IN THE HIGH COURT AT CALCUTTA Constitutional Writ Jurisdiction Appellate Side Present:

The Hon’ble Justice Shampa Dutt (Paul)

WPA 1945 of 2025 Central Board of Trustees, through the Regional Provident Fund Commissioner-1 Regional Office Howrah Vs The Registrar Central Government Industrial Tribunal, Kolkata &

Anr.

For the Petitioner : Mr. Shiv Chandra Prasad.

For the Aditya Birla Vani : Mr. Arnab Dutt.

Bharti/Respondent Hearing concluded on : 12.02.2025 Judgment on : 05.03.2025 SHAMPA DUTT (PAUL), J. :

1. The present writ application has been preferred against an order dated 27.08.2024 in appeal EPF No. 19 of 2016 (old no. 595(15) 2016) passed by the Judge, Central Government Industrial Tribunal, Kolkata.

2. Vide the order dated 28^th April, 2016, the Assistant Provident Fund Commissioner (Damage Cell) concerned in a proceedings under Section 14B of the EPF & MP Act held as follows:-

“For the above reasons order for levy of damage of the below mentioned amount as per prescribed rate under Para 32A of the EPF Scheme, 1952, Para 5 of the EPS 1995 and 8A of EDLI Scheme, 1976 and also the amount of interest as per provisions under Section 7Q of the Act, to be paid by the establishment. And direct the employer of the establishment M/S Rishra Vani Sharati to remit the aforesaid balance amount of damage and interest within 10 days time from receipt of this order. In case of failure actions under Section 8B to 8G of the Act may be initiated against the employer of the establishment.”

3. The total dues was assessed at Rs. 917552.

4. The said order was appealed before the Central Government Industrial Tribunal, Kolkata. The tribunal considering the materials on record held as follows:-

“EPF 19 of 2016 Therefore, let me see whether the APFC (Damage), Howrah is justified in imposing damages for the period from 01-03-2005 to 31-10-2013 the period during which the establishment was enjoying exemption u/s 17 of the Act of 1952 till 01-04-2011. That a penal provision should be construed strictly. Penalty is not to be levied in all situations of all delayed remittance of P. F. dues. The word damages in section 14-B is related to the word 'default' in payment of contribution which is need to be made by 15th of the following month and if there is a failure to perform such duty then section 14-B comes into the picture. In view of provision of section 7-Q of the Act, as soon as any amount becomes due, interest will accumulate automatically till such time the amount is paid. As per provision of EPF & MP Act, 1952 the interest in PF contribution is mandatory but in respect of levy of damages it is left to the discretion of the P.F. authority to decide the percentage of damage/amount payable by the employer but he has to decide based on the facts and circumstances of each case. That order levying damages for late payment of P.F. contribution cannot be undertaken as a mechanical process, The EPFO authority which exercise discretionary power u/s 14-B is bound to take into account an aggravating and mitigating circumstances which has prevented the Appellant to make deposit in time and to see whether there is wilful and deliberate delay on the part of the employer. If the employer makes the payment without any reason then EPF Authority can burden the employer by way of imposition of penalty. Further, it appears that damages has no relationship to the loss suffered by the beneficiaries under the scheme as they are compensated by imposition of interest on belated remittance and realized/ recovered interest on belated remittance is credited in the accounts of the beneficiaries but the realized/recovered damages is not credited in the accounts of the beneficiaries. In view of the above, this Tribunal holds the impugned order suffers from illegality and without basis. Thus, EPF Appeal no. 19 of 2016 is hereby allowed and impugned order u/s 14-B of the EPF Act dt. 28-04-2016 is hereby set aside.

5. Being aggrieved the Central Board of Trustees through the Regional Providen