The Kerala State Cashew Development Corporation Ltd. v. Employees Provident Fund Appellate Tribunal

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR. JUSTICE A.MUHAMED MUSTAQUE** # **WEDNESDAY, THE 29TH DAY OF MARCH 2017/8TH CHAITHRA, 1939** ## **WP(C).No. 4945 of 2008 (L)** **----------------------------------------** **PETITIONER(S) :** **--------------------------** **THE KERALA STATE CASHEW DEVELOPMENT CORPORATION LTD., CASHEW HOUSE, P.B.NO.13, KOLLAM, REPRESENTED BY ITS MANAGING DIRECTOR.** **BY SRI.U.K.RAMAKRISHNAN (SENIOR ADVOCATE) ADVS. SRI.DEVIDAS.U.K** **SRI.V.KRISHNA MENON SMT.UMA GOPINATH SMT.P.VIJAYAMMA** **RESPONDENT(S) :** - **----------------------------** **1. THE EMPLOYEES PROVIDENT FUND APPELLATE TRIBUNAL, 9TH FLOOR, MAYUR BHAVAN, NEW DELHI.** **2. THE ASSISTANT PROVIDENT FUND COMMISSIONER, EMPLOYEES PROVIDENT FUND ORGANISATION, REGIONAL OFFICE, BHAVISHYANIDHI BHAVAN, PATTOM, THIRUVANANTHAPURAM-4.** **BY SRI.N.N.SUGUNAPALAN (SENIOR ADVOCATE) ADV. SMT.T.N.GIRIJA, S.C** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 29-03-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** Msd. ## **WP(C).No. 4945 of 2008 (L) ----------------------------------------** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS :** **EXHIBIT P1: TRUE COPY OF THE GOVT. ORDER DATED 04.12.2000. EXHIBIT P2: TRUE COPY OF THE GOVT. ORDER DATED 27.03.2001. EXHIBIT P3: TRUE COPY OF THE GOVT. ORDER DATED 28.08.2001. EXHIBIT P4: TRUE COPY OF THE GOVT. ORDER DATED 14.03.2002. EXHIBIT P5: TRUE COPY OF THE GOVT. ORDER DATED 31.03.2003. EXHIBIT P6: TRUE COPY OF THE GOVT. ORDER DATED 08.03.2004. EXHIBIT P7: TRUE COPY OF THE GOVT. ORDER DATED 28.09.2004. EXHIBIT P8: TRUE COPY OF THE GOVT. ORDER DATED 19.07.2005. EXHIBIT P9: TRUE COPY OF THE GOVT. ORDER DATED 18.08.2005.** **EXHIBIT P10: TRUE COPY OF THE JUDGMENT DATED 07.02.2005 OF THE HON'BLE HIGH COURT IN W.P(C).NO. 11045 OF 2004. EXHIBIT P11: TRUE COPY OF THE ORDER NO. KR/1232/RO/TVM/PD/B/NS/06/ 6137A DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT. EXHIBIT P12: TRUE COPY OF THE ORDER NO. KR/1187/RO/TVM/PD/B/NS/06/ 6137W DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT. EXHIBIT P13: TRUE COPY OF THE ORDER NO. KR/1179/RO/TVM/PD/B/NS/06/ 6137S DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT. EXHIBIT P14: TRUE COPY OF THE ORDER NO. KR/1232/RO/TVM/PD/B/NS/06/ 6137B DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT. EXHIBIT P15: TRUE COPY OF THE ORDER NO. KR/1538/RO/TVM/PD/B/NS/06/ 6137A2 DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT. EXHIBIT P16: TRUE COPY OF THE ORDER NO. KR/1251/RO/TVM/PD/B/NS/06/ 6137O DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P17: TRUE COPY OF THE ORDER NO. KR/1267/RO/TVM/PD/B/NS/06/ 6137J DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P18: TRUE COPY OF THE ORDER NO. KR/1218/RO/TVM/PD/B/NS/06/ 6137Q DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P19: TRUE COPY OF THE ORDER NO. KR/1183/RO/TVM/PD/B/NS/06/ 6137L DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** ## **WP(C).No. 4945 of 2008 (L)** ## **----------------------------------------** - **EXHIBIT P20: TRUE COPY OF THE ORDER NO. KR/1185/RO/TVM/PD/B/NS/06/ 6137G DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P21: TRUE COPY OF THE ORDER NO. KR/1240/RO/TVM/PD/B/NS/06/ 6137B2 DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P22: TRUE COPY OF THE ORDER NO. KR/1544/RO/TVM/PD/B/NS/06/ 6137V DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P23: TRUE COPY OF THE ORDER NO. KR/1156/RO/TVM/PD/B/NS/06/ 6137C DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P24: TRUE COPY OF THE ORDER NO. KR/1163/RO/TVM/PD/B/NS/06/ 6137-I DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P25: TRUE COPY OF THE ORDER NO. KR/3407/RO/TVM/PD/B/NS/06/ 6137Y DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P26: TRUE COPY OF THE ORDER NO. KR/3407/RO/TVM/PD/B/NS/06/ 6137Z DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P27: TRUE COPY OF THE ORDER NO. KR/1183/RO/TVM/PD/B/NS/06/ 6137K DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P28: TRUE COPY OF THE ORDER NO. KR/1185/RO/TVM/PD/B/NS/06/ 6137F DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P29: TRUE COPY OF THE ORDER NO. KR/1187/RO/TVM/PD/B/NS/06/ 6137X DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P30: TRUE COPY OF THE ORDER NO. KR/1218/RO/TVM/PD/B/NS/06/ 6137P DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P31: TRUE COPY OF THE ORDER NO. KR/1156/RO/TVM/PD/B/NS/06/ 6137D DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P32: TRUE COPY OF THE ORDER NO. KR/1163/RO/TVM/PD/B/NS/06/ 6137E2 DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P33: TRUE COPY OF THE ORDER NO. KR/1267/RO/TVM/PD/B/NS/06/ 6137H DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P34: TRUE COPY OF THE ORDER NO. KR/1179/RO/TVM/PD/B/NS/06/ 6137R DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P35: TRUE COPY OF THE ORDER NO. KR/1266/RO/TVM/PD/B/NS/06/ 