The EPF authorities lack jurisdiction to impose damages on an exempted establishment under section 14B of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952.

1. THE petitioners challenge the order dated 1st March, 1999 passed by the first respondent imposing damages in exercise of power purportedly conferred by section 14B of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 (hereafter referred to as the Act) as well as the notice of demand dated 28th February, 2000 issued by the third respondent.

2. MR. Sengupta, learned Senior Counsel appearing for the petitioners has invited attention of this Court to a judgment dated 13th April, 2006 rendered by a learned Single Judge of this Court in Hooghly Mills Company Limited and Anr. vs. Regional Provident Fund Commissoner and Anr., 2006(3) CHN 749, and submitted on the basis thereof that the Provident Fund authorities cannot, under section 14B of the Act, recover damages for delayed payment of contribution in Trust Fund maintained by the Board of Trustees of an exempted establishment. The first petitioner being an establishment enjoying exemption, he contended that the first respondent committed jurisdictional error in imposing damages. He has next placed the unreported Division Bench decision of this Court dated 26th September, 2008 passed in M.A.T. No. 1944 of 2006 whereby the judgement dated 13th April, 2006 referred to above has been upheld. Accordingly, it was submitted that since the issue raised in this writ petition is covered by the Division Bench decision of this Court, the impugned order as well as the impugned notice of demand may be set aside and the bank guarantee which the petitioner offered in terms of the initial order passed by this Court while entertaining the writ petition may be allowed to be withdrawn.

3. MR. Prasad, learned Counsel representing the respondents, has opposed the prayer made in this writ petition.

4. IT has been submitted by him that the petitioners by filing a supplementary affidavit, and annexing thereto copy of the judgement dated 13th April, 2006 have sought to change the nature and character of the lis. In particular, he has invited the Court's attention to the grounds of the petition to contend that the point on which the petition in Hooghly Mills Company Ltd. and Anr. vs. Regional Provident Fund Commissioner and Anr. (supra) was decided has not at all been raised in this petition. Secondly, it was argued by him that the decision of the Division Bench would have prospective application and cannot apply retrospectively so as to govern the rights of the parties existing on the date the present petition was moved. In fact this also appears to be the stand taken by the respondents in their affidavit-in-opposition.

5. FINALLY, he has submitted that challenging the decision of the Division Bench dated 26th September, 2008 dismissing the appeal filed by the Regional Provident Fund Commissioner, a special leave petition has been preferred before the Supreme Court and that upon condonation of delay in filing the same, notice has been directed to be issued. The petition is due to be listed soon for hearing and, accordingly, he has made a prayer for adjournment of hearing of this petition till such time the Supreme Court decides the issue.

6. MR. Prasad, however, has conceded that the issue raised by MR. Sengupta on the point of jurisdiction of the first respondent to impose damages against the first petitioner is covered by the judgment and order of the learned Single Judge in Hooghly Mills Company Ltd. (supra), since merged in the decision of the Division Bench. In view thereof, this Court finds no reason to accept any of his contentions. It is true that in the writ petition the point argued by Mr. Sengupta has not been raised. However, it is a pure question of law touching the jurisdiction of the first respondent which could be raised at any stage of the proceedings particularly when it has not been disputed before this Court that the first petitioner is an exempted establishments. Now that there is an authoritative pronouncement to the effect that the power to impose damages c