WAGE CEILING FOR PF COVERAGE TO BE RAISED TO RS.15,000 Per Month Also Monthly Pension Rs.1000 Per Month - CiteHR
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every thing is accepted , but where is the India Govt Gazatte...? you can not work on these documents . I agree with you that it is approved by the Finance ministry....bla bla bal.....But it will come into force at the moment it will be passed by the union cabinet
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Hi All,
With the Lok Sabha Election 2014 on its way, i assume that this issue will surely get entangled. As the proposal made by the Labour Ministry has asked Finance ministry to provide an additional 1217 crores, which is indeed a big amount.
PROVIDENT FUND UPDATE

January 2014

Editor's Note

The number of beneficiaries and the volume of financial transactions undertaken by the Employees’ Provident Fund Organisation (EPFO) is the largest in the country. Its total assets is more than Rs. five lakh crore as on 1st May, 2013. This money belongs to the investors-employees and employers. Every organisation that employs 20 or more employees is obligated to be the investor. The scheme must enjoy the confidence and approval of all stake holders as far as its methods, fairness and integrity is concerned and that is how it can meaningfully contribute to the economic and social well being of members.

Despite all claims about improvements in the function of the organisation, we often hear about the alleged malfunctioning and the cases of corruption in the organisation. There has been a report in the Economic Times that out of 107.16 Lakh PF claims received during 01.04.2012 to 13.12.2012, around 7 lakh claims are pending for settlement. As per the provisions contained in para 72(7) of the Employees’ Provident Funds Scheme, 1952, all claims found in order are to be settled within 30 days but this time limit is hardly adhered to.

It is not that only employees have to run from pillar to post but the employers are also aggrieved by the provident fund authorities. Most of the employers are unaware that there is an EPF Appellate Tribunal (Delhi) – the only one for whole of India where they can file their appeals. What the Tribunal has been deciding is summarized below, which will be informative to know in order to ward off harassment by the provident fund authorities.

HIGHLIGHTS OF ORDERS OF EPF APPELLATE TRIBUNAL

COVERAGE OF ESTABLISHMENT EMPLOYING BELOW 20 PERSONS SET ASIDE

M/s. Sh. Mahabaleshwara Auto Industries (P) Ltd. vs. APFC, Bangalore, ATA No.793(6) 2005, decided on 26.12.2013

In an appeal filed before the Employees’ Provident Fund Appellate Tribunal, the appellant has challenged the orders dated 09.05.1997 and 18.12.1991, passed by the EPF Authority, under section 7-A of the Act, covering the establishment of the appellant for compliance of the Act as well as for determination of the PF dues.

The plea taken by the appellant is that it had never engaged more than 14 employees. Services of 3 security guards were engaged through a contractor M/s. Ex. Soldiers Industrial Security Services, covered under the Act.

The employees, already covered under the Act by their employer, cannot be counted again for covering the establishment of the appellant under the Act. Hence, impugned order is set aside. Appeal is allowed.

ARREARS OF WAGES - NOT TO ATTRACT INTEREST/DAMAGES

M/s. HSIL Ltd. vs. RPFC, Hyderabad, ATA No.561(1) 2012, decided on 6.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the validity and legality of order dated 15.05.2012, passed by the EPF Authority, under section 14-B of the Act, imposing interest and damages on account of delayed remittance in respect of arrears of wages paid later on in compliance of a settlement between the employer and the workmen/union.

‘Actually drawn’ must be understood as actually due, payable and drawn, if the disbursement has not occasioned, it must be understood as liable to be drawn and payable when they become due and payable. Accordingly, the levy of damages in the case in hand is contrary to the law settled by the Andhra Pradesh High Court and the impugned order is set aside. Appeal is allowed.

DAMAGES FOR LATE DEPOSIT SUSTAINED BUT INSTALMENTS ALLOWED

M/s. Air Force School vs. APFC, Bangalore, ATA No. 06(06) 2012, decided on 24.12.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the order dated 17.11.2011, passed by the EPF Authority, under section 14-B of the Act, levying damages for late deposit of PF dues on the ground that impugned order is arbitrary, illegal and pre-determined whereas the default of the appellant was not wilful.

The EPF Appellate Tribunal concluded that since the appellant had admitted the delayed remittance of dues, to remit the damages in instalments, hence appellant is permitted to deposit the damages and interest in 10 equal monthly instalments.

TRAINEES UNDER STANDING ORDERS ARE NOT EMPLOYEES TO BE COVERED

M/s. ISS Catering Services (South) Pvt. Ltd. vs. APFC, Chennai, ATA No.44(13) 2011, decided on 8.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, challenging the order dated 31.12.2010, passed by the EPF Authority, under section 7-A of the Act, determining the EPF dues in respect of trainees engaged on the basis of Certified Standing Orders.

