Dismissed¶¶63

M/S Electrex (India) v. the Enforcement Officer

Employees' Provident Funds and Miscellaneous Provisions Act, 1952 – S.14(1B) r/w S.14A – offences by companies

Karnataka HC5 Mar 2026CRL.RP/1116/2017

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Case brief

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What is this about?

Karnataka High Court, Bengaluru; V Srishananda J; CRL.RP No. 1116 of 2017; decided 05-03-2026; Electrex (India), Peenya Industrial Area vs Enforcement Officer, Employees Provident Fund Organisation; S.397 r/w 401 CrPC criminal revision; S.14(1B) r/w 14A EPF & MP Act 1952; offences by companies; PF contribution deducted but not deposited; misappropriation; abatement on death of accused; fine Rs.5,000/-; conviction upheld; revision dismissed.

What did the court decide?

No relief to petitioners: revision dismissed; conviction and fine upheld qua first accused/Company; revision stood abated qua deceased accused No.3 ¶¶63

M/S Electrex (India) Vs the Enforcement Officer — Karnataka HC (2026) — LawSathi Research

What the court decided

AI extract

Outcome

No relief to petitioners: revision dismissed; conviction and fine upheld qua first accused/Company; revision stood abated qua deceased accused No.3

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Issue for consideration

Whether the conviction of the revision petitioners (accused Nos.1 and 3) for the offence punishable under Section 14(1B) r/w 14A of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 should be set aside on the contentions that there was no willful violation of the provisions of law and the material on record was insufficient to establish the offence.

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Court's answer

On close perusal of Section 14A, taking note of the fact that the material evidence on record reflects that the amount towards contribution of provident fund was deducted by the first accused-Company and not deposited with the concerned authorities, the offence stands concluded; hence the contentions of the revision petitioners cannot be countenanced in law.

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Ratio / Principle

With the fine of Rs.5,000/- imposed on the first accused/Company and the third accused being dead, the revision petition deserves dismissal upholding the order of conviction and imposition of fine insofar as the first accused-Company is concerned; accordingly the revision petition was held meritless and dismissed.

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Detailed headnote1 paragraphs

Employees' Provident Funds and Miscellaneous Provisions Act, 1952 — S.14(1B) r/w S.14A — offences by companies — revision under S.397 r/w 401 CrPC. The accused-company deducted provident fund contributions from employees' salary but failed to deposit the same with the authorized agency, thereby misappropriating the money. The Special Court for Economic Offences (C.C.No.266/2011, order dated 22.06.2015) convicted accused Nos.1 (company) and 3 (Director) and fined the company Rs.5,000/-; accused No.2 (Executive Director) was acquitted and the State filed no appeal. The LXII Addl. City Civil and Sessions Judge (CCH-63) in Crl.A.No.943/2015, on reappreciation of the material on record, upheld the conviction (order dated 25.09.2017). During pendency of revision, accused No.3 died and the revision abated qua him. Held: deduction of the PF contribution by the company without deposit with the concerned authorities, evidenced on record, itself concludes the offence; contentions of absence of willful violation and insufficiency of material rejected. Revision petition dismissed; order of conviction and imposition of fine upheld insofar as the first accused-Company is concerned.

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NC: 2026:KHC:13904 CRL.RP No. 1116 of 2017

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HC-KAR

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 05^TH DAY OF MARCH, 2026

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BEFORE

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THE HON'BLE MR. JUSTICE V SRISHANANDA CRIMINAL REVISION PETITION No.1116 OF 2017

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BETWEEN:

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M/S ELECTREX (INDIA) NO.21-D1 PEENYA INDUSTRIAL AREA II PHASE, BENGALURU-560 058 REP. BY AJITH V HEGDE

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MR AJITH V HEGDE S/O VIGNESWARA HEGDE AGED ABOUT 59 YEARS, NO.607, OPPOSITE TO RMV CLUB 80 FEET ROAD, DOLLAR COLONY BENGALURU-560 094

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…PETITIONERS

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Digitally signed by R MANJUNATHA Location: HIGH COURT OF KARNATAKA

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(BY SRI UDAY URS N FOR SRI DESU REDDY G, ADVOCATES; VIDE ORDER DATED 04.03.2026, P2 IS DEAD)

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AND:

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THE ENFORCEMENT OFFICER EMPLOYEES PROVIDENT FUND ORGANISATIONS NO.6(1) F, 1^ST CROSS PEENYA INDUSTRIAL AREA BENGALURU-560 058

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…RESPONDENT

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(BY SRI K.S.VENKATARAMANA, ADVOCATE)

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NC: 2026:KHC:13904 CRL.RP No. 1116 of 2017

