no power to waive or remit or reduce the amount of damages. Mr. Prasad, learned advocate for the petitioner tried to expound the above case of the statutory authorities. On the other hand, Mr. Ghosh learned advocate for the respondent company made three basic submissions. First, this writ petition is not maintainable by the Central Board.;