Point of Law: S.14B of Act read as Power to recover damages.

JUDGMENT :

Sandeep Sharma, J.

By way of instant petition filed under Art. 226 of the Constitution of India, challenge has been laid to order dated 2.3.2016 Annexure P-2 passed by Provident Fund Appellate Tribunal, New Delhi, whereby appeal filed by the petitioner under S.7(i) of Employees Provident Fund and Miscellaneous Provisions Act, 1952 (hereinafter, ‘Act’ came to be dismissed.

2. Precisely, the facts, as emerge from the record, are that since the petitioner-Institution failed to deposit the provident fund and other allied dues to its employees, as per provisions of the Act and Employees Provident Fund Scheme (hereinafter, ‘Scheme’) framed thereunder, office of Assistant Provident Fund Commissioner issued a Show Cause Notice on 29.4.2014, calling upon the petitioner to show cause that why damages under S.14B and interest under S.7Q may not be recovered on account of default in making payment within stipulated period. Alongwith aforesaid Show Cause Notice, details of default committed by the petitioner-Institution were furnished, enabling the petitioner Institution to deposit the amount of damages under S.14B and interest under S.7Q of the Act, within seven days. Though, the petitioner-Institution by way of a detailed reply dated 13.5.2014 (Annexure P-16) rendered explanation for not depositing the provident fund and other allied dues within stipulated time but the Assistant Provident Fund Commissioner vide order dated 23.3.2015 (Annexure P-20) directed the petitioner-Institution to deposit a sum of Rs.95,75,435/- i.e. Rs. 64,42,965 on account of damages under S.14B and Rs.31,32,470/- on account of interest under S.7!. Pursuant to aforesaid direction, petitioner-Institution deposited Rs.31,32,470/- under S.7Q and 25% of amount levied on account of damages under S.14B and amount of Rs.48,28,671/- remained to be paid by the petitioner-Institution.

3. Being aggrieved by the order dated 23.3.2015 passed by Assistant Provident Fund Commissioner, petitioner-Institution preferred an appeal under S.7I of the Act (Annexure P-22) before Employees Provident Fund Appellate Tribunal, who vide order dated 2.3.2016 rejected the appeal, as such, petitioner-Institution has approached this Court in the instant proceedings, praying therein for quashing and setting aside order dated 2.3.2016 (Annexure P-25) passed by the Employees Provident Fund Appellate Tribunal and order dated 23.3.2015 (Annexure P-20) passed by Assistant Provident Fund Commissioner, Shimla.

4. Having heard learned counsel for the parties and perused the material available on record, this Court finds that there is no dispute regarding assessment order under S.7Q, which has attained finality, because at no stage, same ever came to be laid challenge in the superior court of law. Dispute raised in the instant proceedings is only qua damages imposed under S.14B of the Act. Though, vide order impugned in the instant proceedings, interest was also imposed under S.7Q, but since the same already stands deposited, this Court has no reason to go into the correctness of the order thereby imposing interest under S.7Q of the Act.

5. Mr. Yudhvir Singh Thakur, learned counsel for the petitioner, while making this Court peruse the reply to Show Cause Notice (Annexure P-16), vehemently argued that once factum with regard to financial condition /inability of the petitioner-Institution to pay the dues within stipulated time was brought to the notice of the authority concerned, it ought to have waived or reduced the damages. While making this Court read provisions of S.14B, learned counsel for the petitioner argued that the law makers have used the word “may” which clearly suggests that the imposition of penalty/damages, if any, by the authority under aforesaid provision of law, would depend on various factors including financial condition of the Institution seeking wager/reduction. In support