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HC-KAR

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THIS CRIMINAL REVISION PETITION IS FILED UNDER SECTION 397 R/W 401 CODE OF CRIMINAL PROCEDURE PRAYING TO SET ASIDE THE JUDGMENT AND ORDER DATED 22.06.2015 IN C.C.NO.266/2011 ON THE FILE OF THE LEARNED PRESIDING OFFICER, SPECIAL COURT FOR ECONOMIC OFFENCES AT BANGALORE IN SO FAR AS CONVICTING AND SENTENCING THE PETITIONERS AND FURTHER BE PLEASED TO SET ASIDE THE JUDGMENT AND ORDER DATED 25.09.2017 IN CRL.A.NO.943/2015 ON THE FILE OF THE LEARNED LXII ADDITIONAL CITY CIVIL AND SESSIONS JUDGE (CCH-63) AND ACQUIT THE PETITIONERS.

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THIS PETITION, COMING ON FOR HEARING, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

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CORAM: HON'BLE MR. JUSTICE V SRISHANANDA

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ORAL ORDER

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Heard Sri Uday Urs N, advocate for Sri Desu Reddy G, learned counsel for the revision petitioners and Sri K.S. Venkataramana, learned counsel for the respondent.

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Accused Nos.1 and 3 who have suffered an order of conviction for the offence punishable under Section 14(1B) r/w 14A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 are the revision petitioners.

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The allegation against the revision petitioners/accused persons is that they have deducted the contribution from the employees' salary but failed to deposit the same with the

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NC: 2026:KHC:13904 CRL.RP No. 1116 of 2017

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HC-KAR

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authorized agency and thereby misappropriated the money which is established by placing necessary evidence on record.

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Accused No.3 was the Director of accused No.1/Company. Accused No.2 being the Executive Director, was acquitted by the learned Trial Magistrate. State did not choose to file any appeal against the said order of acquittal.

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It is the first and third accused who filed appeals before the District Court.

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Learned Judge in the District Court, after securing the records, heard the arguments of the parties and on reappreciation of the material on record, found that mandatory provisions are violated by the accused and therefore, upheld the order of conviction.

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Being further aggrieved by the same, accused Nos.1 and 3 are before this Court in this revision petition.

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During pendency of this revision petition, accused No.3 who was representing the accused No.1 as the Director, died.

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NC: 2026:KHC:13904 CRL.RP No. 1116 of 2017

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HC-KAR

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Memo is filed in that regard and therefore revision petition stood abated insofar as the accused No.3 is concerned.

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Therefore what remains before this Court to be

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considered is, the conviction of the first accused/Company imposing fine of Rs.5,000/- for the proved offence.

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Sri Uday, learned counsel for the revision petitioners would submit that there was no willful violation of the provisions of law and the material on record was not sufficient to establish the offence alleged against the revision petitioners.

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To appreciate said arguments of revision petitioners, it is just and necessary to cull out Section 14A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, which reads as under:

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“ 14A. Offences by companies .—(1) If the person committing an offence under this Act [,the Scheme or [the [Pension] Scheme or the Insurance Scheme]] is a company, every person, who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of

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NC: 2026:KHC:13904 CRL.RP No. 1116 of 2017

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HC-KAR

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the offence and shall be liable to be proceeded against and punished accordingly:

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Provided that nothing contained in this sub-section shall render any such person liable to any punishment, if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

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(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act [,the Scheme or [the [Pension] Scheme or the Insurance Scheme]] has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of, any director or manager, secretary or other officer of the company, such director, manager, secretary or other officer shall be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

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Explanation.—For the purposes of this section,— (a) “company” means any body corporate and includes a firm and other association of individuals; and

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(b) “director” in relation to a firm, means a partner in the firm.”

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On close perusal of the above provision, taking note of

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the fact that the material evidence on record reflects that the

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NC: 2026:KHC:13904 CRL.RP No. 1116 of 2017

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HC-KAR

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amount towards the contribution of the provident fund has been deducted by the first accused-Company and not deposited with the concerned authorities, itself concludes the offence.

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Therefore, the contentions urged on behalf of the revision petitioners cannot be countenanced in law.

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Since a sum of Rs.5,000/- is imposed as the fine amount to the first accused/Company and, third accused being dead, the revision petition needs to be dismissed upholding the order of conviction and imposition of fine, insofar as the first accusedCompany is concerned.

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16. Accordingly, the following:

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ORDER

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Revision petition is meritless and is hereby dismissed .

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Sd/(V SRISHANANDA) JUDGE

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kcm List No.: 1 Sl No.: 51

M/S Electrex (India) v. the Enforcement Officer

Case brief

What is this about?

What did the court decide?

M/S Electrex (India) v. the Enforcement Officer

Case brief

What is this about?

What did the court decide?

Why is it important?

What the court decided

Issues for consideration

Statutes considered

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