There is no period of limitation for initiating a proceeding under section 14-B of the Act, 1952, and the principles of natural justice and consideration of prejudice by the employer are crucial in such cases.

JUDGMENT

Rajesh Shankar, J. - The present writ petition has been filed for quashing the order dated 31st July, 2007 passed by the Regional Provident Fund Commissioner-II, Ranchi whereby the petitioner-Damodar Valley Corporation (DVC) has been held liable for payment of damage and interest under section 14-B and 7Q of the Employees Provident Fund and Misc. Provisions Act, 1952 (for short ''Act, 1952'').

2. The factual background of the case, as stated in the writ petition, is that the employees working in the factory of the petitioner-DVC were granted exemption under section 17(1) of the Act, 1952 vide Approval Order of the Regional Provident Fund Commissioner being Order no.R-Ex-077/WB/ Rules/8702 dated 03.09.1966, hence the petitioner-DVC is governed by the Provident Fund Rules of Employees Contributory Provident Fund DVC, 1962. From the commencement of the Employees'' Pension Scheme, 1995 w.e.f. 16th November, 1995, 8.33% of the employees'' pay was directed to be remitted by the employer to the Employees Provident Fund. The respondent vide Letter no.JH/RAN/Circle: 14/D/JH/1683/CA/733 dated 16.06.2005 made demand of Rs. 13,10,882/- from the petitioner-DVC under A/C-1, A/C no.2, A/C no.10, A/C no.22 on the alleged delayed payment of PF dues for the period from 6/88 to 7/02. The petitioner no.2 vide Letter no.SR.ACAO/ STPS/ACCOUNTS/ Cont/ EPF/ 1313 dated 13th October, 2005 made objection to the alleged demand. However the respondent vide Order No.RO/RNC/Damages/JH/1683/06/ 488 dated 31.07.2007 held the petitioners liable to make payment of damage and interest on account of delayed payment of Provident Fund for the period from 6/88 to 7/02.

3. Learned counsel for the petitioners submits that Paragraph 32(A) of the Employees'' Provident Funds Scheme, 1952 empowers the Central Provident Fund Commissioner to initiate a proceeding under Sections 14(B) and 7(Q) of the Act, 1952 as such, the Regional Provident Fund Commissioner-II, Ranchi wrongly assumed his jurisdiction to impose the damages and interest under Sections 14(B) and 7(Q) of the Act, 1952, respectively. Learned counsel for the petitioners further submits that the circular issued under the signature of the Assistant Provident Fund Commissioner on behalf of Regional Provident Fund Commissioner, Delhi dated 28th November, 1990 has made it clear that as per the decision of the Central Board of Trustees, the cases under Section 14(B) of the Act, 1952 are to be finalized within a period of three years. Accordingly, the Regional Provident Fund Commissioners were suggested that the cases in which the damages are yet to be levied as on 30.06.1990, they should ensure that all such cases should be disposed of within a period of three years from the date of issuance of the circular and the fresh defaulted damages were required to be levied within the closure of the subsequent three financial years. It is also submitted that the period of default of the petitioners is said to be from June, 1988 to July, 2002 for which a proceeding was initiated by the respondent in the year, 2005 and the said delay cannot be said to be reasonable for initiating a proceeding under Section 14(B) and 7(Q) of the Act.

4. Learned counsel for the petitioners further submits that pursuant to the notice issued to the petitioner-DVC dated 16th June, 2005, the reply was submitted vide letter no.1313 dated 13th October, 2005, bringing the fact to the notice of the respondent that some of the amount shown bythe said authority in its statement appear to have been inserted twice. The said details have been mentioned in Paragraph No.2 of the reply dated 13th October, 2005. It was also pointed out to the said authority that there were some factual errors also in the statement to the extent that for certain months there should not have been any penalty, as the remittance was made by the petitioner-DVC on time. It was also highlighted that some amount already remitted by the petitioner-DVC for the period 6/1988 to 3/199