Commissioner Vs. Sanatan Dharam Girls Secondary
School & Ors
 Insc 701 (30
Ar. Lakshmanan & Tarun Chatterjee
APPEAL Nos. 7738/2004, 7740/2004, 7739/2004, 715- 737/2005, 739/2005, 742/2004,
741/2005, 746/2004, 745/2005, 738/2004, 747/2004, 748/2005, 740/2005, 750/2005,
749/2005, 752/2005, 751/2005, 743/2005, 744/2005 and 753/2005. Dr. AR. Lakshmanan,
present matter, the appellant is the Regional Provident Fund Commissioner
(RPFC) and the respondents are Sanathan Dharam Girls Secondary
School, a Non-
Governmental Educational Institution and the State of Rajasthan among others.
facts in the matter are as follows:
Employees Provident Fund and Misc. Provisions Act (in short 'the EPF Act') came
into force in 1952. In 1982, vide Gazette notification by the Government,
Educational Institutions were added in the Schedule of the Act under section 1
(3). The schedule reads thus:
college whether or not affiliated to a University
school, whether or not recognized or Aided by the Central or State Government
institution in which research in respect of any matter is carried on.
any other institution in which the activity of imparting knowledge or training
is systematically carried on."
in 1988, clause (b) of section 16(1) of the EPF Act, 1952 was substituted by
new clauses (b) (c) and (d). The amended provisions read as under:
16 (1) (b): to any other establishment belonging to or under the control of the
Central Government or a State Government and whose employees are entitled to
the benefits of contributory provident fund or old age person in accordance
with any scheme or rule framed by the Central Government or the State
Government governing such benefits;
any other establishment set up under any Central Provincial or State Act and
whose employees are entitled to the benefits of contributory provident fund or
old age person in accordance with any scheme or rule framed under that Act
governing such benefits;
any other establishment newly set up until the expiry of a period of three
years from the date on which such establishment is has been set up" The
State Government had framed rules known as 'The Rules for payment of
Grant-in-Aid to non-governmental educational, cultural and physical educational
institutions in Rajasthan, 1963'.
in 1989 the Rajasthan Legislative Assembly passed "The Rajasthan
Non-Government Educational Institutions Act, 1989" which came into force
05.08.1997, the State Government (Finance Department) issued an order to
implement the provisions of the EPF Act, 1952 on Non-Governmental aided
educational institutions employing 20 or more persons.
24.01.1998, the State Government (Educational Department) passed an order by
which it transferred the existing Provident Fund amount from the State treasury
to the office of Regional Provident Fund Commissioner.
on 24.08.1998, the State Government (Finance Department) passed an order about
transfer of Provident Fund amount from State treasury to the Provident Fund
Educational Institutions filed 21 writ petitions in the High Court of
Rajasthan, challenging the orders and circulars of the State Government issued
on 05.08.1997, 24.01.1998 and 24.08.1998. The Regional Provident Fund
Commissioner also filed 2 writ petitions in the High Court.
learned Single Judge dismissed the writ petitions filed by the Regional Provident
Fund Commissioner and allowed the 21 writ petitions filed by different
Educational Institutions by an order dated 16.01.2001 stating that the state
Act would override the provisions of EPF Act, 1952 and also observed that the
educational institutions before him would fall under the exception under the
amended section 16 (1) (b) of the EPF Act.
this order of the learned Single Judge, the RPFC went on appeal before the
Division Bench of the Rajasthan High Court. However, the Division Bench also
observed that the EPF Act will not apply to the Educational Institutions before
the Court and dismissed the appeals filed by the RPFC.
on 23.02.2003, the respondent, Educational Institution filed the S.B. Civil
Writ Petition before the High Court challenging the order of the State
Government directing the Non-Governmental aided Educational Institution
employing 20 or more persons to deposit its contribution with the RPFC. The
High Court disposed off the matter in favour of the Educational Institution in
line with the decision in the matter of Balbari Vidya Mandir Churu v. State of Rajasthan & others (S.B. Civil Writ
Petition No. 1085/2000).
this decision of the High Court, the RPFC went on appeal to the Division Bench
of the High Court which in turn by an order dated 16.09.2002, dismissed the
aggrieved by this order of the High Court of Rajasthan, the appellant, RPFC has
approached this Court.
