KERALA MALANADU KARSHAKA PRODUCE CO-OPERATIVE MARKETING SOCIETY LTD.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE AMIT RAWAL** **WEDNESDAY, THE 21[ST] DAY OF DECEMBER 2022 / 30TH AGRAHAYANA, 1944** ## **WP(C) NO.14102 OF 2020** ## **PETITIONER:** KERALA MALANADU KARSHAKA PRODUCE CO-OPERATIVE MARKETING SOCIETY LTD.NO.F 1777 THIRUVAMBADY P.O., KOZHIKODE 673 603, REPRESENTED BY ITS SECRETARY. BY ADVS. P.RAMAKRISHNAN SMT.PREETHI RAMAKRISHNAN (P-212) SRI.T.C.KRISHNA SRI.C.ANIL KUMAR SMT.ASHA K.SHENOY SRI.PRATAP ABRAHAM VARGHESE ## **RESPONDENTS:** 1 THE REGIONAL PROVIDENT FUND COMMISSIONER EMPLOYEES PROVIDENT FUND ORGANZIATION, SUB REGIONAL OFFICE, BHAVISHYANIDHI BHAVAN, KOZHIKODE 673 006. 2 THE ASSISTANT PROVIDENT FUND COMMISSIONER, EMPLOYEES PROVIDENT FUND ORGANZIATION, SUB REGIONAL OFFICE, BHAVISHYANIDHI BHAVAN, KOZHIKODE 673 006. 3 EMPLOYEES PROVIDENT FUND APPELLATE TRIBUNAL (CENTRAL GOVERNMENT INDUSTRIAL TRIBUNAL), KARITHALA LANE, KARSHAKA ROAD, ERNAKULAM, KOCHI 682 011. BY ADV DR.ABRAHAM P.MEACHINKARA, SC, EPF ORG. THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 21.12.2022, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: 2 WP(C)No.14102/2020 ## **JUDGMENT** Petitioner is a Co-operative Society registered under the Cooperative Societies Act, engaged in the business of purchase, processing and sale of agricultural produces. The Society has staff strength of eight employees. 2. With effect from 01.12.2019, the Regional Provident Fund Commissioner, Kozhikode, brought the Society under the purview of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (hereinafter called 'the Act'). The aforementioned order was objected to vide objection dated 31.01.2000 on the ground that the Co-operative Society had been employing less than 50 persons and working without the aid of the power. Hearing was conducted by the first respondent in the objection. In the meanwhile State introduced Kerala Co-operative Societies Employees Self Financial Pension Scheme, 1994. Since no order was passed by the respondents, Writ Petition bearing No.23744 of 2000 challenging Ext.P1 was preferred by the petitioner. Vide judgment dated 01.03.2006, Provident Fund Department was directed to pass a speaking order. Respondent No.2 initiated the proceedings seeking provident fund contribution, pension fund contribution, insurance fund contribution etc. for the 3 WP(C)No.14102/2020 period July, 1999 to March, 2006. Objections were raised, but of no avail, resulting into order under Section 7A of the Act on the ground that the petitioner was not an establishment set up under the Central or State Act to attract exemption under Section 16(1). The proceedings resulted into a demand of Rs.12,40,952/- vide Ext.P4 order dated 26.11.2006. The Government of Kerala also issued Ext.P5 notification dated 19.06.2006 exempting the primary societies, but the same was not taken into consideration. WP(C) No.29790 of 2006 was preferred challenging the order Ext.P4. The said Writ Petition was disposed of on 21.06.2013 by relying upon the judgment reported in **Kerala State Co-operative Employees Pension Board v. Udayakumar** [2012(3) KLT 820]. Ext.P4 was set aside and it was held that it was open for the employees of a Co-operative Society to opt either for Central Scheme under the EPF or the Scheme under the State Act vide Ext.P6 judgment dated 21.06.2013. In view of the aforementioned judgment, all the proceedings under Section 7A stood extinguished. 