IMPORTANT POINT
Directors can be held liable for non-remittance of provident fund contributions, and late payments do not absolve prior violations.

JUDGMENT :

(Bibhas Ranjan De, J.) :

1. In the present application the challenge is the proceedings in connection with G.R. Case no. 7492 of 2015 arising out of Khardah Police Station case no. 1060/15 dated 18.12.2015 under Sections 406/409/420/120B of the Indian Penal Code (for short IPC) presently pending before the Court of Ld. Additional Chief Judicial Magistrate (for short ACJM), Barackpore.

Background:-

2. On 18.12.2015 the Inspector of Enforcement, Employees’ Provident Fund and Miscellaneous Organization, SRO, Barackpore lodged a written complaint with the officer in-charge of Khardah Police Station inter alia alleging the commission of offence under Section 406 of the IPC. The allegation leveled in the said complaint is to the effect that the petitioner no.1/company is covered under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (for short EPF and MP Act) under code no. 338. It has been alleged that as per provisions of Section 6 of the said act read with paragraph 38 of the Employee’s Provident Fund Scheme, 1952, the petitioner no.1 is required to pay the employees’ share of provident fund contribution deducted from the salaries/wages/amount on or before 15th of the following month to the Statutory Provident of the Central Board of Trustees. It was alleged that when the complainant went on inspection of the said mill of the petitioner no.1/ company, it was noted by him that the petitioner no. 2 had deducted a sum of Rs. 15,91,619/- from the wages/salaries of the employees for the period months of October and November of 2015 and the same amount was not remitted with the statutory fund.

3. On the basis of the aforesaid complaint, a case being no. Khardah Police Station case no. 1060/15 was registered against the petitioners herein under Section 406 of the IPC. During investigation, the Investigating Officer made a prayer for adding further Sections 409/420/120B of the IPC as it was revealed that there was a non-remittance of the said amount being Rs. 15,91,615/- by the petitioners. The prayer was allowed by the Ld. ACJM, Barackpore vide an order dated 20.08.2016 and the charges under Sections 409/420/120B of the IPC were added subsequently.

Argument advanced:-

4. Ld. Counsel, Mr. Moyukh Mukherjee, appearing on behalf of the Petitioners has advanced a two folds argument. To begin with, it is submitted that petitioner no. 2 herein, being a Director of a company cannot be termed as employer within the meaning of Section 2(e) (i) (ii) of the EPF and MP Act, 1952.

5. In addition to, Mr. Mukherjee has submitted that the proceedings was initiated for non-deposit of the share of provident fund of the employees within the stipulated period. But, all the outstanding dues for the months of October and November, 2015 has already been paid by the petitioners although after statutory period. Mr. Mukherjee has further submitted that outstanding amount was paid on 18.12.2015 and 06.01.2016.

6. Mr. Mukherjee, thereby, has made an effort to impress this court that the liability of the petitioners/company has been absolved after payment of the outstanding dues even beyond statutory period.

7. In support of his contention, Mr. Mukherjee, has relied on the following cases:-

- Adoni Cotton Mills Limited v. Regional Provident Fund Commissioner reported in 1992 0 Supreme (SC) 391

- Air Transport Corporation & Ors. v. State of West Bengal & Anr. reported in 2006 SCC OnLine Cal 164

- Jasoda Glass and Silicate and others v. Regional Provident Fund Commissioner and others reported in 2001 SCC OnLine Cal 542.

- Employees’ State Insurance Corporation v. S.K. Aggarwal and others reported in (1998) 6 Supreme Court Cases 288

- Howrah Motor Company Limited & Ors. v. Samir Kumar Das reported in 2004 SCC OnLine Cal 430.

8. Before parting with Mr. Mukherjee, submitted that the judgements relied on behalf of the opposite parties did not refer the observation of the Hon’ble Apex Court in Adoni Cotton Mills (supra). As a sequel, the jud