JUDGMENT

1. The petitioner is a factory registered under the Factories Act. It carries on the business of processing and manufacture of fruits, vegetables jams, Jellies and Syrups and squashes etc. It has 500 persons in employment working in the factory. The factory is covered by the provisions of the Employees' Provident Funds and Family Pension Fund Act. 1952 and the schemes framed thereunder. It appears that the petitioner did not pay in time its contributions to the provident fund account in respect of the period. June, 1964 and July, 1964 to March, 1970. The Regional Provident Fund Commissioner, U. P., Kanpur by an order dated the 17th January, 1975 (Annexure I to the writ petition) passed under Section 4-B of the Employees' Provident Funds Act, 1952 called upon the petitioner to pay e sum of Rs. 7,830.65 in Employees' Provident Fund Account No. 1 and Rs. 302.20 in employees' provident fund account No. II, by way of damages. The petitioner has challenged that order.

2. Under the scheme framed under the Employees' Provident Funds Act. 1952 (hereinafter referred to as the Act), every employer to whom the Act applies has a statutory duty to make payments of contributions and administrative charges by the 15th of every month and in case of default Section 14-B provides that the Government may recover from the employer such damages not exceeding 25 per cent of the amount of arrears, as it may think fit to impose. The contention of the learned counsel is that an order finder Section 14-B for the levy and recovery of damages for non-payment of contributions in time should be passed as expeditiously as possible and if it is passed with inordinate delay the presumption can be drawn that the Government had condoned the delay. In support of this contention he relies upon a decision of the Punjab High Court in M/s. Amin Chand and Sons v. State of Punjab. (AIR 1965 Punj 441) where it has been held that the purpose of Section 14-B is as much re- formative as punitive and technically the damages should be levied immediately after the default and it is legitimate for the employer to have thought that the Government had decided not to exercise its discretion to levy damages after a lapse of several years. This case clearly supports the contention of the learned counsel fur the petitioner. In the instant case also the arrears relate to the years 1964 to 1970 but the impugned order was passed as late as January, 1975. It is not disputed that the arrears had actually been paid up even though late long before the impugned notice was issued. In the circumstances the petitioner was well within its rights to presume that the Government had condoned the delay and had decided not to demand any damages from the petitioner.

3. That apart, there is vet another serious infirmity in the impugned order. The petitioner had made a representation against the levy of damages. In that representation it was pointed out that the contributions to the provident fund scheme and the administrative charges had been paid up to date but due to some unavoidable circumstances and owing to financial difficulties the payments were delayed. The petitioner had also raised the point that the damages, if levied at all. must be levied expeditiously and had cited the decision of the Punjab High Court in the case of M/s. Amin Chand and Sons (supra). He had also cited a few other decisions and raised a contention that it is proper for the authority to give a hearing to the petitioner and that the appropriate Government which could decide as to whether any damages should be levied under Section 14-B is the State Government and the power to fix the damages did not vest in the Accounts Officer or any other officer of the Fund and to support these contentions the petitioner relied upon 1970 Lab IC 96 (Mad) and (AIR 1969 Mvs 196 = (1969 Lab IC 691). Clearly the petitioner has raised some factual and legal pleas and it was the duty of the Regional Provident Fund Commissioner to have de