The EPF Appellate Tribunal has held that the trainees were appointed and certification of Standing Orders was obtained subsequently. So long as the Standing Orders were not certified by the competent authority, the trainees appointed shall be governed by Model Standing Orders incorporated in the Industrial Establishment (Standing Orders) Act, 1946.

EXCLUDED EMPLOYEES NOT ENTITLED TO BE MEMBER OF PENSION SCHEME

M/s. Manikgarh Cement vs. RPFC, Nagpur, ATA No.529(9) 2011, decided on 6.12.2013

An appeal was filed before the Employees’ Provident Fund Appellate Tribunal, by the appellant, against the order dated 30.06.2011, passed by the EPF Authority, under section 7-A of the Act on the ground that the assessment of EPF dues in respect of ‘unrolled employees’ by the EPF Authority, is wrong and illegal.

The EPF Appellate Tribunal observed that it is an admitted fact by both the parties that the wages of the employees are above the prescribed limit of ‘excluded employees’ i.e. Rs.6500 per month. Such employees are to be treated as ‘excluded employees’ in view of para 2(f) of the Scheme. Even the excluded employees who attended the proceedings conducted under section 7A of the Act stated not to be interested in pension scheme, as per paragraph 26(6) of the Scheme, 1952. Hence, the impugned order is not sustainable and quashed.

NO INTEREST OR DAMAGES WHEN DEFAULT IS NOT WILFUL

M/s. Looksan Tea Estate vs. RPFC, Jalpaiguri and Another, ATA No.468(15) 2012, decided on 25.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the validity and legality of orders, passed by the EPF Authority, under section 14-B of the Act, imposing damages and interest on account of delayed remittance whereas the appellants have been suffering losses and delay was not wilful.

It is settled position that a penal provision should be construed strictly. Levy of damages cannot be construed as imperative by the reason of an enabling provision. After amendment to Para 32A of the EPF Scheme with effect from 26.09.2008, the damages are to be levied at the lower rate by excluding the element of interest included earlier. In the impugned order, the EPF Authority has not indicated the reasons for delay in remittance of EPF dues attracting levy of damages. There is no finding by the EPF Authority to establish that the appellant had unlawfully diverted the funds collected from the employees for its business use. Since there is no mens rea on the part of the appellant, damages or interest should not be levied. Hence, the impugned order is set aside.

DEFAULT IN DEPOSIT WHEN NOT WILFUL, PENAL DAMAGES UNJUSTIFIED

M/s. Shiv Herbal Research Laboratory Ltd. vs. APFC, Nagpur, ATA No.103(09) 2007 decided on 21.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, challenging the order dated 11.12.2003, passed by the EPF Authority, under section 14-B of the Act, levying damages and interest for delayed remittance of PF dues without giving opportunity of hearing, which is illegal.

Since the EPF Authority has failed to prove on record the wilful default on the part of the appellant, levy of damages be restricted to 25% of the actual amount of damages levied under the impugned order. The appeal is disposed of accordingly.

LEVY OF DAMAGES - REDUCED TO 5% WHEN DEFAULT NOT WILFUL

M/s. Kattima Export vs. APFC, Chennai, ATA No.293(13) 2012, decided on 29.11.2013

The appellant filed an appeal before the Employees’ Provident Fund Appellate Tribunal, questioning the order passed by the EPF Authority, under section 14-B of the Act, levying damages and interest for delayed remittance of PF dues on account of poor financial condition.

In the impugned order, the EPF Authority has not indicated the reasons attracting levy of damages. Since there is no mens rea on the part of the appellant, levy of damages be restricted to 5% of the actual amount of damages levied under the impugned order. Hence, the appeal is disposed of accordingly.

HIGHLIGHTS OF THE JUDGMENTS OF HIGH COURTS AND SUPREME COURT

An order passed by the EPF Authority under section 7-A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, without affording an opportunity to be heard to the employer for submitting his defence, is liable to be quashed.

Rallis India Ltd. vs. The Asst. Provident Fund Commissioner & Ors., 2014 LLR 25 (Bom. HC)

An order passed by the EPF Authority determining the EPF dues towards employer and imposition of interest thereon for belated remittance is a composite order under Sections 7-A and 7-Q of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 and is appealable before the EPF Appellate Tribunal.

