M/S.Prakash Cashew Company vs The Assistant Provident Fund ...
2022 Latest Caselaw 10862 Ker

                IN THE HIGH COURT OF KERALA AT ERNAKULAM
                                PRESENT
              THE HONOURABLE MR. JUSTICE P.V.KUNHIKRISHNAN
   THURSDAY, THE 3RD DAY OF NOVEMBER 2022 / 12TH KARTHIKA, 1944
                         WP(C) NO. 6844 OF 2011
PETITIONER:

          M/S.PRAKASH CASHEW COMPANY,
          KAITHAKODE, KUNDRA, KOLLAM, REPRESENTED BY PROPRIETOR
          B.JAYAPRAKASH.
          BY ADVS.
          SRI.T.M.CHANDRAN
          SRI.JOSEPH ALBIN NEDUNTHALLY
          SRI.V.A.SASIDHARAN


RESPONDENTS:

    1     THE ASSISTANT PROVIDENT FUND COMMISSIONER,
          KOLLAM.
    2     THE EMPLOYEES PROVIDENT FUND APPELLATE TRIBUNAL,
          MINISTRY OF LABOUR AND EMPLOYMENT, 4TH FLOOR, SCOPE
          MANOR, LAXMI NAGAR DISTRICT CENTRE, DELHI-110 092.
    3     EMPLOYEES PROVIDENT FUND ORGANIZATION,
          REPRESENTED BY REGIONAL PROVIDENT FUND COMMISSIONER-II,
          SUB REGIONAL OFFICE, PONNAMMA CHAMBERS, PARAMESWAR
          NAGAR, KOLLAM-691001.
    4     RECOVERY OFFICER,
          EMPLOYEES PROVIDENT FUND ORGANIZATION, SUB REGIONAL
          OFFICE, PONNAMMA CHAMBERS, PARAMESWAR NAGAR,
          KOLLAM-691001.
          BY ADV SRI.PIRAPPANCODE V.S.SUDHIR,SC,EPF



     THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON
03.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
                                 2

             P.V.KUNHIKRISHNAN, J.
            ------------------------------
           W.P.(C).No. 18033 of 2011
    ----------------------------------------------
   Dated this the 01st day of November, 2022


                        JUDGMENT

The above writ petition is filed with the following

prayers:

"(i) issue a writ of mandamus or any other appropriate writ, order or direction, quashing Exhibits P1 and P5

(ii) that the petitioner be granted such further reliefs as are appropriate and incidental to the Writ Petition.

(iii) issue a writ of certiorari or any other appropriate writ to quash Exhibits P1, P1 (b) and Exhibit P5 orders.

(iv) issue appropriate writ or order granting an effective opportunity to contest the enquiry proceeding under Section 7A of the Act and to produce necessary documents in the said enquiry and to adduce evidence;

(v) to pass an order for keeping all proceeding in abeyance including the recovery proceedings in pursuance of Ext.P1, P1(b) and P5 orders;

(vi) allow the Writ Petition with costs and grant such other reliefs as this Honourable Court

deems fit and just."[SIC]

2. The petitioner is the proprietor of M/s.

Prakash Cashew Company, Kaithakode, Kundara,

Kollam engaged in the Cashew industry after

employing both permanent and excluded employees.

It is a covered establishment as per the Employees

Provident Fund and Miscellaneous Provisions Act, 1952

and the Schemes (for short 'the Act'). An enquiry

under Section 7A was initiated against the petitioner

which resulted in Ext.P1 order. It is the specific case of

the petitioner that the Proprietor of the petitioner

Company was hospitalized and undergone a major

operation on 7.8.2008 and advised rest for a period of

3 months and hence he could not attend the enquiry

nor engage a representative to represent in the

Section 7-A enquiry. It is the case of the petitioner that

the employer was not given adequate opportunity to

prove the actual wages. Consequently Ext.P1 order

was passed. Thereafter the petitioner filed a Review

Petition to review Ext.P1 as per Section 7B of the Act.