3. However, to the utter surprise of the petitioner, the second respondent initiated the proceeding vide Ext.P7 demanding a sum of Rs.8,37,312/- as contribution for the same period July 1999 to July 2006 by interpreting Ext.P6 judgment to be an exemption from 4 WP(C)No.14102/2020 remitting the contribution under the Employees Pension Scheme whereas there was no such exemption from remitting contribution. An objection to Ext.P7 proceedings dated 25.11.2013 was filed vide Ext.P8. Vide letter dated 04.02.2014, an intimation was received that it was a fresh demand pursuant to the judgment and that the judgment Ext.P6 was applicable only for pension. Thereafter Ext.P10 appeal was filed by the petitioner bearing No.249 of 2014, but the same was dismissed being barred by 120 days vide Ext.P12. 4. Learned counsel appearing on behalf of the petitioner submitted that the orders Ext.P7, P8, P12 and P13 are arbitrary, illegal and unsustainable on the ground that Section 16(1) of the Act shall not be applicable to an establishment registered under the Co-operative Societies Act. Once there is already a judgment in favour of the petitioner by this Court, Ext.P6 dated 21.06.2013, it was an attempt to reassess the petitioner for the same period. In support of the contention, relied upon paragraph 5 of the judgment referred above : > _“5. Learned counsel for the appellant as well as the learned Special Government Pleader for the State referred to R.58 of the Co-operative Societies Rules and also Clauses 3 and 29 of the State and District Cooperative Employees Pension Scheme, which provide for compulsory transfer of funds from existing provident fund account to the appellant Board. However, learned counsel for the respondents referred to the first proviso to_ 5 WP(C)No.14102/2020 _R.58 of the Co-operative Societies Rules, which states that when the EPF Act is applicable to the Society, and the provisions of that Act are more beneficial, the Fund shall be maintained in accordance with the provisions of that Act. Further, it is stated in sub-r. (4) of R.58 that for discontinuance of benefit of Fund prior permission of the EPF Commissioner is required. What we notice from the proviso to S.61(1) of the KCS Act is that after establishment of Self Financing Pension Scheme under the appellant Board under S.80A(1) of the KCS Act, the provisions of E.P.F. Act do not apply to the establishment, which is required to establish a Provident Fund by itself so that the appellant will operate the Pension Fund, and provident fund will be managed by the Trust-Fund established by the Co-operative Banks. However, neither S.80A nor S.61(1) of the KCS Act provides for compulsory transfer of funds of retired employees as well as serving employees who are members of the Employees Provident Fund Scheme, 1952 and Employees Pension Scheme, 1995 to the appellant Board. So much so, we feel the appellant Board or the State Government or the Banks cannot demand transfer of funds of the employees, who are members of the Employees Provident Fund Scheme, 1952 and Employees Pension Scheme, 1995, to the appellant Board and discontinue their benefits under the Schemes of the Central Act without their consent. Since both the appellant as well as the Employees Provident Fund Organisation and the Pension Fund operate for the benefit of the employees, we feel those who wish to opt to transfer the membership from the Employees Provident Fund Scheme, 1952 and the Employees Pension Scheme, 1995 can apply for the same and in such cases the EPF Commissioner should transfer the funds. In other words, transfer of fund from Employees Provident Fund Scheme, 1952 and Employees' Pension Scheme, 1995 of any retired or continuing member should be made only with his/her consent. It is for the appellant Board to fix a time limit for exercising the option for retired employees and for serving employees and in all such cases Fund will be transferred to the appellant Board from the Employees Provident Fund and Pension Schemes.”