Arcot Textile Mills Ltd. vs. The Regional Provident Fund Commissioner and Ors., 2014 LLR 89 (SC)

When the evidence recorded by the Trial Court reveals that no cogent evidence has been placed and proved on record by the EPF Authority i.e. complainant to substantiate that during the material time, firm of the respondents was working, employing a particular number of workers etc., the question of depositing the EPF contributions by the employer does not arise.

Regional Provident Fund Commissioner vs. Atma Ram and Sons and Anr., 2014 LLR 29 (P&HHC)

Unless the issue with regard to contribution, as pending before the EPF Appellate Tribunal, is decided, the petitioner cannot be directed by the Employees Provident Fund Authority to pay interest and damages.

Guru Nanak College, Chennai vs. Assistant Provident Fund Commissioner, Chennai and Others, 2014 LLR (SN) 110 (Mad. HC)

No appeal Section 7-I of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 is maintainable for challenging the order, passed by the EPF Authority, imposing only interest under Section 7-Q of the Act.

Arcot Textile Mills Ltd. vs. The Regional Provident Fund Commissioner and Ors., 2014 LLR 89 (SC)
Dear All,
If any of the member got the copy of the notification, then kindly share here.
Because, till the notification will not be issued, it could not be implemented.
As there are some news paper have claimed that the wage ceiling revision has been approved by the finance ministry, but no information has been posted regarding its effectiveness. Whereas for revision of pension, it is clearly mentioned that it will be revised w.e.f. 01-04-2014.
So, it will be better to have notification before implementing the same, as we are answerable to the management also.
Dear All, Kindly provide us the copy of Government Order (G.O.)
How you can got the copy as the same is not passed by Union Cabinet ?? Friend , always remember that this types of notification can be published only after it is approved by the Union Cabinet through vote of confidence... So , just wait and see what is going to be happened..But it's for sure that this bill will be passed before the declaration of next Loksabha Election.......because this types of bill can work as a vote bank...
The comments posted by Mr Yatin Pundhir is good .....It can help us to increase our knowledge.......But regret to say that the same posting is not relevant to the main topics..... and it can create unwanted confusion to the members.......Requestiong to be more specific and simple so that all the general members can digest the topics.....
Useful update. Let these proposals be endorsed by the Central Govt. Warm regards, Sourav Mukherjee
Dear Seniors,
As per the latest decision from the Central Board of Trustees in regards of raising the monthly wage ceiling to Rs. 15000/- from Rs 6500/-, we would like to the when is the said law applicable from.
As per our knowledge the said law was passed on February 05th, 2014 but there is no mention for its date with which it is effective.
Kindly revert.
Thanks & Regards
Ms. Chakrapani
PROVIDENT FUND COVERAGE AT RS.15,000 AND MINIMUM MONTHLY PENSION RS.1,000 TO START SOON

The Central Board of Trustees (CBT), the apex decision making body of Employees' Provident Fund Organisation on 5th February, 2014 has decided to amend Employees' Provident Fund Scheme to raise the monthly wage ceiling to Rs.15,000 from Rs.6,500 for coverage of an employee.

According to EPFO, the Finance Ministry has already approved the Labour Ministry's proposals for entitlement of minimum monthly pension of Rs.1,000 and enhancing wage ceiling for coverage to Rs.15,000 per month.

PROVIDENT FUND UPDATE



The Employees Provident Fund Organization (EPFO) is inflicted with inefficiency and opacity leading to the unmitigated hardships to all stakeholders despite the fact that the administrative charges are paid by the employers alongwith the contributions. In view of the glaring lacunas in the Act and inefficient management of the Organization judicial interpretations, come to the rescue. We summarized the judicial interpretations of 2013, which are produced below.

HIGHLIGHTS OF ORDERS OF EPF APPELLATE TRIBUNAL

AS DIGESTED IN 2014

Damages waived in the absence of proper enquriy and identification of beneficiaries

Loss making company permitted to deposit outstanding in instalments

20% towards labour charges in the cost of construction - to be set aside for want of identification of beneficiaries

Determination of dues without making physical verification and identification of beneficiaries - to be quashed

Damages untenable if default in deposit is not willful

Coverage of establishment employing less than 20 persons set aside

Arrears of wages - not to attract interest/damages

Trainees under model standing orders are not employees to be covered

No interest or damages when default is not wilful

Excluded employees not entitled to be member of pension scheme

Default in deposit when not wilful, penal damages unjustified

Damages for late deposit sustained but instalments allowed

Levy of damages - reduced to 5% when default not wilful

5% damages appropriate when delay in deposit of dues is not wilful

Coverage of a trust needs fresh consideration

Levy of damages without considering the reasons for delayed deposit to be re-examined

International workers when availing benefit of PF and pension - not to be covered in India

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