Padam Mercantiles Private Limited & Anr. Vs Regional Provident Fund Commissioner-I (Calcutta High Court)
The Calcutta High Court allowed a writ petition challenging the EPFO communications dated 2nd July 2021 and 9th July 2021 demanding interest under Section 7Q and damages under Section 14B of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952.
The petitioners stated that the jute mill had changed ownership and operations over time and had enjoyed exemption under Section 17(1) of the Act. Recovery proceedings for provident fund dues relating to the period from April 1985 to October 1997 had earlier resulted in orders of the High Court dated 25.09.2002 and 16.08.2005 prescribing a modality for liquidation of the dues through instalments. The Recovery Officer subsequently informed the establishment by letter dated 06.05.2013 that the certificate dues had been liquidated and only ₹6,300 remained payable towards costs.
Despite this, the EPFO initiated proceedings for interest under Section 7Q and damages under Section 14B for alleged belated remittances covering 1993 to 2013, resulting in an order dated 26.02.2015 for ₹1.80 crore. That order was remanded by the High Court on 18.06.2015. Thereafter, the impugned orders dated 2nd July 2021 and 9th July 2021 reaffirmed the demand. The petitioners also explained that the company had been struck off under Section 248(5) of the Companies Act, 2013 in 2019 and restored by the NCLT on 18.07.2024 under Section 252(3), accounting for the delay in filing the writ petition.
