2/18/22, 8:14 PM Labour Law Reporter
2022 LLR 198
CALCUTTA HIGH COURT
Hon'ble Mr. Hiranmay Bhattacharyya, J.
WP No. 17421/2021, Dt/– 29-10-2021
Bollore Logistics India Private Limited & Anr.
vs.
Regional Provident Fund Commissioner
EMPLOYEES' PROVIDENT FUNDS AND MISCELLANEOUS PROVISIONS ACT, 1952 –
Sections 7A, 7Q, 14B – EPF Authority has levied damages and interest – Contention
of petitioner is that it deposited the money in Bank through challans – EPF Authority
has imposed interest by exceeding its authority – EPF Authority has contended that
since the impugned order is a composite one passed under sections 14B and 7Q of
the Act, writ petition is not maintainable without exhausting remedy of statutory
appeal – Held, petitioner has prayed for grant of interim stay against recovery of
interest amount – In case of a composite order under section 7A and 7Q of the Act,
Tribunal is competent to grant consequential relief by reducing the amount of
interest in the event the quantum of amount determined under section 7A of the
said Act is reduced – Petitioner has filed appeal against order passed under section
14B of the Act – Tribunal is not empowered to grant any consequential relief by
reducing interest under section 7Q of the Act since it is charged on amount
determined under section 14B of the Act and not under section 7A of the Act – An
order passed under section 7Q of the Act is not appealable – Hence, writ petition is
maintainable – Impugned order is passed without any reasons – Unconditional stay
of operation imposed shall continue till 10.11.2021 – Petitioners shall deposit Rs.
26,00,000/- with Registrar General of the High Court by Demand Draft on or before
10.11.2021 – Balance Rs. 24,72,956/- be deposited on or before 30.11.2021 – In
the event of a default, order of stay shall stand vacated – Let affidavit in opposition
be filed within three weeks.
For Petitioner: Mr. Soumya Majumdar, Mr. Deepan Kumar Sarkar and Mr. Soumitra Datta,
Advocate.
For Respondent No. 4: Mr. Paritosh Sinha, Mr. Amitava Mitra, Ms. Antara Choudhury
For Respondents 1 & 2: Mr. Anil Kumar Gupta, Advocate.
IMPORTANT POINTS
If the EPF Authority has passed a composite order under sections 7A and 7Q
of the Act, writ petition is not maintainable without exhausting remedy of
statutory appeal.
Writ petitioner against order passed under section 7Q of the Employees
Provident Funds and Miscellaneous Provisions Act, 1952 is maintainable.
In case of a composite order under section 7A and 7Q of the Act, Tribunal is
competent to grant consequential relief by reducing the amount of interest in
the event the quantum of amount determined under section 7A of the said Act
is reduced.
Tribunal is not empowered to grant any consequential relief by reducing
interest under section 7Q of the Act when it is charged on amount determined
under section 14B of the Act.
An order passed under section 7Q of the Act is not appealable.
Since impugned order is passed without giving any reasons, stay against its
operation can be granted subject to conditions to the satisfaction of the Court.
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Stay granted would stand vacated in case failure on the part of the petitioner
to comply with the conditions, as imposed.
Judgment
Affidavit of service filed in Court today be kept on record.
Learned counsel for the respondent Nos. 1, 2 and 4 are present.
The challenge in the instant writ petition is restricted to the imposition of interest under
section 7Q of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (for
short “the 1952 Act”) to the tune of Rs. 50,72,956/- by an order dated October 11, 2021
passed by the Regional Provident Fund Commissioner-I – Regional Office, Park Street for the
period from September 21, 2011 and November 21, 2016.
Mr. Majumdar, learned advocate appearing for the petitioners draws the attention of this Court
to the said order wherein it was recorded that the establishment deposited the money through
challan in bank on time and the date mentioned in Annexures – ‘A' and ‘B'.
Mr. Majumdar also submits that after accepting the contention of the establishment that they
have deposited the money on time and the authorities exceeded its jurisdiction by directing
the petitioners to pay interest amounting to Rs. 50,72,956/- without assigning any reasons
therefor.
