PF can be deducted on gross salary. Actually it should be deducted on gross salary only. the Basic pay as per PF Act means gross salary only. The exclusion part of HRA is that house rent which is borne by the employer for the employee and not the one included in the salary.
Coming to Palahuja, I understand that the situation is like this. You have increased the Basic salary (or simply PF qualifying salary) of your employees. Now the amount that each one will contribute will obviously increase. That will benefit the employees by way of Tax. Now just because you have increased the salary and that the employees are contributing higher amounts to PF, the employer is not liable to contribute on amounts higher than Rs 15000. The employer's contribution can be restricted to 12% of Rs 15000.
One more observation. Suppose the employees' PF qualifying salary has become more than Rs 15000. If the employees think that PF shall be contributed only on a maximum of Rs 15000, the PF qualifying salary shall be kept at Rs 15000. Normally in such cases, the Payroll will be modified and the PF will be deducted on a maximum of Rs 15000.