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Judgment
D.V. Sehgal, J.—This judgment will dispose of C.W. Ps Nos. 3331, 5198, 5199 of 1985, 920, 1214 and 4121 of 1986 as common questions of law are involved in all these writ petitions.
It would suffice to notice briefly the facts set out in C.W.P. No. 1214 of 1986. The Petitioner is a Private Limited Company and is covered by the provisions of the Employee''s Provident Funds and Misc. Provisions Act, 1952 (hereinafter called ''the Act'') and the schemes framed thereunder. The Regional Provident Fund Commissioner, Respondent No. 1, issued a notice to it vide letter dated 5.7.1985 Annexure P. 1 proposing therein levy of damages u/s 14-B of the Act for different months spanning over the period from May, 1976 to July, 1984. The Petitioner submitted reply dated 16.7.1985 Annexure P.2 contending that the claim for damages for the period from May, 1976 to December, 1981 was barred by time and no claim for damages could be raised for the period preceding three years before the issuance of the notice Annexure P.1. It was also contended that the rate for levy of damages up to October, 1977 was 25% of the amount of contribution delayed and not 100%. as proposed in the aforesaid notice. The Petitioner also pleaded that there was a strike in its factory from 1.7.1982 to 23.9.1982 during which period it suffered financial losses which consequently affected the payment position including that of the provident fund. It was also contended that for the months of December, 1981, April 1983, May 1983, June 1983, December, 1983, January 1984, May 1984 and June 1984, the delay was only for one day and therefore this delay should be ignored. It was also stated that from October, 1982, the rate of levy of damages had been at the rate of 25% per annum and there was no mala fide intention on its part to deliberately delay the payment of contribution. Delay in payment had in fact been caused by factors like strike in the factory, financial stringency etc. The Petitioner contends that in spite of an elaborate explanation submitted by it, the Respondent arbitrarily passed the order dated 8.10.1985 Annexure P.3 levying damages u/s 14-B ibid on it amounting to Rs. 92049 55. The levy of damages has been challenged on four grounds which are summarised hereunder:
(1) That as per the instructions dated 3.11.1982 Annexure P.6, damages were to be charged at the flat rate of 25% per annum on all belated remittances of contribution and that it was only vide circular letter dated 13.5.1983 Annexure P.7 that the Central Provident Fund Commissioner issued revised guidelines in pursuance of which damages could be levied to the extent of 100% of the amount of delayed contribution. The contention, therefore, is that in respect of the delayed contributions for the period preceding 13.5.1983, damages can be levied not exceeding 25% of the delayed amount of contribution.
(2) That the Respondent has no authority to recover damages u/s 14-B of the Act for the period preceding three years before the date of Annexure P.1. It is maintained that under the law of limitation, the period prescribed for recovery of money is three years which should reasonably be construed and made applicable to the recovery of damages u/s 14-B of the Act also.
(3) That it was obligatory on the Respondent to have noticed the delay in the remittances of the contribution of the Petitioner within a reasonable time and to have issued notice for timely deposit of the same. The delay in the payment of damages is, according to the Petitioner, directly attributable to the want of issuance of time by notice to it by the Respondent.
(4) That as para III(h) of the instructions Annexure P.5, dated October 24, 1975, half the rates of penal damages were to be levied where the employer had paid the dues after the grace period but before the end of the same month. These instructions have not been followed in the case of the Petitioner and damages have been levied at full rate even for the delayed contributions pertaining to the months which were paid before the end of the same month.
On the basis of the above grounds, a prayer has been made in the writ petition that a writ in the nature of certiorari quashing the impugned order Annexure P.3 should be issued and recovery proceedings initiated under the Act should also be quashed.
The petition has been opposed by the Respondent. Written statement has been filed by him. All the contentions raised have been countered. It has been maintained that the damages levied to the tune of Rs. 92049.55 vide Annexure P.3 are in accordance with law and the Petitioner is bound to make payment of the same. Proceedings for the recovery of the said amount are quite in accord with the procedure prescribed.
I have heard the learned Counsel for the parties. During the course of arguements, I found that grounds Nos. (1) to (3) enumerated above were not res integra as these have been dealt with and repelled by different judicial pronuncements to which reference shall be made presently.
