Horticulture Experiment Station Gonikoppal, Coorg vs The Regional Provident Fund Organization

Court

Supreme Court of India

Date

23 February 2022

Case No.

Civil Appeal No(s). 2136 of 2012

Result

Dismissed

Bench

Ajay Rastogi, Abhay S. Oka

Citation

[2022] 16 S.C.R. 485 : 2022 INSC 223

Headnote

Employees Provident Fund & Miscellaneous Provisions Act, 1952: ss. 7A, 14B – Power to recover damages – Mens rea and actus reus, if essential element for imposition of damages – Appellant’s establishment failed to comply with the provisions of the Act – There was delay in payment of employees provident fundEPF amount – Levy of damages for the period – Challenge to – High Court held that once default in payment of contribution is admitted, damages u/s. 14B are consequential, and employer is under obligation to pay damages for delayed in payment of contribution of EPF u/s. 14B – Held: Any default or delay in the payment of EPF contribution by the employer under the Act is sine qua non for imposition of levy of damages u/s. 14B – Mens rea or actus reus not an essential element for imposing penalty/damages for breach of civil obligation

Dismissing the appeals, the Court

HELD: It is well- settled that mens rea or actus reus is not an essential element for imposing penalty or damages for breach of civil obligations and liabilities. Any default or delay in the payment of EPF contribution by the employer under the act is a sine qua non for imposition of levy of damages under Section 14B of the Act 1952 and mens rea or actus reus is not an essential element for imposing penalty/damages for breach of civil obligations/liabilities. [Para 13, 17][496-D; 497-C]

Organo Chemical Industries and Another v. Union of India and Others (1979) 4 SCC 573 : [1980] 1 SCR 61; Mcleod Russell India Ltd. v. Regional Provident Fund Commissioner (2014) 15 SCC 263 : [2014] 9 SCR 162; Jalpaiguri and Others and Assistant Provident Fund Commissioner, EPFO and Another v. The Management of RSL Textiles India Private Limited through its Director (2017) 3 SCC 110; Chairman, SEBI v. Shriram Mutual Fund and Another (2006) 5 SCC

361 : [2006] 2 Suppl. SCR 833; Dilip N. Shroff v. Joint Commissioner of Income Tax, Mumbai and Another (2007) 6 SCC 329 : [2007] 7 SCR 499 – referred to.

Union of India and Others v. Dharmendra Textile Processors and Others (2008) 13 SCC 369 : [2008] 14 SCR 13 – relied on.

Employees State Insurance Corporation v. HMT Ltd. and Another (2008) 3 SCC 35 : [2008] 1 SCR 646 – held not a binding precedent.

The Judgment of the Court was delivered by RASTOGI, J. 1. The instant appeals are directed against the common judgment and order dated 26th October, 2009 passed by the Division Bench of the High Court of Karnataka at Bangalore. 2. That while setting aside the judgment of the learned Single Judge dated 3rd February, 2009, it was observed that once the employer has failed to deposit the contribution of EPF or committed default as mandated under the provisions of the Employees Provident Fund & Miscellaneous Provisions Act, 1952 (hereinafter referred to as the “Act 1952”), having failed to do s

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