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Judgment
A curious situation has arisen. The employer here has challenged an adjudication under Section 7A and Section 14B of the Employees’ Provident
Funds and Miscellaneous Provisions Act, 1952. The facts are that the employees for whose benefit the Principal Employer was to deposit provident
fund with the authorities, were all engaged through Contractors. Such contractors had been summoned by the authorities for the purpose of
assessment.
The period for default is from the years 1995 till 2004. The said contractors stated before the authorities that the records of such employees are no
longer available with them. The principal employer in this case being the writ petitioner before me, fairly admits that there may have been omissions on
its part. The employer also submits that there is equal amount of omission on the part of the authorities.
Notices have been published in the newspapers calling for claims from such employees but in vain. The authority has therefore relied on the principle
of the ‘best judgment’ to determine of such dues. The principle of best judgement is stated to have been borrowed from the principles of
assessment of default settled by the Hon’ble Supreme Court, under the pari materia provisions of Employees’ State Insurance Corporation
Act. The principal employer is stated to have provided in its books a contingent liability in this regard to the extent of about Rs. 7 crores. The figure is
disputed as the authority states that the principal employer has in fact kept a part of Rs.17 crores.
Be that as it may, at the interim stage of the proceeding before the authorities a deposit to the extent of Rs.4.28 crores and odd has been made by the
principal employer. The authorities in the final adjudication have taken the same as a self assessment by the Principal Employer. Based on the same a
figure was arrived at, which is strongly disputed by the employer. A further sum of 5 crores have also been deposited by the Principal Employer
pursuant to orders of Coordinate Bench.
There are in fact no employees to whom any assessed amount may be actually paid by the authorities. No such person has come to claim any sum till
date. The employer here says that the deposit even after calculation may be an idle formality. The authorities on the other hand contend that the
amount is mandatorily required to be kept in and maintained by them against any eventuality as conceived under the EPF Act. In the given facts there
cannot be any reasonable way on which the authorities can proceed to make fair determination or assessment of the liability of the employer. The
questions before me are as follows;-
(a) In the facts as aforesaid what is the most acceptable andreasonable test to be applied by the authorities to determine the liability of the principal
employer.
(b) Can the principal Employer’s penalty as submitted by thepetitioner be restricted to mere damages and other penal provisions under the EPF
Act without an actual deposit of the assessed amounts.
(c) Does the Act permit a defaulting Principal Employer to benefitfrom his own wrong and present fait accompli before the Authorities and this Court.
In these facts it is deemed necessary by this Court to appoint Amicus Curiae. Sri Partha Sarathi Sengupta, Learned Senior Advocate of this Court is
appointed as Amicus Curiae.The learned Advocate-on-Record for the H.S.W.C.L. shall communicate a copy of this order to the Ld. Amicus Curiae
along with all the pleadings filed and documents handed over to this by the parties. Let this matter appear on 11th June, 2018 under the same heading.
The convenience of learned Amicus Curiae may be ascertained by the Advocate.