A newly set-up company, due to purely administrative/operational reasons, could not deposit the dues on time for the first six months. After these months, the dues have been paid religiously on time to date. The company also happens to be a respected brand in other parts of India but had to face this unfortunate penalty of interest and damages (under the PF Act) while setting up its base in Maharashtra with around 800 to 900 employees.
Provision for Waiver in the PF Act
1) Is there any provision in the PF Act or Scheme that provides for a waiver or any case law for companies that are established with a genuine intention to pay on time but could not do so because of initial set-up issues (operational or administrative)?
Authority to Waive Interest or Damages
2) Who has the authority to waive off such interest or damages (whether partially or in totality) under the PF Act/Scheme?
Thanks in advance for your response.
From India, Aurangabad
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14Provision for Waiver in the PF Act
1) Is there any provision in the PF Act or Scheme that provides for a waiver or any case law for companies that are established with a genuine intention to pay on time but could not do so because of initial set-up issues (operational or administrative)?
Authority to Waive Interest or Damages
2) Who has the authority to waive off such interest or damages (whether partially or in totality) under the PF Act/Scheme?
Thanks in advance for your response.
From India, Aurangabad
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Understanding "Waiver" in the Context of Defaulting Parties
"Waiver" is the discretionary power vested with the authorities, which will be exercised when the defaulting party submits proof to the satisfaction of the authorities. The aggrieved can approach the appropriate forum for a remedy.
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From India, Tiruchchirappalli
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"Waiver" is the discretionary power vested with the authorities, which will be exercised when the defaulting party submits proof to the satisfaction of the authorities. The aggrieved can approach the appropriate forum for a remedy.
Regards
From India, Tiruchchirappalli
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If waver was allOwed I think every defaulted would go for it. You didn’t pay on time, there is no excuse. Administrative default is your fault right ?
From India, Mumbai
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From India, Mumbai
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There is no waiver of PF subscription or interest, damages, etc. It is submitted that PF dues should be paid by filling up different challans as applicable. In your case, you will have to pay 37% interest on the due amount if it exceeds 6 months. Please refer to para 38 of the Employees Provident Fund Act in this regard. Initially, pay the dues as applicable. Subsequently, you will be asked to pay interest and damages.
Warm regards,
Pranab Kumar
[Email Removed For Privacy Reasons]
From India, Mumbai
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Warm regards,
Pranab Kumar
[Email Removed For Privacy Reasons]
From India, Mumbai
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Waiver of Interest and Damages Under the PF Act
Interest and damages may be waived by the CPFC or any other person authorized by him for conducting an inquiry. As the recovery provision states, before issuing a recovery notice or assessment, the employer should be given a reasonable opportunity to be heard.
If, in the view of the Inquiry Officer, you have a reason and justifiable cause for not submitting the contribution on time, the amount can be waived partly or wholly, depending on the facts and circumstances.
There are a number of factors that have to be taken into consideration before levying damages or interest, such as the time of payment, amount of damages, delay of payment, etc.
There have been a number of court cases where the court has waived off the amount of damages or interest in appropriate cases.
Regards
From India, Delhi
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Interest and damages may be waived by the CPFC or any other person authorized by him for conducting an inquiry. As the recovery provision states, before issuing a recovery notice or assessment, the employer should be given a reasonable opportunity to be heard.
If, in the view of the Inquiry Officer, you have a reason and justifiable cause for not submitting the contribution on time, the amount can be waived partly or wholly, depending on the facts and circumstances.
There are a number of factors that have to be taken into consideration before levying damages or interest, such as the time of payment, amount of damages, delay of payment, etc.
There have been a number of court cases where the court has waived off the amount of damages or interest in appropriate cases.
Regards
From India, Delhi
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(Fact Checked)-The user's reply is mostly accurate. The information provided aligns with the guidelines under the PF Act regarding the waiver of interest and damages under certain circumstances, including the role of the CPFC in conducting inquiries and making decisions on waivers. (1 Acknowledge point)