KULGAON BADLAPUR NAGAR PARISHADversusEMPLOYEES PROVIDENT FUND ORGANISATION AND ANR

2026:BHC-AS:36204

              Renuka                                             11-WP-11240-2026.docx


                         IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                                 CIVIL APPELLATE JURISDICTION
                                WRIT PETITION NO. 11240 OF 2026
              Kulgaon Badlapur Nagar Parishad                     ...Petitioner
                               V/s.

              Employees       Provident           Fund           ...Respondents
              Organisation and Anr
                                           ________________
              Mr. Narayan R. Bubna a/w Mr. Aryanraj A. for Petitioner.
              Mr. Gunjan Chaubey a/w Mr. Sandeep Singh for Respondent-EPFO.


                                           ________________
                                                     CORAM: SANDEEP V. MARNE, J.
                                                      DATED: 1 SEPTEMBER 2026.


              P.C.:


              1)          The Petition is filed by Kulgaon Badlapur Nagar Parishad
              challenging the order dated 30 June 2026 passed under Section 7B of the
              Employees Provident Fund and Miscellaneous Provisions Act, 1952(EPF
              Act). The Impugned order rejects Review Petition filed by the Petitioner-
              Municipal Corporation against Section 7-A order dated 29 October 2020.
              This is a second round of litigation qua Section 7B order. Earlier the
              review was apparently rejected without grant of an opportunity of
              hearing to the Petitioner. By order dated 22 February 2022, this Court set
              aside the order and directed grant of opportunity to the Petitioner of
              hearing in the Review Petition. Accordingly, the Review was heard for a
              prolonged period of four years and numerous dates of hearing were fixed.

                                                Page No.1 of 6
                                             1 SEPTEMBER2026
Renuka                                                             11-WP-11240-2026.docx


The Regional Provident Fund Commissioner has passed 81 page detailed
order rejecting the Review Petition dealing with each and every
contention sought to be raised by the Petitioner.


2)                There is a remedy of filing Appeal against the order under
Section 7B of the EPF Act. Under Sub-section (5) of Section 7B, an Appeal
lies under the EPFAct against the order passed under review as if the
order passed under the review were the original order passed under
Section 7A. Petitioner thus has alternate and equally efficacious remedy
of filing review before the Central Government Industrial Tribunal
(CGIT).


3)                Mr. Bubna, the learned counsel appearing for the Petitioner
submits that the Petitioner may not be relegated to the alternate remedy
of filing of Appeal in view of the special circumstances in the present
case where the RPFC has not issued notices to the individual contractors
for ascertaining the details of employees. He has relied on judgments of
the Apex Court in Food Corporation of India V/s Provident Fund
Commissioner and Ors. 1 and Bharat Heavy Electricals Ltd V/s Employees
State Insurance Corporation2 as well as of this Court in M/s. Altaf
Ahamad, Anjuman Shops Complex Bajar, Sadar, Nagpur V/s The
Assistant Provident fund Commissioner and Anr.3 and Matheran
Municipal Council V/s Assistant Provident Fund Commissioner 4 Relying
on the above judgments, it is sought to be contended by Mr. Bubna that

1    (1990) 1 SCC
2    (2008) 3 SCC 247
3    Writ Petition No. 1335 of 2011 decided on 29 January 2026.
4    Writ Petition No. 15200 of 2023 decided on 27 February 2024

                                             Page No.2 of 6
                                          1 SEPTEMBER2026
Renuka                                                    11-WP-11240-2026.docx


Section 7A inquiry must be conducted after undertaking investigation by
summoning the contractors to ascertain the details of payments of PF
contribution paid by them through PF code numbers.


4)          In the present case, the RPFC has analyzed the provisions of
Section 21A of the Contract Labour (Regulation of Abolition Act 1970),
(CLRA) paragraph 30 and 36B of the EPFC and has concluded as under;-


         For the sake of brevity, relative section of the CLRA Act is reproduced
         herein below:

              21. Responsibility for payment of wages.-

              (1) A contractor shall be responsible for payment of wages to each
              worker employed by him as contract labour and such wages shall be
              paid before the expiry of such period as may be prescribed.

              (2) Every principal employer shall nominate a representative duly
              authorised by him to be present at the time of disbursement of wages
              by the contractor and it shall be the duty of such representative to
              certify the amounts paid as wages in such manner as may be
              prescribed.

              (3) It shall be the duty of the contractor to ensure the disbursement
              of wages in the presence of the authorised representative of the
              principal employer.

              (4) In case the contractor fails to make payment of wages within the
              prescribed period or makes short payment, then the principal
              employer shall be liable to make payment of wages in full or the
              unpaid balance due, as the case may be, to the contract labour
              employed by the contractor and recover the amount so paid from the
              contractor either by deduction from any amount payable to the
              contractor any contract as a debt payable by the contractor.