understand, the issue before this court is:
the provisions of EPF Act, 1952 are applicable to the Non- Governmental
Educational Institutions or not in view of the provisions contained in Section
16 of the EPF Act.
whether the respondents Institutions will fall under the exceptions stated in
section 16(1) (b) of the EPF Act.
heard Mr. H.L. Aggarwala, learned senior counsel appearing for the appellant,
Mr. Aruneshwar Gupta, learned Additional Advocate General appearing for the
respondent and Mr. S.K. Dubey, learned senior counsel, Mr. Sushil Kumar Jain
and Manish Singhi, learned counsel appearing for the interveners. We have also
perused all the documents filed before us.
senior counsel appearing for the appellant, the RPFC stated that, the Central
Act that is the EPF Act came into force in 1952, the same was made applicable
to all Educational Institutions from 06.03.1982 and there were no State Acts or
rules in place which dealt with the matters relating to Provident Fund in
Educational Institutions. Later in 1989 the Rajasthan Legislative Assembly passed
"The Rajasthan Non-Government Educational Institutions Act, 1989 which
came into force from 01.01.1993.
during the period from 06.03.1982 to 31.12.1992, the Central Act, that is the
EPF Act, 1952 will be applicable on all Educational Institutions employing more
than 20 employees. To establish this, the learned counsel invited our attention
to M.P. Shikshak Congress and Ors. 396), case, where this Court observed that:
after the application of the Employees' Provident Fund and Miscellaneous
Provisions Act, 1952 to education institutions, in 1983 new Rules were framed
by the State of Madhya
Pradesh under Act 20
of 1978. These are referred to as the State Rules of 1983. Under the State
Rules of 1983, for the first time a scheme was set out for Contributory
Provident Fund covering the teachers and employees of aided schools. The State
Government, however, was conscious of the fact that the Employees' Provident
Fund and Miscellaneous Provisions Act, 1952 was applicable in the State of Madhya Pradesh. Therefore, by Rule 10(6) of the
State Rules of 1983, it was provided that the scheme as set out in State Rules
of 1983 would not apply where the provisions of the Employees' Provident Fund
and Miscellaneous Provisions Act, 1952 apply. Clearly, therefore, far from
there being any conflict between the State and the Central Legislation, the
State Legislation by Rules framed in 1983 has excluded from the operation of
the State scheme as framed under the 1983 Rules, those employees to whom the Central
this view of the matter, there can be no doubt that for the period 1st August,
1982 to 1st August, 1988 the Employees' Provident Fund and Miscellaneous
Provisions Act, 1952 was applicable to such teachers and employees of the aided
schools in the State of Madhya Pradesh who are covered by the provisions of the
scheme framed thereunder.
orders of the Regional Provident Fund Commissioner, therefore, in so far as the
orders cover the period 1st August, 1982 to 1st August, 1988 are valid"
Further the learned senior counsel submitted that, the Educational
Establishment covered or coverable under EPF Act, 1952 during the period from
06.03.1982 to 31.12.1992 will remain covered or coverable under Central Act of
1952 itself even after the coming into force of the State Act of 1989 or the
State Rules of 1993, as RPFC has already settled the PF Accounts of their
employees on retirement and has settled their pension cases, family pension
cases, children and parents pension cases and monthly pension cases and paying
monthly pension/family pension regularly for number of years.
submitted by the learned counsel appearing for the appellant that, the learned
single Judge and the Division Bench of the Rajasthan High Court have not
correctly appreciated and interpreted Section 16 (1) (b) of the EPF Act, 1952
and have wrongly recorded that all Educational Institutions are under the
control of the State Government as they are recognized by the State Act of
1989. He pointed out that these Educational Institutions were running and are
managed by registered societies and none of them are owned or managed by the
State Government. Merely on the basis of recognition under the State Act of
1989 it could not have been held that these Educational Institutions are under
the control of the State Government as required under section 16 (1) (b) of the
EPF Act, 1952.
the counsel stated that, only the Educational Institutions whose management has
been taken over by the State Government under section 10 of the State Act, 1989
shall fall within the exception under section 16 (1) (b) of the State Act of
1989. Section 10 reads as follows:
Powers of the State Government to take over management-
notwithstanding anything contained in any law for the time being in force,
whenever it appears to the State Government that the managing committee of any
recognized institution has neglected to perform any of the duties assigned to
it by or under this Act or the rules made there under or has failed to manage
the institution properly and that it has become necessary in the public
interest to take over the management of such institution, it may after giving
to such managing committee a reasonable opportunity of showing cause against
the proposed action, take over such management and appoint an administrator to
exercise control over the assets of the Institution and to run the institution
for such period as the State Government may from time to time fix.
