Gujarat High CourtEmployees Provident Fund Organisation ... vs Faze Three Limited & on 26 November, 2015Bench:Jayant Patel,Vipul M. PancholiC/LPA/1050/2015                                          JUDGMENT




                   IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                     LETTERS PATENT APPEAL          NO. 1050 of 2015

                In SPECIAL CIVIL APPLICATION NO.                5713 of 2014

                                    With
                    LETTERS PATENT APPEAL NO. 1051 of 2015
                                     In
                  SPECIAL CIVIL APPLICATION NO. 3911 of 2014

         FOR APPROVAL AND SIGNATURE:


         HONOURABLE THE ACTING CHIEF JUSTICE             MR. JAYANT PATEL

         and
         HONOURABLE MR.JUSTICE VIPUL M. PANCHOLI

         ==========================================================

         1   Whether Reporters of Local Papers may be
             allowed to see the judgment ?

         2   To be referred to the Reporter or not ?

         3   Whether their Lordships wish to see the
             fair copy of the judgment ?

         4   Whether this case involves a substantial
             question of law as to the interpretation
             of the Constitution of India or any order
             made thereunder ?

         ==========================================================
                   EMPLOYEES PROVIDENT FUND ORGANISATION &
                               1....Appellant(s)
                                     Versus
                  FAZE THREE LIMITED & 1....Respondent(s)
         ==========================================================
         Appearance:
         MS E.SHAILAJA, ADVOCATE for the Appellant(s) No. 1 - 2
         MR DEEPAK DAVE, ADVOCATE for the Respondent(s) No.1
         ==========================================================

                 CORAM: HONOURABLE THE ACTING CHIEF JUSTICE MR.
                        JAYANT PATEL
                        and
                        HONOURABLE MR.JUSTICE VIPUL M. PANCHOLI




                                     Page 1 of 11

HC-NIC                             Page 1 of 11      Created On Tue Dec 01 00:32:59 IST 2015
                  C/LPA/1050/2015                                                   JUDGMENT



                                        Date : 26/11/2015

                                ORAL JUDGMENT(PER : HONOURABLE THE ACTING CHIEF JUSTICE                               MR. JAYANT
         PATEL)1.   As in both the appeals common question arises for
         consideration,                 they           are           being             considered
         simultaneously.2.   Letters Patent Appeal No.1050 of 2015 has been
         preferred against the order dated 05.11.2014 passed by
         the learned Single Judge of this Court in Special
         Civil Application No.5713 of 2014, whereby the learned
         Single Judge, for the reasons recorded in the order,
         found that no case is made out for interference to the
         order   passed            by   the     Tribunal          under         theEmployees
         Provident Fund and Miscellaneous Provisions Act, 1952(hereinafter referred to as 'the Act') and the learned
         Single Judge dismissed the petition.3.   Whereas, Letters Patent Appeal No.1051 of 2015 is
         preferred against the order dated 05.11.2014 passed by
         the learned Single Judge in Special Civil Application
         No.3911 of 2014, whereby, the learned Single Judge,
         based on the order passed by the Tribunal, directed
         refund of the amount of Rs.88,17,095/- with interest
         at the rate of 9% per annum and certain directions
         were also issued to the Secretary of the Ministry of
         Labour and Employment, Union of India, regarding the
         affairs     of      Regional          Provident            Fund       Commissioner's
         office at Surat.4.   It may also be recorded that after the order wasPage 2 of 11HC-NIC                                        Page 2 of 11     Created On Tue Dec 01 00:32:59 IST 2015
                   C/LPA/1050/2015                                                  JUDGMENT




