Calcutta High Court (Appellete Side)
The Regional Provident Fund ... vs Sri Soumen Ghosh & Ors on 9 January, 2023
Item No.2 & 3.
IN THE HIGH COURT OF JUDICATURE AT CALCUTTA
CIVIL APPELLATE JURISDICTION
APPELLATE SIDE
HEARD ON: 09.01.2023
DELIVERED ON: 09.01.2023
CORAM:
THE HON'BLE MR. JUSTICE T. S. SIVAGNANAM
AND
THE HON'BLE MR. JUSTICE HIRANMAY BHATTACHARYYA
M.A.T. No.385 of 2019
with
I.A. No.CAN 1 of 2019 (Old CAN 5268 of 2019)
with
I.A. No.CAN 2 of 2019 (Old CAN 5269 of 2019)
The Regional Provident Fund Commissioner & Anr.
Vs.
Sri Soumen Ghosh & Ors.
With
F.M.A. No.464 of 2019
Sri Soumen Ghosh
Vs.
The Regional Provident Fund Commissioner & Ors.
Appearance:-
Mr. Ananta Kr. Shaw,
Mrs. Tanusri Santra ... for the appellant.
(F.M.A. No.464 of 2019)
2
Mr. Shiv Chandra Prasad ... for the P.F. Authorities.
JUDGMENT
(Judgment of the Court was delivered by T.S. SIVAGNANAM, J.)
Re: I.A. No.CAN 1 of 2019 (Old CAN 5268 of 2019)
1. This is an application to condone the delay of 180 days in
filing MAT 385 of 2019.
2. We have heard Mr. S. C. Prasad, learned Standing counsel
appearing for the P.F. organisation and Mr. Ananta Kumar Shaw,
learned Advocate appearing appellant / employee.
3. We are satisfied with the reasons assigned in the affidavit
filed in support of the application. Accordingly, the delay in
filing MAT 385 of 2019 is condoned.
4. The application for condonation of delay being I.A. No.CAN
1 of 2019 (Old CAN 5268 of 2019) is allowed.
5. There shall be no order as to costs.
Re: MAT 385 of 2019 and FMA 464 of 2019
6. These intra-Court appeals have been filed by the Regional
Provident Fund Commissioner as well as the Sri Soumen Ghosh, the
employee. Both being dissatisfied and aggrieved by the order
passed by the learned Single Bench dated 14th August, 2018 in
W.P. No.18643(W) of 2015 are before this Court.
7. We have heard Mr. S. C. Prasad, learned Standing counsel
appearing for the P.F. organisation and Mr. Ananta Kumar Shaw,
learned Advocate appearing appellant / employee.
8. The short issue, which falls for consideration in these
appeals is as regards the quantum of interest payable to the
employee on the total amount of provident fund dues payable /
paid to the employee. The learned Single Bench had held that
the employee is entitled for interest to a total sum of
Rs.3,05,291/- as against the claim of the employee at
Rs.5,66,256/- as of June, 2013. The learned Single Bench
further directed that the P.F. organisation to pay interest at
the rate of 6% per annum for the period from 2011 to 2013.
Thus, the employee being aggrieved by denial of the total
interest payable and the organisation being aggrieved by the
direction to pay interest at the rate of 6% per annum from 2011
to 2013 have preferred these appeals.
9. The explanation, which is sought to be given before this
Court is by placing reliance on an affidavit filed by the
Regional P.F. Commissioner before the learned Writ Court. The
contents of the said affidavit were in fact adopted as the
submissions by Mr. Prasad. It is stated that the employee was
initially employed with M/s. Birds Jute and Exports Limited,
which was an exempted establishment enjoying relaxation under
para 79 of the Employees Provident Fund Scheme, 1952. The said
exemption was cancelled / withdrawn with effect from 1 st January,
2007 by order dated 12th December, 2006. It goes without saying
that upon the exemption being cancelled, the Board of Trustees
have to hand over the entire provident fund accumulation of its
members to the provident fund authorities.
10. The moot question would be if the Board of Trustees of the
establishment whose exemption was cancelled, failed to hand over
the entire provident fund accumulations to the P.F. authorities,
what is required to be done and who is required to take action.
The provisions of the Employees Provident Fund and Miscellaneous
Provisions Act, 1952 (for brevity, "the Act") makes the position
clear and it is the duty of the P.F. authorities to ensure that
the entire accumulation of the members are remitted by the
erstwhile Board of Trustees to the organisation. The Act
provides for sufficient safeguard in the event the said
establishment whose exemption was cancelled, fails to transfer
the entire accumulations. Therefore, the employee cannot be
blamed for the inaction on the part of the organisation in not
taking adequate steps to recover the entire accumulation to its
credit. The employee left the services of M/s. Bird Jute and
Exports Limited on 1st September, 2004 and joined another
establishment, which was also an exempted establishment.
