EPF dues – Registration of Crime for offence of misappropriation is illegal without following mandatory provisions of Section 7A is illegal
On 18.6.2018, the FIR / Crime was registered for offences punishable under Sections 406, 409 read with Section 34 of the Indian Penal Code and Section 14 of the Employees Provident Funds & Miscellaneous Provisions Act 1952.
The petitioner no.1 is private limited company, petitioner nos.2 and 3 are Founder & Director and Co-founder Director of the Petitioner No.1 and Respondent no.3 is nominee Director.
The Petitioner No.1 is liable for the EPF dues of its employees. On inspection of the record, it was found that although the petitioner no.1 deducted Rs.37,23,451/- during the period of September, 2017 to February 2018 as EPF subscription from the salaries of employees but did not deposit in the relevant EPF account in the SBI.
On 28.6.2018, the respondent no.1 lodged the report about the misappropriation of the EPF dues.
The petitioners deposited the dues of Rs.73,50,586/- in the concerned EPF account on 12th & 20th March, 2018 and also paid amount of Rs.3,37,998/- towards interest and penalty.
HELD that the registration of the FIR / Crime without holding an inquiry, giving an opportunity to the petitioners and passing the order under the mandatory provisions of Section 7A of the EPF Act and continuation of the same would be an abuse of process of law. FIR was quashed.
Judgment dated 17.1.2024 of the Division Bench in Criminal Writ Petition No.4679 of 2018 of M/s. Edunetwork Private Limited and others Vs. The Regional Provident Fund and others
