If any establishment or employer claims to be not covered under Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, burden to prove in such cases is on the establishment – Delhi HC

By TG Team Corporate Law Judiciary May 24, 2011

TaxGuru Citation: 2011 taxguru.in 813
Case Name: J K College Of Nursing & Paramedicals Vs UOI & ORS (Delhi High Court)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Courts: All High Courts, Delhi High Court

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J K College Of Nursing & Paramedicals Vs UOI & ORS (Delhi High Court)- It was held that if any establishment or employer claims to be not covered under the said Act, then it is for the employer to place sufficient cogent and convincing material before the designated authority in an enquiry under Section 7A of the Act, so as to satisfy the Authority with regard to non-applicability of the Act and further held that on failure to place any such material, the onus cannot be shifted on the EPF authorities to prove the applicability of the Act. It was yet further held that the EPF authorities under no circumstances can be in possession of necessary records evidencing the extent of strength of employees in any particular establishment.

IN THE HIGH COURT OF DELHI AT NEW DELHI

SUBJECT : EMPLOYEES’ PROVIDENT FUNDS AND MISCELLANEOUS PROVISIONS ACT, 1952

J K COLLEGE OF NURSING & PARAMEDICALS

Vs UOI & ORS

Date of decision: 24th May, 2011

W.P.(C) 8195/2010 & CM No.21123/2010 (for stay)

CORAM :-

HONOURABLE MR. JUSTICE RAJIV SAHAI ENDLAW

RAJIV SAHAI ENDLAW, J.

1. The petition impugns the order dated 10th September, 2010 of the Employees’ Provident Fund Appellate Tribunal, New Delhi dismissing the appeal of the petitioner against the order under Section 7A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, finding the petitioner to be employing more than 20 employees and thus, though covered by the provisions of the Act but in non-compliance thereof.

2. It is the case of the petitioner that it has never employed even 20 persons and the EPF Authority had wrongly found the petitioner to have engaged 37 persons and having not extended the benefit of the Act to the said employees.

3. The Appellate Tribunal, relying upon Saraswati Construction Company v. Central Board of Trustees 171 (2010) DLT 3, held that if any establishment or employer claims to be not covered under the said Act, then it is for the employer to place sufficient cogent and convincing material before the designated authority in an enquiry under Section 7A of the Act, so as to satisfy the Authority with regard to non-applicability of the Act and further held that on failure to place any such material, the onus cannot be shifted on the EPF authorities to prove the applicability of the Act. It was yet further held that the EPF authorities under no circumstances can be in possession of necessary records evidencing the extent of strength of employees in any particular establishment.