P.B. Bajanthri, J. - (1.) Both the petitioner-Patiala Co-operative Sugar Mills and EPF Department assailed the order of the Employees Provident Fund Appellate Tribunal dated 9.6.2011. The petitioner-Patiala Cooperative Society Sugar Mills Limited is a registered Society under the Punjab State Cooperative Societies Act, 1961 Co-operative Societies Act (for short petitioner - Cooperative Society). The petitioner-Cooperative Society during the period from June, 2002 to November, 2002 and June 2004 to March, 2008 PF contribution was deposited with the respondent EPF Department. On 17.7.2009 EPF Department issued a show cause notice under Section 7-P of the EPF Act. Thereafter, 7-A proceedings were held on 9.4.2010 and assessment order was passed on 25.5.2010 vide Annexure P-3. As on 9.4.2010, it was an ex parte proceedings. The petitioner Society aggrieved by the order dated 25.5.2010 preferred an appeal before the EPF Appellate Tribunal under Section 7(i) of the EPF and MP Act, 1952. The Appellate Tribunal passed order on 9.6.2011 remanding the matter to the authority to assess the damage @ 22% inclusive of interest. Both the petitioner Society and EPF Department are aggrieved by the order of the Appellate Tribunal dated 9.6.2011 presented these petitions.
(2.) Learned counsel for the petitioner-Society submitted that when 14-B proceedings were listed on 22.2.2010 it was adjourned to 9.4.2010 as Assessing Officer was on leave and 9.4.2010 and representative of the petitioner Society remained ex parte. The EPF Authority proceeded to pass orders under Section 7-Q and Section 14-B i.e. interest on provident fund, and levy of damages. Section 14-B proceedings determined the damages to the extent of Rs. 60,57,463/- and interest under Section 7-Q to the extent of Rs. 20,15,549/-. Learned counsel for the petitioner-Society submitted that perusal of proceedings under Section 14-B read with Section 7-Q, it is evident that he has not been given opportunity. It was further contended that Section 14-B read with para 32-A of the EPF Scheme, 1952, the word used is may that means discretionary power is vested with the Competent Authority. Therefore, while exercising power under Section 14-B read with para 32-A of EPF scheme, the Competent Authority has not appreciated the financial crisis of the petitioner having regard to the fact that on 26.10.2003, Registrar of Cooperative Society took a decision to wind up the petitioner - Society. It was further contended that the EPF Department have taken 7 years time to determine the interest and levy of damages under Section 7-Q and 14-B, respectively. Therefore, while exercising discretionary power under Section 14-B read with para 32-A of the EPF Scheme, there should have been waiver for waiving interest as well as levying of damages. Having regard to the fact that the petitioner -Society is in financial crisis. It was further contended that the Appellate Authority appreciated the financial crisis and reduced the levy of damages from 37% to 22%. The Appellate Tribunal have power to modify the percentage of damages when the Competent Authority who determined the damages under Section 14-B such power is vested with the Appellate Tribunal also.
(3.) On the other hand, learned counsel for the respondent-EPF Department submitted that admittedly there is an inordinate delay in depositing EPF amount and taking action under Section 7-Q and 14 is in accordance with statutory provisions. Delay would not be a hurdle as held by the Supreme Court in the case of Hindustan Times Ltd. v. Union of India and others 1998(2) SCC 242 . Further it was contended that Appellate Tribunal erred in reducing the rate of interest from 37% to 22% which is contrary to para 32-A of the EPF Scheme. The said statutory provision relates to terms and conditions for reduction or waiver of damages. The power is vested with the Central Board for the purpose of reducing or waiver of damages levied under Section 14-B of the Act. Therefore, the Appellate Tribunal exceeded its jurisdiction while reducing the damages from 37% to 22% inclusive of interest. Further learned counsel for the respondent EPF Department relied on latest decisions of this Court passed in CWP No.22297 of 2012 The Regional Provident Fund Commissioner v. M/s Shivon International and another) wherein identical question was considered with reference to para 32-B of the EPF Scheme, 1952 and also considering the decision of the Supreme Court passed in Hindustan Times Ltd. v. Union of India 1998(2) SCT 256 , M/s Shanti Garments v. RPFC, 2003(1) CLR 228 and Organo Chemical Industries v. Union of India and others, 1980 (1) SCR 61 .;