Suresh Kumar S and Others v. The Principal Secretary to Government Higher Education (K) Department, Government Secretariat, Thiruvananthapuram and others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE V.G.ARUN** **MONDAY, THE 09TH DAY OF MARCH 2020 / 19TH PHALGUNA, 1941** ## **WP(C).No.22223 OF 2016(C)** ## **PETITIONER/S:** - **1 SURESH KUMAR.S AGED 54 YEARS ASSISTANT EXECUTIVE ENGINEER, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **2 ABY VARGHESE SUB ENGINEER, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **3 KRISHNAKUMAR M.R. SCIENTIFIC OFFICER, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **4 SURESH R. SCIENTIFIC OFFICER, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **5 ALICE KURIAN SCIENTIFIC OFFICER, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **6 SREELATHA K. JOINT DIRECTOR, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **7 BIJU R. TECHNICAL ASSISTANT (M), KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **8 HAREESH M. SUB STATION ASSISTANT, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** - **9 ABDUL SALAM N. HEAD GARDENER, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** _**WP(C).22223/16**_ 2 **10 SHYAM S.S. SCIENTIFIC OFFICER, KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM, THIRUVANANTHAPURAM.** **BY ADVS. SRI.K.SASIKUMAR SRI.S.ARAVIND SRI.K.JANARDHANA SHENOY SRI.R.ROHITH SRI.P.S.RAGHUKUMAR** ## **RESPONDENT/S:** - **1 THE PRINCIPAL SECRETARY TO GOVERNMENT HIGHER EDUCATION (K) DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM - 695 001.** - **2 THE PRINCIPAL SECRETARY TO GOVERNMENT FINANCE DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM - 695 001.** **3 KERALA STATE SCIENCE AND TECHNOLOGY MUSEUM THIRUVANANTHAPURAM - 695 033, REPRESENTED BY ITS DIRECTOR.** - **4 ACCOUNTANT GENERAL KERALA, THIRUVANANTHAPURAM - 695 001.** - **5 REGIONAL PROVIDENT FUND COMMISSIONER EMPLOYEES PROVIDENT FUND ORGANIZATION, GOVERNMENT OF INDIA, PATTOM, THIRUVANANTHAPURAM - 695 004.** **R1, R3 BY GOVERNMENT PLEADER R1 BY ADV. SRI.N.N.SUGUNAPALAN SR. R1 BY ADV. SMT.T.N.GIRIJA SCEPF ORGANISATION R5 BY ADV. SRI.N.N.SUGUNAPALAN (SR.)** ## **OTHER PRESENT:** ## **GP SRI.SHYAMJI RAM** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 21-01-2020, THE COURT ON 09-03-2020 DELIVERED THE FOLLOWING:** ## **V.G.ARUN, J. ----------------------------------------------W.P(C).No. 22223 of 2016 ----------------------------------------------Dated this the 9[th] day of March, 2020** ## **JUDGMENT** Petitioners are employees of the 3[rd] respondent, a Government establishment under the Higher Education Department. The establishment is covered under the Employees Provident Funds and Miscellaneous Provisions Act, 1952 (EPF & MP Act, 1952) and the petitioners are covered by the Employees' Provident Fund Scheme, 1952. The relevant details, like the petitioners' entry into service, dates of enrollment with the EPF and the EPF numbers allotted to them have been provided in a tabular form. It is stated in the writ petition that as per the provisions of the EPF & MP Act, 1952 and the EPF Scheme, the 3[rd] respondent had been collecting employees' contribution at the rate of 12% of the petitioners' basic pay plus DA, with the employer contributing an equal amount. The grievance of the petitioners are founded on Exhibit P1, an audit objection to the effect that the employers' share contributed towards EPF was in excess of the statutory _**WP(C).22223/16**_ 4 limit. The objection is based on paragraph 26 of the EPF Scheme which stipulates that a person appointed on a salary exceeding Rs.6,500/- per month will be treated as an 'excluded employee' as defined under paragraph 2(f) of the Scheme and will not be eligible for the benefit of provident fund under the Scheme. However, if the employer and the employee mutually agree, the employee can be enrolled as a member of the Fund but, the employer's liability to contribute is limited to the prescribed percentage of the statutory limit of Rs.6,500/- per month. In Ext. P1 objection it was stated that the 3[rd] respondent was paying contribution on the actual pay and the DA of the employees, which in most cases was in excess of the statutory limit of Rs.6,500/- per month, thereby imposing unwarranted additional financial burden on the exchequer. The excess amount thus paid up to 2008-2009 was quantified at Rs.7,63,754/-. 