Where, before the expiry of the period fixed under sub- section (1) the State
Government is of opinion that it is not necessary to continue the management of
the institution by an administrator, such management shall be resorted to the
concluding his submissions, the learned senior counsel stated that the High
Court did not take into consideration that the Central Act is more beneficial
for the employees than the State Act as there is compulsory pension scheme,
called "The Employees Pension Scheme, 1995" under the Central Act.
Gupta, learned Additional Advocate General, appearing for the State of Rajasthan, respondent herein submitted that,
in the year 1989 the Government of Rajasthan enacted the Rajasthan
Non-government Educational Institutions Act, 1989. The Act came into force on
01.01.1993. The State Government after the enactment of the said Act has
clearly occupied the field concerning the deposit of PF of the employees of
Non-Government Institutions and it clearly overrides the provisions of the EPF
Act, 1952. He submitted that, it is relevant to mention that the contribution
to the PF pertains to Entry 24 of List III of the Schedule 7 of the
Constitution of India. Therefore, as far as post 1993 period is concerned, the
RPFC do not have any subsisting legal right as that Act of 1989 of Rajasthan
shall prevail and to this extent the issuance of orders dated 05.08.1997,
28.01.1998 and 24.08.1998 by the Government of Rajasthan amounted to incorrect
application of law and the AG appearing for the state of Rajasthan clearly
conceded to the same before the High Court of Rajasthan. Thus it is clear that
the Educational Institutions are outside the purview of the EPF Act.
the Central Act itself contemplates non- application of the Central Act in
certain situations especially enumerated under section 16 of the Act of 1952.
Section 16 (1) (b) clearly mentions that the establishments which are under the
control of state government will not fall within the purview of the Central
Act, 1952. Moreover, there is a scheme framed for contributory PF under the
chapter VIII of the Rules of 1993.
conclusion it was submitted by the learned counsel for the respondent State
that in the present fact scenario, the provisions of section 16(1) (b) of the
Central Act, 1952 are attracted and therefore, the appellant cannot claim any
right over the contributory provident fund of the employees of the Educational
Institutions covered by the Act of 1989.
S.K. Dubey and Sushil Kumar Jain, learned counsel appearing for the interveners,
submitted as follows:
their institutions are governed under the provisions of the Rajasthan
Non-Government Educational Institutions Act, 1989. The said Act was enacted in
the year 1989 and was reserved for and received Presidential assent on 4.6.1992
in terms of Article 254(2) of the Constitution of India. The said Act came into
force with effect from 4.7.1992.
Entry 24 of List III of the VII Schedule read with Article 246(2) of the
Constitution of India allows concurrent power to the Center and the State
Governments to legislate with regard to Provident Funds. The said entry
provides as under:
of labour including conditions of work, provident funds, Employer's liability,
workman's compensation, invalidity and old age pension and maternal
the Union had enacted the Employees Provident
Fund Act, 1952 in exercise of the said powers. The State Government of
Rajasthan has, thereafter, enacted the Rajasthan Non-Government Educational
Institutions Act, 1989, which also includes a power to make a provident fund
scheme. It was also submitted that the State Government has, thereafter, framed
the scheme under the rules and the respondent- institutions are governed by the
said scheme. Since the State Act has received Presidential assent, the said Act
would prevail over the Central Act in the State of Rajasthan as per the provisions of Article
254(2) of the Constitution of India. The said Article provides as under:
Inconsistency between the laws made by Parliament and Laws made by Legislatures
of States:- (1) (2) Where a law made by the legislature of the State with
respect to one of the matters enumerated in the concurrent list contains any
provisions repugnant to the provisions of an earlier law made by the Parliament
or any existing law with respect to that matter, then, the law so made by the
Legislature of such State shall, if it has been reserved for the consideration
of the President and has received his assent, prevail in that State.
