EPFO – Forwarding of Landmark Judgment delivered by the Hon’ble Division Bench of Madhya Pradesh High Court on the issue of considerable components of Basic Wages
Montage Enterprises Pvt. Ltd versus Employees Provident Fund (Madhya Pradesh High Court)- In aforesaid case, the Madhya Pradesh High Court has contended that;
1. Conveyance allowance is included in the definition of basic wages because it is universally, necessarily and ordinarily paid to all across the board.
2. Special allowance is included in the basic wages since it is paid to all the workers and there are no specific criteria to determine the amount of special allowance.Online GST Certification Course by TaxGuru & MSME- Click here to Join
However it is pertinent to note that, review petition has been filled by Montage Enterprise Pvt. Ltd before the Gwalior bench of Madhya Pradesh High Court as against the aforesaid judgment. In view of the same, the aforesaid judgment of Madhya Pradesh High Court is not definitive.
EMPLOYEES’ PROVIDENT FUND ORGANISATION
(Ministry of Labour & Employment, Govt. of India), Head Office-
Bhavishya Nidhl Bhawan, 14, Bhlkaiji Camaji Place, New Delhi – 110 066.No. Coord./4(6)2003/Clarification/Vol.II/2482 Dated: 21.06.2011Sub: Forwarding of Landmark Judgment delivered by the Hon’ble Division Bench of Madhya Pradesh High Court on the issue of considerable components of Basic Wages – regarding,Sir,Please find enclosed herewith a copy of Judgment dated 24.03.2011 in the matter of Montage Enterprises Pvt. Ltd versus Employees Provident Fund, Indore & one another delivered by the Hon’ble Divisional Bench of Madhya Pradesh High Court Bench at Gwalior whereby, the Hon’ble Court has laid down a principle for treatment of certain allowances like Conveyance/Transportation allowance, Special Allowance etc. as component of “Basic Wages” for the purpose of Provident Fund liabilities if the same are being paid uniformly, necessarily and ordinarily to all employees. The same may be utilized as per merits of the case.
End: As above.
(Anita S. Dixit)
Regional PF Commissioner-I (Coord.)