Bombay High Court
Regional Provident Fund ... vs M/S. Manoharbhai Ambalal on 15 December, 2010
Bench: S.A. Bobde, P. D. Kode
1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH AT NAGPUR
Letters Patent Appeal No.486/2010
in
Writ Petition No.1939/2001 (D)
Regional Provident Fund Commissioner,
Sub-Regional Office, 138-A, Ridge Road,
Sant Tukdoji Square, Raghuji Nagar,
Nagpur. ..Appellant.
..V/s..
M/s. Manoharbhai Ambalal,
through its partner, a registered
Partnership firm having its registered
office at Kolkata and a Branch Office
situated at Railtoli, Gondia. ..Respondent.
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Mr. R.S. Sundaram, Adv. for appellant.
Mr. A.N. Vatsani, Adv. for respondent no.1.
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CORAM : S.A. BOBDE & P.D. KODE, JJ.
DATE : DECEMBER 15, 2010.
ORAL JUDGMENT (Per S.A. Bobde, J.)
1. Admit.
2. Advocate Shri Vatsani waives service for respondent. Taken
up for final hearing by consent of the parties.
3. This letters patent appeal is preferred against the judgment
and order of learned Single Judge upholding the power of the Tribunal to
reduce the damages awarded by the Central Provident Fund
Commissioner under paragraph 32-A of the Employees Provident Fund
Scheme, 1952. The appellant imposed damages on the respondent
employer under paragraph 32-A of the Provident Scheme in default
seeking the contribution in time. The damages were imposed at rates for
various period at varying rates from 17 % to 25 % in the following
terms :-
"Damages can be imposed upon the establishment at
the rate of 17% for prediscovery period 6/77 to 7/77, for the
period 8/77 - 22% (a/c 1 & 10) and 25% (for a/c 2, 21,
22), for the period 9/77, 10/77 - 17 % for (a/c 1 & 10) and
25% for (a/c 2, 21, 22), for the period 11/77 to
9/85 - 25%, for 4/86 to 8/86 - 17% and for the period
10/80 to 5/84 - 17% on one share and damages are nil for
the period 3/90 to 3/95, in accordance with the section 14-B
read with para 32A of EPF Scheme, 1952."
4. An order was passed under section 14-B of the Act to recover
the said damages by the Provident Fund Commissioner. In an appeal
filed by the employer, before the Tribunal under section 7-I of the Act,
the Tribunal found that the damages imposed by the Commissioner were
excessive and having regard to certain precedents of the Tribunal, in
similar situation, came to the conclusion that it would be equitable and
just to order the reduction and damages to 12% per annum for all the
periods of default. The appellant challenged the said order by way of a
writ petition. Before the learned Single Judge, the appellant contended
that the Tribunal under the Act has no power to reduce the damages
awarded against an employer and sought to be recovered since that
power is exclusively vested, under paragraph 32-B of the Scheme, in the
Central Board. Paragraph 32-B reads as follows -
"32-B. Terms and conditions for reduction or
waiver of damages. -
The Central Board may reduce or waive the
damages levied under section 14-B of the Act in relation to
an establishment specified in the second proviso to section
14-B, subject to the following terms and conditions,
namely,-
ig (a) in case of a change of management
including transfer of the undertaking to workers'
co-operative and in case of merger or amalgamation of the
sick industrial company with any other industrial company,
complete waiver of damages may be allowed;
(b) in cases, where the Board for Industrial
and Financial Reconstruction, for reasons to be recorded in
its Scheme, in this behalf recommends, waiver of damages
up to 100 per cent. may be allowed;
(c) in other cases, depending on merits,
reduction of damages up to 50 per cent. May be allowed."
5. The learned Single Judge has rejected the contention of the
appellant and has came to the conclusion that the Tribunal has been
vested with the powers to hear an appeal and must be taken to have been
also vested with the power to reduce the damages. We are in agreement
with the judgment of the learned Single Judge. Indeed, section 7-I of the
Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (for
short "the Act") confers power on the Tribunal to hear an appeal and
dispose it of in accordance with law, even where the appeal is against an
order under section 14-B for recovery of damages. It stands to reason
that the Tribunal, which is invested with the power to decide an appeal
from an order directing recovery of damages and to set aside the order if
found illegal, it must be held to have the lesser but equally important
power to reduce the quantum of damages. Indeed, there is no dispute
that section 7-L of the Act which confers power on the Tribunal
specifically confers the power to modify, to reduce or annul the order
appealed against, including the power to pass such orders thereon as it
thinks fit. Section 7-L of the Act reads as follows -
"7-L. Orders of Tribunal - (1) A Tribunal may, after
giving the parties to the appeal an opportunity of being
heard, pass such orders thereon as it thinks fit, confirming,
modifying or annulling the order appealed against or may
refer the case back to the authority which passed such order
with such directions as the Tribunal may think fit, for a fresh
adjudication or order, as the case may be, after taking
additional evidence, if necessary.
(2) A Tribunal may, at any time within five
years from the date of its order, with a view to rectifying any
mistake apparent from the record, amend any order passed
by it under sub-section (1) and shall make such amendment
in the order if the mistake is brought to its notice by the
parties to the appeal :
Provided that an amendment which has the effect
of enhancing the amount due from, or otherwise increasing
the liability of, the employer shall not be made under this
sub-section, unless the Tribunal has given notice to him of its
intention to do so and has allowed him a reasonable
opportunity of being heard.
(3) A Tribunal shall send a copy of every order
passed under this section to the parties to the appeal.
(4) Any order made by a Tribunal finally
disposing of an appeal shall not be questioned in any Court of
law."
6. Shri Sundaram, learned counsel for the appellant, however
argued that the power to reduce the damages is conferred on the
Tribunal under paragraph 32-B, reproduced supra. That may be so. It
only means that the Central Board also has the power to reduce damages,
though not the exclusive power to do so. The power conferred on the
Board does not warrant an inference that such a power is absent in the
Tribunal while deciding an appeal. The statutory power to frame a
Scheme is on the Central Government by section 5 of the Act. An
instrument such as a Scheme, issued by the Central Government under
such a conferred power can not be construed to modify or vary the extent
of appellate powers conferred by the Act. We see no merit in the appeal.
Hence the present letters patent appeal is dismissed.
JUDGE JUDGE
Tambaskar.
