Shishu Sansar Public School ... vs The Regional Provident Fund ...
2008 Latest Caselaw 1700 Del

*     IN THE HIGH COURT OF DELHI AT NEW DELHI

+     WRIT PETITION (CIVIL) 2549 OF 2006

                              Reserved on :           28th July, 2008

                          Date of Decision :    22nd September, 2008

      SHISHU SANSAR PUBLIC SCHOOL (PRIMARY) ..... Petitioner

                           Through:   Mr. R.M. Sinha, Adv.

                    versus

      THE REGIONAL PROVIDENT FUND COMMISSIONER & ANR.

                                                       ..... Respondents

                           Through:   Ms. Reema Khorana, Adv. for
                                      respondent no.1 & 2
%     CORAM:
      HON'BLE MR. JUSTICE SIDDHARTH MRIDUL

      1.     Whether reporters of local papers may be allowed to see
             the judgment? Yes.
      2.     To be referred to the Reporter or not?    Yes.
      3.     Whether the judgment should be reported in the Digest?
             Yes.


                              JUDGMENT

SIDDHARTH MRIDUL, J.

1. By way of present petition under Article 226 of the Constitution

of India the petitioner prays for quashing of the orders dated 31st

January, 2002, 8th June, 2005 and 4th February, 2006 passed by the

Regional Provident Fund Commissioner, respondent no.1 herein, and

further for a mandamus directing the respondent no.1 to pass a fresh

order under Section 7A of the Employees Provident Fund &

Miscellaneous Provision Act, 1952 (in short „EPF Act‟).

2. The present petition is a species of proceedings that can only be

categorized in terms of the Latin maxim „suppressio veri suggestio

falsi‟ and an abuse of the process of Court. The facts necessary for the

adjudication of the present petition, briefly adumbrated, are as

follows:

(a) The petitioner-school received provisional and temporary

recognition in the year 1991 and is stated to have been

granted permanent recognition on 14th August, 1992. The

date of setup of the petitioner-school is 12th January, 1988

as per the Certificate of Registration issued under the

Societies Act, XXI of 1860. The petitioner was registered

with the Registrar of Societies vide Registration No.

S/18553.

(b) On completion of the infancy period of three years on 11th

January, 1991, the petitioner-school became liable to make

contributions under EPF Act.

(c) The Enforcement Officers under the EPF Act conducted

visit of the petitioner-school on 5th October, 1991 and

found that a total of 20 employees were employed by the

petitioner.

(d) The Manager of the petitioner-school, vide his letter no.

SSPS/91-92 dated 5th October, 1991, furnished to the

respondent a list giving the names of the 20 employees

employed by the petitioner-school as on 5th October, 1991.

(e) As a result, the petitioner school was covered under the

provisions of EPF Act w.e.f. 1st November, 1991 under

Code No. DL/13746. However, the petitioner school failed

to remit the provident fund, pension fund, deposit linked

insurance fund for the period commencing from the date

of liability.

(f) Consequently, proceedings under Section 7A of the EPF

Act for determining the dues of the petitioner-school for

the period from October, 1991 to March 1994 were

initiated by respondent no.1.

(g) The petitioner-school was summoned vide summons dated

30th March, 1994 for non-deposit of PF dues for the

aforesaid period. After numerous opportunities in this

behalf, the petitioner-school finally filed the reply on 17th

January, 1995 stating therein that as the number of

employees in their school was below the prescribed

number of 20, the provisions of the EPF Act were not

applicable.

(h) After more than sixty adjournments in this behalf between

the years 1994 to 2001, the respondent no.1 after taking

into consideration the documents placed on record,

including but not limited to, the report of the Enforcement

Officer, vide order dated 27th February, 2001 ordered that

the EPF Act applies to the petitioner-school w.e.f. 5th

October, 1991 and further ordered that for purpose of

determination of provident fund dues the petitioner should

produce (i) attendance/wages registers, (ii) ledgers/cash

books, vouchers/balance sheets and (iii) any other

document for ascertaining the attendance, payment etc.

before the respondent no.1 on 27th March, 2001, with a

further direction that in the event of failure to produce the

required record for the purpose of assessment, the

respondent would be at liberty to determine the dues on

the basis of material available on record.

(i) At this juncture it would be relevant to state that the

petitioner did not assail this order at any stage.

(j) The petitioner admitted that he filed replies before the

respondent no.1, including a reply dated 29th January,

2002. However, the petitioner did not appear or produce

the record in terms of the order dated 27th February, 2001

as directed, and, therefore, vide order dated 31st January,

2002, the provident fund dues of the petitioner were

assessed by respondent no.1, for the period from 1st

November, 1991 to March, 1994, in an amount of

Rs.1,93,140/-.

(k) The petitioner dissatisfied and aggrieved by the order

dated 31st January, 2002, challenged it by an application

for review, inter alia, on the ground that it was incumbent

upon the respondent no.1 to determine the applicability of

the EPF Act before determining the amount due and

raising a demand in that behalf. Vide its order dated 8 th

June, 2005 the respondent no.1 rejected the application

for review of the order passed under Section 7A, inter alia,

stating that "it was intimated to the establishment that the

applicability of the Act had already been decided vide 7A order

dated 27.02.2001 after considering all the facts and documents

produced by the establishment and that order was not

challenged by the establishment in accordance to the provision

of the Act. Further the establishment did not produce any new

and important matter or evidence in the case. A squad of

Enforcement Officers were also deputed for purpose of

determination of dues but the establishment refused to produce

any record on the plea that applicability of Act should be

decided first."

