JUDGMENT :

KULDEEP TIWARI, J. 

1) The petitioner-company, by instituting the present writ petition under Article 226 of the Constitution of India, has questioned the legality of the order dated 24.12.2007 (Annexure P-4), passed by the Regional Provident Fund Commissioner-respondent No.2, and also the order dated 01.09.2011 (Annexure P-6), rendered by the Employees’ Provident Fund Appellate Tribunal-respondent No.1.

Factual Matrix

2) Succinctly put, the petitioner-Company manufactures plastic films and sheets, and is registered under the Companies Act. With the aid of CCTS Module, an exponential drop in remittance from March, 2005 onwards, came to light. Accordingly, an enquiry, in sync with Section 7A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, (for short, ‘the Act of 1952’), was initiated against the petitioner- Company. As a result, the amounts, as described below, were assessed to be deducted/deposited by the petitioner-Company on account of Provident Fund contribution: -

1) Special allowance from March, 2003, to January, 2006, valuing Rs.27,73,866/-;

2) Emoluments to the tune of Rs.5,30,872/-, as paid towards tea/canteen allowance for March, 2003, to January, 2006; and

3) A sum of Rs. 58,66,553/-, as paid to the employees on account of extra wages/over time allowance from March, 2003 to January, 2006.

3) Resultantly, upon consideration of the matter, respondent No.2, by drawing the impugned order dated 24.12.2007 (Annexure P-4), assessed an amount of Rs.3,02,649/-, to be paid by the petitioner- Company on account of special allowance and tea/canteen allowance for the period spanning from March, 2003 to January, 2006. However, the amount, which was paid by the petitioner-Company to the employees as overtime/extra wages, was found well within the exceptions enshrined in the definition of the basic wages, under Section 2(b) of the Act of 1952.

4) Aggrieved by the aforesaid order, the petitioner-Company moved the learned Appellate Authority by preferring a statutory appeal, which, as indicated above, was dismissed, vide order dated 01.09.2011 (Annexure P-6). So much so, it was held that since no document was filed to indicate that the petitioner-company had obtained the necessary permission from the competent authority to engage employees beyond the scheduled working hours, therefore, the emoluments paid under the head of overtime/extra wages, would also be required to be assessed for the purpose of Provident Fund contribution. That is how, the petitioner is before this Court.

Submissions

5) Learned Senior counsel for the petitioner, at the outset, submitted, that admittedly, the Department concerned has not preferred any appeal against the order passed by respondent No.2, therefore, the learned Tribunal ought to have refrained itself from including the emoluments under the head of overtime/extra wages, for the purpose of Provident Fund deduction. Thus, on this score alone, the appellate order is liable to be set aside. Not only that, apparently, the Appellate Authority passed a cryptic order, as none of the contentions raised on behalf of the petitioner-Company, were considered.

6) In an endeavour to persuade this Court, he asserted that, no such provision exists in the Act of 1952, which obligates the petitioner- Company to deduct/deposit the contribution for the emoluments paid under the head of special allowance. In fact, the said allowance was being paid by the petitioner-Company, at its own discretion, to certain employees, therefore, the same, by any stretch of imagination, could not be linked with basic wages, dearness allowance or retaining allowance. Further, the said allowance was introduced by the petitioner-Company, vide a circular dated 26.11.1999, which was also taken note of, by respondent No.2 in its order dated 24.12.2007. While referring to the said circular, it was submitted that the special allowance was not paid at any uniform rate, but was paid according to the status/designation of the