The cash canteen subsidy is classified as the cash value of any food concession, thus included in dearness allowance under the EPF Act, subject to provident fund contributions.

JUDGMENT :

(A.S. Supehia, J.)

1. The Courts time and again have been confronted with the litigation relating to the interpretation of the expression “the cash value of any food concession” as used in section 2(b)(i) and Explanation 1 to Section 6 of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter referred to as the “EPF Act, 1952”). The present appeal stems out from such issue.

2. The present appeal filed under Clause 15 of the Letters Patent, 1865, is directed against the judgment and order dated 10.01.2011 passed by the learned Single Judge allowing the writ petition filed by the respondent – Reliance Industries Ltd., (hereinafter referred to as the “the Industries”) assailing the order dated 20.01.2000 passed by the Appellate Tribunal, New Delhi, dismissing the appeal of the respondent – Industries, while confirming the orders dated 25.06.1998 passed by the Regional Provident Fund Commissioner, Vadodara under Section 7A of the EPF Act, 1952 and the order dated 01.06.1999 passed by the respondent – Regional Provident Fund Commissioner

BRIEF FACTS :-

3. The dispute between the appellant – IPCL Employees Association and the Industries pertain to “the Canteen Subsidy”, which is being paid at the rate of Rs.475/- per month to the members of the appellant-Association. The entire case of both the parties’ hinges on the provisions of Section 2(b) and Explanation-1 to Section 6 of the EPF Act, 1952.

4. A settlement dated 09.08.1995 under Section 12(3) and Section 18(3) of the Industrial Disputes Act, 1947 (the I.D. Act) was arrived at between the Association and the respondent- Industries, which contained clause 17, increasing the canteen subsidy from Rs.300/- to Rs.475/-. The said settlement does not contain any explanation as to whether the canteen subsidy will form part of basic wages or dearness allowance.

5. Ultimately, the dispute landed before the EPF authorities and after hearing both the parties, the respondent – Regional Provident Fund Commissioner passed an order on 25.06.1998 concluding that the “Cash Canteen Subsidy”, is in the form of “dearness allowance” and would attract the contribution under the EPF Act, and hence, the Industries are liable to contribute such amount. Such order is passed in the proceedings under Section 7-A of the EPF Act, 1952 by the employees’ Association. Thus, it is held by the respondent – Regional Provident Fund Commissioner that the “Cash Canteen Subsidy” being in the form of dearness allowance would attract the provident fund and the Industries are liable to pay the provident fund on canteen subsidy since June, 1996. The contention of the Association to treat the cash canteen subsidy as part of basic wages has been rejected.

6. The Industries, thereafter, moved an application seeking review of the said order under Section 7-B (1) of the EPF Act, 1952. The contention was raised by the Industries in the review application was that the canteen subsidy, which is paid to the appellant - employees does not fall within the definition of “basic wages”, as defined under Section 2(b) of the said Act, and therefore, it cannot form part of dearness allowance, as envisaged under Section 6 of the EPF Act, 1952. The review application was rejected vide order dated 01.06.1999. The respondent – Industries assailed the said orders under Section 7-A of the EPF Act, 1952 by filing an appeal under Section 7-I of the EPF Act, 1952 before the Appellate Tribunal, New Delhi. After hearing both the parties, the Appellate Tribunal, New Delhi vide its order dated 20.01.2000 dismissed the appeal and confirmed the orders dated 25.06.1998 and 01.06.1999 passed by the respondent No.1, however modified the order passed under section 7-A to the extent that the Industries shall pay the contribution on cash value of food concession from the date of order of 7-A or from the date when employees’ share was deducted or whichever is earlier. These orders were subject matter of challenge before the