The Central Board of Trustees, Employees Provident Fund and Others vs Veekay Cotsyn Ltd.

Z.A. Haq, J.—Heard learned advocates for the parties.

RULE. Rule made returnable forthwith.

The petition has been filed challenging the order passed by the Employees Provident Fund Appellate Tribunal, under Section 7-I of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (hereinafter referred to the as "the Act of 1952").

Initially, the writ petition was filed by the Assistant Provident Fund Commissioner, however, in view of the judgment given by this Court in the case of the Assistant Provident Fund Commissioner, Goa Vs. Nirmitee Holidays (P) Ltd., Pune, reported in 2011-II-LLJ 469 (Bom.) and the judgment given by this Court in the case of The Regional Provident Fund Commissioner Employees'' Provident Fund Organization Vs. Malegaon Sah. Sakhar Karkhana Ltd., reported in 2014 LLR 1035, the writ petition has been amended and the Central Board of Trustees has been shown as petitioner No. 1.

In this petition, the issue which arises for consideration is, as to whether the order passed by the Appellate Tribunal reducing the damages as imposed by the Assistant Provident Fund Commissioner while exercising powers under Section 14-B of the Act of 1952 to the extent of 80%, is proper.

Shri Dharmadhikari, the learned advocate for the respondent has raised preliminary objection to the maintainability of the petition on the ground that the Assistant Provident Fund Commissioner, who is petitioner No. 2, cannot maintain the writ petition as he is quasi-judicial authority whose order is set aside by the Appellate Tribunal and therefore, cannot file writ petition. The learned advocate for the respondent has further submitted that the Central Board of Trustees i.e. petitioner No. 1 has delegated the powers to prosecute the petition to the Assistant Provident Fund Commissioner i.e. petitioner No. 2 which is not permissible. It is submitted that the Appellate Tribunal is supreme authority under the Act of 1952 and this is clear from the provisions of Section 7-L(4) of the Act of 1952, which lays down that the order made by the Tribunal finally disposing of the appeal shall not be questioned in any Court of law. It is submitted that the Assistant Provident Fund Commissioner is subordinate authority under the scheme of the Act and it cannot challenge the order passed by the Appellate Tribunal. It is further submitted that Section 7-L(2) of the Act of 1952 provides alternate remedy and the petitioners could have approached the Tribunal under Section 7-L(2) of the Act of 1952 if at all they are aggrieved by the impugned order. On these grounds, the respondent No. 1 has objected to the maintainability of the petition.

Shri Verma, the learned advocate for the petitioners has submitted that the Appellate Tribunal has committed an error of jurisdiction by reducing the amount of damages up to 80%, as assessed by the Assistant Provident Fund Commissioner. It is submitted that the Assistant Provident Fund Commissioner had imposed penalty after considering the relevant material on the record and the order passed by the Assistant Provident Fund Commissioner could not have been interfered with by the Appellate Tribunal in the circumstances of the case. The learned advocate for the petitioner has submitted that the Tribunal has no jurisdiction to reduce the amount of damages and the power lies only with the Central Board of Trustees under paragraph 32-B of the Employees Provident Fund Scheme, 1952. It is submitted that the Appellate Tribunal has reduced the amount of damages substantially by 80% without recording any reasons and therefore, the impugned order is unsustainable in law. It is prayed that the impugned order be set aside and the order passed by the Assistant Provident Fund Commissioner be restored.

Shri Dharmadhikari, the learned advocate for the petitioners has submitted that the Appellate Tribunal while deciding the appeal under Section 7L of the Act of 1952 has power to reduce the quantum of damages and for this he relied on the judgment given by this Court in the case of Regional Provident Fund Commissioner Vs. Manoharbhai Ambalal, through its partner and a registered Partnership firm, (2011) 3 ALLMR 204 : (2011) 6 BomCR 773 : (2011) 128 FLR 939 : (2011) 3 LLJ 446 : (2011) LLR 332 : (2011) 3 MhLj 908 . The learned advocate has submitted that the Tribunal has rightly reduced the quantum of damages and the impugned order does not require any interference by this Court.

After considering the submissions made on behalf of the respective parties and after examining the judgments relied by them, I find that the Division Bench of this Court in the case of Regional Provident Fund Commissioner (supra) has laid down that the Appellate Tribunal while deciding the appeal under Section 7-L of the Act of 1952 can reduce quantum of damages and though paragraph No. 32-B of the Employees Provident Fund Scheme of 1952 gives similar power to the Central Board of Trustees, it cannot be said that the Appellate Tribunal does not have such power. In view of this, it cannot be said that the order passed by the Appellate Tribunal is without jurisdiction.

However, the impugned order shows that the Appellate Tribunal has not applied its judicious mind in the matter. The Appellate Tribunal has not recorded any reasons on the basis of which the reduction in the quantum of damages up to 80% of the amount as assessed by the Assistant Provident Fund Commissioner has been reduced. The absence of reasons for reducing the quantum of damages substantially shows arbitrary exercise of powers and jurisdiction by the Appellate Tribunal which is unsustainable in law.

In view of the above, the petition is allowed. The impugned order is set aside. The matter is remitted to the Tribunal for deciding the appeal filed by the respondent on merits according to law.

The respondent and the representative of the petitioner shall appear before the Tribunal on 19th June, 2015 at 11.00 a.m. and abide by the further orders/instructions in the matter.

As the appeal is of 2005, the Tribunal is directed to dispose the appeal till 30th September, 2015.

Rule is made absolute in the above terms. In the circumstances, the parties to bear their own costs.