(l) Although, as a consequence the petitioner was once again

apprised of the order dated 27th February, 2001 whereby

the applicability of the EPF Act to the petitioner-school

had been determined, the petitioner still did not impugn

the order dated 27th February, 2001.

(m) Instead, the petitioner filed the present petition

concealing material facts and assailing the orders dated

31st January, 2002 assessing the dues of the petitioner to

Rs.1,93,140/- for the period 1st November, 1991 to March

1994, the order dated 8th June, 2005 under Section 7B

dismissing the review, as well as the order of recovery of

provident fund dues passed by respondent on.1, on 4th

February, 2006, but, significantly without impugning the

order dated 27th February, 2001 passed by the respondent

whereby it was held that the provisions of EPF Act were

applicable to the petitioner-school and the petitioner was

covered under the purview of the Act w.e.f. 5th October,

1991.

3. Even after a counter affidavit had been filed in the present

petition on behalf of respondent no.1 clearly pointing out that the

petitioner had concealed and suppressed the order dated 27th

February, 2001 in respect of the applicability of the Act to the

petitioner-school, the petitioner did not amend the present petition to

challenge the legality of the order dated 27th February, 2001. On the

contrary the petitioner-school made an attempt to gloss over the

suppression made in this behalf by asserting in the rejoinder affidavit

that the order dated 27th February, 2001 had neither been passed in

the presence of the petitioner nor was ever served on the petitioner.

An attempt was made on behalf of the petitioner-school, however, in

the rejoinder affidavit to, inter alia, question the legality of the order

dated 27th February, 2001, on the ground that the list of 20 employees

furnished to the Enforcement Officers of the respondent no.1 on 5th

October, 1991 was one that was ".....prepared by the department itself

and the petitioner only put a stamp of acknowledgement on the list and

report against which the petitioner filed objection.............and therefore

annexure R-2 is a list prepared by the department itself and cannot be said

to be a list submitted by the petitioner".

4. What unravels the explanation given by the petitioner in the

rejoinder affidavit and nails the lie is the fact that there was not even

a whisper of the inspection conducted by the Enforcement Officers of

respondent no.1 on 5th October, 1991 and the list of 20 employees

„admittedly engaged by the petitioner‟, in the writ petition except to

say that "at the time of inspection the respondent was served certain

papers signed by the Manager of the petitioner establishment and were

filled later on and on the strength of those documents, the respondent is

claiming the petitioner establishment to be covered under the Act for the

period from 1991 to 1994. The petitioner submits that any document the

contents of which if are contrary to the existing facts i.e. number of

employees of the establishment, cannot be made basis of the applicability of

the Act". The petitioner is obviously being too clever by half in

withholding the material relevant from this Court.

5. From the above it is apparent that petitioner-school through its

Manager furnished a list containing the names of 20 employees to

respondent no.1 on 5th October, 1991. The petitioner-school appeared

before the respondent no.1 and after numerous opportunities and

adjournments in this behalf, the respondent no.1 finally determined

the applicability of the EPF Act to the petitioner-school. Further, vide

the said order dated 27th February, 2001, the respondent no.1 also

directed the petitioner-school to produce relevant records in order to

determine the amount due from the petitioner-school in relation to

provident fund dues etc. The petitioner-school deliberately neglected

and avoided to produce the relevant records. Finally, vide order dated

31st January, 2002 the respondent no.1 assessed the dues in the

amount of Rs.1,93,140/- and directed the petitioner-school to deposit

the dues so assessed within 15 days. Instead of challenging the order

dated 27th February, 2001 whereby the applicability of Act to the

petitioner-school was determined, the petitioner challenged the order

of assessment dated 31st January, 2002 by way of a review under

Section 7B of the Act. The respondent no.1 after hearing the

petitioner-school clearly pointed out that the applicability of the Act

had been determined by an order dated 27th February, 2001 which

had not been challenged by the petitioner-school, and that

consequently the review must fail. Even then the petitioner-school did

not challenge the order dated 27th February, 2001. When respondent

no.1 finally issued the impugned order dated 4th February, 2006 for

recovery of provident fund dues, the petitioner filed the present

petition without impugning or bringing to the notice of this court the

order dated 27th February, 2001, on the ground that the respondent

no.1 had assessed dues in relation to provident fund against the

petitioner-school without deciding the applicability of this Act to the

petitioner-school.

6. It is thus seen that the impugned orders have been rendered by

a statutory quasi judicial authority within the limits of its power and

jurisdiction. It is also observed that the impugned orders were

rendered after due compliance with both principles of natural justice

and strictly in consonance with the requirements of law. The authority

clearly acted in conformity with the provisions of the EPF Act and

reached an unexceptionable and reasonable decision, in the facts and

circumstances of the case. On the other hand the conduct of the

petitioner is such that it does not deserve the discretionary remedy on

account of deliberately suppressing material facts in his pleadings

thereby attempting to mislead this court by misrepresentation.

7. For the foregoing reasons, the writ petition is an abuse of the

process of Court and deserves to be dismissed with costs. Therefore,

the present petition is devoid of merit and is rejected with costs of

Rs.10,000/- (rupees ten thousand), to be deposited with the Delhi

High Court Mediation and Conciliation Centre, within two weeks of

the date of this order, under intimation to this Court. Writ petition is

disposed of accordingly.

SIDDHARTH MRIDUL, J.

September 22, 2008 mk