2. On receipt of Exhibit P1, the 3[rd] respondent submitted a reply stating that the remittance of PF contribution on the basis of actual pay and DA of the employees was being remitted, since no objection was raised by the Provident Fund authorities against such remittance. The reply was not accepted and Exhibit P3 audit report was issued reiterating the audit objection. By Exhibit P4 Circular, those establishments, which had made excess payment of employer's contribution to EPF and which had permitted excluded employees to be covered under the Act without sanction from the Government were _**WP(C).22223/16**_ 5 called upon to submit explanations. The 3[rd] respondent was one among the establishments listed under Exhibit P4 circular. Thereafter, by Exhibit P5 letter the Director of the 3[rd] respondent was required to file a detailed report on the corrective measures taken by the establishment in terms of the directions in Exhibit P4 Circular. Meanwhile, in the subsequent audit enquiry also, the alleged excess payment towards EPF contribution of employer's share to the tune of Rs.5,48,364/- for the years 2009-2010 and 2010-2011 was objected. Immediately, Exhibit P7 explanation was offered stating that on receipt of Exhibit P5 Government order, the employer's contribution to EPF had been limited to the permissible statutory limit. Though the 3[rd] respondent pointed out to the Government the fact that on the monthly contribution being limited, there will be substantial reduction in the EPF Pension of the employees, which is the only pension for which the employees are entitled for, the plea fell on deaf ears. Since corrective measures were not being taken by the Government, the petitioners submitted Exhibit P12 representation, which also did not evoke any response. Hence, the writ petition seeking the following reliefs: - _“i. to call for the records leading to the issue of Exhibits P1 to P7 so far as they relate to the petitioners' 3[rd] respondent establishment and quash the same by the issue of a writ in the nature of certiorari;_ - _ii. to declare that the petitioners are not 'excluded_ _**WP(C).22223/16**_ 6 _employees' under the Employees Provident Funds Scheme 1952 and that their right to contribute to employee's provident fund and their entitlement of equal contribution by the employer are not taken away on their crossing the salary of Rs.6500/- pm._ _iii. To issue a writ in the nature of mandamus directing 3[rd] respondent to pay employers' contribution of 12% beyond the salary limit of Rs.6500/- pm towards employees provident fund account of the petitioners from the date of discontinuance continuously with equal remittance of the petitioners share realized from them with arrears;_ - _iv. to issue a writ in the nature of mandamus directing 5[th] respondent to transfer the required percentage of the employer's contribution to the Employees' Pension Fund of the petitioners commensurate with their actual salary.”_ 3. Sri.K.Sasikumar, the learned counsel for the petitioners, made elaborate submissions with reference to the relevant provisions under the EPF Act, the EPF Scheme and the EPF Pension Scheme. It is contended that the audit objection raised and the consequent compulsion by the Government to limit the employer's contribution to the percentage of Rs.6,500/- is misunderstanding of the provisions. That, as per paragraph 2(f)(ii), 'an excluded employee' means 'an employee whose pay, at the time he is otherwise entitled to be a member of the Fund, exceeded Rs.6,500/- per month'. It is contended that at the time when the petitioners became entitled to become _**WP(C).22223/16**_ 7 members of the Fund, their pay did not exceed Rs.6,500/- and as such they do not fall within the definition of 'excluded employee' and hence, Paragraph 26(1) of the Scheme has no application. It is submitted that the audit objection was raised on the wrong premise that immediately on the pay of an employee, who is already a member of the Fund, exceeding Rs.6,500/-, such employee would become an excluded employee. It is pointed out that under Exhibit P10 judgment, the issue was considered and answered in favour of the employees and that Exhibit P10 has become final, on the appeals against Exhibit P10 being dismissed concurrently by the Division Bench and the Honourable Supreme Court. 