The Review Petition was also dismissed as evident by

Ext.P1(b). Challenging the same, the petitioner filed

Ext.P4 appeal as per Section 7I of the Act. The appeal

is also dismissed as per Ext.P5 order. According to the

petitioner, Section 7A enquiry was conducted mainly

based on the report of the Enforcement Officer. It is

the specific case of the petitioner that the same was

not furnished to the petitioner. The petitioner

produced Ext.P6 series to show the contribution paid

towards the ESI corporation. Ext.P7 series is the

contribution paid by the petitioner towards the

Provident Fund dues. The petitioner submitted that

the documents produced will reveal that the petitioner

has remitted a sum of Rs. 23,62,760/- against the due

amount of Rs. 19,43,238/- and thereby the petitioner

has paid an excess amount of Rs. 4,19,522/-.

According to the petitioner, even then the recovery

proceedings is initiated. Hence this writ petition is filed

challenging Exts.P1, P1(b) and P5.

3. Heard counsel appearing for the petitioner

and the Standing counsel appearing for the

respondents.

4. Counsel appearing for the petitioner

reiterated his contentions raised in this writ petition.

The counsel takes me through Exts.P1, P1(b) and P5

and submitted that, no opportunity was given to the

petitioner to adduce evidence and to cross examine

the Enforcement Officer who submitted the report.

The Standing counsel on the other hand submitted

that sufficient opportunity was given to the petitioner

to adduce evidence. The Standing counsel submitted

that a bare perusal of Ext.P1 order itself will show

that, on several days the case was posted and the

petitioner refused to appear before the Court. The

Standing counsel also submitted that the medical

certificate produced by the petitioner is dated

10.04.2012 and there is no sufficient materials in

Ext.P1(a) medical certificate to show that the

Proprietor of the Company was laid up during the

period. The Standing counsel submitted that, even in

the absence of the petitioner, the authority considered

all the relevant materials and thereafter decided the

matter and there is nothing to interfere with the

impugned order. Moreover, the Standing counsel also

submitted that the petitioner has not raised the point

that he was not given proper opportunity to adduce

evidence before the authorities concerned. This is

disputed by the counsel appearing for the petitioner

and submitted that specific contention was raised in

Ext.P4 appeal memorandum.

5. This Court considered the contentions of the

petitioner and the respondents. It is true that a

perusal of Ext.P1 will show that the case was posted

on several occasions to adduce evidence. It will be

better to extract the relevant portion of Ext.P1:

"The Establishment M/s. Prakash Cashew Company, Kaithakode, Kundara, Kollam is covered under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 under code No. KR/16433. The employer of the establishments

defaulted in the payment of various dues fully under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and Schemes framed there under, for the period from 02/2004 to 04/2008. In spite of repeated requests made by this Office as well as the Enforcement Officer, the establishment has not remitted the dues fully towards the Employees' Provident Funds. The employer has thus violated the provisions contained in Para 30 and 38 of Employees' Provident Fund Scheme, 1952 and rendered himself liable for penal action as provided under Section 14(2) of the Act read with Para 76(d) of the Scheme, 1952.

In order to determine the dues, a notice was issued by this office to the employer on 24.07.08 by Registered Post fixing an inquiry on 07.08.2008 under Section 7 A of the Act, wherein production of necessary records and appearance in person or through duly authorized representative was insisted upon.

On 07-08-2008, none attended for hearing but a letter dated Nil received on 07-08-2008 requesting for an adjournment, as the employer has been hospitalized. Considering his request the case was adjourned to 10-09-2008.

On 10-09-2008, none attended the hearing and no representation has been received and the case was again adjourned to 20-10-2008. However a Telegram dated 09-09-2008 has been received on 11-09 2008 requesting further adjournment.

On 20-10-2008, none attended and no representation has been received.

