Delhi High Court
Hello Mineral Water P. Ltd. vs Assistant P.F. Commissioner on 15 May, 2006
Author: G Mittal
Bench: G Mittal
ORDER
Gita Mittal, J.
1. Inter alia, by this writ petition the petitioner has challenged the jurisdiction of the Regional Provident Fund Commissioner to impose interest under Section 7Q of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 in addition to a levy of damages under Section 14B of the enactment. It is contended that Section 7Q merely prescribes the rate of interest which is to be levied which is a factor to be considered while exercising jurisdiction under Section 14B and does not enable the concerned official to impose or levy interest over and above what has been assessed as damages under Section 14B. The submission therefore is that the interest component, is at the most, a constituent of what may be considered while arriving at an appropriate figure of damages which a party may be called upon to pay under Section 14B of the Employees Provident Fund and Miscellaneous Provisions Act, 1957. The factors which may be considered to constitute the penalty which may be imposed on a party under Section 14B of this statute fell for consideration before the Apex Court in Organo Chemical Industry and Anr. v. UOI where the court held that the penalty could constitute of the following three factors : (a) the loss of interest to the employees account ; (b) penalty and; (c) administrative charges.
2. Based on this submission, it is contended that the impugned order dated 12th May, 2005 passed against the petitioner imposing damages to the extent of Rs. 28,20,811/- under Section 14B of the statute and an additional liability of interest under Section 7Q to the extent of Rs. 8,91,142/- is wholly without jurisdiction.
3. The petitioner has submitted that in view of the challenge to the impugned order being passed on a lack of jurisdiction, an objection to the maintainability of the writ petition on the ground of availability of the alternative remedy of a statutory appeal under Section 7I of the Employees Provident Fund and Miscellaneous Provisions Act would be without substance. In this behalf, the petitioner has placed reliance on several pronouncements of the Apex Court including Himmat Lal Harilal Mehta v. State of Madhya Pradesh (1954) SCR 1122, 7 Judges decision in the case of Bengal Immunity Company Ltd. v. State of Bihar , Collector of Central Excise v. A.S. Bava , Baburam Prakash Chandra Maheshwari v. Antarim Zilla Parishad , Government of India v. Alka Subhash Gadia (1992) Supp. 1 SCC 496, Kuntesh Gupta v. Hindu Kaniya Mahavidlya , UOI v. State of Haryana , Calcutta Discount Co. Ltd. v. ITO , A.V. Venkateswaran v. Ramchand Sobhraj Wadhwani , M.G. Abrol, Addl. Collector of Customs v. Shantilal Chhotelal and Co. , Ram and Shyam Co. v. State of Haryana , Addl. Secy. to the Govt. of India v. Alka Subhash Gadia (Smt.) 1992 Supp (1) SCC 496, Whirlpool Corpn. v. Registrar of Trade Marks , Union of India v. State of Haryana , State of Tripura v. Manoranjan Chakraborty , Harbanslal Sahnia v. Indian Oil Corpn. Ltd. and Seth Chand Ratan v. Pandit Durga Prasad .
4. In my view, the issues raised by the petitioner require consideration. Issue notice to the respondent to show cause why rule nisi be not issued. Mr. R.C. Chawla, Advocate accepts notice and prays for time to file a reply. Let reply, if any, be filed within six weeks. Rejoinder thereto may be filed before the next date of hearing.
5. List this matter before the Registrar (Administration) for completion of pleadings on 21st August, 2006.
CM No. 2940/2006
Issue notice.
6. Mr. R.C. Chawla, Advocate accepts notice.
7. It is contended on behalf of the petitioner that the petitioner has since deposited a sum of Rs. 11 lakh with the respondent on account of the demand raised by the respondents vide the impugned order dated 10th May, 2006, subject to the petitioner depositing the remaining amount out of Rs. 28,20,811/- which has been assessed by the respondent towards the damages under Section 14B of the Employees Provident Fund and Miscellaneous Provisions Act and furnishing security for the amount of Rs. 8,91,142/- which has been assessed as the interest liability of the petitioner under Section 7Q of the enactment to the satisfaction of the Registrar of this court within a period of our weeks from today, there shall be a stay of recovery by coercive measures pursuant to the order dated 10th May, 2005.
8. The respondent shall keep this amount of Rs. 28,20,811/- in a fixed deposit receipt till disposal of the writ petition and appropriate orders in this behalf shall be passed at the time of final disposal. Learned counsel for the parties submit that this application can be disposed of in the above terms. It is ordered accordingly.
