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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
(A.B. Chaudhari. J.)
R. V. P. R. T. AYURVED MAHAVIDYALAYA, AKOLA - Petitioner.
Vs.
ASSISTANT PROVIDENT FUND COMMISSIONER, and others - Respondents.
W. P. Nos. 4590 and 6064 of 2005
Decided on 4-5-2007.
Advocates Appeared
In W. P. No. 4590 of 2005 :
For petitioner: A.M. Ghare.
For respondent Nos. 1 and 3 : R.S. Sundaram.
For respondent No.2: S.Y. Deopujari, A.G.P.
In W. P. No. 6064 of 2005 :
For petitioner: A.M. Ghare.
For respondents No. 1 and 3 : R.S. Sundaram.
For respondent No.2: O. D. Kakde, A.G.P.
Merely because the petitioner has amended the writ petition and sought a direction to the State Government for releasing the employer’s contribution towards provident fund it cannot be said that the the Court should me-chanically hold that the matter would pertain to Division Bench. That the Court is under duty to adjudicate upon the correctness or otherwise of the impugned orders made by the provident fund authority and the appellate authority. The Court, therefore strongly feels that it should not abdicate its function of deciding the validity of those orders which under the Appellate Side Rules as per Entry No. 29 is required to be decided by the single Judge. The argument made by Mr. Ghare that the petition should be transferred to Division Bench for hearing is therefore rejected.
Employees Provident Funds and Miscellaneous Provisions Act, 1952 - Section 6 - Contribution toward s provident fund. - The grant-in-aid that has been given by Government to Educational Institutions is for payment of salary to employees and there is no component of payment of employer’s contribution under grant- in-aid scheme.
Insofar as the issue regarding grant-in-aid is concerned in Court’s opinion the Government of Maharashtra has been providing for 8.33% by way of grant for payment of employer’s contribution since over 35 years to the aided colleges. In Court’s opinion providing for grant-in-aid to a new school or college for spreading education is with a view to help the newly opened institution to settle for catering to the need of the society. Insofar as payment of provident fund contribution under the provisions of the Act is concerned the Central Act clearly provides that it is the responsibility of the employer to make payment of the employer’s contribution towards provident fund. Section 6 of the Act read thus :
"6. Contributions and matters which may be provided for in the scheme. - The contribution which shall be paid by the employer to the Fund shall be (ten per cent) of the basic wages (dearness allowance and retaining allowance, (if any) for the time being payable to each of the employees (whether employed by him directly or by through contractor) and the employees contribution shall be equal to the contribution payable by the employer in respect of him and may, (if any employee so desires be an amount exceeding (ten per cent) of his basic wages dearness allowance and retaining allowance (if any) subject to the condition that the employer shall not be under an obligation to pay any contribution over and above his contribution payable under this section) : (Provided that in its application to any establishment or class of establishments which the Central Government after making such inquiry as if deems fit. May, by notification in the Official Gazette specify, t his section shall be subject to the modification that for the words (ten percent), at both the places where they occur the words (twelve per cent) shall be substituted.)
The grant-in-aid that has been given by the Government of Maharashtra to the institutions is for payment of salary to the employees and there is absolutely no component of payment of employer’s contribution under the grant-in-aid scheme, I fail to understand when the central legislation obligates the employer to make payment of employer’ s contribution towards provident fund and no responsibility is cast on the State Government still the Government of Maharashtra took the responsibility of paying 8.33% of petitioner/ employer’s contribution. It is true that the progressive State like Maharashtra might be justified in making payment of cent per cent grants to the payment of salary of employees but insofar employer’s share of contribution towards provident fund is concerned neither the Central Act nor the State Act nor the Contribution of India and in particular Article 337 of the Constitution provide for any such obligation of the State. There does not appear to be any justification for the Government of Maharashtra which is reeling under the financial stress to make payment towards employer’s contribution to the provident fund organization for the institutions which are being paid cent per cent grants for the salary of teaching and non-teaching employees. The Hon’ble Supreme Court in paragraph 141 in the case of T.M.A. Pai Foundation v. State of Karnataka and others, reported in JT 2002 (9) SCJ : 2002 (8) SCC 481, has observed thus :
The grant of aid is not a constitutional imperative. Article 337 only gives the right to assistance by way of grant to the Anglo-Indian community for a specified period of time. If no aid is granted to anyone, Article 30(1) would not justify a demand for aid and it cannot be said that the absence of aid makes the right under Article 30(1) illusory. The founding fathers have not incorporated the right to grants in Article 30 whereas they have done so under Article 337 what then is the meaning, scope and effect of Article 30(2)? Article 30(2) only means what it states viz. that a minority institution shall not be discriminated against when aid to educational institutions is granted. In other words the State cannot when it chooses to grant aid to educational institutions deny aid to a religious or linguistic minority institution only on the ground that the management of that institution is with the minority. We would however like to clearify that if an abject surrender of the right to management is made a condition of aid, the denial of aid would be violative of Article 30(2). However conditions of aid that do not involve a surrender of the substantial right of management would not be inconsistent with constitutional guarantees even if they indirectly impinge upon some facet of administration. If however aid were denied on the ground that the educational institution is under the management of a minority, then such a denial would be completely invalid.
