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TMI Blog1997 (6) TMI 370X X X X Extracts X X X X X X X X Extracts X X X X ..... e impugned order. A show cause notice was served on the appellants requiring them to show cause why damages made under Section 14-B of the Act should not be levied against them for the delay in making the payment for the aforesaid period. It was contended that though delay was alleged in making payment in March, 1975, the show cause notice for the same had been given only on November 24, 1984 and because of the long lapse of time between the period of delay and the show cause notice, the appellant could not effectively exercise its right to explain the circumstances relevant for the purpose. It was, therefore, submitted that the impugned order was illegal, and deserves to be quashed. It was further contended that the appellant/industry had suffered recession in 1970 and was facing financial difficulties and that was the reason for not making the payment in time, and that the authorities should have taken into consideration these facts while fixing the amount of damages and since it has not been done, the impugned order is illegal. 2. The learned counsel for the respondent submitted before the learned single Judge that no period of limitation is prescribed for initiating action f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. It was also pointed out from the table annexed to the impugned order that in some cases 100% levy of damages was made and in a few cases 50% and in the rest of the cases ranging from 20% to 40%. 5. W.P. No. 9609 of 1988 : This writ petition was filed by the appellant in W.A.No. 992 of 1995, to call for the records relating to the order of the respondent in Ref.No. TN/SDC/7832/Accts/88 dated March 24, 1988 and to quash the same. This writ petition was argued by Mr. V. Manivannan. Under the order impugned in this writ petition, the petitioner was directed to remit the following amount by way of damages. SI.No Amount Account to which it relates i) The Provident Fund contributions Rs.2,01,905-45 in EPF A/C.No. 1 ii) The Administrative charges 5,467.60 2 iii) Family Pension Fund contributions 31,800-40 10 iv) Deposit Linked Insurance Contributions and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order is vitiated. 7. Mr. P. Narasimhan, learned Senior Central Government Standing Counsel, in reply to the arguments of the learned counsel for the appellant and the writ petitioner, first invited our attention to Rule 38 of the Employees' Provident Fund Scheme, 1952, which deals with the mode of payment of contribution. The said rule provides that the employer shall, before paying the member his wages in respect of any period or part of period for which contributions are payable, deduct the employee's contribution from his wages which together with his own contribution as well as administrative charges of such percentage of the pay (basic wages, dearness allowance, retaining allowance, if any, and cash value of food concessions admissible thereon) for the time being payable to the employees other than an excluded employee, and in respect of which provident fund contributions are payable, as the Central Government may fix, he shall within fifteen days of the close of every month pay the same to the Fund by separate bank drafts or cheques on account of contributions and administrative charges. 8. Placing reliance on the above Rule, Mr. P. Narasimhan argued that sinc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not. As such, the provident fund payments made after the due date will attract the penal damages under Section 14-B of the Act, fifty percent of the contributions defaulted are actual amounts deducted from the wages of the employees. The petitioner has failed to remit even these amounts in time. The respondent, as pointed out by Mr. P. Narasimhan, is striving its best to give optimum benefits to the provident fund subscribers. But, when the income to the Fund suffers a set back on account of defaults, it is forced to give a lesser benefit than what would have been possible if there had been no defaults. All belated payments cause loss of interest on investments besides increasing the cost of administration besides causing pecuniary loss to the Fund. The members are also put to inconvenience. Mr. P. Narasimhan also contended that in the instant case, the employees' share though deducted was not remitted, which amounts to misappropriation and attracts action under Sections 405, 406 and 409 of the Indian Penal Code. 11. In our view, though the employer is required to remit both the employees' as well as the employer's contribution together with administrative charges be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1985, which is the subject matter of W.P.No. 4454 of 1986, a sum of Rs. 5,37,457-80 has been levied by way of damages. 50% of the same comes to Rs. 2,68,728-90. It can be rounded off to Rs. 2,67,000/-. The appellant shall pay the same in three instalments of Rs. 89,000 each. The first instalment shall be made on or before July 15, 1997, the second instalment on or before August 15, 1997 and the third instalment on or before September 15, 1997. If the appellant fails to pay any one of the instalments within the time stipulated, the respondent is at liberty to proceed against the appellant for recovery of the entire amount levied under the impugned proceedings. 15. In the writ petition, under the impugned proceedings, a sum of Rs. 2,47,589-95 was levied by way of damages. 50% of the same comes to Rs. 1,23,794-97. The petitioner shall pay a sum of Rs. 1,20,000/- instead of Rs. 1,23,794-97. The petitioner shall pay the said damages of Rs. 1,20,000/- in three equal instalments of Rs. 40,000/- each, the first instalment shall be made on or before October 15, 1977, the second instalment on or before November 15, 1997, and the third instalments on or before December 15, 1997. If the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X
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