IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 14.07.2023 CORAM THE HON'BLE Mr. JUSTICE G.K.ILANTHIRAIYAN W.P.No. 22943 of 2013 SALCOMP Manufacturing India Pvt. Limited, Nokia Telecom SEZ SIPCOt Industrial Park Phase III, Chennai-Bangalore Highway, Sriperumbudur 602 105.

Rep. by its Authorised Signatory. .... Petitioner Vs

1. The Regional Provident Fund Commissioner, Employees Provident Fund Organisation Sub Regional Office, Ambattur R-40, A-1, TNHB Shopping cum Office Complex, Mugappair Road, Mogappair East, Chennai – 600 037.

2. The Recovery Officer, Employees Provident Fund Organisation Sub Regional Office, Ambattur, R-40, A-1, TNHB Shopping cum Office Complex, Mugappair Road, Mogappair East, Chennai – 600 037.

3. CVE Manpower Consultants No.16, Tambaram Road, Sriperumbudur Taluk, Kancheepuram – 603 105

4. The Branch Manager, Kotak Mahindra Bank Ltd., Teynampet Branch, Capital Ground Floor, 555, Anna Salai, Teynampet, Chennai – 18.

(R4-Suo Motu impleaded as per Court order dated 19.08.2013 in W.P.No.22943 of 2013) .... Respondents Prayer:- Writ Petition is filed under Article 226 of the Constitution of India praying to issue a Writ of Mandamus forbearing the 2^nd and 3^rd respondents from initiating any recovery proceedings against the petitioner towards the money owe by the 3^rd respondent pursuant to the proceedings of the 2^nd respondent in proceedings No.TN/SRO/AMB/68899/CC 1 Area

5/2013.

For Petitioner : Mr.S.Haroon for M/s.T.S.Gopalan and Co.

For R1 & R2 : Mrs.Sunitha Kumari Standing Counsel For R3 & R4 : No appearance

ORDER

This Writ Petition has been filed for direction directing the 1^st and

2^nd respondent from initiating any recovery proceedings against the petitioner towards the money owe by the 3^rd respondent in pursuant to the proceedings initiated by the second respondent under Employees Provident Fund and Miscellaneous Provisions Act, 1952 (herein after called as EPF &

MP Act).

2. Heard the learned counsel appearing for the petitioner and the learned Standing Counsel appearing for the respondents 1 & 2 and perused the materials available on record.

3. The petitioner has been engaging third party establishments to carry out certain activities inside its factory. These establishments independently provides services not only to the petitioner but also to many other establishments. The third party establishments are registered under the ESI Act and EPF & MP Act. Accordingly, the third respondent had registered with ESI and EPF & MP Act and its PF Code No.TN/68899 (52659). However, the petitioner had terminated its contract with the third respondent with effect from 17.06.2013 for the reason that the third respondent had defrauded the petitioner.

4. While being so, the first respondent passed an order under Section 8F of the Act and informed that the third respondent had defrauded in payment of PF dues to the tune of Rs.19,73,597/- for the period from March 2013 to April 2013, since the petitioner was the sundry debtor of the third respondent, in terms of Section 8F of the EPF & MP Act, the petitioner ought to remit any amount owed to the third respondent. On receipt of the same, the petitioner had sent its reply dated 15.07.2013 and stated that they did not owe any money to the third respondent and if in future any money becomes payable to the third respondent, the petitioner is ready to pay the same to the first respondent. However, again the first respondent issued another communication dated 16.07.2013 and the petitioner replied and reiterated the same.

5. The provision under Section 8F enables the EPFO to issue garnishee orders to the debtors of the defaulter directing them to pay. Such payment by debtors to the organisation has been recognized as good discharge of the debtors debt to the defaulter. It does not empower EPFO to attach bank accounts or proceed against the debtor. That apart, the third respondent is separate and independent establishment, having its own entity and registered under ESI and EPF & MP Act. Even i