_ 5. On the other hand, learned counsel appearing on behalf of the respondents supported the impugned order and submitted that exemption to the Co-operative Society as per Ext.P5 notification dated 19.06.2006 only pertains to pension and not to 6 WP(C)No.14102/2020 the contribution and urged this Court for dismissal of the Writ Petition. 6. I have heard the counsel for the parties and appraised the paper book. 7. Vide Ext.P6 judgment, this Court in WP(C)No.29790 of 2006 held as follows : _“Heard the learned counsel for the petitioner. The prayer in this Writ Petition is as follows :_ _1. issue a writ of certiorari quashing Ext.P9 order._ _2. To declare that the provisions under the_ - _Employees' Provident Funds Act and the Schemes thereunder will not apply to the petitioner Society by virtue of Section 16(1)(c) of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and in view of Ext.P10 order._ _3. To declare that the employees of the petitioner Society who are members of the Kerala Co-operative Societies Employees' Pension Scheme under the Employees' Provident Funds and Miscellaneous Provisions Act._ _4. Issue such other writ, order or direction which this Hon'ble Court may deem fit and proper on the facts and circumstances of this case and in the interest of justice._ _2. The subject mater of this case is covered by a Division Bench decision of this Court reported in Kerala State Co-operative Employees Pension Board v. Udayakumar in (2012(3)KLT 820) wherein the Division Bench held that it is open to the employees of a cooperative society to opt the central scheme under the EPF Act or the State Act. In the present case, petitioner and its employees have chosen to the scheme floated by the State Government under the Co-operative Societies Act, 1969. In that view of the matter, the impugned demand is set aside and the Writ Petition is closed.”_ 8. The said judgment was not challenged by the respondents. The demand again for the period July 1999 to July 2006 was raised by Ext.P7. Even though the notification Ext.P5 dated 19.06.2006 for the sake of argument is applicable only for 7 WP(C)No.14102/2020 the pension scheme, the respondents were estopped to raise the demand in view of the fact that the judgment Ext.P6 attained finality. A person cannot be tested twice for the same alleged default. The findings referred are in clincher to the controversy in question. 9. The question of limitation would not arise for the reason that the petitioner was not required to avail the remedy of appeal in view of the fact that the subsequent proceedings for the same very period under the provisions of the Act were totally without jurisdiction. For the reasons aforementioned, Exts.P7, P8, P12 and P13 are arbitrary, illegal and hereby set aside. Writ Petition stands allowed. Sd/- **AMIT RAWAL JUDGE** csl 8 WP(C)No.14102/2020 ## **APPENDIX OF WP(C) 14102/2020** PETITIONER'S EXHIBITS EXHIBIT P1 TRUE COPY OF ORDER DATED 1/12/1999 ISSUED BY THE 1ST RESPONDENT. - EXHIBIT P2 TRUE COPY OF OBJECTION DATED 31/1/2000 SUBMITTED BY THE PETITIONER BEFORE THE 1[st] RESPONDENT. - EXHIBIT P3 TRUE COPY OF JUDGMENT DATED 1/3/2006 IN O.P. NO.14684/2000. - EXHIBIT P4 TRUE COPY OF ORDER UNDER SECTION 7 A ISSUED BY THE 2ND RESPONDENT. - EXHIBIT P5 TRUE COPY OF NOTIFICATION DATED 19/6/2006 ISSUED BY THE GOVERNMENT OF KERALA. EXHIBIT P6 TRUE COPY OF JUDGMENT DATED 21/6/2013 IN WPC NO.29790/2006. - EXHIBIT P7 TRUE COPY OF PROCEEDINGS DATED 25/11/2013 OF THE 2ND RESPONDENT. - EXHIBIT P8 TRUE COPY OF OBJECTIONS DATED 26/12/2013 SUBMITTED BY THE PETITIONER. - EXHIBIT P9 TRUE COPY OF LETTER DATED 4/2/2014 ISSUED BY THE 2ND RESPONDENT. - EXHIBIT P10 TRUE COPY OF APPEAL SUBMITTED BY THE PETITIONER BEFORE THE 3RD RESPONDENT. - EXHIBIT P11 TRUE COPY OF JUDGMENT DATED 12/5/2015 IN WPC NO. 13388/2015. - EXHIBIT P12 TRUE COPY OF ORDER DATED 27/2/2020 IN APPEAL NO. 249/2019. - EXHIBIT P13 TRUE COPY OF LETTER DATED 29/5/2020 FROM THE 2ND RESPONDENT TO THE PETITIONER.