EPF and Allowances: Why Are Court Judgments Applied Differently Across States?

EPF Applicability and Court Judgments

Our Regional Commissioner for EPF, under a 7A inquiry, has passed an order stating that EPF is applicable to other allowances as per the Gujarat High Court judgment. I argued that the Gujarat High Court judgment is only applicable to cases within the jurisdiction of Gujarat State, not Tamil Nadu. In his findings of the 7A inquiry, he concluded that EPF is applicable to other allowances based on the judgments of the Gujarat High Court and the Madras High Court in the Reynold Pen case. My question is, why did he refuse to cite the sections of the EPF Act?

Regards,
E.A. Murugan
[Phone Number Removed For Privacy Reasons]
Salem, TN

Kindly ask your Regional PF Commissioner for a copy of any circular amendments that have been revised since they have not been communicated to your organization by the regional EPF Office. Additionally, the amendments on the EPF website, i.e., www.EPF.India, are also not available.

Regards,
Ratikanta Rath

Dear Murugan,

Regarding the Query on PF Contributions

The matter is pending in the courts of law. Some of the High Courts, such as Madras, Bhopal, and Gujarat High Courts, have given a verdict on the matter of PF contributions payable on all allowances. In the same instance, Karnataka and Punjab High Courts have dismissed the arguments raised by EPFO to pay contributions on other allowances. You can refer to Sec 2(b) and Sec 6 of the EPF Act - 1952 - contributions are payable on Basic Wages and DA or any other Retaining Allowance. Other allowances do not come under the part of wage. The commissioner does not take or overrule the provisions of the EPF Act - 1952.

Furthermore, in many cases, the Honorable Supreme Court cannot reach the right conclusion on this matter. Any act to be enacted by Parliament after debating the issue in the motion of the session and implementing such changes as amended by way of notification. The courts cannot give such a verdict to overrule the legal parameters.

Regards,
V R RAO PULIPAKA.

Thank you very much for your early reply. It will be highly appreciated if you could provide the case numbers and years for the verdicts of the Karnataka and Punjab High Courts, as well as any information on stays in any High Courts/Supreme Courts related to this matter.

Regards,
Ea Murugan

Until and unless any amendment made by the EPF Office is circulated to any Regional EPF office, it will not be entertained. Any court judgment will also not be entertained since court judgments vary depending on the case. If a court gives any judgment, then as per current practice, the EPF office will send a Circular to all Regional EPF Offices. To date, no circular has been issued in connection to your case. Still, the PF amount is deducted based on Basic+DA or any retaining Allowance payable to the employee. If your PF Enforcement officer imposes any penalty on your company, then you can register a complaint or case against the Local EPF Office.

Regards,
Ratikanta Rath

Thank you, sir. It's not by the EPF Enforcement officer; the Regional Commissioner directed through his 7A and 7C Inquiry's findings to remit the EPF contribution for other allowances by mentioning the verdict of Gujarat High Court in Gujarat Cypromet Ltd vs. APFC & another. Now I am thinking of whether to go to the EPF Tribunal or High Court of Madras for getting a remedy.

Regards,
E.A. Murugan