Munmun Kaur
Published On:- February 25, 2022 at 11:28 IST
The Supreme Court recently held that in a situation where the employer defaults or delays in making contributions to the Employee Provident Funds (EPF), the authorities can impose Penalties and Damages without establishing if there was any ‘Criminal Intent ‘.
The above observation was made by the Bench of Justices Ajay Rastogi and Abhay S Oka. The Bench was hearing a Plea by a Company challenging the imposition of the damages and the amount not contributed by it to the Employee Provident Fund. The company was asked to pay damages of Rs 85,548 and Rs 74,288 which it had not contributed towards the Employee Provident Fund (EPF).
In the present case, the defaulter company failed to comply with the provisions of the Act from January 1, 1975, to October 31, 1988.
The Supreme Court said,” Once default in payment of contribution is admitted, the damages are consequential and the employer is under an obligation to pay the damages for delay in payment of the contribution of Employee Provident Fund.”
The Bench while dismissing the Plea observed that any default or delay in payment of EPF contribution by the employer under the Act is a sine qua non for the imposition of levy of damages under Section 14B of the Act, 1952. The Bench further added that Mens Rea i.e., Criminal Intent or Actus Reus i.e., Criminal Act are not essential elements for imposing a penalty for breach of Civil Obligations or Liabilities.
Also Read :- Recent Judgements under Criminal Law