that nothing in this clause shall prevent Parliament from enacting at any time
any law with respect to the same matter including a law adding to, amending,
varying or repealing the law so made by the legislature of the State."
the State Act would "eclipse" the Central Act within the State of Rajasthan and therefore, the Central Act
(i.e. the EPF Act) would not apply to the educational institutions in the State
of Rajasthan which are governed by the State
Act. Undoubtedly, the respondent- institutions are covered under the State Act
and as such the provisions of the said Act would be applicable on the
support of his submission, he relied on the judgment of this Court in State of Bihar vs. Bhabapritananda Ojha, AIR 1959
SC 1073. In this case, this Court dealt with the provisions of the Bihar Hindu
Religious Trusts Act, 1950(Bihar 1 of 1951), which received the president's
assent on February 21, 1951 and came into force on August 15, 1951. The said
Act established the Bihar State Board of Religious Trusts to discharge the
functions assigned to the Board by the Act.
said Act was challenged on the grounds that it was ultra vires of the Bihar
Legislature and in the alternative, it was contended that even if it was
construed that the Act was intra vires, it did not apply to the Baidyanath
Temple and the properties appertaining thereto by reason of the circumstance
that the said temple and its properties were administered under a Scheme made
by the Court of the District Judge of Burdwan and approved by the Calcutta High
Court, both of which are situated outside the territorial limits of Bihar.
After considering the matter, this Court held as under:
as we have held, it is open to the Bihar Legislature to legislate in respect of
religious trusts situate in Bihar, then that Legislature can make a law which
says, as in sub-s. (5) of s. 4 of the Act, that s. 92 of the Code of Civil
Procedure shall not apply to any religious trust in the State of Bihar. If
sub-s. (5) of s. 4 of the Act is valid as we hold it is, then no question
really arises of interfering with the jurisdiction of the District Judge of Burdwan
or of the Calcutta High Court in respect of the Baidyanath temple, inasmuch as
those courts exercised that jurisdiction under s. 92, Code of Civil Procedure,
which no longer applies to the Baidyanath temple and the properties
appertaining thereto, after the commencement of the Act. It is true that the
Act does put an end to the jurisdiction under s. 92, Code of Civil Procedure, of
all courts with regard to religious trusts situate in Bihar, but that it does
by taking these trusts out of the purview of s. 92. In other words, the Act
does not take away the jurisdiction of any court outside Bihar but takes the
religious trusts in Bihar out of the operation of s. 92 so that a court outside
Bihar in exercise of its jurisdiction under s. 92 will decline to deal with a
religious trust situate in Bihar just as it will decline to entertain a suit
under that section regarding a private trust of religious or charitable nature.
Civil Procedure, including all matters included in the Code of Civil Procedure
at the commencement of the Constitution, is item 13 of the Concurrent List. It
has not been disputed before us that it is open to the Bihar Legislature to
amend the Code of Civil Procedure while legislating in respect of religious
endowments and religious institutions in Bihar, and the President's assent
having been received to the Act, the law made by the Bihar Legislature shall
prevail in that State, under Art. 254(2) of the Constitution, in respect of all
religious trusts situate in Bihar.
case of Bhagwat Singh vs. State of Rajasthan, (1964) 5 SCR 1, with regard to
the applicability of the provisions of the Rajasthan Industrial Tribunal
(Constitution & Proceedings) Validating Act, 1959, this Court held as
It is unnecessary however to consider the merits of these contentions because
the Legislature has remedied the defects, if any, in the constitution of the
Tribunal, by enacting the Rajasthan Industrial Tribunal (Constitution and
Proceedings) Validating Act, 1959, which was reserved for the consideration of
the President of India and has received his assent. By s. 2(1) of that Act,
notwithstanding any judgment, decision or order of any court and
notwithstanding any defect or want of form or jurisdiction, the Industrial
Tribunal for Rajasthan, constituted under s. 7 of the Industrial Disputes Act,
1947, by Government notification dated the 2nd June, 1953, as amended by order
dated the 9th March, 1956, shall, as respects the period commencing on the 10th
day of March 1957 and ending with the 15th day of April, 1959, be deemed to
have been duly constituted under s. 7A of the said Act. By sub-s. (2) it is
provided that notwithstanding any judgment, decision or order of any court all
references made to and all proceedings taken and orders passed by the
Industrial Tribunal constituted in sub-s. (1) between the period 10th March, 1957 and 15th April, 1959, shall be deemed respectively to have been made, taken and
passed as if the said Tribunal were constituted under s. 7A of the Act. It is
clear from the validating provisions that the Tribunal originally constituted
under s. 7 of the Industrial Disputes Act, 1947, before it was amended by Act
36 of 1956 is to be deemed to have been duly constituted under s. 7A, and the
reference made on December 18, 1957 is to be deemed to have been made as if the
Tribunal were constituted under s. 7A of the amended Act. The Validating Act
is, because of Item 22, List III of the Seventh Schedule to the Constitution,
within the competence of the State Legislature, and it was reserved for the
consideration of the President and has received his assent. It must by virtue
of Art. 254(2) prevail in the State of Rajasthan.