         passed by the learned Single Judge in Special Civil
         Application No.5713 of 2014, the review application
         being       Misc.     Civil         Application           No.363         of     2015        was
         preferred        by        the     appellant.         Similarly,            in      another
         Special       Civil          Application            No.3911          of       2014,         the
         appellant had also preferred review application being
         Misc. Civil Application No.364 of 2015 for review.
         But,    the      learned           Single       Judge,        vide        order         dated
         08.05.2015 below both the applications, dismissed the
         review       applications.            Under         the      circumstances,                 the
         appellant has also challenged the order passed by the
         learned Single Judge below the aforesaid Misc. Civil
         Applications in respective Letters Patent Appeal.5.     We    have          heard    Mrs.       Shailaja,           learned          counsel
         appearing        for        the     appellant         and      Mr.       Deepak         Dave,
         learned counsel appearing for respondent No.1 company.
         So far as respondent No.2 - Tribunal is concerned, it
         is a formal party.6.     The contention raised on behalf of the appellant
         by the learned counsel for the appellant was that the
         initial order underSection 7Aof the Act was passed
         by the Regional Provident Fund Commissioner in detail
         and after considering all relevant aspects. However,
         in appeal before the Tribunal being ATA No.126(5) of
         2014,       without          giving         sufficient             opportunity                  of
         hearing, the order dated 13th February 2014 was passed
         by the Tribunal, whereby the order of the Regional
         Provident        Fund       Commissioner            was     set      aside         and      the
         matter       has      been         remanded         for      fresh          inquiry             inPage 3 of 11HC-NIC                                        Page 3 of 11     Created On Tue Dec 01 00:32:59 IST 2015
                  C/LPA/1050/2015                                                    JUDGMENT




         accordance with law. Learned counsel submitted that as
         per the requirement of the Rule, the Tribunal has to
         give    appropriate             time     to      the     appellant             for     filing
         reply     or        otherwise.            The         learned         advocate,              who
         represented the appellant before the Tribunal, did ask
         for time but such request was not granted and the
         Tribunal       rushed           up     the      matter         for       its       decision
         immediately on the next date. She submitted that had
         the opportunity been given to the appellant, the case
         could have been made out for dismissal of the appeal
         but such opportunity as was not given, the order was
         vulnerable. However, the learned Single Judge did not
         consider the said aspect properly and hence this Court
         may    consider           in    the     present         appeal.           It     was       also
         submitted that when the Tribunal had passed the order,
         the amount of Rs.88,17,095/- was already recovered and
         therefore the learned Single Judge, in exercise of his
         discretion, ought not to have directed for refund of
         the amount but could have said subject to final order
         which may be passed after remand. Therefore, to that
         extent, the learned Single Judge committed error which
         may be considered by this Court in the present appeal.7.     Whereas, Mr. Dave, learned counsel appearing for
         respondent          No.1        company              submitted          that         without
         identifying the workers and without compelling the
         presence       of     the       contractor,             the      proceedings               were
         concluded       by        the    Provident             Fund      Commissioner.                   He
         further submitted that this Court had directed for
         even giving opportunity of cross-examination of the
         witness of the Provident Fund Commissioner but no suchPage 4 of 11HC-NIC                                         Page 4 of 11     Created On Tue Dec 01 00:32:59 IST 2015
                   C/LPA/1050/2015                                                   JUDGMENT




         express       opportunity          was       given           and       therefore             the
         Tribunal was justified in setting aside the order of
         the Provident Fund Commissioner underSection 7Aand
         has directed for remand of the matter. He submitted
         that the order of remand could not be said to be
         illegal. Further, when the Tribunal had set aside the
         order of the Provident Fund Commissioner underSection
         7A, the recovery, if any made was required to be
         refunded and the same has been rightly ordered by the
         learned Single Judge. He also submitted that pending
         the present proceedings, the recovery with interest at
         the rate of 9% per annum was already effected and
         matter       is       pending          before           the         Provident              Fund
         Commissioner for fresh consideration as ordered by the
         Tribunal. Under these circumstances, this Court may
         not interfere to the order passed by learned Single
         Judge in the present appeal.8.   It     is     undisputed          position            that       the        order       was
         passed      underSection      7Aby      the        Provident             Fund
         Commissioner.              But,   at    the       same        time,         it     is      also
         undisputed position that this Court in Special Civil
         Application           No.9730          of    2013,           vide         order          dated
         23.09.2013, had specifically directed the Provident
         Fund Commissioner to give an opportunity of cross-
         examination of the witness i.e. Assistant Provident
         Fund Commissioner and thereafter only the matter could
         have been proceeded further. The learned counsel for
         the appellant during the course of the hearing is not
         in a position to show any material from the record of
         the Provident Fund Commissioner about the specificPage 5 of 11HC-NIC                                      Page 5 of 11        Created On Tue Dec 01 00:32:59 IST 2015
                C/LPA/1050/2015                                                  JUDGMENT




