Telangana High Court

Rolex Meters Pvt. Ltd., vs Union Of India on 6 February, 2024

Author: Surepalli Nanda

Bench: Surepalli Nanda

      HON'BLE MRS JUSTICE SUREPALLI NANDA

            WRIT PETITION No.2243 OF 2024


ORDER:

Heard Mr. Kailash Nath P S S, learned counsel

appearing on behalf of the petitioner and learned

counsel appearing on behalf of the respondents.

2. The petitioner approached the Court seeking

prayer as under:

"to issue a writ, order or direction, more particularly in the nature of a Writ of Certiorari, calling for records and quashing the Order dt.30.08.2023 issued by the 2nd Respondent bearing Diary No:197/2022 and Reference No/TS/RO/KKP/PD/7Q/68805/Z-III/2023/164 u/s 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 on the grounds that it is illegal, arbitrary, highhanded and violative of principles of natural justice, and consequently release the attachment of the bank account of the Petitioner bearing Account No:

03642320000055, and pass such other order or orders as this Hon'ble Court deems fit and proper in the circumstances of the case.."

3. The case of the petitioner, in brief, is as follows:

"3.1 It is submitted that the Petitioner company is engaged in the business of manufacture and sale of Electric Meters and has its plant at Kukatpally Industrial Estate, Hyderabad. The Petitioner got itself registered vide Code No.AP/KKP/68805 w.e.f 01.04.2006 under 2 WP_2243_2024 SN,J

the EPF Act. The Petitioner has been regular in filing the necessary returns and remitting contributions and administrative charges on time.

3.2. It is submitted that for the period March 2012 to February 2015, the Petitioner remitted the contributions and administrative charges on time and the same is evidenced by way of challans issued by the Bank and the Respondent Department. However, due to an error in the employee codes filed by the Petitioner in the Electronic Challan cum Return ("ECR") for the said period, the Petitioner, on the direction of the Respondent Department, uploaded revised ECRs on 17.08.2015. The same was communicated to the Respondents by way of letter dt.17.08.2015, which was acknowledged by the Respondents on 18.08.2015.

3.3. While things stood thus, after a period of almost 9 years, the 2nd Respondent issued a Show Cause Notice dt.05.07.2022, u/s 14B and 7Q of the EPF Act for the period March 2012 to May 2022 claiming damages of Rs.3,60,796 and interest of Rs.1,84,712, cumulatively Rs.5,45,508, on the ground that the contributions for the period April 2012 to May 2022 have been paid belatedly by the Petitioner. 3.4. It is also submitted that the Petitioner issued a reply to the show cause notice dt.27.09.2022 stating that the dates of contribution have been taken incorrectly, more particularly for the period March 2012 to February 2015 as there was only a revision in the ECRs then and not a delay in paying the contributions.

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The Petitioner furnished all the challans for the said period to support its claims. For the remaining period, the Petitioner bonafidely provided a calculation stating that the interest and damages at the most would be Rs.49,380 and not Rs.5,45,508 as claimed by the Respondents. The Reply furnished by the Petitioner is acknowledged under the seal of the 2nd Respondent on 27.09.2022.

3.5. It is further submitted that respondent No.2 issued emails on various dates such as 11.10.2022, 31.10.2022, 14.11.2022, 20.12.2022 and 01.02.2023 directing the Petitioner to attend virtual hearing. The Petitioner diligently logged in on all the dates to attend the hearing but none appeared for the Respondents. Even on 01.02.2023, the Petitioner received an email intimating personal hearing, by way of virtual hearing on 03.02.2023 between 12:45 PM and 01:00 PM. Even though Petitioner logged in on time, respondent No.2 was not present online. After the designated time, the Petitioner sent an email at 01:04 PM stating that the Respondents have not attended the call and sought for a hearing in person instead of a virtual meeting. However, there has been no response from the Respondents in this regard.

3.6. It is submitted that the 2nd Respondent however issued the impugned order on 30.08.2023 confirming the proposal in the show cause notice by concluding the inquiry and imposing damages of Rs.3,60,796. A separate order was passed on the same date imposing 4 WP_2243_2024 SN,J

interest of Rs.1,84,712. Respondent No.2 has also attached the bank account of the Petitioner held with the Respondent No.3. Aggrieved by the said impugned order, the present writ petition is being filed.

4. It is specifically averred by the petitioner at

paragraph Nos.7 and 8 of the affidavit filed in support

of the present writ petition as under:

"7. It is submitted that the 2nd Respondent issued an emails on various dates such as 11.10.2022, 31.10.2022, 14.11.2022, 20.12.2022 and 01.02.2023 directing the Petitioner to attend virtual hearing. The Petitioner diligently logged in on all the dates to attend the hearing but none appeared for the Respondents. Even on 01.02.2023 the Petitioners received an email intimating personal hearing by way of virtual hearing on 03.02.2023 between 12:45 PM and 01:00 PM. Even as the Petitioner logged in on time, the 2nd Respondent was not present online. After the designated time, the Petitioner sent an email at 01:04 PM stating that the Respondents have not attended the call and sought for a hearing in person instead of a virtual meeting. However, there has been no response from the Respondents in this regard.