Even though the inquiry has been adjourned as requested by the employer, the employer or his authorised representative has failed to attend the hearing and to produce the records called for vide notice dated 24-07-2008. The Enforcement Officer during his inspection visit to the establishment has also reported that the establishment has not produced the records and reported that (i) there is huge variation between the wages reported to ESIC and EPF (ii) the employer is not remitting the Provident Fund Contributions on the actual full wages paid to the employees. (iii) The employer is submitting NIL returns to the EPF, whereas he has remitted ESIC Contributions for the same period etc. and the Enforcement Officer has reported the balance outstanding wages based on the salary for the month of 05/2008.

It is also reported that the Trade Union conveners have complained that the contributions furnished in the Form 23 slips are much less than the actual contributions deducted from the wages of employees. On comparison of leave book with form 3A in respect of KR/16433/266, it is seen that the wages furnished in the form 3A is only 21.6% of the actual wages, furnished in the leave book.

I therefore determine the outstanding dues for the period from 02/2004 to 04/2008 on the basis of the dues reported by Enforcement Officer reserving

the right to assess the escaped dues if any as and when the original records of the establishment are verified by the Enforcement Officer.

6. Thereafter, a review petition was filed and

the same was dismissed as per Ext.P1(b) order. In

Ext.P1(b) order, it is stated that the petitioner has not

made any request for cross examination of the

Enforcement Officer. It is also stated in Ext.P1(b) that

sufficient opportunities were provided to the employer

to represent his side and he has not participated in the

inquiry, inspite of repeated adjournments. A perusal

of Ext.P1(b) will show that Sri.Anil Narayan,

authorized representative of the establishment

attended the hearing with authorization letter from the

petitioner. He requested for a copy of all the

Inspection Reports and documents based on which the

enquiry under Section 7A was initiated. But a perusal

of Ext.P1(b) will show that, since such a request is not

made from the petitioner, the same is rejected. Ext.P5

is the order passed in the appeal. In paragraph 13 of

Ext.P5 order, it is stated that the appellant participated

in the proceeding under section 7A. But never asked

to supply the copy of the Enforcement Officer's report.

A perusal of Ext.P5 will show that the petitioner never

appeared, but only requested for adjournment. It is

an admitted fact that the petitioner was not able to

appear for Section 7A enquiry. According to the

petitioner, there is payment in excess of the demand

and the petitioner is entitled to refund certain amount

and submitted several documents to substantiate the

case. I don't want to make any observation about the

merit of the case. In the peculiar facts and

circumstances of the case, I think an opportunity can

be given to the petitioner to contest the matter once

again by producing adequate materials to substantiate

the case. To facilitate the authorities to pass fresh

order, Exts.P1, P1(b) and P5 can be set aside. The 1 st

respondent will pass fresh orders after giving an

opportunity of hearing to the petitioner. Now it is

submitted that the report of the Enforcement Officer is

already produced in this writ petition in the counter

affidavit. The 1st respondent will furnish the

documents which they are going to rely to the

petitioner before proceeding with Section 7A enquiry.

Therefore, this writ petition is disposed of in the

following manner:

i) Exts.P1, P1(b) and P5 are set aside.

ii) The 1st respondent is directed to

reconsider the matter after giving an opportunity

of hearing to the petitioner, as expeditiously as

possible.

iii) The 1st respondent will furnish the

documents which the 1st respondent is going to

rely to the petitioner before proceeding with

Section 7A enquiry.

Sd/-

                                         P.V.KUNHIKRISHNAN
DM                                               JUDGE


              APPENDIX OF WP(C) 6844/2011

PETITIONER ANNEXURES
ANNEXURE I       TRUE COPY     OF   INTERIM    ORDER   DATED
                 9.3.2011.
ANNEXURE II      TRUE   COPY    OF   JUDGMENT          DATED
                 27.5.2011 IN W.A.526/2011.
EXHIBIT P1       A TRUE COPY OF THE CERTIFICATE DATED

10.4.2012 ISSUED BY DR.R.P.MADHAVAN.

EXHIBIT P1 A TRUE COPY OF THE ORDER DATED 9.2.2009.

