Bombay High Court
THE CENTRAL BOARD OF TRUSTEES, EMPLOYEES PROVIDENT FUND ORGANIZATION THORUGH ASST.PF.COM.(LEGAL)andversusKALPESH ENTERPRISES
- Decided
- Disposal
- Disposed Off
- Bench
- AMIT BORKAR
Holding
The order of the Employees Provident Fund Appellate Tribunal dated 2 November 2016 is set aside and the matter is remitted to the Central Jurisdictional Inquiry Tribunal, Mumbai, for fresh determination of damages under Section 14B.
Summary
The petitioners, Sayali Deepak Upasani Employees Provident Fund Organisation, challenged an order dated 2 November 2016 passed by the Employees Provident Fund Appellate Tribunal (EPFAT) which imposed damages under Section 14B of the Employees Provident Fund and Miscellaneous Provisions Act. The Tribunal had relied on a Delhi High Court judgment in System and Stamping & Another v. Employees Provident Fund Appellate Tribunal (2008 2 LLJ 939) to determine the quantum of damages. The Supreme Court, however, in Central Board of Trustees v. Roma Henny Security Services Pvt. Ltd. (Civil Appeal No. 6592/2014) set aside that Delhi High Court decision for ignoring clause 32A of the EPF Scheme, 1952. The petitioners argued that, in view of the Supreme Court’s ruling, the EPFAT could not base its order on the over‑ruled judgment and must reassess damages afresh. The Bombay High Court agreed, held that the Tribunal’s order was unsustainable, set it aside and remitted the matter to the Central Jurisdictional Inquiry Tribunal, Mumbai, for a fresh determination of damages under Section 14B. The writ petition was allowed and the order of the EPFAT was vacated.
Issues considered
- Whether the EPFAT could rely on the Delhi High Court judgment in System and Stamping & Another v. EPFAT for assessing damages under Section 14B after the Supreme Court set aside that judgment.
- Whether the order of the EPFAT dated 2 November 2016 imposing damages is liable to be set aside.
- Whether the matter should be remitted to the CJIT for fresh consideration of damages in accordance with the correct legal position.
Legislation cited
Subjects
- Section 14B
- damages
- Employees Provident Fund
- EPF Act
- Supreme Court precedent
- remand
- appellate tribunal
- employee benefits
Judgment
28-Wp-5867-18-F.doc
Sayali
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
SAYALI WRIT PETITION NO.5867 OF 2018
DEEPAK
UPASANI
The Central Board of Trustees
Digitally signed by
SAYALI DEEPAK
UPASANI
Employees Provident Fund Organisation
Date: 2026.04.30
18:25:02 +0530
Through Asst. PF. Co. (Legal) and Others … Petitioners
V/s.
Kalpesh Enterprises … Respondents
Mr. Sandeep Mishra with Ms. Madhura Mulay, for
Petitioners.
Ms. Sunita Dube i/b P. Bhagat, for Respondent.
CORAM : AMIT BORKAR, J.
DATED : APRIL 30, 2026
P.C.:
1. Rule. Rule made returnable forthwith.
2. The petitioners challenge the order dated 02 nd November,
2016. This order was passed by the Presiding Officer of the
Provident Fund Appellate Tribunal at New Delhi in Appeal ATA
No.1146 (9) of 2015. The petitioners say that this order is wrong
on law and facts. They want the Court to interfere.
3. The order in dispute was passed under Section 14B of the
Employees Provident Fund and Miscellaneous Provisions Act.
This provision deals with the power of the authorities to impose
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28-Wp-5867-18-F.doc
damages when an employer delays payment of provident fund
contributions. The purpose of damages is to discourage delay and
protect the interest of employees. When an authority uses Section
14B, it has to consider the facts of each case and then decide the
amount of damages.
4. A reading of the impugned order shows that the Tribunal
relied on a judgment of the Delhi High Court in the case of
System and Stamping and Another vs. Employees Provident Fund
Appellate Tribunal and Others reported in (2008) 2 LLJ 939. In
that case, the Delhi High Court had examined how Section 14B
should be applied. The Tribunal treated that judgment as a
guiding source for deciding damages. The reasoning of the
Tribunal mainly flows from this judgment.
5. It is pointed out that the Supreme Court has considered this
issue in Civil Appeal No.6592/2014, Central Board of Trustees vs.
Roma Henny Security Services Pvt. Ltd. The Supreme Court
noted that the Delhi High Court had not considered clause 32A of
the Employees Provident Fund Scheme, 1952. Because of this,
the Supreme Court set aside the judgment and sent the matter
back to the Delhi High Court to reconsider. The petitioners argue
that once the Supreme Court has set aside the judgment relied
upon by the Tribunal, the basis of the impugned order has
disappeared. They say the Tribunal must now decide the issue of
damages under Section 14B without relying on the Delhi High
Court judgment.
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28-Wp-5867-18-F.doc
6. It is not in dispute that the judgment in System and
Stamping has been set aside by the Supreme Court. Once the
Supreme Court has taken that step, the reasoning of that
judgment cannot support the Tribunal's order. Therefore, the
Tribunal must reconsider the matter. The Tribunal will have to
decide damages under Section 14B by applying the correct legal
position and by examining the facts on record. In view of these
facts, the petition deserves to be allowed.
7. The order dated 02nd November, 2016 passed by the
Employees Provident Fund Appellate Tribunal in Appeal No. 1146
(9) of 20 is set aside.
8. The matter is sent back to the CJIT, Mumbai, to reconsider
the question of damages under Section 14B of the Act. The
authority will give fresh consideration as per law and evidence.
9. Rule is made absolute in above terms.
10. The writ petition stands disposed of.
(AMIT BORKAR, J.)
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