Joy K. G vs The Employees Provident Fund ...
2021 Latest Caselaw 1572 Ker

               IN THE HIGH COURT OF KERALA AT ERNAKULAM

                               PRESENT

                 THE HONOURABLE MR. JUSTICE A.M.BADAR

     FRIDAY, THE 15TH DAY OF JANUARY 2021 / 25TH POUSHA, 1942

                      WP(C).No.26565 OF 2020(U)

PETITIONERS:

      1        JOY K. G.
               AGED 35 YEARS
               S/O. K. P. GEORGE, KOIKKARA HOUSE, ERUMATHALA P. O.,
               ERNAKULAM - 683 122.

      2        M/S GOODLIFE CONSTRUCTION & DEVELOPERS
               VALAYIL HOUSE, PALISSERY ROAD, PALARIVATTOM P. O.,
               KOCHI - 25 - REPRESENTED BY ITS MANAGING PARTNER
               SRI.JOY K. G.

               BY ADVS.
               SRI.MANU GOVIND
               SRI.A.JAYASANKAR
               SRI.RAHUL SURENDRAN

RESPONDENTS:

      1        THE EMPLOYEES PROVIDENT FUND ORGANIZATION
               REGIONAL OFFICE, BHAVISHYANIDHI BHAVAN, KALOOR P. O.,
               COCHIN - 682 017, REPRESENTED BY THE REGIONAL
               PROVIDENT FUND COMMISSIONER.

      2        THE ASSISTANT PROVIDENT FUND COMMISSIONER
               EMPLOYEES PROVIDENT ORGANIZATION, REGIONAL OFFICE,
               BHAVISHYA NIDHI BHAVAN, KALOOR P. O.,
               ERNAKULAM - 682 017.

      3        THE PROVIDENT FUND COMMISSIONER
               EMPLOYEES PROVIDENT ORGANIZATION, REGIONAL OFFICE,
               BHAVISHYA NIDHI BHAVAN, KALOOR P. O.,
               ERNAKULAM - 682 017.

      4        THE RECOVERY OFFICER
               EMPLOYEES PROVIDENT ORGANIZATION, REGIONAL OFFICE,
               BHAVISHYA NIDHI BHAVAN, KALOOR P. O.,
               ERNAKULAM - 682 017.

               R1-R4 BY ADV. SRI.S.PRASANTH, SC.

     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
15.01.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
 W.P.(C) No.26565/2020                   2


                                JUDGMENT

Dated this the 15th day of January 2021

The petitioners, by this writ petition, are challenging the order

at Ext.P3 passed under Section 7A of the Employees' Provident

Funds and Miscellaneous Provisions Act, 1952 (EPF Act, for short)

by the Regional Provident Fund Commissioner in pursuant to the

judgment of this Court in W.P.(C) No.1346 of 2020 decided on

16.03.2020 (Ext.P2).

2. Heard both sides. Learned counsel for the petitioners

drew my attention to paragraph 5 of the judgment at Ext.P2 and

argued that even though respondents found the grievance of

petitioners regarding non service of notice as genuine, he argued

that the first order under Section 7A of the EPF Act dated

08.05.2018 (Ext.P1) was served on petitioners after expiry of the

limitation period of 120 days and therefore, he was constrained to

approach this Court by filing the writ petition which was decided by

Ext.P2 judgment. It is further argued that no notice of proceedings

under Section 7A of the EPF Act was ever served on petitioners. No

e-mail address of petitioners was provided to the respondent-

authorities. There was common e-mail address from which former

partner of the establishment had received e-mails to the

respondent-department. With this, learned counsel for the

petitioners argued that the finding recorded in the subsequent

order at Ext.P3 dated 17.10.2020 regarding receipt of notice of

hearing is per se illegal and therefore, the order at Ext.P3 needs to

be quashed and set aside. Learned counsel drew my attention to

paragraph 6 of the judgment at Ext.P2 and submitted that this

Court has even noted that proceedings were completed without

serving notice to present partners. According to the learned

counsel for the petitioners, the proceedings under Section 7A of the

EPF Act needs to be reopened with liberty to the petitioners to

participate therein.

3. As against this, learned counsel appearing for respondents

drew my attention to paragraph 6 of the judgment at Ext.P2 and

argued that the discretion was left on EPF authorities to decide

whether notice of hearing was served on petitioners. Learned

counsel for respondent-authorities further argued that in

compliance of the judgment at Ext.P2, the authorities have

re-examined the record and come to a categorical finding that the

petitioners have themselves acknowledged summons when notice

was issued for hearing on 11.10.2017. Therefore, according to the

learned counsel for the respondent-authorities, petitioners have not

made out any case for interference. If the petitioners feel

aggrieved, they have to approach Appellate Tribunal in the matter.

4. I have considered the submissions so advanced and

perused the materials placed before me. According to the EPF

authorities, in routine inspection, it was found that the petitioner-

establishment has failed to remit dues of Provident Fund on time

and that the petitioner-establishment is a chronic defaulter of dues

under the EPF Act. That is how proceedings under Section 7A of

the EPF Act commenced and concluded vide order at Ext.P1 dated

08.05.2018. Contending that principles of natural justice were

violated by respondent-authorities, the petitioner-establishment

preferred Writ Petition bearing No.1346 of 2020 before this Court.

Paragraphs 5 and 6 of the judgment rendered in that writ petition

which was decided on 16.03.2020 (Ext.P2) needs reproduction and

those paragraphs read thus:

"5. The respondents were directed to get instructions. It is submitted by the learned standing counsel that the representation submitted by the petitioners, which has been produced as Ext.P3, was considered by the respondents and their grievance was found genuine. Consequently, letter dated 28.1.2020 was issued by the recovery officer to the petitioners and an opportunity has been granted to submit proof of their contentions.