in the present case, the provisions of the said Act and the Rules made thereunder
apply and prevail over the provisions of the Employees Provident Fund Act,
1952. It was further submitted that there is a clear conflict among the provisions
in respect of the Provident Fund Scheme and the resultant effects thereto
between the State and the Central Act and as the State Act has received
Presidential assent, the provisions of the said Act would apply.
no arguments have been advanced by the appellants in the present case with
regard to the present submissions before the High Court nor were any arguments
raised by the appellant before this Court. It was also submitted that in the
absence of any rebuttal by the respondent, it is clear that the provisions of
the State Act would prevail over the Central Act.
fall under exception contained under Section 16(1)(b) of the EPF Act, 1952.
16(1)(b) of the EPF Act, 1952 provides as under:
This Act shall not apply-
any other establishment belonging to or under the control of the Central
Government or a State Government and whose employees are entitled to the
benefit of contributory provident fund or old age pension in accordance with
any scheme or rule framed by the Central Government or the State Government
governing such benefits; or
(e) " In order to be covered under the exception to the EPF Act, 1952
stated above, following two conditions have to be satisfied by the establishment
seeking to be exempted from the provisions of the EPF Act, 1952:
must be an establishment belonging to or under the control of the Central
Government or a State Government, and
must be an establishment whose employees are entitled to the benefit of
contributory provident fund or old age pension in accordance with any scheme or
rule framed by the Central Government or the State Government governing such
heard the parties in detail. The submissions made by the learned counsel appearing
for the respondents merit acceptance. It is not in dispute that the respondent-
institutions have been paying the provident fund dues to the State Government
in accordance with the Scheme framed by the State Government under the State
Act and thus the employees of the respondent-institutions are entitled to the
benefit of the provident fund. By the orders impugned by the
respondent-institutions, the State Government has sought to transfer the
balance standing to its credit to the Regional Provident Fund Commissioner.
Thus it is clear that the respondent-institutions have been paying in
accordance with the Scheme and there is no grievance with regard to the same.
respect to the contention of the respondent that the establishment belonging to
or under the control of the Central Government or a State Government, it was
submitted that the establishments must either be
the control of the Central Government or the State Government.
view, the two words used in the said Section have different connotations. The
words "belonging to" signifies ownership i.e. the Government owned
institutions would be covered under the said part and the words "under the
control of" signifies control other than ownership since ownership has
already been covered under the words "belonging to". It must be also
noted that the two words are separated by the word "OR" and therefore
these two words refer to two mutually exclusive categories of institutions.
the institutions "belonging" to the Central or the State Government
would imply the control of the State but the privately owned institutions can
be "under the control of" the Government in various ways.
the State Act itself, the "Control" by the State is in the following
Under Section 3 of the State Act, the State Government grants recognition to
the "Non-government educational institutions".
submitted that recognition by the State is of prime importance for running and
operating an educational institution. The said recognition can be withdrawn on
the failure of the institution to abide by the terms and the conditions of the
grant of recognition.
Under Section 7 of the State Act, the State Government grants aid to only recognized
aid given by the State can be used only for the purpose for which the aid has
been given. Under Section 8, the institutions are thereafter required to keep
accounts in the manner prescribed by the State. It was submitted that in such
manner, the State exercises Financial Control over the institutions.
Under Section 9, it has been prescribed that the institutions shall be governed
by a managing committee and Section 10 of the Act empowers the State to take
over management of the institutions "whatever it appears to the State that
the Managing Committee has neglected to perform the duties assigned to it by or
under the Act or the Rules made thereunder.
