- (1.) This writ petition has been filed by the Regional Provident Fund Commissioner against the order of the Employees Provident Fund Appellate Tribunal dt. 5.8.1998 by which the appeal Filed by respondent-Mis. Maharaja Shree Umaid Mills Ltd. has been allowed and the penalty/damages equal to the amount of provident fund of Rs. 2,96,056 deposited by the respondent with delay has been set aside. The facts of the case are that a notice u/s. 14B of the Act of 1952 dt. 4.12.1996 was served upon the respondent establishment, upon its failure to deposit the provident fund for the period from January, 1981 to January, 1996 by Regional Provident Fund Commissioner. The respondent sent its reply on 23.12.1996 requesting to drop the proceedings under Sec. 14-B. During the pendency of the proceedings, the respondent by letter dt. 2.4.1997 submitted that it has deposited the amount of Rs. 50,000 under protest. Eventually the respondent deposited the entire amount in two installments respectively on 8.3.1996 and 13.3.1996. The Regional Provident Fund Commissioner passed an order u/s. 14B on 3.9.1997 determining the sum of Rs. 2,96,056 as damages for the aforesaid period from January, 1981 to September, 1995 to be recovered from the respondent establishment. Aggrieved thereby the respondent filed appeal before the Tribunal which has allowed the same vide order dt. 5.8.1998, which is under challenge in the present writ petition.
(2.) Shri Deepak Goyal, learned counsel for the petitioner submits that there is no dispute between the petitioner and the respondent as to the coverage of the establishment inasmuch as there is also no dispute that the respondent did not for as long as 15 years deposit the amount of provident fund. The delay ranges from the period of six months to fifteen years. The period of default and date of deposit was thus not disputed before the Commissioner. It was statutory liability of the employer to deposit the amount well in time. Reference in this connection is made to para 38(1) of the Provident Fund Scheme of 1952. The learned Tribunal has wrongly observed in para 8 of the judgment that the respondent is always prompt in paying PF contributions. It was argued that the learned Tribunal has misread and misapplied the judgment of the Supreme Court in Organo Chemical Industries & Anr. vs. Union of India, (UOI) & Ors., 1979 4 SCC 573. In fact, the aforesaid judgment supports the case of the petitioner. The Supreme Court in that case categorically held that the amount of damages includes the compensation, mainly of interest and penal consequences so as to warn the employer. The Regional Provident Fund Commissioner was well within its jurisdiction in awarding the damages/compensation to the extent of 100%. There was no case for interference. The Provident Fund Commissioner was fully justified in holding that the payment of provident fund by the respondent was not depended on the vigilance of the petitioner and it was not required to issue a demand letter. Section 7-B is a provision of review, which has nothing to do in the present case. Section 7-C was for the first time introduced with effect from 1.7.1998 and deals with the case of determination of escaped amount. This provision would therefore also not apply to the present case.
(3.) Shri Anant Kasliwal, learned counsel for the respondent opposed the writ petition and argued that the respondent deposited the amount within prescribed time without any demand being raised by the petitioner. It was thereafter that show cause notice was issued by the Provident Fund Department for damages. The respondent paid the share of even such employees who were no more in their employment and could not be traced to be made member of provident fund scheme. Those employees were not working with the respondent on regular basis, but were in fact engaged on contract basis on special occasions for carrying out the Work relating to factory. Petitioner never during long period of 18 years carried out the first default. Default, if at all any, was unintentional. It is argued that by realising the payment of wages, the department will be unjustly enriched clearly attracting the doctrine of unjust enrichment. Contention of the department that the respondent was habitual defaulter, is wholly without any basis.;