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Report No. 137

4.2. Except when prohibited by a court, payment should not be withheld merely because someone else objects.-

Paragraph 69 of the Scheme of 1952 provides for the disbursement of the provident fund amount to the employee while paragraph 70 provides for payment of the provident fund accumulations in the case of a decease employee either to the nominee or legal beneficiaries of the deceased as the case may be. The employer has to process the case in terms of either paragraph 69, paragraph 70. Similarly, the Trust of the Regional Provident Fund Commissioner has to settle the claim and pay the amount in accordance with the provisions of Paragraph 69 or Paragraph 70, as the case may be.

Neither the employer nor the Trust nor the Regional Provident Fund Commissioner can stop the settlement of the claim and payment to the claimant entitled under the Scheme to receive such amount on an objection raised by a third party. As pointed out earlier, instances of settlement of the claims being kept in abeyance on mere objection of a third party are not lacking, there is no provision either in the Act or in the Scheme framed therein authorising such a course.

The Commission feels that though the provisions are quite clear, out of abundant caution an Explanation needs be added under Paragraphs 69 and 70 to the effect that save and except under the orders of a Court, the payment of the Provident Fund accumulations shall not be withheld on an objection being raised by a third party and the amount should be paid to the claimant in terms of Paragraph 69 and Paragraph 70, as the case may be.

Need for creating Office of Ombudsman and for Evolving Legislative - Administrative measures Inter alia to relieve hardships caused by Inordinate Delays in settling Provident Fund claims of Beneficiaries Back

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