Therefore, so far as the employee is concerned, it is deemed
that all the provident fund accumulations to his account should
automatically stand transferred to the P.F. account in the new
establishment, which in the case on hand, was also an exempted
establishment. The employee retired from service of the new
establishment on 1st February, 2008. Thereafter, several
representations have been made by him to settle the P.F. dues
not only to the management of the establishment but also to the
Assistant Provident Fund Commissioner (Exempted), Regional
Provident Fund office, Kolkata. The employee also submitted
form 19 on 4th October, 2010. However, the account was settled
much later, i.e. in June, 2013 by paying the provident fund dues
without interest.
11. From such date, the employee has been approaching the
authorities for payment of interest and since there were no
results for any of his representations, he has moved the learned
Writ Court for necessary relief.
12. By representation dated 20th July, 2013, the employee
claimed interest of Rs.5,66,256/- payable upto 21st June, 2013.
Out of the said amount, the P.F. authorities have paid a sum of
Rs.3,05,291/-. The learned Single Bench has not recorded any
finding as to why the differential amount need not or cannot be
paid to the employee. When the writ petition was heard, an
affidavit was filed by the P.F. authorities, which appears to
have been the basis for the direction issued by the learned
Single Bench. The P.F. authorities would contend that interest
would be payable only from 9th July, 2011 and not from the
earlier period because the entire accumulations were not
received by the organisation from the employer and they were
received in instalments and they also rely upon an amendment to
paragraph 60 of the Employees Provident Fund Scheme, 1952 by
which sub-para 6 was added in paragraph 60, which states that
interest shall not be credited to the account of member from the
date on which it has become inoperative account under the
provision of sub-para 6 of paragraph 72.
13. Firstly, the employee cannot be blamed for inaction on the
part of the P.F. authorities in not ensuring that the entire
accumulations under the erstwhile employer was not remitted to
the P.F. authorities within time. The affidavit filed by the
Regional Provident Fund Commissioner does not state about the
steps taken by the organisation against the first employer, that
too in spite of several representations made by the employee.
Therefore, the delay in receiving the accumulations or receiving
the accumulations in instalments can have no impact on the
employee's entitlement for payment of statutory interest in
terms of para 60 of 1952 Scheme. Therefore, the organisation is
bound to pay interest for the entire period.
14. So far as the direction issued by the learned Single Bench
to pay interest at the rate of 6% per annum for the period from
2011 to 2013 is concerned, the interest being statutory cannot
be altered nor there can be any waiver or reduction. Therefore,
the interest shall be payable at the appropriate rate fixed by
the Central Government from time to time.
15. In other words, interest shall be payable to the employee
on the P.F. amount at the rate fixed by the Central Government
during the relevant time. Therefore, we are of the view that
the claim for interest as made by the employee has to be settled
by the respondent /organisation. The learned Advocate appearing
for the employee had furnished a calculation sheet stating that
the interest payable upto November, 2022 after giving credit to
a sum of Rs.3,05,291/- is Rs.7,85,282/-. However, this
calculation has been handed over to us in court and has not been
furnished to the department at any earlier point of time. In
any event, having held that the employee is entitled for payment
of interest with effect from 20th June, 2013, the amount of
interest has to be calculated by the P.F. authorities by
applying the rate of interest fixed by the Central Government
from time to time and the amount should be settled to the
employee.
16. In the result, the appeal filed by the employee in FMA 464
of 2019 is allowed and the appeal filed by the Provident Fund
organisation being MAT 385 of 2019 is dismissed.
17. There will be a direction to the P.F. organisation to
calculate the interest in terms of the above direction and
settle the same to the employee within a period of four weeks
from the date of receipt of the server copy of this judgment and
order.
18. Mr. Prasad would contend that the organisation should be
granted liberty to proceed against the employers of the employee
concerned for recovery of the appropriate sums, which they have
to pay to the employee. Needless to state that if the statute
empowers the organisation to proceed against those employers, it
will be well open to the organisation to proceed against them in
accordance with law.
19. There shall be no order as to costs.
20. Urgent photostat certified copy of this order, if applied
for, be furnished to the parties expeditiously upon compliance
of all legal formalities.
(T.S. SIVAGNANAM, J)
I agree,
(HIRANMAY BHATTACHARYYA, J.)
NAREN/PALLAB(AR.C)
