Bombay High Court
The Central Board Of Trustees, ... vs Maha. State Handloom Corporation ... on 11 July, 2016
Bench: A.S. Chandurkar
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH : NAGPUR.
WRIT PETITION NO.5754 OF 2015
PETITIONERS: 1. The Central Board of Trustees,
Employees Provident Fund
Organization, having office at
Bhavishya Nidhi Bhawan, Bhikaji
Cama Place, New-Delhi - 110066,
Through The Regional Provident
Fund Commissioner, Employees
Provident Fund Organization,
Regional Office, Nagpur.
2. The Assistant Provident Fund
Commissioner, Employees Provident
ig Fund Organization, Regional office,
132-A, Ridge Road, Raghuji Nagar,
Nagpur.
-VERSUS-
RESPONDENTS: 1. Maharashtra State Handloom
Corporation Ltd; Umred Rolad,
Nagpur Through its Managing
Director.
2. Employees Provident Fund Appellate
Tribunal, New Delhi, Laxmi Nagar,
New Delhi Through its Presiding
Officer.
Shri H. N. Verma, Advocate for the petitioners.
Shri A. J. Pathak, Advocate for the respondent No.1.
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CORAM: A.S. CHANDURKAR, J.
DATED: 11
th JULY, 2016.
ORAL JUDGMENT :
1. Rule. Heard finally with the consent of the learned
Counsel for the parties.
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2. The petitioners are aggrieved by the order passed by
the Employees Provident Fund Appellate Tribunal, New Delhi
dated 22-10-2014 thereby reducing the amount of damages and
interest payable on provident fund dues to 7%.
3. In proceedings initiated under Section 14B of the
Employees Provident Fund and Miscellaneous Provisions Act, 1952
(for short, the said Act) the Assistant Provident Fund
Commissioner by order dated 17-12-2013 passed an order
imposing penal damages under Section 14B of the said Act as well
as interest on delayed payment under Section 7 Q of the said Act.
4. Being aggrieved, this order was challenged by the
respondents by filing an appeal under Section 7 I of the said Act.
By the impugned order, the Tribunal has reduced the amount of
penal damages and interest to 7% on the amounts due.
5. Shri H. N. Verma, the learned Counsel for the
petitioners submitted that the Tribunal had no jurisdiction
whatsoever to reduce the amount of interest that was levied under
Section 7Q of the said Act. He submitted that there was no such
power conferred on the Tribunal by the provisions of the aforesaid
Act. He then submitted that there was no case made out to reduce
the amount of damages to 7%. He referred to clause 32A and 32B
of the Employees Provident Fund Scheme, 1952 (for short, the
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Scheme of 1952) in that regard. According to him, the Tribunal
without taking into consideration any of the relevant
circumstances proceeded to reduce the amount of damages. He
referred to the judgment dated 15-4-2015 in Writ Petition
No.5565/2010 (The Central Board of Trustees and another vs. M/s
Veekay Cotsyn Ltd.)and submitted that in somewhat similar
circumstances, the proceeding has been remanded for deciding
these aspects afresh.
ig Shri A. J. Pathak, the learned Counsel for the
respondent no.1 supported the impugned order. He, however,
fairly stated that the impugned order in so far as it reduces the
amount of penal interest is concerned is contrary to the judgment
of the Hon'ble Supreme Court in M/s Goetze (India) Limited v.
Employees State Insurance Corporation AIR 2008 Supreme Court
3122. He, however, submits that the amount of damages under
Section 14B have been rightly reduced to 7% by the Tribunal. He
referred to the averments made in paras 6B and 6C of the
memorandum of the appeal and submitted that the said
circumstances were sufficient to permit reduction in the amount of
damages. He submitted that there was no case made out to
interfere with the impugned order on that count.
7. I have heard the respective counsel for the parties and
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I have perused the documents filed on record. The impugned order
of the Tribunal in so far as it reduces the amount of interest
adjudicated by the Assistant Provident Fund Commissioner is liable
to be set aside on the ground that there is no such jurisdiction with
the Tribunal to reduce the amount of interest. The law in this
regard stands settled in view of the decision of the Hon'ble
Supreme Court in M/s Goetze (India) Limited (supra).
8. In so far as the reduction in the amount of damages is
concerned, the power to reduce the same has to be exercised in
terms of Clause 32B of the Scheme of 1952. Said Clause permits
waiver of reduction of damages in certain contingencies. In so far
as the reduction of damages is concerned, the same is restricted to
50% of the damages adjudicated under Section 14B of the said
Act. In the present case, the damages have been reduced to 7% by
the Tribunal. The impugned order does not reflect the basis on
which the Tribunal found it necessary to reduce the amount of
damages. It has merely observed that the case for such reduction
has been made out. The judgment of learned Single Judge in Writ
Petition No.5565 of 2010 (The Central Board of Trustees Employees
Provident Fund and another vs. M/s Veekay Cotsyn Ltd.) supports
the submissions made on behalf of the petitioners that such
decision to reduce damages has to be supported by reasons. On
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this count, the impugned order is liable to be set aside.
9. In view of aforesaid, the order passed by the Tribunal
dated 22-10-2014 is set aside. The proceedings in the appeal
preferred by the respondent no.1 are restored to file and the
Tribunal shall decide the appeal in the light of the observations
made in the aforesaid order. The respective contentions of the
parties on the aspect of reduction of damages are kept open. Rule
is made absolute in aforesaid terms with no order as to costs.
JUDGE
//MULEY//
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