Mr. Gupta, learned advocate appears for the Provident Fund authorities and submits that the
impugned order being a composite order passed under section 14B read with section 7Q of
the 1952 Act, the instant writ petition is not maintainable as there is a statutory provision of
an appeal under section 7-I against an order passed under section 14B of the said Act. He
also relies upon a judgment of the Coordinate Bench of this Court reported at (2005) 2 WBLR
Cal 898 ( M/s. Capri Home Products Ltd. & Ors. v. The Regional P.F. Commissioners (I) W.B.,
Sikkim, the Adndaman & Nicobar Island & Ors. in support of his submission.
I have heard learned counsels for both the parties and have considered the materials on
record.
The dispute involved in the instant writ petition is required to be decided after exchange of
affidavits. However, Mr. Majumdar, learned advocate appearing for the petitioners prays for an
interim order restraining the respondents from recovering any amount on account of interest
as indicated in the order dated October 11, 2021.
For the limited purpose of deciding the issue with regard to passing of the interim order, the
point of maintainability of the instant writ petition is to be decided first. Section 7A of the
1952 Act empowers the competent authority to determine the amount due from any employer
under the provisions of the 1952 Act, the Scheme or the Pension Scheme or the Insurance
Scheme as the case may be.
Section 7Q of the said Act provides that the employer shall be liable to pay simple interest at
the rate of 12% or at such higher rate as may be specified in the scheme on any amount due
from him under the 1952 Act from the date on which the amount has become so due till the
date of its actual payment.
Thus, from a bare reading of the aforesaid two provisions of the 1952 Act it is evident that
interest is to be charged at the rate fixed under section 7Q on the amount determined to be
due from the employer under section 7A of the said Act.
The order passed under section 7A is appealable under section 7I of the said Act.
The Co-ordinate Bench in Capri Home Products (supra) held that in case a composite order is
passed under section 7A read with section 7Q of the 1952 Act the Tribunal while deciding an
appeal against an order passed under section 7A of the said Act is competent to grant
consequential relief by reducing the amount of interest in the event the quantum of amount
determined under section 7A of the said Act is reduced.
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However, in the instant case the impugned order is an order passed under section 14B and 7Q
of the said Act. The same is not a composite order passed under section 7A read with 7Q of
the Act.
Section 14B provides for recovery of damages. The object of levying damages under section
14B and charging interest under section 7Q is different. An order passed under section 14B is
also appealable under section 7-I of the said Act. In the instant case the petitioner has
preferred an appeal against the order passed under section 14B. But in an appeal against an
order passed under section 14B of the said Act the Tribunal is not empowered to grant any
consequential relief in the form of reduction of interest charged under section 7Q of the said
Act as interest under section 7Q is charged on the amount determined under section 7A and
not on the penalty levied under section 14B. As such the judgment of the Co-ordinate Bench
in the case of Capri Home Products ( supra ) is not applicable to the facts of the instant case.
Furthermore, an order passed under section 7Q is not appealable. Thus, in my considered
opinion the instant writ petition is maintainable. However, for the purpose of grant of an
interim order, the petitioners are to be put to terms. Upon perusal of the order impugned this
Court is of the prima facie view that the impugned order insofar as imposition of interest is
concerned is bereft of any reasons therefor. However, since, the petitioners have been
directed to pay a sum of Rs. 52,72,956/- on account of interest, the impugned order insofar
as it relates to realization of the said amount shall remain stayed subject to the following
conditions:–
(1) There shall be an unconditional order of stay of operation of the order in so
far as it relates to realization of the aforesaid amount till November 10, 2021.
(2) Petitioners shall deposit a sum of Rs. 26,00,000/- (Rupees Twenty Six Lac
only) with the Learned Registrar General, High Court at Calcutta by way of
Demand Draft on or before November 10, 2021.
(3) In the event, the said amount is deposited within the time limit mentioned
hereinabove, the order of stay shall continue till the end of November, 2021
subject to the condition that the petitioners shall deposit the balance amount of
Rs. 24,72,956/- on or before November 30, 2021. In the event, the said amount
is deposited within the aforesaid time limit, the order of stay shall continue till
the disposal of the instant writ petition.
It is, however made clear that in the event the petitioners make a default in making payment
as indicated above, the order of stay shall stand vacated without any further reference to this
Court.
Let affidavit in opposition be filed within three weeks after reopening of this Court after Puja
Vacation; reply, if any, be filed within one week thereafter.
Liberty to mention after expiration of the period fixed for exchange of affidavits strictly upon
notice to each other.
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