8. It is submitted that the 2nd Respondent however issued the impugned order on 30.08.2023 confirming the proposal in the show cause notice by concluding the inquiry and imposing damages of Rs.3,60,796. A separate order was passed on the same date imposing interest of Rs.1,84,712. Respondent No.2 has also attached the bank account of the petitioner held with respondent No.3. Aggrieved by the said impugned order, the present writ petition is being filed."

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5. Learned counsel appearing on behalf of the respondent

No.2refers to paragraph No.3 of the order impugned dated

30.08.2023 and submits that an ample opportunity has been

provided to the petitioner establishment, however, the

petitioner did not avail the said opportunity and the petitioner

was absent for more than 7 occasions and therefore no

indulgence need be extended to the petitioner and the

petitioner has an alternative remedy to approach the

appellate authority under Section 7-I of the Act.

6. A bare perusal of the order impugned clearly indicates

that the reply notice dated 27.09.2022 submitted by the

petitioner in response to the show cause notice dated

05.07.2022 had not been considered by respondent No.2, in

view of the fact that there is no discussion about explanation

furnished by the petitioner in the order impugned dated

30.08.2023. It is also borne on record from a bare perusal of

the material documents, that though respondent No.2,

scheduled for virtual hearing on various dates, in spite of the

petitioner intimating the same, there was no response from

respondent No.2.

7. The Division Bench of Apex Court in a judgment

dated 20.04.2021 reported in (2021) 6 SCC 771 in M/s.

Radhakrishnan Industries Vs. State of Himachal 6 WP_2243_2024 SN,J

Pradesh, referred to Whirlpool Corporation Vs.

Registrar of Trade Marks (reported in (1998) 8 SCC 1)

and further the said view had been reiterated by a Full

Bench of the Apex Court (3 Judges) in a judgment

reported in (2021) SCC Online SC page 801 in Magadh

Sugar and Energy Limited Vs. State of Bihar and Others

dated 24.09.2021 and in the said judgment of the Apex

Court, it is observed as under :

28. The principles of law which emerge are that:

(i) The power under Article 226 of the Constitution to issue writs can be exercised not only for the enforcement of fundamental rights, but for any other purpose as well;

(ii) The High Court has the discretion not to entertain a writ petition. One of the restrictions placed on the power of the High Court is where an effective alternate remedy is available to the aggrieved person;

(iii) Exceptions to the rule of alternate remedy arise where (a) the writ petition has been filed for the enforcement of a fundamental right protected by Part III of the Constitution; (b) there has been a violation of the principles of natural justice; (c) the order or proceedings are wholly without jurisdiction; or (d) the vires of a legislation is challenged;

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(iv) An alternate remedy by itself does not divest the High Court of its powers under Article 226 of the Constitution in an appropriate case though ordinarily, a writ petition should not be entertained when an efficacious alternate remedy is provided by law;

(v) When a right is created by a statute, which itself prescribes the remedy or procedure for enforcing the right or liability, resort must be had to that particular statutory remedy before invoking the discretionary remedy under Article 226 of the Constitution. This rule of exhaustion of statutory remedies is a rule of policy, convenience and discretion; and

(vii) In cases where there are disputed questions of fact, the High Court may decide to decline jurisdiction in a writ petition. However, if the High Court is objectively of the view that the nature of the controversy requires the exercise of its writ jurisdiction, such a view would not readily be interfered with."

8. The judgment dated 29.10.2010 of the Apex Court

in Oryx Fisheries Private Limited v Union of India and

others reported in (2010) 13 SCC 427, and in particular

at paras 36 and 37, it is observed as under:

"36.The appellant gave a reply to the show-cause notice but in the order of the third respondent by which registration certificate of the appellant was cancelled, no reference was made to the reply of 8 WP_2243_2024 SN,J

the appellant, except saying that it is not satisfactory. The cancellation order is totally a non-speaking one.

37. Therefore, the bias of the third respondent which was latent in the show cause notice became patent in the order of cancellation of the registration certificate. The cancellation order quotes the show-cause notice and is a non- speaking one and is virtually no order in the eye of the law. Since the same order is an appealable one it is incumbent on the third respondent to give adequate reasons."

9. Taking into consideration the law laid down by the

Hon'ble Apex Court in the judgments (referred to and

extracted above), this Writ petition is allowed and the

order impugned dated 30.08.2023 issued by the 2nd

respondent bearing Diary No.197/2022 and reference

No. TS/RO/KKP/PD/ 68805/Z-III/2023/164 is set

aside remanding the matter to respondent No.2 to

reconsider the reference No.TS/RO/KKP/PD/68805/Z-

III/2023/164 u/s 14B of the Employees Provident

Funds and Miscellaneous Provisions Act, 1952 within a

period of three (03) weeks from the date of receipt of a

copy of this order in accordance to law and in