Page 1 of 18

$~3

*

IN THE HIGH COURT OF DELHI AT NEW DELHI

Date of decision: 25^th August, 2021

+

W.P.(C) 8485/2021 & CM APPL. 26248/2021

GAURAV ENTERPRISES

..... Petitioner

Through:

Ms.

Maninder

Acharya,

Senior

Advocate with Mr. Tarkeshwar Nath,

Mr.

Rajiv

Shukla,

Mr.

Viplav

Acharya, Mr. Shikhar Kishore, Ms.

Shivani Kapoor and Mr. Sanjay

Kumar, Advocates.

versus

UNION OF INDIA & ORS.

..... Respondents

Through:

Mr. Shivanath Mahanta, Advocate for

R-2 & 3.

Mr. Rizwan, Advocate for R-4 to 9.

CORAM:

JUSTICE PRATHIBA M. SINGH

Prathiba M. Singh, J.(Oral)

1. This hearing has been done through video conferencing.

2.

The present petition has been filed challenging order dated 3^rd August,

2021 passed by the CGIT, by which the CGIT has refused to grant a stay in

respect of the interest component imposed under Section 7Q of the

Employees' Provident Fund & Miscellaneous Provisions Act, 1952

(hereinafter, “EPF Act”) on the ground that no opinion can be formed at

this stage as to whether the order which was passed by the original authority,

i.e., the Regional Provident Fund Commissioner (hereinafter, “RPFC”), is a

composite order under Sections 14B and 7Q of the EPF Act.

3.

The brief background to this petition is that vide a common show-

cause notice dated 23^rd May, 2019, proceedings were initiated against the

Petitioner under Sections 14B and 7Q of the EPF Act. The said show-cause

2021:DHC:2620

Page 2 of 18

notice relates to alleged defaults occurring during the period from 1^st

November, 2013 till 31^st March, 2019. The show-cause notice commences

with the title - “Summons to appear for hearing u/s 14B of the EPF and MP

31/03/2019”. In response to this show-cause notice, a common reply is filed

by the Petitioner on 10^th June, 2019. Thereafter, further submissions have

also been made in the form of letters and documents on 11^th June,

2019. After receipt of the documents, including challans which showed

some deposits by the Petitioner, a revised notice was issued by the RPFC on

25^th September, 2019, which is again a joint notice under Sections 14B and

7Q of the EPF Act. The revised computation is as under:

Account

14B

7Q

Total

(Rupees One Crore Fourteen Lakh Fifty Thousand Three Hundred

and Seventy Four Only)

4.

Common replies to the revised notice were again filed by the

Petitioner on various dates between 2^nd January, 2020 to 3^rd June,

2021. Hearings have been held before the authority on various occasions. A

perusal of the order sheets shows that they clearly mention that these are

“Proceeding under Section 14B & 7Q of the EPF & MP Act, 1952”. Each

order sheet which has been placed on record, dated 10^th June 2019, 1^st July,

2019, 9^th January, 2020, 24^th January 2020 and 10^th September, 2020, shows

2021:DHC:2620

Page 3 of 18

that a common order has been passed under Sections 14B and 7Q of the EPF

Act.

5. However, thereafter, the RPFC chose to pass separate orders under

Section 14B and Section 7Q. Under Section 14B, the total demand raised

was to the tune of Rs.69,21,490/-. The order under Section 14B is passed on

26^th May, 2021 and communicated to the Petitioner on 15^th June, 2021. The

order under Section 7Q is also passed on 26^th May, 2021 and communicated

to the Petitioner on 15^th June, 2021. The total amount computed under

Section 7Q is Rs.40,81,884/-. Thus, both orders bear the same date and have

been communicated to the Petitioner on the same date.

6.

Considering the said two orders as composite orders, the Petitioner

approached the CGIT. The CGIT, while admitting the appeal, imposed a

stay on the assessment of damages under Section 14B, subject to pre-deposit

of 10% of the assessed amount of damages. However, insofar as the order

under Section 7Q is concerned, no stay was granted. The operative portion

of the CGIT’s order is extracted herein below:

“Hence in this ca