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Judgment
Mr. Justice Vinod K. Sharma
The petitioner has approached this Court with a prayer for issuance of a Writ in the nature of Certiorari, to quash the order, dated September 17, 2009 passed u/s 7Q of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (hereinafter referred to as the Act), order u/s 14B of the ''Act'' imposing damages for delay in deposit of the contribution, and also the executory order passed u/s 8F of the ''Act''. The admitted facts leading to the filing of the writ petition, is that the petitioner is a Co-operative society registered under the Tamil Nadu Cooperative Societies Act, 1983.
On February 24, 1994, the petitioner had employed six employees including Secretary. A joint application was submitted for voluntary coverage u/s 1(4) of the ''Act''.
The request was accepted and the petitioner was allotted Code No. 209491, covering the petitioner''s establishment w.e.f. March 1, 1994.
The petitioner committed default in deposit of the contribution and proceedings were initiated for the recovery of contribution u/s 7A of the ''Act''. As the petitioner did not comply with the orders, steps were taken for attachment of its property.
The petitioner being aggrieved by the order of attachment of the property, approached this Court by filing a writ petition which was dismissed by the Honourable single Judge.
The petitioner, however, succeeded in the Writ Appeal, and the order passed by the respondents imposing damages, interest etc., was set aside. The case was remitted back for fresh consideration in accordance with law.
Before, the matters could be finally adjudicated by the respondents, an application was filed on March 6, 2006 by the petitioner, along with the employees of the petitioner, for withdrawal from coverage under the ''Act'' and to drop all proceedings initiated under the ''Act''.
The respondents did not accept the application, and proceed to pass the impugned orders, which are under challenge in this writ petition.
The only ground on which the impugned orders are challenged, is that the petitioner is not covered under the ''Act'' by operation of law, but by way of voluntary coverage u/s 1(4) of the ''Act'', therefore, it is their option to withdraw from the coverage. Any such request made by establishment to withdraw from voluntary coverage is binding on the respondents.
In support of this contention, the learned counsel for the petitioner placed reliance on the judgment or this Court in the case of Sampath Kumaran and Co v. Regional Provident Fund Commissioner, wherein, this Court was pleased to lay down as under:
An establishment having only four employees voluntarily got itself covered under the Employees'' Provident Funds Act, 1952, by an application u/s 1(4). subsequently, when the employer was reconstituted as a partnership, the employer along with the employees sought release from the liability under the Act. On a refusal, the employer filed a writ petition to quash the order of the authorities. Held, that, notwithstanding the constitution of the employer from a proprietory one to a partnership one, since a majority of the employees together with the employer wish to withdraw from the liability under the Act the authorities are bound to release them. u/s 21 of the General Clauses Act, 1897, if a person or a body of persons can do an act for their benefit, but contemporaneously burdened with obligations, they would be in order at any time thereafter to seek for a relief of such obligations created by their voluntary act of commission by once again expressing in unequivocal terms their desire not to be burdened any more with such liabilities or obligations.
The writ petition is opposed by the respondents, on the grounds that once the establishment is covered, whether voluntary or by operation of law, it cannot opt out of the coverage of the ''Act''.
The contention of the learned counsel for the respondents, is that there is no provision under the ''Act'' permitting the withdrawal from the coverage.
This contention is based on the assertions that the ''Act'' is a beneficial piece of legislation for the benefit of the employee, therefore, the employer, cannot be permitted to withdraw from its coverage.
In support of this contention, the learned counsel for the respondents placed reliance on a judgment of the Honourable Bombay High Court in the case of Forest Development Corporation v. Regional Provident Fund Commissioner.
The reliance on this judgment is misconceived, as the Honourable Bombay High Court, did not deal with the question whether establishment is permitted to withdraw from the coverage under exercise of power u/s 1(4) of the "Act", i.e., the point involved in this case.
The matter in issue, in this writ is squarely covered by decision of this Court Sampath Kumaran and Co v. Regional Provident Fund Commissioner (supra).
In view of the fact that the petitioner prayed to withdraw from the provisions of the ''Act'', and the respondents are bound to accept the request, the proceedings initiated after the request for withdrawal, are totally without jurisdiction. Consequently, the impugned orders being without jurisdiction cannot be sustained, in law.
This writ petition accordingly allowed. A writ in the nature of certiorari is issued quashing the impugned orders. The respondents are requested to accept the request of petitioner for withdrawal from coverage. Consequently, connected Miscellaneous Petition is closed. No costs.