Corporation of India Vs. Provident Fund Commissioner
& Anr  INSC 327 (26 October 1989)
K.J. (J) Shetty, K.J. (J) Thommen, T.K. (J)
1989 SCR Supl. (1) 755 1990 SCC (1) 68 JT 1989 (4) 380 1989 SCALE (2)1029
Provident Funds and Miscellaneous Provisions Act, 1952: Section
7A--Determination of amounts payable by employer as contribution--Statutory
authority--Whether duty bound to summon evidence when requested by party,
before coming to proper conclusion.
No. 1--the Provident Fund Commissioner called upon the appellant--Food
Corporation of India to deposit contribution payable by it under the Employees'
Provident Fund and Miscellaneous Provisions Act, 1952 and the scheme there under,
in respect of workers employed by the contractors appointed by the appellant
for handling storing and transporting food grains and other articles in its
depots in Rajasthan. On appellant's non-compliance, Respondent No. 1 made an
order under Section 7A of the Act determining the amount payable by the
appellant. Against the aforesaid order, the appellant filed writ petition
before the High Court, which dismissed the same. Hence the appeal, by special
leave, by the appellant--Corporation.
contended that the appellant was denied a reasonable opportunity to produce
actual proof of identification of workers in respect of whom contribution was
payable inasmuch as Respondent No. 1 neither gave notice to contractors, who
were in possession of the relevant lists of workers, nor made them parties to
the proceedings, despite its repeated requests.
The Commissioner, while conducting an inquiry under Section 7A of the
Employees, Provident Fund and Miscellaneous Provisions Act, 1952 has the same
powers as are vested in a court under the Code of Civil Procedure for trying a
suit. Thus, the Commissioner is authorised to enforce attendance in person and
also to examine any person on oath. He has the power requiring the discovery
and production of documents. This power was given to the Commissioner to decide
not abstract questions of law, but only to determine actual concrete
differences in payment of contribution and other dues by identifying the 756
workmen. The Commissioner should exercise all his powers to collect all
evidence and collate all material before coming to proper conclusion. That is
the legal duty of the Commissioner. It would be failure to exercise the
jurisdiction particularly when a party to the proceedings requests for
summoning evidence from a particular person. [757H; 758A; F-H] In the instant
case, the appellant--Corporation had some problems in collating the lists of
all workers engaged in depots scattered at different places. It requested the
respondent--Commissioner to summon the contractors to produce the respective
lists of workers engaged by them. However, the appellant--Commissioner did not
summon the contractors, nor the lists maintained by them. The matter is,
therefore, remitted to the Commissioner for fresh disposal.
APPELLATE JURISDICTION: Civil Appeal No. 4552 of 1989.
the Judgment and Order dated 23.12. 1988 of the Rajasthan High Court in C.W.P.
No. 13 of 1987.
and Y.P. Rao for the Appellant.
S.R. Setia and K.V. Mohan for the Respondents.
Judgment of the Court was delivered by K. JAGANNATHA SHETTY, J. Special leave
heard counsel on both sides and having perused the material on record, we are
of opinion that the matter requires reconsideration by the Provident Fund
Food Corporation of India has depots located at various
places in Rajasthan for handling storing and transporting food grains and other
articles. It has appointed contractors for execution of such works and the
contractors in turn engaged some workers. In respect of such workers, the
Provident Fund Commissioner called upon the Corporation to deposit contribution
payable under the Employees, Provident Fund Act and the scheme framed thereunder.
When there was non-compliance, the Commissioner made an order under section 7A
of the said Act determining amount payable by the Corporation. Being aggrieved
by that determination, the Corporation moved the 757 High Court for relief
under Art. 226 of the Constitution.
Court has dismissed the petition. Hence the Corporation has appealed to this
grievance complained of by the Corporation is that it was denied of reasonable
opportunity to produce material in proof of identification of the workers in
respect of whom the contribution was payable. It is urged that the contractors
are in possession of the relevant lists and the Commissioner has not even given
notice to contractors nor made them parties to the proceedings in spite of
repeated requests made by the Corporation. Counsel for the Union of Workmen,
however, contended that under the provisions of the Contract Labour (Regulation
and Abolition) Act, 1970 the Corporation being the principal employer has to
maintain list of workers; that it has failed to produce such list and,
therefore, it cannot throw the burden on the contractors to prove the case.
have carefully perused the Commissioner's order and also the order of the High
Court. The total amount ordered to be payable comes to about Rs.22,48,000 in
respect of the employees of depots namely: Udaipur, Jaipur, Ajmer, Badmer and Sawai Madhopur. The
Commissioner has also directed the Divisional Officer, Jaipur to deposit the
Provident Fund Contribution i.e. Rs. 18,72,194 to the Fund being maintained by
the trustees of the establishment. It is indeed a large amount for the
determination of which the Commissioner has only depended upon the lists
furnished by the workers, Union. It is no
doubt true that the employer and contractors are both liable to maintain
registers in respect of the workers employed. But the Corporation seems to have
some problems in collating the lists of all workers engaged in depots scattered
at different places. It has requested the Commissioner to summon the
contractors to produce the respective lists of workers engaged by them. The
Commissioner did not summon the Contractors nor the lists maintained by them.
He has stated that the Corporation has failed to produce the evidence.
question, in our opinion, is not whether one has failed to produce evidence.
The question is whether the Commissioner who is the statutory authority has
exercised powers vested in him to collect the relevant evidence before
determining the amount payable under the said Act.
of importance to remember that the Commissioner while conducting an inquiry
under section (7A) has the same powers as are 758 vested in a Court under the
Code of Civil Procedure for trying a suit. The section reads as follows:
7(A) Determination of Moneys due from Employer-(1) The Central Provident Fund
Commissioner, any Deputy Provident Commissioner or any Regional Provident Fund
Commissioner may, by order determine the amount due from any employer under any
provision of this Act (the scheme or the Family Pension Scheme or the Insurance
Scheme as the case may be) and for this purpose may conduct such inquiry as he
may deem necessary.
The Officer conducting the inquiry under sub-section (1) shall, for the
purposes of such inquiry, have the same powers as are vested in a Court under
the Code of Civil Procedure, 1908, for trying a suit in respect of the
following matters, namely:
the attendance of any person or examining him on oath;
the discovery and production of documents;
evidence on affidavit;
commissions for the examination of witnesses. and any such inquiry shall be
deemed to be a judicial proceeding within the meaning of Sections 193 and 228,
and for the purpose of Section 196 of the Indian Penal Code."
will be seen from the above provisions that the Commissioner is authorised to
'enforce attendance in person and also to examine any person on oath. He has
the power requiring the discovery and production of documents. This power was
given to the Commissioner to decide not abstract questions of law, but only to
determine actual concrete differences in payment of contribution and other dues
by identifying the workmen. The Commissioner should exercise all his powers to
collect all evidence and collate all material before coming to proper
conclusion. That is the legal duty of the Commissioner. It would be failure to
exercise the jurisdiction particularly when a party to the proceedings requests
for summoning evidence from a particular person.
We, therefore, allow the appeal and reverse the order of the Commissioner and
that of the High Court. The matter stands remitted to the Commissioner to
dispose it of afresh and in accordance with law and in the light of the
parties shall appear before the Commissioner to receive further orders on December 12, 1989. The Commissioner, shall dispose of
the matter within three months thereafter.
.P.V. Appeal allowed.