         opportunity given for cross-examination of the witness
         to the company concerned. However, she only submitted
         that after the matter was remanded by this Court in
         Special Civil Application No.9730 of 2013, vide order
         dated 23.09.2013, the date was fixed and therefore it
         should be deemed that the same was for permitting
         cross-examination           of    the      witness.           When       this        Court
         further inquired as to whether any proceedings are
         drawn that the date is fixed for cross-examination of
         the witness and on behalf of the company nobody is
         present    and          therefore       the        right        of       the       cross-
         examination      is      closed     or      not,       the      learned          counsel
         fairly submitted that such proceedings are not drawn.
         Under these circumstances coupled with the aspect of
         identification of the workman concerned by securing
         the presence of the labour contractor, if the Tribunal
         has exercised the discretion for remand of the matter
         to the Provident Fund Commissioner, such an exercise
         of discretion cannot be said to be perverse.9.   If the grievance raised for not giving sufficient
         opportunity to the learned advocate appearing for the
         Provident Fund Commissioner before the Tribunal is
         considered, the Tribunal at para 3, has observed thus:"3. The learned Advocate for the Respondent
              has opposed the appeal and requested that no
              reliefs be granted, since the Appellant was
              provided the opportunity which has not been
              utilized by the Appellant. The Advocate for
              the Respondent has argued that, the Appellant
              was provided fullest opportunities to submit
              their sayings during the inquiry proceedings
              and the order has been passed in conformity
              with the statute. Hence requires no reliefs."Page 6 of 11HC-NIC                                    Page 6 of 11      Created On Tue Dec 01 00:32:59 IST 2015
                   C/LPA/1050/2015                                                     JUDGMENT10. If the matter is considered as it is, it cannot
         be said that any request was made on behalf of the
         Provident Fund Commissioner before the Tribunal and
         such was declined by the Tribunal. If the learned
         advocate appearing for the Provident Fund Commissioner
         in     the    proceedings            before          the        Tribunal           proceeded
         further for making submission, the question of giving
         time     to     file         reply      as      per         the       rule         would           be
         inconsequential. It is hardly required to be stated
         that if both the sides before any forum agree to
         proceed       with         the   matter,        there          is     no      question             of
         adjournment or giving further time to any party to the
         proceedings. However, the learned advocate appearing
         for the appellant by relying upon e-mail communication
         of the advocate, who represented the appellant before
         the Tribunal, attempted to contend that she had made
         demand for adjournment but such time was not granted
         and therefore she submitted that the recital in the
         judgment       of      the       Tribunal           at     para        3     may       not         be
         considered as fully correct.11. As such, the so-called e-mail communication is
         later to the decision of the Tribunal and not during
         the    time      when        the   matter           was       pending          before          the
         Tribunal. Further, even if it is considered for the
         sake of examination that she requested for time and
         the said time was not granted by the Tribunal, then
         also     the        matter         would            not         end         there,           more
         particularly,              when    on       the          aspect         of       breach            of
         principle of natural justice law is further developedPage 7 of 11HC-NIC                                        Page 7 of 11        Created On Tue Dec 01 00:32:59 IST 2015
                   C/LPA/1050/2015                                                    JUDGMENT




         to    the        extent          that        the           prejudice              must            be
         satisfactorily demonstrated on account of the breach
         of principle of natural justice. When, as observed
         earlier,       there       were    two       basic          deficiencies              in      the
         order passed by the Provident Fund Commissioner underSection 7A; one for not compelling the presence of the
         labour        contractor            for            the         purpose             of         the
         identification of the labourer and the another was for
         not giving express opportunity of cross-examination,
         and if the discretion is exercised by the Tribunal
         under such circumstances to remand the matter and when
         such exercise is not perverse, it cannot be said that
         any   prejudice            is    caused      to      the       appellant,             who         is
         otherwise supposed to act independently as a quasi-
         judicial authority. Hence, we find that on such ground
         the order of the Tribunal would not be vulnerable.
         Apart from the above, the fact remains that this Court
         in exercise of the powers underArticle 226or 227 of
         the Constitution may not interfere to the order of the
         Tribunal unless this Court finds that the discretion
         has not been properly exercised by the Tribunal or the
         exercise of discretion is perverse. Further, Court may
         also decline the entertainment of the complaint for
         alleged breach of principle of natural justice when
         Court finds that no prejudice is caused on account of
         the alleged breach of principle of natural justice.12. The       learned           counsel      for        the      appellant            made         a
         vague attempt by relying upon the order passed by the
         Provident Fund Commissioner on the date fixed after
         the   matter          was       remanded           by      the       High         Court           by
         contending that after the order dated 23.09.2013 inPage 8 of 11HC-NIC                                       Page 8 of 11        Created On Tue Dec 01 00:32:59 IST 2015
                   C/LPA/1050/2015                                                     JUDGMENT