         Similarly, Para 30 of the EPF Scheme, 1952 makes it explicit that the
         Principle Employer is liable to secure PF compliance in respect of eligible
         employees employed by him directly or by or through a contractor. For the
         sake of brevity, Para 30 is reproduced herein below:

              Para 30 of the EPF Scheme - Payment of contributions:

                                     Page No.3 of 6
                                  1 SEPTEMBER2026
Renuka                                                  11-WP-11240-2026.docx



              "(1) The employer shall, in the first instance, pay both the
              contribution payable by himself (in this Scheme referred to as the
              employer's contribution) and also, on behalf of the member employed
              by him directly or by or through a contractor, the contribution
              payable by such member (in this Scheme referred to as the member's
              contribution).

              (2) In respect of employees employed by or through a contractor, the
              contractor shall recover the contribution payable by such employee
              (in this Scheme referred to as the member's contribution) and shall
              pay to the principal employer the amount of member's contribution
              so deducted together with an equal amount of contribution (in this
              Scheme referred to as the employer's contribution) and also
              administrative charges.

              (3) It shall be the responsibility of the principal employer to pay both
              the contribution payable by himself in respect of the employees
              directly employed by him and also in respect of the employees
              employed by or through a contractor and also administrative
              charges."

         The Municipal Council has questioned the names of contractors and
         employees for whom the dues were assessed under Section 7A. The basis
         of computation has already been detailed in the Section 7A order and
         further explained in the deposition report dated 03/09/2025 submitted by
         the Enforcement Officer.

         Further, Para 36-B of the EPF Scheme, 1952 empowers the Principle
         Employer to obtain all relevant information from the contractors. For the
         sake of brevity, the Para 35-B is reproduced herein below:

              Para 36-B. Duties of Contractors: "Every contractor shall, within
              seven days of the close of every month, submit to the principal
              employer a statement showing the recoveries of contributions in
              respect of employees employed by or through him and shall also
              furnish to him such. Information as the principal employer is
              required to furnish under the provisions of the Scheme to the
              Commissioner."

         From the combined reading of the provisions of the CLRA Act, 1970 and
         the EPF & MP Act, 1952, it Is evident that:

                 The Principal Employer must maintain complete records of all
                  workers engaged through contractors.




                                     Page No.4 of 6
                                  1 SEPTEMBER2026
Renuka                                                   11-WP-11240-2026.docx


                  The Principal Employer must verify wage disbursement and
                   ensure statutory payments.

                  The Principal Employer must secure PF compliance for all eligible
                   employees engaged directly or through any contractor.

                  Contractors are legally bound to furnish monthly details to the
                   Principal Employer, enabling the latter to comply with the EPF
                   Scheme.

          Accordingly, Identification of employees and ensuring their PF compliance
          is the sole and statutory responsibility of the Municipal Council, being the
          Principal Employer.

5)           Thus, after considering combined effect of the CLRA Act and
the EPF Scheme, the RPFC has arrived at the conclusion that the sole and
statutory responsibility of maintaining all details with regard to
employees of the contractor rests on the Municipal Council. Whether
this conclusion of the RPFC is correct or not can be decided by the
Appellate Court. It appears that the RPFC has thought it unnecessary to
summon the contractors in the facts of the present case and has put the
entire responsibility of providing details of contract workers on the
Petitioner. Whether this is right or not again can be considered only in
an Appeal.


6)           In my view, therefore this is not appropriate case for
entertaining the present Petition by permitting the Petitioner to skirt the
remedy of Appeal under Section 7-I of the EPF Act.


7)           It appears that the position of the Presiding Officer at
C.G.I.T-II is vacant. It is contended by Mr. Bubna that precipitative steps
would be taken by the RPFC against the Municipal Council, if it is unable
to press Application for stay before the Tribunal on account of non

                                     Page No.5 of 6
                                  1 SEPTEMBER2026
                          Renuka                                                11-WP-11240-2026.docx


                          availability of the Presiding Officer. In my view a pro tem arrangement
                          can be made by directing the Petitioner to deposit 25% of the ascertained
                          amount with the EPF department. Subject to such deposit being made,
                          an ad-interim protection can be granted in favour of the Petitioner-
                          Municipal Council till the Tribunal considers and decides Application
                          under Section 7-O for interim relief.


                          8)            Writ Petition is accordingly disposed of with liberty to the
                          Petitioner to file Appeal against order 7I of the EPF Act and application
                          of stay. Till the Petitioner's Application for stay under Section 7-O is
                          decided by the Tribunal, no coercive steps shall be taken for recovery of
                          ascertained amount in the event Petitioner deposits 25% of the amount
                          due and payable with the EPF department within a period of four weeks.


                          9)            All rights and contentions of the parties on merits are
                          expressly kept open to be agitated before the Tribunal. Time spent in the
                          prosecuting the Petition shall be excluded while computing the period of
                          limitation.


                                                                             [SANDEEP V. MARNE, J.]




Signed by: Renuka S Thakur
                                                            Page No.6 of 6
Designation: PA To Honourable Judge                      1 SEPTEMBER2026
Date: 03/09/2026 16:16:47