4. The learned counsel referred to paragraph 26(6) of the EPF Scheme to contend that, irrespective of the statutory limit of Rs.6,500/-, it is open for the employer to enroll employees with pay of more than Rs.6,500/- as members or allow them to contribute more than Rs.6,500/- of their pay per month. Reference is made to paragraph 11(3) of the Pension Scheme to explain as to how the maximum pensionable salary is limited at Rs.6,500/- per month. Placing reliance on the decision in _**Vijayan v. Secretary to Government**_ [2006(110) FLR 918], it is contended that the limit mentioned in the Statute is minimum and therefore it shall always be in the discretion of the employer to make contributions in excess of the minimum as mentioned in the statute. _**WP(C).22223/16**_ 8 5. As pointed out by the learned counsel, in _**Vijayan's case (supra)**_ it was held that in a given case, where an employer, on his own volition, pays more than what is statutorily required, he shall have the choice to do so, since there is no embargo against such voluntary payment of contribution in excess of the statutory limit. Even though I find substantial force in the contentions urged on behalf of the petitioners, the 3[rd] respondent having decided to limit its contribution to Rs.6,500/- as directed by the Government, the 3[rd] respondent will be able to pay contributions in excess of the statutory limit, only in the event the Government grants permission. For that, the Government should be convinced that that embargo under Paragraphs 2(f)(ii) and 26(1) are not applicable as far as the petitioners are concerned. It is for this purpose that the petitioners have submitted Exhibit P12 representation, pointing out the relevant statutory provisions and the disadvantage to which they are put due to the payment of contribution being limited to 12% of Rs.6,500/-. Therefore, it is only appropriate that the Government considers the grievance of the petitioners. In the circumstances, the writ petition is disposed of directing the 2[nd] respondent to consider Exhibit P12 representation, after affording an opportunity of hearing to the petitioners, within an outer limit of three months from the date of receipt of a copy of this judgment. Sd/- **V.G.ARUN, JUDGE** _vgs_ _**WP(C).22223/16**_ 9 ## **APPENDIX** ## **PETITIONER'S/S EXHIBITS:** |**P1**|**A TRUE COPY OF THE AUDIT ENQUIRY NOTE NO.7**| |---|---| ||**DATED 13.11.2009 FURNISHED BY THE 4TH**| ||**RESPONDENT.**| |**P2**|**A TRUE COPY OF THE REPLY FORWARDED BY THE**| ||**3RD RESPONDENT.**| |**P3**|**A TRUE RELEVANT EXTRACT OF THE AUDIT REPORT**| ||**OF THE 4TH RESPONDENT.**| |**P4**|**A TRUE COPY OF THE CIRCULAR DATED**| ||**19.05.2010 ISSUED BY THE 2ND RESPONDENT.**| |**P5**|**A TRUE COPY OF THE LETTER DATED 24.07.2010**| ||**ISSUED BY THE 1ST RESPONDENT TO THE 3RD**| ||**RESPONDENT.**| |**P6**|**A TRUE COPY OF THE AUDIT ENQUIRY NOTE NO.17**| ||**DATED 28.11.2011.`**| |**P7**|**A TRUE COPY OF THE REPLY DATED 30.11.2011**| ||**FORWARDED BY THE 3RD RESPONDENT.**| |**P8**|**A TRUE COPY OF THE LETTER DATED 09.01.2014**| ||**FORWARDED BY THE 3RD RESPONDENT TO TEH 1ST**| ||**RESPONDENT.**| |**P9**|**A TRUE COPY OF THE CIRCULAR ISSUED BY THE**| ||**CENTRAL PF COMMISSIONER.**| |**P10**|**A TRUE COPY OF THE JUDGMENT DATED**| ||**04.11.2011 IN W.P.(C)NO.6643/2007.**| |**P11**|**A TRUE COPY OF THE JUDGMENT DATED**| ||**31.10.2014 IN W.P.(C)NO.23447 OF 2014 OF**| ||**THE HON'BLE HIGH COURT OF KERALA.**| |**P12**|**A TRUE COPY OF THE REPRESENTATION DATED**| ||**11.05.2016 FORWARDED BY THE PETITIONERS TO**| ||**EACH OF THE RESPONDENT.**|