As regards ground No. (I), the matter is squarely covered by a judgment dated 4.12.1984 of S. S. Kang, J. in C. W. P. 2813 of 1984) (M/s Precision Stampings, Faridabad v. Regional Provident Fund Commissioner) C.W.P. No. 2813 of 1984. After an elaborate discussion, it was observed therein that the circular dated 3.11.1982 Annexure P.6 provides levy of damages at the maximum to the extent of 100% of the amount of delayed contribution. However, the Central Provident Fund Commissioner had erroneously drawn a distinction between pendency or otherwise of the cases of delayed contribution. The Central Board of the Fund in its decision had not drawn any such distinction. This anomally was ultimately removed by way of clarification issued vide instructions dated 13.5.1985 Annexure P.7. It was, therefore, held that there was no bar against the issuance of this clarification nor could it be styled as unauthorised as it only complied with the actual decisions taken by the Central Board. I. P. As Nos. 42 to 44 of 1985 filed against the aforesaid judgment, which disposed of the connected petitions also, were dismissed in limine by a Division Bench of this Court on 6.2.1985.
As regards ground No. (2), the matter is again concluded by a Division Bench judgment of this Court in M/s T. C. M. Woollen Mills (Pvt.) Ltd. Ludhiana v. The Regional Provident Fund Commissioner for Punjab and Haryana, Himachal Pradesh 1981 Lab I. C. 267, wherein it has been held that in case of levy of damages for delayed payments u/s 14-B of the Act, it cannot be contended either that the arrears have been deposited before the issue of the notice under the section and as such no damages can be levied or that the arrears having been paid damages beyond the prescribed time are irrecoverable. The learned Counsel for the Respondent has also placed reliance on The Bombay Gas Co. Ltd. Vs. Gopal Bhiva and Others, , which has been followed by a Division Bench of the Allahabad High Court in The Regional Provident Fund Commissioner, V. P. v. M/s Allahabad Canning Co. Bamrauli 1978 Lab. I. C. 998, and again in Mrs. Mary George v. Regional Provident Fund Commissioner, Trivandrum 1983 Lab. I. C. 133. In the latter two judgments, it has been held that Section 14-B of the Act does not provide any limitation during which action against an erring employer can be taken for delayed deposits under the Act. In the absence of any bar of limitation, there is no principle of law which debars the Regional Provident Fund Commissioner from exercising the statutory powers available to him u/s 14-B of the Act. I find no reason to differ with the view taken in the aforementioned authorities.
Now coming to ground No. (3), it is again squarely met with by a Division Bench judgment of this Court in Provident Fund Inspector, Panipat v. Ram Kumar (1982) 84 P. L. R. 295. It has been held therein that the employer is under a legal obligation to deposit the employer''s and the employees'' share of contribution to the Fund within the time prescribed the moment the Act and the scheme become applicable to him. No intimation or notice of any kind in this respect is necessary to be issued to him by the authorities concerned. I am bound to follow this judgment. There is, therefore, no force in this ground also.
As regards ground No. (4), the learned Counsel for the Petitioner relied on para III(h) of the instructions contained in Annexure P.5. The learned Counsel for the Respondent, on the other hand, by specific reference to the calculation sheet attached to Annexure P.3 brought out that with respect to the delayed contributions for the period preceding January, 1978, in case the delayed payment had been made by the end of the same month, damages had been calculated at one half of the prescribed rate. He, however, pointed out that as per instructions contained in para 168 (iii) of Chapter VII of the Manual of Accounting Procedure, Vol. I of Empleyees'' Provident Fund Organisation with effect from January, 1978 levying damages at half the rates in cases where the employer had paid the dues after the grace period but before the end of the same month is not applicable. Thus, levy of damages at full rate from January, 1978 onwards is quite consistent with the instructions and guidelines issued by the Central Board from time to time.
Lastly dealing with the particular facts of this writ petition, the learned Counsel for the Respondent also brought out that in the impugned order Annexure P. 3 on delayed payment for the period pertaining to July, 1982 to September, 1982 when there was allegedly a strike in the Petitioner''s factory, have been dealt with or damages levied pertaining to the same. By reference to the impugned order and the calculation sheet appended thereto this fact is fully borne out.
I, therefore, find no merit in these writ petitions which are consequently dismissed. The parties are, however, left to bear their own costs.