6137E DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P36: TRUE COPY OF THE ORDER NO. KR/1491B/RO/TVM/PD/B/NS/06/ 6137D2 DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** ## **WP(C).No. 4945 of 2008 (L)** ## **----------------------------------------** - **EXHIBIT P37: TRUE COPY OF THE ORDER NO. KR/2687/RO/TVM/PD/B/NS/06/ 6137 DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P38: TRUE COPY OF THE ORDER NO. KR/1491A/RO/TVM/PD/B/NS/06/ 6137T DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P39: TRUE COPY OF THE ORDER NO. KR/4655/RO/TVM/PD/B/NS/06/ 6137N DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P40: TRUE COPY OF THE ORDER NO. KR/1209/RO/TVM/PD/B/NS/06/ 6137C2 DATED 07.11.2006 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P41: TRUE COPY OF THE ORDER NO. KR/1473A/TVM/PD/EX./NS/07/ 3813 DATED 11.07.2007 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P42: TRUE COPY OF THE ORDER NO. KR/1240/RO/TVM/PD/B/NS/06/ 3814 DATED 11.07.2007 PASSED BY THE SECOND RESPONDENT.** - **EXHIBIT P43: TRUE COPY OF THE APPEAL MEMORANDUM WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P44: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 736(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P45: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 737(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P46: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 738(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P47: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 739(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P48: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 740(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P49: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 241(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P50: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 742(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P51: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 743(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** ## **WP(C).No. 4945 of 2008 (L)** ## **----------------------------------------** - **EXHIBIT P52: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 744(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P53: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 745(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P54: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 746(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P55: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 747(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P56: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 748(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P57: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 749(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P58: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 750(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL.** - **EXHIBIT P59: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 26(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P27 ORDER.** - **EXHIBIT P60: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 27(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P28 ORDER.** - **EXHIBIT P61: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 28(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P29 ORDER.** - **EXHIBIT P62: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 29(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P30 ORDER.** - **EXHIBIT P63: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 30(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P31 ORDER.** - **EXHIBIT P64: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 31(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P32 ORDER.** ## **WP(C).No. 4945 of 2008 (L)** ## **----------------------------------------** **EXHIBIT P65: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 32(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P33 ORDER.** - **EXHIBIT P66: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 33(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P34 ORDER.** - **EXHIBIT P67: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 757(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P35 ORDER.** - **EXHIBIT P68: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 758(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P36 ORDER.** - **EXHIBIT P69: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 759(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P37 ORDER.** - **EXHIBIT P70: TRUE COPY OF THE APPEAL MEMORANDUM WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P38 ORDER.** - **EXHIBIT P71: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 761(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P39 ORDER.** - **EXHIBIT P72: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 762(7) OF 2006 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P40 ORDER.