Allowed

The House of Foods and Chemicals (P)Ltd v. Employees Provident Fund Organization

Kerala HC14 Nov 2022WP(C)/15725/2019

Case brief

AI extract

What is this about?

The Kerala High Court allowed this writ petition challenging an EPF damages assessment order. The court reduced damages from 60% to 30% considering the petitioner's financial difficulties and closure, modifying the Appellate Tribunal's order.

What did the court decide?

Damages were confined to 30% of the assessed amount and the order of the Appellate Authority was modified.

The House of Foods and Chemicals (P)Ltd Vs… — Pension and Retirement Benefits | Kerala HC (2022)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT

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THE HONOURABLE MR. JUSTICE AMIT RAWAL

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MONDAY, THE 14^TH DAY OF NOVEMBER 2022 / 23RD KARTHIKA, 1944

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WP(C) NO. 15725 OF 2019

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PETITIONER/S:

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THE HOUSE OF FOODS AND CHEMICALS (P)LTD KANJIKODE, PALAKKAD, REPRESENTED BY ITS MANAGING DIRECTOR.

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BY ADVS. V.N.HARIDAS SIBY.P.JOSE K.T.BOSCO

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RESPONDENT/S:

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1 EMPLOYEES PROVIDENT FUND ORGANIZATION REPRESENTED BY THE ASSISTANT PROVIDENT FUND COMMISSIONER, SUB REGIONAL OFFICE, BHAVISHYANIDHI BHAVAN, ERANIHIPALAM, KOZHIKODE 673 006.

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2 CENTRAL GOVERNMENT INDUSTRICAL TRIBUNAL CUM LABOUR COURT, MINISTRY OF LABOUR AND LABOUR, 38/377,A-2, KATITHALA LANE, KARSHAK ROAD ERNAKULAM, COCHIN 682 623. BY ADV DR.ABRAHAM P.MEACHINKARA

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THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 14.11.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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WP(C) NO. 15725 OF 2019

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JUDGMENT

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Order dated 28.3.2019 of Central Government Industrial Tribunal – cum – Labour Court, Ernakulam dismissing the appeal No.51/2017 preferred by the petitioner against the order dated 28.3.2019 assessing the damages to the tune of Rs.1,50,301/- on account of delayed remittances for the period June 2006 to January 2014 is under challenge in the present writ petition.

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Petitioner Company was into manufacturing of candies and toffees but owing to the increase in cost of the production was forced to closed down the operations with effect from September 2007. The EPF contribution of the employees was being paidbut owing to the financial difficulties from September 2007 and closure w.e.f 8.3.2010, there was default. Proceedings under Section 7A were initiated and the contribut ion had been paid but as a consequential effect, the proceedings for assessment of damages under 14 B were initiated. The assessing authority vide order dated 18.9.2017 assessed the damages to the tune of Rs.1,50,301/-, but, however, noticing the financial difficulty, in appeal, was reduced to 60%.

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Learned counsel for the petitioner submitted that this Court while issuing notice had directed the petitioner to deposit

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WP(C) NO. 15725 OF 2019

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50% of the said amount which has been deposited. It is further contended that even though the registration of the petitioner was cancelled but what weighed in the mind of the appellate authority, by not accepting the appeal in complete, was that the contribution of the employee was being paid upto September 2014. The measures under the 7A are more stringent than the consequential and since few of the employees were not paid off, it was on that account thedamages were determined. But once the financial conditions, had been noticed, the damages ought to have been considerably reduced.

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Per contra, learned counsel appearing on behalf of the respondent opposed the aforementioned prayer by submitting that the payment of the contribution up to 2014 is a testimony that there was no financial difficulty. yet the Appellate Tribunal reduced the damages to 60%, the same may be ordered to be maintained.

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I have heard the learned counsel for the parties and appraised the paper book. The factum of the petitioner having ran into financial difficulty from September 2007 and closure on 8.3.2010 is not in dispute much less the cancellation of the registration on 31.11.2011. The contribution made was not of all the employees but of few, who could not have been laid off . That

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WP(C) NO. 15725 OF 2019

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could not be a ground for taxing the p ersons with the damages even to the extent of 60%. It is settled law even if there was no mens rea on the part of the establishment that cannot be determining factor fro reduction or waiver. The Appellate Tribunal noticing all the facts, reduced the damages to 60% which is in my view is liable to be reduced to some extent. Since this Court had already interdicted the recovery proceedings by ordering the petitioner to deposit 30% of the 60%, I deem it fit that the damages should be confined to only 30%. Order of the Appellate Authority is modified. The writ petition is allowed in the aforementioned manner.

Sd/-

sab

AMIT RAWAL JUDGE

WP(C) NO. 15725 OF 2019

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APPENDIX OF WP(C) 15725/2019

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PETITIONER EXHIBITS

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EXHIBIT P1 A TRUE ISSUED	COPY OF BY THE	THE 1ST	NOTICE DATED 27.3.2014 RESPONDENT
EXHIBIT P2 A TRUE 27.5.20	COPY OF 14 TO E	REP XT P	LY SENS EXHIBITS DATED 1.
EXHIBIT P3 A TRUE ISSUED	COPY OF BY THE	THE 1ST	ORDER DATED 18.9.17 RESPONDENT
EXHIBIT P4 A TRUE SANS EX	COPY OF HIBITS	THE DATE	MEMORANDUM OF APPEAL D 29.10.2017
EXHIBIT P5 A TRUE IN APPE	COPY OF AL NO 5	THE 1 OF	ORDER DATED 28.3.2019 2017
EXHIBIT P6 A TRUE ISSUED	COPY OF BY THE	THE 1ST	NOTICE DATED 2.5.2019 RESPONDENT

The House of Foods and Chemicals (P)Ltd v. Employees Provident Fund Organization

Case brief

What is this about?

What did the court decide?

The House of Foods and Chemicals (P)Ltd v. Employees Provident Fund Organization

Case brief

What is this about?

What did the court decide?

What the court decided

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