IN THE HIGH COURT OF JHARKHAND AT RANCHI.
W.P. (C) No. 6592 of 2007
with W.P. (C) No. 6617 of 2007
...
M/s. Binod Kumar Jain, Bokaro ... Petitioner [In W.P. (C) No. 6592 of 2007]
M/s. Suraj Lal Singh, Bokaro ... Petitioner [In W.P. (C) No. 6617 of 2007]
-V e r s u s-
1. Provident Fund Commissioner, E.P.F.O., Ranchi
2. Assistant Provident Fund Commissioner, E.P.F.O., Ranchi.
3. Enforcement Officer, E.P.F.O., Ranchi. ... Respondents [In both cases].
...
CORAM: - HON'BLE MR. JUSTICE D.G.R. PATNAIK.
...
For the Petitioners : - M/s. Kalyan Roy & R.M. Singh, Advocates. [In both cases]
For the Respondents : - Mrs. Banani Verma, Advocate [In both the cases]
...
7/20.08.2009
Both these writ applications are heard together and disposed of by this
common order.
2. Heard Mr. Kalyan Roy, learned counsel for the petitioners and Mrs.
Banani Verma, learned counsel for the Respondent No. 2.
3. The petitioners in these two writ applications have challenged the order
dated-24.09.2007, passed by the Respondent No. 2 in the proceedings under Section 7 A
of the E.P.F. and M.P. Act, whereby the petitioners were directed to deposit the amounts
specified in the orders, which had purportedly accrued by way of arrears of deposit
towards P.F. contributions, from July, 2003 to July, 2006, together with interest
calculated thereon.
4. By an amendment in both the writ applications, the petitioners have
introduced the orders passed by the Reviewing authority under Section 7 B of the Act on
the Review applications filed by the petitioners and have prayed for quashing the orders
passed by the Reviewing authority.
5. For realization of the amounts assessed against the petitioners, the Bank
accounts of the petitioners were attached. However, by order dated 22.01.2008, passed by
this Court in both these writ applications, the Bank account was ordered to be released
from attachment upon the petitioners’ depositing 50 per cent of the principal amount
assessed against them in the impugned order under Section 7 A of the Act, subject to the
final result of both the writ applications.
6. The contention of the learned counsel for the petitioners, in both these writ
applications are that the petitioners have deposited the amounts of P.F. of their respective
employees between the period, March, 2002 to August, 2006. The amounts on enhanced
V.D.A. for about two months could not be deposited as because the petitioners had no
information about the Government Notification regarding the enhanced V.D.A. and in
absence of such information, the petitioners could not deduct the P.F. contributions at the
enhanced rate of V.D.A. from the workmen.
Learned counsel adds that before the concerned authorities in the
proceedings under Section 7 A of the Act, the petitioner had disputed the calculations
made by the Enforcement Officer regarding the arrears amount of deposit towards the
E.P.F. funds. Learned counsel adds that without considering the statements made by the
petitioners and acting entirely upon the wrong calculations submitted by the Enforcement
Officer, the concerned authority had passed erroneous orders under Section 7 A of the
Act against the petitioners directing them to deposit the amount specified there under.
Learned counsel adds that both the petitioners had submitted their
respective applications for review of the order before the concerned authority under
Section 7 B of the Act. The applications were summarily rejected by the Reviewing
authority without affording any opportunity to the petitioners of being heard and merely
on the ground that the applications were not filed in the prescribed format and that the
applications have been filed belatedly.
Learned counsel submits that the Reviewing authority had not
applied its judicial mind to the facts pleaded by the petitioners and to the materials
available on record and has merely adopted the findings recorded in the order passed
under Section 7 A of the Act. Learned counsel explains that the authorities while
disposing of the proceedings under Sections 7 A and 7 B of the Act, have seriously erred
in failing to take into consideration the petitioners’ categorical statement that the
calculations made by the Enforcement Officer was erroneous and the further statement
that the petitioners were not aware of the enhancement made by the Government in the
V.D.A. According to the learned counsel, even if the deposits could not be made on the
basis of the enhanced V.D.A., the petitioners cannot be made liable to pay any interest on
the accrued amount.
7. Per contra, learned counsel for the Respondents would submit that the
instant writ applications are not maintainable in view of the fact that the petitioners ought
to have availed the statutory remedy of appeal before the Appellate Tribunal under the
provisions of Section 7 (I) of the Act.
Mrs. Benani Verma would argue that the provisions under Section
7 B of the Act do not impose any obligation upon the concerned authority to issue notice
to the parties, if it proposes to reject the Review application. Such opportunity of being
noticed in advance and of being given opportunity of hearing, could be demanded only in
case whether the concerned authority proposes to grant the application for review.
Learned counsel adds further, that even as admitted by the
petitioners, they had failed to deposit the P.F. amounts on the basis of the enhanced
V.D.A. rates and in this view of the matter, there is no error or perversity either in the
order passed under Section 7 A of the Act or on the Review application filed by the
petitioners.
8. I have heard the learned counsels for the parties and have also gone
through the impugned orders passed under Section 7 B of the Act.
As it appears, the impugned orders rejecting the application of the
petitioners under Section 7 B of the Act, have been passed mainly on the ground that the
applications for review have not been filed in the prescribed Form 9 and that the
applications were filed beyond the period of limitation of 45 days from the date of
making the order under Section 7 A of the Act. As regards the merits of the contentions
raised by the petitioners in the Review application, the reviewing authority has merely
examined the records available in the office and has endorsed the findings recorded by
the concerned authority in the proceedings under Section 7 A of the Act. Apparently, the
specific grounds pleaded by the petitioner have not been adverted to by the Reviewing
authority, nor have the petitioners been afforded any opportunity to explain the
documents which they had produced in the proceedings.
9. The contention of the learned counsel for the Respondents that the
Reviewing authority had no obligation to offer any opportunity to the petitioners of being
heard or to explain the matters, does not appeal to reason and appears to be
misconceived. Merely because, the provisions under Section 7 B of the Act, specifically
provides that if the application for review is granted, then before granting, the party
should be given prior notice and be heard and because such corresponding requirement
has not been mentioned specifically in case where the authority concerned proposes to
reject the application, it does not lay down that the petitioner should be deprived of an
opportunity of being heard. The principles of equity and natural justice do certainly apply
and would demand that before passing any order, which lead to civil consequences
adverse to the interest of the petitioners, a reasonable opportunity has to be given to them
to explain their case before passing any such order. I am satisfied from the submissions
made by the learned counsel for the petitioners that reasonable opportunity of hearing has
not been given to them by the Reviewing authority before passing the impugned order on
the Review application. Accordingly, both these writ applications [W.P. (C) No. 6592 of
2007 and W.P. (C) No. 6617 of 2007] are allowed. The impugned order of the Reviewing
authority dated-24.09.2007 passed on the Review applications of the petitioners, are
hereby set aside. Accordingly, I remand this matter to the Reviewing authority for
passing a fresh order on the review applications filed by the petitioners. The petitioners
shall appear before the Reviewing authority within 15 days from the date of this order,
whereafter the Reviewing authority shall fix and communicate an appropriate date to
enable the petitioners to submit their explanations/grounds and thereafter pass an
appropriate, speaking and reasoned order in accordance with law on the Review
Applications.
10. Let a copy of this order be given to the learned counsel for the parties.
(D.G.R. Patnaik, J.)
APK