** - **EXHIBIT P73: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 531(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P41 ORDER.** - **EXHIBIT P74: TRUE COPY OF THE APPEAL MEMORANDUM NO. ATA. 532(7) OF 2007 WITHOUT ANNEXURES FILED BEFORE THE FIRST RESPONDENT TRIBUNAL AGAINST EXT. P42 ORDER.** - **EXHIBIT P75: TRUE COPY OF THE JUDGMENT OF THIS HON'BLE COURT DATED 22.02.2007 IN W.P(C).NO. 6074 OF 2007(W).** - **EXHIBIT P76: TRUE COPY OF THE COVERING LETTER DATED 16.03.2007 SENT ALONG WITH THE DEMAND DRAFT SENT BY THE PETITIONER TO THE SECOND RESPONDENT.** - **EXHIBIT P77: TRUE COPY OF THE COVERING LETTER DATED 26.04.2007 SENT ALONG WITH THE DEMAND DRAFT SENT BY THE PETITIONER TO THE SECOND RESPONDENT.** ## **WP(C).No. 4945 of 2008 (L)** **----------------------------------------** **EXHIBIT P78: TRUE COPY OF THE COMMON ORDER DATED 17.08.2007 PASSED BY THE FIRST RESPONDENT TRIBUNAL.** **RESPONDENT(S)' EXHIBITS :** **NIL** **//TRUE COPY//** **P.S.TO JUDGE.** Msd. ## **A.MUHAMED MUSTAQUE, J.** ========================= ## **W.P.(C).No.4945/2008** ~~~~~~~~~~~~~~~~~~~~~~~~~ Dated this the 29[th] day of March, 2017 ## **J U D G M E N T** The writ petition is filed challenging the orders passed under Section 14B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 (for short, the “Act”) and also the common order of the Appellate Tribunal. The petitioner is a State Government undertaking. It is fully owned by the Government. The petitioner has cashew factories in Thiruvananthapuram, Kollam, Alappuzha, Thrissur and Kannur Districts. The learned counsel for the petitioner submits that some cashew factories belong to the petitioner and some factories are run under a lease. 2. The petitioner's establishments are covered under the above Act. It appears that there was a delay in payment of contribution on the side of the petitioner which resulted in the proceedings under Section 14B claiming damages under the said Act. The petitioner raised objections against the same. Those objections inter alia pointed out that the petitioner suffered huge loss and it could run the factories only with the aid of the Government. The objections put forward by the petitioner would show that the Corporation suffered huge loss and the delay in remittance was due to ``` WPC 4945/2008 ``` ## **-:2:-** the above financial constraints. No doubt, mere financial difficulties cannot be a reason at all for the delay in remittance of the provident fund contribution but, certainly, if it affected running of the factories itself then that could be a substantial reason for not making payment within time. The above proposition, in fact, is reiterated in a large number of cases of this court including the judgment rendered by a learned Single Judge of this court in **Harrisons Malayalam Ltd. v. Regional Provident Fund Commissioner [2012 (2) KLT SN 74]** . 3. It is to be noted that mere delay in payment of contribution cannot result in levy of damages. There must be some contemporaneous act on the part of the employer in making delayed remittance. It is also to be noted that the petitioner's objections were overruled stating that the petitioner had to pay the amount and do not find any reason to accept the petitioner's objections. In fact, the petitioner has stated cogent reasons to absolve it from the remittance of damages. The appellate authority also had not adverted to the reasons put forward by the petitioner for the delayed payment in the right perspective. It is not the mere delay on the part of the petitioner in making remittance alone to be considered, the question that had to be considered was whether there was any wilful laches on the part of the ``` WPC 4945/2008 ``` ## **-:3:-** petitioner in remitting the contribution within time. When the very existence of the factories itself was not viable, the question of remittance of contribution within the time contemplated by the provisions of the Act does not arise. In such circumstances, if the petitioner could demonstrate and establish that the delayed payment was due to the reasons beyond its control, certainly, the authority can demand the petitioner to produce those documents to prove the same. The petitioner cannot be treated at par with ordinary employers though, it cannot demand any differential treatment. Taking note of the explanation put forward by the petitioner, this court is of the view that they should be given one more opportunity to place the entire records before the first respondent to substantiate its objections. Accordingly, the impugned orders are set aside. The matter shall be reconsidered by the first respondent afresh within a period of four months. The petitioner's representative shall appear before the first respondent on 26.6.2017 with all the relevant records to substantiate the objections. Thereafter, appropriate orders shall be passed within the above period. The writ petition is disposed of as above. Sd/- ## **A.MUHAMED MUSTAQUE, JUDGE** ms