EXHIBIT P1 TRUE COPY OF THE PROCEEDINGS OF THE 1ST RESPONDENT DATED 20.10.2008. EXHIBIT P2 TRUE COPY OF THE COMBINED CHALLAN ISSUED FROM THE OFFICE OF THE 1ST RESPONDENT ON 9.12.2009.

EXHIBIT P3 TRUE COPY OF THE CHEQUE OF CATHOLIC SYRIAN BANK LTD. CHINNAKKADA BRANCH DATED 30.4.2010.

EXHIBIT P4 A TRUE COPY OF THE MEMORANDUM OF APPEAL DATED 18.3.2008 (WITHOUT DOCUMENTS).

EXHIBIT P5 A TRUE COPY OF THE ORDER DATED 13.1.2011.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.1.2005 FOR RS.7551/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.8470/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.11048/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.1.2005 FOR RS.11138/-.

EXHIBIT P6 TRUE COPY OF THE CHALLAN DATED 23.3.2004 FOR RS.16,942.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 6.5.2004 FOR RS.13978/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 2.6.2004 FOR RS.7505/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 26.6.2004 FOR RS.11575/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.12460/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10..2004 FOR RS.14280/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.7842/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.11438/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.10046/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 12.5.2005 FOR RS.18348/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.10368/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.11020/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.11967/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.8051/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.11050/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 21.4.2006 FOR RS.13519/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 21.4.2006 FOR RS.15245/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED

21.4.2006 FOR RS.13413/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 21.4.2006 FOR RS.14135/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 4.8.2006 FOR RS.11110/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 4.8.2006 FOR RS.12840/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 10.10.2006 FOR RS.9965/-.

EXHIBIT P6 A TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.10047/-.

EXHIBIT P6AA A TRUE COPY OF THE CHALLAN DATED 10.10.2006 FOR RS.10537/-.

EXHIBIT P6AB A TRUE COPY OF THE CHALLAN DATED 1.1.2007 FOR RS.21124/-.

EXHIBIT P6AC A TRUE COPY OF THE CHALLAN DATED 1.1.2007 FOR RS.12888/-.

EXHIBIT P6AD A TRUE COPY OF THE CHALLAN DATED 31.7.2007 FOR RS.37372/-.

EXHIBIT P6AE A TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.32346/-.

EXHIBIT P6AF A TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.32087/-.

EXHIBIT P6AG A TRUE COPY OF THE CHALLAN DATED 20.5.2008 FOR RS.30469/-.

EXHIBIT P6AH A TRUE COPY OF THE CHALLAN DATED 11.12.2008 FOR RS.42291/-.

EXHIBIT P7 TRUE COPY OF CHALLAN DATED 23.3.2004 FOR RS.2010/-.

EXHIBIT P7A TRUE COPY OF THE CHALLAN DATED 26.4.2004 FOR 3/2004 FOR RS.7/-.

EXHIBIT P7B TRUE COPY OF THE CHALLAN DATED 26.6.2004 FOR RS.7/- FOR RS.4/2004..

EXHIBIT P7C TRUE COPY OF THE CHALLAN DATED 26.6.2004 FOR RS.10591/- FOR RS.5/2004.. EXHIBIT P7D TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.25339/-. EXHIBIT P7E TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.30642/-. EXHIBIT P7F TRUE COPY OF THE CHALLAN DATED 19.10.2004 FOR RS.80337/- FOR 8/2004. EXHIBIT P7G TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.44530/-. EXHIBIT P7H TRUE COPY OF THE CHALLAN DATED 13.4.2005 FOR RS.43900/-. EXHIBIT P7I TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.29751/-. EXHIBIT P7J TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.33372/-. EXHIBIT P7K TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.43095/-. EXHIBIT P7L TRUE COPY OF THE CHALLAN DATED 20.4.2005 FOR RS.39291/-.

