Judicial Analysis Court Copy Headnote Facts Arguments Court observation

STATE CONSUMER DISPUTES REDRESSAL COMMISSION
G. Radha Rani, President, R.S. Rajeshree, Member
T. Nageshwar Rao – Appellant
Versus
Regional Provident Fund Commissioner – Respondent
F.A. No.1007 OF 2024

Advocates:
For the Appellants/Petitioners: Party-in-Person
For the Respondents: T. Sasi Kumar

While EPF authorities are not liable for interest beyond the 36-month statutory limit for inoperative accounts under Para 72(6), the unexplained delay in releasing the accrued interest after the principal amount is settled constitutes a deficiency of service under the Consumer Protection Act, 2019.

Headnote:(A) EPF Scheme, 1952 - Para 72(6) - Payment of provident fund - Entitlement to interest - Complainant retired and kept PF amount for 36 months to earn interest - Provident fund accumulation transferred to inoperative account after 36 months - Held, interest is payable only for the period of 36 months as per regulations - Appellant not entitled to interest beyond the three-year statutory limit. (Para 12)

(B) Consumer Protection Act, 2019 - Deficiency of service - Delayed payment of interest - Despite payment of PF balance, interest amount was paid with a delay of 55-56 days only after letters were addressed by complainant - Held, the delay in payment of admitted interest amounts to deficiency of service - Compensation awarded for mental agony and inconvenience. (Para 13)

Facts of the case:
The appellant, a retired bank officer, kept his EPF amount with the respondent for three years post-retirement to earn interest. Upon his request for withdrawal, the respondent rejected the claims, causing delay in settlement. While the respondent paid the principal amount and the interest for the 36-month period, there was a significant delay in releasing the interest component, which the appellant contended was a deficiency of service warranting additional compensation.

Findings of Court:
The Commission agreed that the respondent was not liable to pay interest beyond the 36-month period specified in Para 72(6), but found that the delayed release of the undisputed interest amount after the principal was paid constituted deficiency of service.

Issues: Whether the respondent is liable for additional interest beyond 36 months and whether the delayed payment of the PF interest constitutes deficiency of service.

Ratio Decidendi: An authority is not obligated to pay interest beyond the statutory limit set for inoperative accounts; however, unnecessary delay in paying the accrued interest once the claim is established constitutes deficiency of service under the Consumer Protection Act.

Result: Appeal partly allowed; respondent directed to pay Rs.10,000 as compensation and Rs.5,000 as costs.

Table of Content
1. procedural grounds of appeal and key dates. (Para 10)
2. interpretation of para 72(6) regarding inoperative accounts. (Para 12)
3. delay in payment constitutes deficiency of service. (Para 13 , 14)

:QUORUM:

HON’BLE SMT JUSTICE DR.G. RADHA RANI, PRESIDENT

HON’BLE SMT R.S. RAJESHREE- MEMBER (NON-JUDICIAL)

MONDAY, THE 6TH DAY OF APRIL

TWO THOUSAND TWENTY-SIX

ORDER: (HON’BLE SMT. R.S. RAJESHREE, MEMBER, NON-JUDICIAL)

01. This appeal is filed U/s.41 of the Consumer Protection Act, 2019, by Appellant/Complainant praying this Commission to allow the appeal by overturning the order dated 16.10.2024 passed by the District Consumer Redressal Commission, Ranga Reddy in CC No.127 of 2023 and consequently allow the complaint in CC No.127/2023 by granting entire relief as prayed for in CC No.127/2023 and pass such orders in the interest of justice.

02. For the sake of convenience, the parties are described as complainant and opposite party as arrayed in the complaint.

03. The case of the complaint is that he retired as Chief Manager from Andhra Pradesh Grameena Vikas Bank (APGVB) on 31.08.2019. That during his service he was a subscriber of EPF Scheme with the Regional Provident Fund Commissioner, Warangal, that he had not withdrawn the PF Balance at the time of retirement in order to avail the facility of keeping the PF amount for a period of three years, so that he could earn some interest on the same. As on date of his retirement the total amount entitled by him under PF scheme was Rs.10,83,610/- and the interest for a period of 03 years from the date of retirement till 31.08.2022 comes to Rs.2,56,494/-. That on 20.08.2022 he had made a request for final payment of the PF amount along with interest, as the three years period would be completed on 31.08.2022. But the opposite party rejected the claim as such another claim form was submitted on 25.08.2022, the said application was also rejected by the opposite party with the following remarks:

“As per the modalities discussed with APGVB, the claim will be settled by APGVB.”

As per the said advice a claim was made to APGVB and finally the claim was settled on 14.12.2022. But the opposite party failed to pay the interest for the period from 01.09.2022 to 14.12.2022, which comes to Rs.31,199/-. This act of not paying the interest for more than three months though retaining the PF benefits, amounts to deficiency of service. As such a complaint was filed before the District Commission seeking the interest amount of Rs.31,199/-.

04. The opposite party filed its written version while admitting that the complainant was one of the subscriber under the EPF Scheme and also admitting that he had not withdrawn the PF amount for a period of three years. The opposite party further admitted that the complainant had made the application for release of PF amount on two occasions i.e., on 20.08.2022 and 25.08.2022. But however, opposed the complaint on the ground that “In view of EPF & MP Act, 1952 vide notification dated 13.12.2018 issued by the Government of India Andhar Pradesh Grameena Vikas Bank, Hanumankonda-Warangal vide EPF code No. NZ/WGL/14141 was excluded from the purview EPF& MP Act,1952 with affect from 01.01.2020 under Section 16 of the Act.” As such the application of the complainant was rejected by giving a liberty to the complainant to make an application before APGVB. That as per the para 72(6) of EPF Act, the PF accumulations shall be transferred to inoperative account after 36 months from the date it becomes payable in respect of any member who has retired from service. In the instant case the complainant retired from service on 31.08.2019 and his PF accumulation was transferred to inoperative account after the lapse of 36 months i.e., in the month of September,2022. As such interest was paid only for a period of 36 months and the complainant is not entitled for interest beyond three years. As such there is no deficiency of service on the part of opposite party, as opposite

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STATE CONSUMER DISPUTES REDRESSAL COMMISSIONG. Radha Rani, President, R.S. Rajeshree, MemberT. Nageshwar Rao – AppellantVersusRegional Provident Fund Commissioner – RespondentF.A. No.1007 OF 2024

While EPF authorities are not liable for interest beyond the 36-month statutory limit for inoperative accounts under Para 72(6), the unexplained delay in releasing the accrued interest after the principal amount is settled constitutes a deficiency of service under the Consumer Protection Act, 2019.

STATE CONSUMER DISPUTES REDRESSAL COMMISSION
G. Radha Rani, President, R.S. Rajeshree, Member
T. Nageshwar Rao – Appellant
Versus
Regional Provident Fund Commissioner – Respondent
F.A. No.1007 OF 2024