M/s Prompt Security Services vs Central Government Industrial Tribunal & Anr.

KIRTI SINGH, J. (ORAL)

The present writ petition has been filed under Article 226/227 of the Constitution of India for quashing of the order 29.4.2019 (Annexure P-5) passed by the Regional Provident Fund Commissioner, whereby the petitioner was directed to make deposit of Rs. 9,60,251/- and the order dated 26.11.2019 (Annexure P-7) passed by the learned Appellate Tribunal, whereby the petitioner was directed to deposit Rs. 2,50,000/- as a pre condition for admission of the appeal.

The facts in brief are that the petitioner, M/s Prompt Security Services, is an organization of ex-servicemen engaged in supplying security guards and skilled/unskilled manpower to various industrial and commercial establishments in and around Faridabad. On 20.07.1992, the Provident Fund Inspector visited the petitioner’s premises and inspected its records relating to the years 1989–90, 1990–91 and 1991–92. The petitioner produced its ledgers, cash books and wage registers from March 1989 to February 1990 in which the wages of the workman/guards etc. of six establishments were the ledger showing the commission received from 60 establishment from supplying manpower/guards. Thereafter, proceedings were initiated against the petitioner under Section 7A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (for short ‘the Act of 1952’). The petitioner organization received a notice dated 31.12.1992 under Section 7-A of the Act of 1952. The petitioner submitted its reply and pleaded that he was under no obligation to make provident fund deposits in respect of the workers as pointed out by the inspector in his report. However, on 16.5.1995, the petitioner received a registered letter containing the order dated 26.12.1994 passed by the Assistant Provident Fund Commissioner assessing Rs. 9,60,251/- as payable by the petitioner. The petitioner challenged the said order before this Court by filing CWP No. 10363 of 1995. Vide order dated 19.02.2018, the said petition was allowed; the impugned order was set aside and remanded the matter to the competent authority for fresh consideration under Section 7A of the Act of 1952. It is the case of the petitioner that instead of complying with the above order passed by this Court, the Regional Provident Fund Commissioner insisted the petitioner to provide the records of the employees against which the contributions of provident funds has been assessed by the Inspector. The petitioner maintained that the records had already been taken by the Inspector. The Enforcement Officer reported that the relevant records could 9,60,251/- be treated as the basis for fresh assessment. Accordingly, vide order dated 29.04.2019, the Provident Fund Commissioner again assessed the petitioner’s liability at Rs. 9,60,251/-. Aggrieved by the said order, the petitioner filed a statutory appeal before the Central Government Industrial Tribunal along with an application seeking waiver of the despoit of 75% amount. However, on 26.11.2019, the Tribunal directed the petitioner to deposit Rs. 2,50,000/- as a pre-condition for admission of the appeal. Being aggrieved therefrom, the petitioner has preferred the present writ petition before this Court.

Learned counsel for the petitioner inter alia submits that the impugned order dated 26.11.2019 passed by the learned Tribunal is illegal, arbitrary and unsustainable in law. It is submitted that the Assistant Provident Fund Commissioner had determined an amount of Rs. 9,60,251/-without duly considering the reply and material submitted by the petitioner in response to the notice issued under Section 7-A of the Act of 1952. It is further submitted that the learned Tribunal has also not considered the fact that earlier order dated 16.5.1995 was duly challenged before this Court by filing CWP No. 10363 of 1995. This Court vide while passing the final order dated 19.2.2018 observed that on 18.12.2017 the concerned Assistant Provident Fund Commissioner was directed to file an affidavit explaining the material and basis on which the amount payable had been arrived at. However, despite sufficient opportunities having been granted, the respondents failed to comply with the aforesaid direction and failed to place the requisite material before this Court. Consequently, the order dated 16.05.1995 was set aside. It is further submitted that despite passing of the aforesaid order, the respondents subsequently reiterated the very same demand by passing the order dated 29.04.2019 (Annexure P-5) without disclosing any fresh material or evidence. Thus, the subsequent order, therefore, cannot be permitted to revive a demand which had already been set aside by this Court. It is submitted that the petitioner filed an appeal under Section 7-I of the Act of 1952 along with an application under Section 7-O of the Act of 1952 seeking waiver of the pre-deposit requirement, which ought to have been considered on its own merits having regard. However, vide impugned order dated 26.11.2019, the Tribunal decided the said application while erroensouly directing the petitioner to deposit Rs. 2,50,000/- as a pre condition for admission of the appeal. Therefore, it is submitted that the impugned order be quashed and set aside.

Per contra, learned counsel for respondent No. 2 opposes the present petition. It is submitted that the learned Appellate Tribunal had rightly passed the impugned order in accordance with Section 7-O of the Act of 1952. It is further submitted under Section 7-O of the Act of 1952, the pre-deposit of the prescribed amount is mandatory for entertaining an appeal by the Appellate Tribunal under the said Act. It was further submitted that vide order dated 19.02.2018, this Court had directed the petitioner-establishment to cooperate in the proceedings under Section 7-A of the Act of 1952. However, despite the said direction, the petitioner-establishment failed to produce the requisite records before the competent authority during the course of the said proceedings. Therefore, it is submitted that the present petition be dismissed.

Heard the learned counsel for the parties and perused the record with their able assistance.

The petitioner had already availed the statutory remedy of appeal against the order dated 29.04.2019 and had also moved an application under Section 7-O of the Act of 1952 seeking waiver of deposit of 75% amount. While considering the said application, the learned Tribunal directed the petitioner to deposit Rs. 2,50,000/- as a condition for admission of the appeal. The petitioner’s grievance with regard to the assessment under Section 7-A of the Act of 1952 , including the non-consideration of relevant records and the calculation of provident fund dues, could be considered by the Tribunal while deciding the statutory appeal. Thus, this Court is of the view that the learned Appellate Tribunal had exercised its jurisdiction while considering the application under Section 7-O of the Act of 1952.

This Court finds no perversity, patent illegality or jurisdictional error in the said finding warranting interference in exercise of writ jurisdiction.

Accordingly, the instant petition stands dismissed.

Needless to say that nothing observed hereinabove shall be construed as an expression on the merits of the case.

Pending miscellaneous application(s), if any, also stands disposed of.