Chapter V of the Act relates to properties of the institutions and the manner
in which the institutions can manage the properties of the institution. It was
submitted that under Section 13 of the Act, the institutions have to apply and
get the approval of the competent authority set up under the said Act before
transferring the management of the institution. Under Section 15, restrictions
have been placed on the transfer of immovable properties of the institutions.
Section 14 of the Act prohibits closure of any institution or its class or the
teaching of any subject therein without notice in writing to the competent
authority. It was submitted that the government thus has Functional control
over the institution.
Chapter VI of the State Act deals with recruitment and removal etc. of
employees. Their salary, conditions of service, provident fund, code of conduct
are all prescribed under the Act. The Act further prescribes setting up of a
Tribunal for resolution of the disputes whose decision is final and binding on
State Government also exercises Administrative Control over the institution.
Section 17 deals with the manner of recruitment and Section 18 deals with the
procedure in which the employees may be removed or dismissed or reduced in
rank. Section 28 permits the State Government to prescribe the code of conduct
of the employees and Section 29 enjoins upon the institutions not to give to
its employees a pay lesser than the scales of pay and the allowances paid to
similar categories of the State Government.
view, the State Act is a complete code in itself with regard to the educational
institutions and the State Government exercises substantive control over the
institutions even though the institutions are not "owned" by it. The
word "control" has not been defined under the EPF Act, 1952.
this Court in Shamrao Vithal Coop. Bank Ltd. vs. Kasargode Panduranga Maliya,
(1972) 4 SCC 600 at page 604 has cited with approval the meaning of the word
"control" as it appears at page 442 of Words & Phrases Vol.9,
Permanent Edition as under:
word "control" is synonymous with superintendence, management or
authority to direct, restrict or regulate." In the case of State of Mysore
vs. Allum karibasappa, (1974) 2 SCC 498 at page 501, this Court defined the
words "word control" as under:
word "control" suggests check, restraint or influence Control is
intended to regulate and hold in check and restrain from action." We
further observe that the State Government has the power of Superintendent or
the authority to direct, restrict or regulate the working of the educational
institutions. It was, therefore, submitted that the institutions had satisfied
both the conditions (i) and (ii) mentioned above and as such they would fall
within the exception contained under Section 16(1)(B) of the EPF Act, 1952.
this context we may refer to the decision cited by the appellant in the case of
M.P. Shikshak Congress vs. R.P.F. Commnr., (1999) 1 SCC 396, in which it was
stated that the provisions of the E.P.F. Act apply in supersession of the State
Act. This contention is not correct; the said case is clearly distinguishable
on facts as has been noted in the judgment itself. The State Act did not
provide for establishment of any Scheme as has been provided under the
provisions of the State Act in the State of Rajasthan. In this regard, this Court noted as under:
Act did not even provide for any scheme for setting up a provident fund. The
Act incidentally required that the institutional contribution to any existing
provident fund scheme should be paid into the institutional fund set up under
the said Act." In addition to the above, the said case is also
distinguishable with regard to the contention of repugnancy and Article 254(2)
of the Constitution. In the said case, the Act in relation to the State of Madhya Pradesh came into force prior to the
application of the provisions of the EPF Act, 1952 on educational institutions
and therefore the benefit of Art. 254(2) was not available to it. In the
present case, however, admittedly the State Act has been enacted and has received
the assent of the president subsequent to the applicability of the EPF Act,
1952 on the educational institutions. In this regard, this Court in the said
case noted as under:
It was by reason of the notification of 06.03.1982 that the Central Act was
extended to educational institutions.
