ADARSH KUMAR GOEL, J. - (1.) THIS appeal has been preferred against order of learned Single Judge upholding the order of the Tribunal under the provisions of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (for short, "the Act") on the issue of determination of Provident Fund dues of the respondent - employer.
(2.) THE Employees Provident Fund Commissioner issued notice under Section 7A of the Act alleging that the employer -respondent was wrongly calculating the provident fund contributions by making unjustified exclusion from the component of 'basic wage'. It was further stated that the contribution was liable to be calculated under Section 6 of the Act with reference to 'basic wage', Dearness Allowance and Retaining Allowance. The 'basic wage' could not be less than 'minimum wage'. The respondent -employer contested the allegation by submitting that calculation of contribution was made as per statutory provision and there was no requirement for taking basic wage to be equal to minimum wage. The employer was entitled to take basic wage as per Section 2(b) of the Act by excluding the allowances liable to be excluded under the said provision. The Commissioner rejected the stand of the employer as follows: - "18....... I hold that splitting of minimum wages into basic, HR and other allowance was clearly a subterfuge in order to avoid statutory liability of Provident Fund. I further order that the Provident Fund is to be paid on the entire minimum wages disclosed by the establishment and the splitting of minimum wages should not be allowed. The matter of payment of provident fund and other dues on overtime allowance is being examined separately and separate orders will be issued in this regard......"
(3.) ON appeal, the Tribunal reversed the stand of the Commissioner and upheld the plea of the employer holding as under: - "6. On the basis of the above discussions, the wages payable by the appellant to its employees is in accordance with minimum wages and the pay structure of the appellant is as per law and the PF contribution shall be payable on the basic wages paid to the employees. In nutshell, the appellant is liable to pay its share of PF contribution on the basic wages payable + other allowances permissible under the Act and not on entire minimum wages which the employer is paying to its employees. The HRA and other allowances, which is part of Appellant's wage structure, are not a part of Basic Wage as per the definition of the basic wages defined under Section 2 (b) of the Act and the Appellant is not liable to pay PF contribution on the same....." ;