Point of Law : Provision of Section 14B explicitly employs the term “may” recover, which when read with corresponding Rule 32B, further cements discretion provided to authorities vide Act of 1952 and their corresponding Rules, to exercise their discretion in imposing penalty and/or reduce it thereof.

ORDER :

1. The present petition is filed against the impugned order dated 19.02.2010 passed by Presiding Officer, Employees Provident Fund Appellate Tribunal, New Delhi in ATA 509(12) 2006, titled as Rajasthan State Mines and Minerals Ltd. vs. Assistant Provident Fund Commissioner Jaipur and against the order dated 04.08.2006 passed by Assistant Provident Fund Commissioner Jaipur under Section 14B of the Employees Provident Fund and Misc. Provisions Act, 1952.

2. Learned counsel for the petitioner has submitted that the order(s) dated 19.02.2010 and 04.08.2006 have been passed in contravention of the settled position of law and while passing the said orders, the respondents have neither considered the relevant facts of the case nor have they abided by the mandate of the ad rem statutory provisions pertaining to the imposition of penalty by way of damages and the corresponding charges on interest. Hence, the impugned orders are non-est and void ab-initio.

3. In this background, while praying for the quashing of the orders referred herein-above, learned counsel for the petitioner has apprised the Court of the brief and relevant factual matrix of the present petition. It is submitted that the petitioner is an enterprise of the Government of Rajasthan, which is engaged in the mining of rock phosphate, lignite, gypsum, silica and limestone. The petitioner is covered by the mandate of The Employees Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter, ‘Act of 1952’) and the Employee’s Pension Scheme of 1971. However, the provisions of the Act of 1952 were applicable to the petitioner only to the extent that the petitioner is an exempted establishment under Section 17(1)(a) of the Act of 1952. The petitioner-company, with a resolve to benefit its employees, proposed to introduce a pension scheme titled, ‘RSMDC Ltd. Employee’s Pension Regulations, 1994’; in lieu of the Employee’s Pension Scheme of 1971. The Board of Directors of the petitioner-company resolved to implement the said Regulations of 1994 w.e.f. 1.04.1994. Meanwhile, during the period when the said Regulations of 1994 were being finalized, the Central Government, namely the EPF Department introduced the ‘Employee’s Pension Scheme, 1995’.

4. At this juncture, it was submitted by the learned counsel for the petitioner that considering the fact that the implementation of the petitioner-company’s Regulations of 1994 was to be carried out w.e.f. 01.04.1994, the petitioner-company entered into a dialogue with the Assistant Provident Fund Commissioner regarding the compliance and modalities for the grant of exemption from the Pension Scheme of 1995, as introduced by the Central Government. Subsequently, taking into account the factum of resistance and unrest from the employees of the petitioner-company qua the Scheme of 1995 and after further considering the fact of the probable implementation of the Regulations of 1994, subject to the examination by the Committee formed by the Board of Directors; the petitioner-company decided to avail the benefit of Paragraph 39 of the Scheme of 1995, which provides establishments exemptions from the operation of the Pension Scheme of 1995. Therefore, relying upon the benefit envisioned in Paragraph 39, the petitioner-company did not make contributions to the pension fund.

5. Thereafter, since there was a delay occurring in the finalization of the Pension Regulations of 1994, which were to take effect from 01.04.1994; vide communication dated 23.12.1996, it was suggested by the P.F. Authorities that the amount of pension contribution be remitted to the pension fund by the petitioner-company and the same would be refunded, subject to the grant of exemption under Paragraph 39 of the Pension Scheme of 1995. In light of the said suggestion, the petitioner-company deposited the due amount on 23.12.1996. Moreover, upon a finalization of the Regulations of 1994, the petitioner-company submitted an application under Paragraph 39 of the Schem