Employees' Provident Funds and Miscellaneous Provisions Act, 1952, therefore,
became applicable to educational institutions in the State of Madhya Pradesh for the first time on 6-3-1982. This was much later than the enactment of the State
Act 20 of 1978. The parliamentary enactment, therefore, would prevail over the
State Act 20 of 1978, assuming that the State Act of 1978 created or effected
any scheme for provident fund. Article 254(2), therefore, has no application in
the present case." Mr. Manish Singhvi, learned counsel appearing for
respondent No.1 in Civil Appeal No. 748 of 2005 reiterated the submissions made
by them in the counter affidavit filed in the special leave petition No. 2625
of 2003. He submitted that the demand issued by the Regional Provident Fund
Commissioner at Udaipur was ultra vires and beyond
jurisdiction because there was already an exemption under law for the purposes
of application of this Act and, therefore, the order dated 23.05.1997 was a
nullity. It was further submitted that the exemption was withdrawn from
October, 1993 onwards and, therefore, the exemption notification granted under
this Act was prevalent between January, 1983 to September, 1992. He has also
given the details in regard to the details of payment of Provident Fund/Pension
scheme in accordance with the directions issued by the State Government/Central
Government in the counter affidavit filed by them. He also invited our
attention to the notification dated 14.02.1983 issued by the Government of
Rajasthan in exercise of the power conferred by sub-section 17 of the EPF and
Act, 1952 exempting schools added by the State Government from the operation of
the said Act subject to the condition that the scheme of the Provident Fund
applicable the employees of educational institutions vide No. F7(13) Education
GR 74 dated 12.11.1974 shall be reviewed by the Committee which shall be
constituted by the Education Department with representatives of the Finance Department
and Labour Department to review the existing schemes so as to bring
inconformity with the central scheme if needed. It is beneficial to refer to
the notifications dated 23.12.1988 and 26.12.1993 in this context. The said two
notifications read thus:
OF RAJASTHAN Labour Department No.F.13(9)Shram/82-Pt.II, Jaipur Dtd.23.12.1988
NOTIFICATION In exercise of Powers conferred by Sub-section (1) of Section 17
of the Employees Provident Fund & Miscellaneous Provisions Act, 1952
(Central Act 19 of 1952) and in supersession of this department notification
No.F.13(9)Shram/82-Pt.II dated 14.2.83 the State Government hereby exempts all
schools and educational institutions aided by the State Government from the
operation of all the provisions of the Provident Fund Scheme only.
shall have immediate effect.
ORDER OF THE GOVERNOR Sd/- K.L.KOCHAR SPECIAL SECRETARY TO THE GOVERNMENT"
"GOVERNMENT OF RAJASTHAN Labour Department No.F.13(9)Shram/82-Pt.II, Jaipur
Dtd.26.10.1993 NOTIFICATION Notification No.F.13(9)Shram/82-Pt.II dated
14.02.1983 and even notification dated 23.12.1988 issued by this department
under Sub-section (1) of Section 17 of the Employees Provident Fund &
Miscellaneous Provisions Act, 1952 (Central Act 19 of 1952) is hereby nullified
with immediate effect.
this regard, it is hereby clarified that if the relief- granted educational
institutions want to seek exemption for their employees, for whom they get
relief, under the provisions of Employees Provident fund Scheme 1952 then such
educational institutions can seek exemption from Regional Provident Fund
Commissioner, Rajasthan, Jaipur as per para 27 of Employees Provident Fund
Scheme 1952, after obtaining applications from their such employees.
Order of Governor Sd/- Ramveer Singh Bhanwar Labour Commissioner and Deputy
Secretary to the Government" Learned counsel appearing for the respondent
in C.A. Nos. 715-737 of 2005 also drew our attention to the counter affidavit
filed on behalf of the State of Rajasthan and the educational institutions. It is submitted that the order of
recovery is patently illegal and unjustified because of the fact that the
respondent institution does not come under the purview of the Act of 1952. He
would further submit that after the amendment was made in Section 16 of the Act
by the EPF and Miscellaneous Provisions Amendment Act (33 of 1988) all
establishments belonging to or under the control of the Central Government or
State Government have been exempted from the provisions of the Act. Arguing
further, he submitted that the words in Section 2(b) and 2(a) are so clear and
unambiguous that no further interpretation need be made to amplify the same and
that the provisions made in the enactment of 1989 make it clearer that the
respondent institution is a recognized educational institution managed by the
private management and is within the effective management of the State
Government and, therefore, it is entitled to be excluded from the applicability
of the Central Act, 1952.
counsel appearing for the respondents in all the other appeals adopted the
arguments of Mr. Sushil Kumar Jain.
the foregoing reasons, all the civil appeals filed by the Regional Provident
Fund Commissioner stand dismissed and the judgment and order passed by the Division
Bench of the High Court dated 16.09.2002 and all the judgments on different
dates by different Division Benches stand affirmed.