6. I have considered the submissions advanced. It appears that the proceedings were completed without serving notice to the present partners. This fact is evident from Ext.P1. Now that the respondents have agreed to offer a chance to the petitioners to substantiate their contentions, necessary directions can be issued and this matter can be disposed of".

5. A bare perusal of the above referred paragraphs shows

that this Court has come to prima facie conclusion that notice of

hearing was not served on the present partner (petitioners) of the

establishment and therefore, the respondent authorities were

directed to examine whether notice was served on retired partner

and also whether guidelines prescribed by respondents were

violated while issuing order under Section 7A of the EPF Act

(Ext.P1). This Court had made it clear that if these aspects go in

favour of the petitioners, then the assessment should be reopened

and fresh assessment should be made. In the light of the

judgment of this Court (Ext.P2), authorities did necessary exercises

and give a finding in the subsequent order at Ext.P3 dated

17.10.2020. Paragraphs 15, 18 and 19 of the order at Ext.P3 read

thus:

"15. However, on verification of the records it is seen that the petitioner himself has acknowledged a

summons when notice was issued for hearing on 11.10.2017. The same is annexed to this order.

18. In view of the above, I am convinced that the petitioner was aware of the proceedings before this Authority which resulted in Ext.P1 order and the consequent proceedings of the Recovery Officer vide Ext.P2 and therefore, there was no violation of the principles of natural justice.

19. I hereby affirm the orders issued under Sec.7A vide dated 04.05.2018 and call upon the petitioner, who is also the employer to remit the dues as determined by the said order".

6. It is thus clear that respondent-authorities have

undertaken necessary exercises as directed by this Court for

ascertaining whether principles of natural justice were followed or

not by noticing the petitioners while making necessary

adjudication under Section 7A of the EPF Act. A categorical finding

is given by the respondent-authorities that the petitioners were

duly noticed and they themselves have acknowledged the notice of

hearing on 11.10.2017. With this, the respondent-EPF authorities

have affirmed the earlier order issued under Section 7A of the EPF

Act. In the light of the observations of this Court in paragraph 6 of

the judgment at Ext.P2, there was no necessity of fresh

assessment as the Provident Fund authorities have given a finding

that notice of hearing was served on the petitioners. Section 7-I of

the EPF Act reads thus:

"7-I. Appeals to Tribunal.-(1) Any person aggrieved by a notification issued by the Central Government, or an order passed by the Central Government or any authority, under the proviso to sub-section (3), or sub-section (4) of section 1, or section 3, or sub-section (1) of section 7A, or section 7B (except an order rejecting an application for review referred to in sub-section (5) thereof, or section 7C, or section 14B, may prefer an appeal to a Tribunal against such notification or order.

(2) Every appeal under sub-section (1) shall be filed in such form and manner, within such time and be accompanied by such fees, as may be prescribed".

7. The petitioners are thus aggrieved by the order of the PF

authorities passed under Section 7A of the EPF Act for determining

the money due from the petitioner-establishment. Subsequent

order dated 17.10.2020 passed by the EPF authorities is also an

order under Section 7A of the EPF Act which gets merged in the

earlier order at Ext.P1 dated 08.05.2018 so far as it deals with

compliance of principles of natural justice. The apprehension of the

petitioners that they are beyond limitation as such does not survive

because cause of action accrues on the petitioners on receipt of the

order at Ext.P3.

Thus, in view of the alternate and most efficacious remedy of

filing an appeal before the Tribunal, the writ petition, as framed and

filed, is not maintainable. However, it is clarified that along with

other aspects of the matter, the petitioners are free to agitate the

issue regarding non compliance of the principles of natural justice

before the Appellate Tribunal as the appeal is nothing but

continuation of the original proceedings. If the petitioners

approach the Appellate Authority, the Appellate Authority shall keep

in mind the fact of pendency of the writ petition filed by the

petitioners before this Court.

This writ petition is disposed of as above.

Sd/-

A.M.BADAR

JUDGE

smp

APPENDIX PETITIONER'S EXHIBITS:

EXHIBIT P1 COPY OF SECTION 7A, ORDER NO.KR/KCH/29474(7A)/ENF-(13)/2018 DATED 04.05.2018.

EXHIBIT P1 (a) COPY OF THE SHOW CAUSE NOTICE NUMBER KP/KCH/29474/RECOVERY/2019-20 DATED 18.11.2019.

EXHIBIT P2 COPY OF THE JUDGMENT DATED 16.03.2020, PASSED BY THIS HONORABLE COURT IN WP(C) NO.1346 OF 2020 PREFERRED BY THE 1ST PETITIONER.

EXHIBIT P3 COPY OF THE ORDER DATED 17.10.2020, PASSED BY THE 3RD RESPONDENT, PURSUANT TO THE HEARING CONDUCTED IN ACCORDANCE TO THE DIRECTION CONTAINED IN EXHIBIT P2.

EXHIBIT P4 COPY OF THE REPRESENTATION DATED 02.12.2019 PREFERRED BY THE 1ST PETITIONER.

EXHIBIT P5 TRUE PHOTOCOPY OF THE WEB CIRCULAR NO.C-

III/110001/4/3(71) DI/2013 VOL.II/22-147 DATED 08.02.2016.

EXHIBIT P6 TRUE PHOTOCOPY OF THE WEB CIRCULAR NO.C-

III/110001/4/3(7)MIS.C/2013 VOL.II/6511 DATED 15.06.2016.

RESPONDENTS' EXHIBITS; NIL.

True Copy

P.S to Judge

smp