K. N. Seth, J. :- The respondents, who are Directors of the Laxmi Ratan Cotton Mills Company Limited, Kanpur, were prosecuted on a complaint filed by the Provident Fund Inspector, U.P. after obtaining previous sanction of Labour Commissioner U.P. under Section 14(3) of the Employees' Provident Funds Act, 1952 (hereinafter referred to as the Act). It was alleged that respondents failed to invest the employees' and employers' contribution for the months of July, August and September 1965 within the specified period and thereby rendered themselves liable to penalty provided under Sub-section (2-A) of Section 14 of the Act.

2. Pleading not guilty the respondents, inter alia, challenged the validity of the sanction granted by the Labour Commissioner U.P. for the prosecution. It was contended that the Central Government alone was competent to specify the authority to accord sanction for the prosecution and as the Labour Commissioner U.P. had not been so specified by the Central Government, the sanction granted by him was invalid and incompetent and no cognizance could be taken of the offence alleged to have been committed by the respondents. The trial Magistrate repelled this contention and convicted the respondents. On appeal the learned Sessions Judge, Kanpur relying on R. K. L. Gupta v. Ram Babu Lal, 1969 All LJ 722 held that the Central Government alone could authorise the Labour Commissioner U.P. to accord the sanction and as the Labour Commissioner U.P. was not authorised by the Central Government, there was no proper sanction for the prosecution and no cognizance could be taken by the learned Magistrate. The State of U.P. through the Provident Fund Inspector preferred an appeal to this Court which came up before a Division Bench. The Bench felt that in R. K. L. Gupta's case, 1969 All LJ 722 (Supra) this Court was not called upon to decide the question which was in controversy in the present case, but in view of certain observations made in that case it was desirable to refer the following question to a larger Bench :-

"As to whether by virtue of notification No. S.R.O. 1258 dated 10-4-1957 issued by the Central Government under S. 19 of the Employees' Provident Funds Act, 1952 and the corresponding notification No. 5392 (ST) XXXVIA 261-54 dated December 14, 1960, issued by the Government of Uttar Pradesh, Sri J. N. Tiwari, Labour Commissioner, Uttar Pradesh, was the duly specified authority for issuing sanction under sub-section (3) of Section 14 of the said Act for launching the prosecution for contravening the provisions of the Employees' Provident Funds Act (19 of 1952).

3. Under Sub-section (3) of section 14 of the Act no court is to take cognizance of any offence punishable under the Act or under any Scheme except on a complaint made with the previous sanction of such authority as may be specified in this behalf by the appropriate Government. It is not disputed that the appropriate Government in relation to the Company, of which the respondents are Directors is the Central Government. The sanction could therefore, be granted by an authority to be specified in this regard by the Central Government.

4. Section 19 of the Act, which deals with the delegation of powers, provides :-

"19. Delegation of powers - The appropriate Government may direct that any power or authority or jurisdiction exercisable by it under this act or any Scheme shall, in relation to such matters and subject to such conditions, if any, as may be specified in the direction, be exercisable also -

(a) Where the appropriate Government is a State Government, by such officer or authority subordinate to the Central Government or by the State Government or by such officer or authority subordinate to the State Government, as may be specified in the notification; and

(b) Where the appropriate Government is a State Government by such officer or authority subordinate to the State Government as may be specified in the notification."

Under the aforesaid pro