Madras High Court
The Employees' Provident Fund ... vs M/S.Brakes India Ltd. on 18 August, 2021
W.A.No.1730 of 2015
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 18.08.2021
CORAM
THE HONOURABLE MR.JUSTICE T.RAJA
and
THE HONOURABLE MR.JUSTICE V.SIVAGNANAM
W.A.No.1730 of 2015
The Employees' Provident Fund Organisation,
Sub Regional Office,
31, Filter Bed Road, Vellore,
Rep by its Regional Provident Fund Commissioner ... Appellant
-vs-
M/s.Brakes India Ltd., (Brakes Division)
Rep by its Vice President (Pers & HRD)
Sholinghur-631 102. ...
Respondent
Prayer: Writ Appeal filed under Clause 15 of the Letters Patent against the
order dated 06.02.2015 passed in W.P.No.391 of 2014 by a learned Single
Judge of this Court.
For Appellant : M/s. V.J.Latha
For Respondent : Mr.Sanjay Mohan
for M/s.Ramasubramanian
Associates
1/8
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W.A.No.1730 of 2015
JUDGMENT
(Judgment of the Court was pronounced by T.RAJA, J.)
This Writ Appeal has been directed against the impugned order dated
06.02.2015 passed in W.P.No.391 of 2014 in and by which the proceedings
dated 26.12.2013 issued by the Regional Provident Fund Commissioner,
Vellore against the respondent, were quashed on the basis of the
judgements relied on by the respondent herein, more particularly, the order
passed in W.P.Nos.7776 and 7777 of 2005 dated 25.02.2010, wherein it
was clearly held that the respondent cannot be held responsible in any
manner so as to make an attempt to recover any damage that was not passed
on to the respondent.
2.Learned counsel appearing for the appellant would submit that
when the responsibility of depositing the contributions lies with the principal
employer, even though the contractor has been allotted with a code number,
the principal employer cannot escape from the statutory liability. But, this
aspect has been completely overlooked by the learned Single Judge.
Therefore, the impugned order is liable to be set aside.
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W.A.No.1730 of 2015
3. Learned Counsel for the appellant further contended that since
the provisions of the Employees' Provident Funds and Miscellaneous
Provisions Act and the schemes framed thereunder, clearly fasten the
liability on the principal employer in respect of the workers engaged through
or by a contractor, the impugned order passed by the learned Single Judge,
directing the appellant to recover the damages only from the contractor, who
is no more, is also liable to be set aside.
4. Learned counsel for the appellant also contended that when
liberty was also obtained to proceed against the legal representatives of the
contractor who was also allotted independent code number, the respondent
cannot escape from the legal obligation to remit the contributions. Arguing
further, it was contended that the allotment of separate code number to the
contractor is for administrative reason, that does not extinguish the duty or
obligation cast on the principal employer to remit the contributions on time.
In this regard, learned Counsel for the appellent relied upon a judgement of
this Court reported in [2010 (3) LLJ 232] Balaji paper and newsprint Pvt
Ltd., and another V Regional Provident Fund Commissioner and
another.
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W.A.No.1730 of 2015
5. Concluding her argument, learned Counsel for the appellant
stated that when the respondent establishment, the principal employer, has
failed in its duty to ensure that the contractor employed by them have
sincerely and promptly paid the contribution, as there were admittedly
belated payment of contribution, in accordance with Section 14-B of the Act
read with para 32-A of the scheme, the respondent is liable to pay penal
damages. Since the damages could not be collected from the contractor on
his demise, there is nothing wrong in proceeding against the principal
employer.
6. Opposing the above prayer, learned Counsel appearing for the
respondent submitted that when the proceeding dated 26.12.2013 issued by
the Regional Provident Fund Commissioner, Vellore admits the case of the
respondent that one A.Govindaraj, Labour contractor was undertaking
contract work from the respondent, while so, the said contractor had paid
the EPF and allied contributions belatedly for the period from June 1991 to
November 2002, the Proceeding dated 26.12.2013 makes the issue very
clear that the Labour Contractor A.Govindaraj, was covered separately
under the EPF Code No.(TN/VL/38789/SDC). Hence no interference is
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W.A.No.1730 of 2015
called for with the impugned order, as the appellant has already been given
liberty to proceed against legal heirs of the said contractor.
7. We find some merit on the submissions of the learned Counsel
for the respondent. The reason being that it is an admitted fact that the said
contractor A.Govindaraj paid the EPF and allied contributions belatedly for
the period from June 1991 to November 2002. Therefore, once the
Contribution was admittedly paid in respect of all the employees employed
by him, for the delay caused by the said contractor, it is not open to the
appellant to proceed against the principal employer. The reason is simple
and obvious, inasmuch as a similar issue came up before this Court in
W.P.Nos.7776 and 7777 of 2005, where the contractor, who was the
second respondent therein under the respondent M/s.Brakes India Ltd.,
failed to pay the EPF contribution on behalf of the workmen and in view
thereof, the appellant herein passed an order under Section 14-B of the
Employees Provident Funds and Miscellaneous Provisions Act 1952,
imposing damages to be paid by the said Contractor A.Govindaraj. When
the said contractor failed to pay the same, in order to recover the said
amount, the proceedings dated 25.02.2005 were wrongly issued against the
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W.A.No.1730 of 2015
respondent. Questioning the same, when the above said writ petitions were
filed, the learned Single Judge by order dated 25.02.2010 after hearing both
parties, has clearly held that there is no controversy that damages sought to
be recovered was not passed against the respondent, namely, M/s. Brakes
India Limited. As a matter of fact, it was imposed only against the
contractor and for the failure on the part of the said contractor, the
respondent herein cannot be held responsible in any manner. The Relevant
portion of the order is given as under:
''3.There is no controversy before this Court that the
damages sought to be recovered was not passed against
the petitioner. As a matter of fact, it was imposed only as
against the 2nd respondent. For the failure of the 2nd
respondent, the petitioner cannot be held responsible in
any manner so as to make an attempt to recover such
damages from the petitioner. In such view of the matter,
the impugned proceeding is wholly without jurisdiction.
4. In the result, the writ petition is allowed and the
impugned order of the 1st respondent dated 25.02.2005 by
his proceeding in No.TN/VL/38789/SDC is set aside.
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W.A.No.1730 of 2015
However, liberty is given to the 1st respondent to initiate
appropriate recovery proceedings against the legal heirs
of the 2nd respondent in accordance with law. No costs.
consequently, connected MP is closed.''
8. Since the said order has become final and concluded, the appellant,
having accepted the said order to proceed against the legal heirs of the said
contractor A.Govindaraj, has no justification to proceed against the
respondent/ principal employer once again, when the issue is no longer res-
integra. Therefore, the learned Judge, by the impugned order, has rightly
quashed the proceedings dated 26.12.2013 following the order dated
25.02.2010 passed in W.P.Nos.7776 & 7777 of 2005. Hence, finding no
infirmity with the impugned order, the writ appeal fails and it is dismissed.
No Costs.
(T.R.J.,) (V.S.G.J.,)
18.08.2021
vsn
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W.A.No.1730 of 2015
T.RAJA, J.
and
V.SIVAGNANAM, J.
vsn
W.A.No.1730 of 2015
18.08.2021
http://www.judis.nic.in
