SUNDER HOTCHAND ASRANI Vs. K. M. BHATT, PROVIDENT FUND COMMISSIONER

JUDGEMENT

(1.) This petition is directed against the. order passed by the first respondent under Section 7A of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter called 'the Act') whereby he directed the Company to pay an amount of Rs. 52,606/-by way of provident fund contribution for the period commencing from May 1982 and ending on 31st December, 1982.

(2.) The petitioners are the Directors of the Company, that is, the second respondent. Sometime in May 1982 the financial condition of the Company suffered a setback because of a strike in the factory which was supplying raw material to the Company. For want of raw material, the Company could not manufacture food articles and could not meet with its obligations with the result that the customers who had placed the orders cancelled them. There was some dispute raised by the Trade Union representing the workmen at the relevant point of time and in view of the worsening condition the management took a decision to close down the company. Because of this decision there was a dispute with the Trade Union representing the workmen and ultimately an agreement was arrived at between the Managing Director of the Company and the General Secretary of the Union representing the workmen on 3rd May 1982. A copy of the said agreement is produced at Annexure 'B' to the petition.

(3.) By the agreement, Annexure 'B', the Company agreed to pay regularly every month 'an advance' equivalent to the monthly wage of the respective workmen during the closure period. It was also agreed that during the said period the workmen will not attend the factory every day but shall mark their presence on every Monday, unless the management wants any specific duty to be performed by the workmen.. It was further agreed that on the date the factory reopens, all workmen will be allowed to resume their normal duties without any hesitation, whatsoever. Clause 5 of the agreement which is relevant for our purpose may be reproduced. It reads as under.