LexN.K. JAIN AND OTHERS versus C.K. SHAH AND OTHERS
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A
N.K. JAIN AND OTHERS
-v.
C.K. SHAH AND OTHERS
MARCH 26. 1991
B
[S. RATNAVEL PANDIAN AND K. JAYACHANDRA
..
- REDDY, 'JJ.)
Empfoye<:s' frovtdent Funds and Miscellaneous Provisions Act,
1952 ·Employees Provic(f,mt Funds Scheme, 1952: Ss: 5,. 6, 14, 17,~
Schedule JI Notification dated 17. 10: 1957 Paragraph 76-Establish-
mems exempted under s. 17-Employ_ers' scheme for co,ntribution of
C provident fund-Employers' .failure to contribute-Whether amounts to
contravention ·of s. 6 and attracts prosecution under s. ·14 or mere
cancellation of exemption 1,1,nder s. 17(4) s. 17( J)(a/-Exemption from
operation of 1952 Scheme granted subject to certain conditions-
Violation of conditions-Whether attracts s. 14(2A)-Nature and
D purpose of exemption explained. Ss. 17(4)-Cance/lation of exemption
granted under s. 17( /)-Whether amounts to 'penalty' as contemplated
by express.ion "if no. other penalty is elsewhere provided by or u_nder this
Act" occurring ins. 14(2A). Ss. 2, 2(c), 2(h}, 2(1)-Expression "unless
the context otherwise requires"--Scope of.-Words "contribution"
"fund" "scheme"-Whether applicable to a provident fund scheme
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instituted by an exempted csrablishment.
Interpretation of Statutes: Penal statutes-Construction of-
. Cohte~t in which the words are use(i is also important-Statute must be
read as a. whple-Words to be interpreted to achieve legislative purpose.
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Code of Criminal Procedure, 1973: Chapter XX-Trial of
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summons cases-<;mnp.~nts for offences punishable under ss. 14( IA)
and 14(2A) of £,mployees' Provident Funds and Miscellaneous Provi-
sions Act, 1952 pending-~-Prima fade case against the accused not ruled
out-Applicqtiuns j()r a.cqltittal an4 dropping of proceedings-Main-
tainability of
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Words & Phrases:
'Pen.ci.lty'~Meaningof.
Employees' Provident- _Funds und Miscel}aJieous Provisions Act, --{
1952_ was enacted wi.th a view to prm:i~'e· for institutjon of provident
fund· for employees in factories andothert--stablisbments and was made
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ap_pAicable to '''<!cy e11tahlishment 'lhk~ came withit) too m~Wiing of
938
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N:K. JAIN v. C.K. SHAH
939
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~factory'. The Central Government under·s. 5 of the Act, framed the A
Employees' Provident Fund Scheme in 1952 for establishment of provi-
dent funds for the employees of the establishments governed by the Act.
Management of such establishments bad to.contribute to the provident
fund of its employees in accordance with s. 6. Contravention or default
in complying with s. 6. was punishable under s 14. Under s. 17 the
appropriate goverment·was empowered to grant exemption from the
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~operation of the 1952 Scheme provided the concerned establishment
had instituted its own provident fund scheme and the. rules in this
respect were .not Jess favourable than those specified in s. 6 and the
employees were also in the enjoyment of other provident fund benefits.
_ ......
The Act underwent .major amendments in. 1971 and thereafter.
The appellants were in the. management of. an' establishment
governed by the Act. By a notification dated 17.10.1957 the.Central
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Governmen~ granted exemption under s .. 17 to the said establishment
subject to the conditions specified in Schedule II to the notification.
Condition no. 1 was to the effect that the factory was to have a provi-
dent fund scheme in force, the rules of which with respect to the rates:of
contribution should not be less favourable than those specified ins. 6 of
the Act and the employees should also be in the enjoyment of other
provident fond benefits provided under the Act. Consequently the 1952
c
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).... Scheme did not apply to the. company .as it created a trust and the
management was making contibutions of provident fund to the said
trust. In September/October, 1975, the Inspector Provident Fund tiled E
complaints that the appellants being incharge of the management of the
establishment failed to pay contributions to the provident fund trust in
1974 and thereby committed offences .punishable under ss. · 14(1A),
14(2), 14(2A), 14A(l), 14A(2), of the Act and Paragraph 76 of the 19S2
Scheme, the appellants also received notice d_ated 15.9.1975 threatening
\A.._to cancel the exemption granted under s. 17.· In September 1975 the F
company was closed and liquidation proceedings w~re initiated.
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·The appellants filed applications before the Metropolitan Magis-
trate, before whom the~complaints were pending, contendfug Excerpt shown. Read the full judgment & AI analysis in Lexace.