EXHIBIT P7M TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 3/2005. EXHIBIT P7N TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 4/2005. EXHIBIT P7O TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/-.

EXHIBIT P7P TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 6/2005. EXHIBIT P7Q TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.7/- FOR 7/2005. EXHIBIT P7R TRUE COPY OF THE CHALLAN DATED

13.12.2005 FOR RS.40383/-.

EXHIBIT P7S TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.29772/-.

EXHIBIT P7T TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.39291/-.

EXHIBIT P7U TRUE COPY OF THE CHALLAN DATED 13.12.2005 FOR RS.43075/-.

EXHIBIT P7V    TRUE COPY    OF THE CHALLAN     DATED
               28.9.2007    FOR   RS.12221/-     FOR
               12/2005.
EXHIBIT P7W    TRUE COPY OF THE CHALLAN DATED

28.9.2007 FOR RS.7/- FOR 1/2006.

EXHIBIT P7X TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR THE MONTH 2/2006.

EXHIBIT P7Y TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 3/2006.

EXHIBIT P7Z TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 4/2006.

EXHIBIT P7AA TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 5/2006.

EXHIBIT P7AB TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 6/2006.

EXHIBIT P7AC TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 7/2006.

EXHIBIT P7AD TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.27998/-.

EXHIBIT P7AE TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.233512/-.

EXHIBIT P7AF TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.28842/-.

EXHIBIT P7AG TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.29301/-.

EXHIBIT P7AH TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.30352/-.

EXHIBIT P7I TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 1/2007.

EXHIBIT P7J TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 2/2007.

EXHIBIT P7AK TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.7/- FOR 3/2007. EXHIBIT P7AL TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 4/2007.

EXHIBIT P7AM TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 5/2007.

EXHIBIT P7AN TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.7/- FOR 6/2007.

EXHIBIT P7AO TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.5888/-.

EXHIBIT P7AP TRUE COPY OF THE CHALLAN DATED 28.9.2007 FOR RS.11956/-

EXHIBIT P7AQ TRUE COPY OF THE CHALLAN DATED 19.11.2007 FOR RS.15359/-.

EXHIBIT P7AR TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.11907/-.

EXHIBIT P7AS TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.15014/-.

EXHIBIT P7AT TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.27828/-.

EXHIBIT P7AU TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.28402/-.

EXHIBIT P7AV TRUE COPY OF THE CHALLAN DATED 19.5.2008 FOR RS.37372/-.

EXHIBIT P7AW TRUE COPY OF THE CHALLAN DATED 30.7.2007 FOR RS.9780/-.

EXHIBIT P7AX TRUE COPY OF THE CHALLAN DATED

30.7.2009 FOR RS.11131/-.

EXHIBIT P8 TRUE COPY OF THE STATEMENT OF ACCOUNT.

EXHIBIT P9 TRUE COPY OF STATEMENT OF ACCOUNT. RESPONDENT EXHIBITS EXHIBIT R1(A) TRUE COPY OF THE ENFORCEMENT OFFICER'S NOTE NO.KR/16433/EO.MPA/08 ALONG WITH HIS INSPECTION REPORT. EXHIBIT R1(B) TRUE COPY OF THE STATEMENT OF ACCOUNT SHOWING THE DETAILS OF DUES ASSESSED VIDE 7A & THE REMITTANCE. EXHIBIT R1(C) TRUE COPY OF THE RELEVANT EXTRACT OF THAT LEAVE BOOK & FORM 3A (MONTHLY WAGES DETAILS FOR THE YEAR 2006-

2007).

EXHIBIT R1(D) TRUE COPY OF THE RELEVANT EXTRACT OF THE STATEMENT SUBMITTED BY THE TRADE UNION CONVENERS.

             //TRUE COPY//                   PA TO JUDGE