         Special        Civil         Application               No.9730          of      2013,          the
         Provident Fund Commissioner had recorded that on the
         date fixed nobody was present on behalf of the company
         for cross-examination and therefore he had no option
         but to proceed further. She, therefore, submitted that
         such    may       be       termed      as      the      proceedings              drawn         for
         closure of the cross-examination. We are afraid such
         can    be    considered           as      sufficient             compliance            to      the
         order passed by this Court. It was for the Provident
         Fund Commissioner to give an express notice by fixing
         the     date      for       cross-examination                    of      the       Assistant
         Provident Fund Commissioner and thereafter if none
         remained present on behalf of the company, the matter
         might       stand          on    different              footing          and       different
         consideration but when no such specific notice was
         issued or the date was fixed, it could not be said
         that the opportunity was given for cross-examination
         and    there      was       closure         of        the   cross-examination                      as
         sought       to        be       canvassed.              Therefore,              we       cannot
         countenance such an attempt on the part of the learned
         counsel for the appellant.13. If the aforesaid aspect is considered with the
         reasons recorded by the learned Single Judge while
         undertaking the judicial scrutiny of the order of the
         Tribunal in the petition preferred by the appellant
         being Special Civil Application No.5713 of 2014, we do
         not find that any case is made out for interference in
         exercise of the appellate jurisdiction of this Court
         in Letters Patent Appeal.Page 9 of 11HC-NIC                                          Page 9 of 11      Created On Tue Dec 01 00:32:59 IST 2015
                   C/LPA/1050/2015                                                  JUDGMENT14. On the merits of the order passed by the learned
         Single Judge in Special Civil Application No.5713 of
         2014 is concerned, when the Tribunal had set aside the
         order of the Provident Fund Commissioner underSection
         7Aand the matter was remanded, the refund, if any, in
         normal       circumstances            would           be    consequential.                  The
         learned Single Judge when had not interfered with the
         order of the Tribunal in appeal as per the decision in
         Special      Civil         Application         No.5713          of     2014,        if      the
         learned Single Judge directed for refund of the amount
         with reasonable interest at the rate of 9% per annum,
         such an order could not be said to be erroneous on the
         face of it nor it could be said that the same was by
         exercise of discretion                                perverse to the record
         nor     it    could        be   said        as        having         passed         without
         jurisdiction. Further, as observed by us hereinabove,
         when we have also found that the order passed by the
         learned      Single         Judge     in      Special          Civil        Application
         No.5713 of 2014 would call for no interference, as a
         necessary corollary the another order passed by the
         learned      Single         Judge     in      Special          Civil        Application
         No.3911 of 2014 would also call for no interference.15. In Special Civil Application No.3911 of 2014 some
         observations were made by the learned Single Judge for
         holding of inquiry in the office of the Provident Fund
         Commissioner, Surat. However, the learned counsel for
         the appellant has stated that the inquiry is already
         held.        Under          these       circumstances,                    no        further
         observation deserves to be made except leaving to the
         discretion of the authority to consider the matter inPage 10 of 11HC-NIC                                       Page 10 of 11     Created On Tue Dec 01 00:32:59 IST 2015
                 C/LPA/1050/2015                                         JUDGMENT




         accordance with law.16. In view of the above, no case is made out for
         interference. Hence, both the appeals are meritless
         and therefore dismissed.(JAYANT PATEL, ACJ.)



                                                  (VIPUL M. PANCHOLI, J.)
         JaniPage 11 of 11HC-NIC                            Page 11 of 11     Created On Tue Dec 01 00:32:59 IST 2015