Following the aforesaid decision of Supreme Court the Division Bench of the Court in the case of Keralayeeya Samajam and others v. State of Maharashtra and others reported in 2004 (2) Mh LJ 171 : 2004 (3) Bom CR 723, observed in paragraph 18 as under :
Thus, grant-in-aid cannot be claimed as of right. There is no legal or constitutional right insofar as grant- in-aid is concerned. The Rules set out above themselves make the aforesaid aspect clear. The rules provide for grant-in-aid from public funds. All grants are subject to availability of funds and no secondary school can claim the same as of right. Therefore even if the petitioners are in a position to apply for g rant-in-aid despite the condition set out in the permission granted to them yet there is no enforceable right of the petitioners by which they can compel authorities to either consider their request or grant them aid. This aspect is not at all disputed before Court. If there is paucity of funds which fact is also not disputed the State cannot be compelled to pay grant even if the funds are not available to each and every school more so to the schools who have accepted to open them on permanent no grant basis.
Following the aforesaid observation, Court holds that there is no substance in the ground raised by the petitioner to question the validity of the impugned order. Since as observed above, it is neither a legal nor constitutional right of the petitioner to claim grant from the State Government the claim as made by the petitioner is also without any merit. In Court’s opinion considering the position that the State is under tremendous financial pressure and there is no obligation any- where for the Government of Maharashtra to make payment of employer’s contribution towards the provident fund, it will be necessary for the State of Maharashtra to reconsider its policy to make payment of even 8.33% employer’s contribution to the provident fund organization.
In the result, the impugned orders made by respondents 1 and 3 are legal and correct and the same are hereby confirmed. Insofar as the petition pertaining challenge to the said orders is concerned same is dismissed. Insofar as prayer Clause A(1) to the writ petition is concerned, Court does not decide the validity thereof and leave the petitioner to claim relief if the petitioner has any legal right by filing an independent petition. Consequently, Court does not decide the validity of the communication dated 10.12.2002 nor does Court decide the second part of the prayer in prayer Clause A(1) keeping liberty open to the petitioner to challenge the same or seek direction as in prayer Clause A(1).
2. These petitions are treated as under Article 227 of the Constitution of India. These petitions involve common question of law and therefore they are being disposed of by this judgment. The orders made by respondents 1 and 3 are under challenge. By amending the writ petition, the petitioner has introduced prayer Clause A(1) to question the validity of communication dated 10-12-2002 issued by respondent No.4 Annexure-E.
3. Facts:
The petitioner is an Ayurved College situated at Akola receiving cent per, cent grants from the Government of Maharashtra for payment of salaries to all the teaching and non-teaching employees. On 30-3-2005 the first respondent made an order under the provisions of section 7A of Employees Provident Fund and Miscellaneous Provisions Act, 1952 (for short the Act) directing the petitioner to deposit an amount of Rs. 06,02,802/- towards the difference of provident fund amount for the period from October, 1997 till February, 2003. The said order made by the 1st respondent was confirmed in appeal by the Appellate Authority, who is respondent No.2 herein.
4. Arguments:
Mr. Ghare, learned counsel for the petitioner in both the petitions, at the outset pointed out to me that by amendment prayer Clause A(1) been inserted in the writ petition with appropriate pleadings at appropriate place and amended prayer has been made for issuing directions to respondent No. 2 - State of Maharashtra, to release the Provident Fund contribution to the petitioner-employer in entirety and, therefore, he submitted that the petition will have to be now heard by the Division Bench. He then pointed out Rule 4 of Chapter XVII of the Bombay High Court, Appellate Side Rules, 1960 and argued that since the matter pertains to Division Bench, this Court cannot decide the present writ petition.
5. Mr. Ghare, learned counsel for the petitioner in both the petitions, argued that admittedly the petitioner has been receiving cent per cent grants from the Government of Maharashtra towards the payments of salary of its teaching and non-teaching employees since the beginning. He then argued that not only that, the Government of Maharashtra has admittedly been paying the provident fund contribution of the employer at the rate of 8.33% along with the salary grant from the beginning. He then stated that the rate of provident fund contribution came to be enhanced from 8.33% to 10% and thereafter to 12%. He therefore submitted that the difference of 3.67% with effect from October, 1997 till February, 2003 due to revision of rate by the Central Government has to be paid by the Government of Maharashtra as the Government of Maharashtra was paying at the old rate of 8.33%. He then submitted that the petitioner being cent per cent aided by the Government and not having any other independent income, the State Government was liable to pay the said difference of amount in satisfying the liability projected by the Provident Fund Organization. To a specific query by the Court as to whether the petitioner had any other ground to challenge the orders of the Provident Fund Organization, Mr. Ghare candidly submitted that there was no other ground for challenging the said orders except the ground that it was the Government of Maharashtra which was responsible to make the payment of difference of provident fund amount and not the petitioner-employer.
6. Per contra, Mr. Sundaram, learned counsel for respondents 1 and 3, submitted that the provident fund organization was concerned in recovering the provident fund contribution of the employer and employees and the organization was under statutory obligation to implement the provisions of the Act and the scheme thereunder. He then submitted that the Central Act does not in any way provide for any such facility or concession to the employer to claim the employer's contribution from any of the Governments nor the same could be a reason to resist t
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