Full Judgment Text
1
IN THE HIGH COURT OF JUDICATURE OF BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO. 391 OF 1998
WITH
CIVIL APPLICATION NO. 11151 OF 2014
Balasaheb Dempurikar Vidhya Mandir,
Umari, Tq. And Dist.Parbhani,
Through its Head Master,
Balaji Eknath Kamble,
Age38 years, OccuService,
R/o Umari, Tq. And Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.3277 of 1997
WITH
CIVIL APPLICATION NO.11124 OF 2014
Dnyanopasak Arts and Commerce College,
at Jintur,
Through its Acting Principal
Prakash Laxman More,
an Educational Institution,
run by Dnyanopasak Shikshan Mandal
at Parbhani, an institution registered
under the Societies Registration Act and
Bombay Public Trusts Act,
running educational institutions
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in the District of Parbhani – PETITIONER
VERSUS
1. Sub Regional Provident Fund Commissioner,
having office at Aurangabad,
2. The Commissioner of Provident Fund
for State of Maharashtra,
having office at Bombay,
3. Union of India,
Through Ministry of Labour,
Central Secretariat,
New Delhi,
4. The Special Recovery Officer,
attached to SubRegional
Provident Fund commissioner's Office,
at Aurangabad,
5. Swami Ramanand Teerth Marathwada
University,
through itsRegistrar,
Dnyan Teerth,
Vishnupuri, Nanded – RESPONDENTS
WITH
WRIT PETITION NO.379 OF 1998
WITH
CIVIL APPLICATION NO.11179 OF 2014
Narshinh Vidhya Mandir,
Pokharni, Tq. And Dist.Parbhani,
Through its Head Master,
Sy.Kaja Sy.Nijam,
Age39 years, OccuService,
R/o Pokharni, Tq. And Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
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Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.380 OF 1998
WITH
CIVIL APPLICATION NO.2270 OF 2017
Pandit Jawaharlal Nehru
Vidhya Mandir, Shingnapur,
Tq. and Dist.Parbhani,
through its Head Master
Khating Rangnath Laxmanrao,
Age36 years,
R/o Singnapur, Tq. Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.381 OF 1998
WITH
CIVIL APPLICATION NO.2268 OF 2017
Rajarshi Shahu Maharaj Vidhya Mandir,
Arvi, through,
its Head Master,
Shri Laxman Sakharamji Thorat,
Age35 years,
Arvi, Tq. And Dist. Parbhani – PETITIONER
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VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.388 OF 1998
WITH
CIVIL APPLICATION NO.404 OF 2013
Punyashlok Ahilayabai Holkar Vidhya Mandir,
Pimpalgaon, Tq. And Dist. Parbhani,
Through its Head Master,
Shri Kishan Kondiba Khandare,
Age40 years, OccuService,
R/o Laxman Nagar, Pimpalgaon,
Tq. and Dist. Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.389 OF 1998
WITH
CIVIL APPLICATION NO.2267 OF 2017
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Dnyaneshwer Vidhya Mandir
Purna (J) Dist.Parbhani,
Through its Head Master,
Shri Gadale Shamrao Gangaram,
Age31 years, OccuService,
R/o Purna, Dist.Parbhani. – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.390 OF 1998
WITH
CIVIL APPLICATION NO.2265 OF 2017
Late Munjaji Vithalrao Shinde Vidhya Mandir,
Khanapur, Tq. And Dist.Parbhani,
Through its Head Master,
Sheshrao Tukaram Garud,
Age39 years, OccuService,
R/o Khanapur Area,
Tq. and Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
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Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.401 OF 1998
WITH
CIVIL APPLICATION NO.2271 OF 2017
Lalbahadur Shastri Vidhya Mandir,
Takali, Tq. And Dist. Parbhani,
Through its Head Master,
Shri Ramesh Rajaramji Bhagwat,
Age32 years, OccuService,
R/o Takli, Tq. And Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.402 OF 1998
WITH
CIVIL APPLICATION NO.2272 OF 2017
Yeshvantrao Chavan Vidhya Mandir,
Takali (B), Tq. And Dist.Parbhani,
Through its Head Master,
Shri Uttam Abaji Bharose,
Age034, OccuService,
R/o Takali (B), Tq. And Dist.Parbhani, – PETITIONER
VERSUS
1. The State of Maharashtra,
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2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.845 OF 1998
WITH
CIVIL APPLICATION NO.1199 OF 2013
1. Little Flower School,
ParaliVaijanath,
District Beed,
Through its Principal,
Shri Abdul Baseer Muniruddin
Siddiqui, Age43 years,
OccuService,
R/o ParaliVaijanath,
Taluka Parali – Vaijanath,
District : Beed,
2. Modern Education Society,
ParaliVaijanath,
Taluka ParaliVaijanath,
District Beed,
Through its Secretary,
Bhanudas Madhavrao Deshmukh,
Age55 years, OccuAgriculture,
R/o Parali Vaijanath,
Tal.Parali Vaijanath,
Dist. Beed – PETITIONERS
VERSUS
1. The Union of India,
2. The Regional Provident Fund
Commissioner, Bombay and Goa
Region, Bandra, Mumbai – 400 051
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3. The Assistant Provident Fund
Commissioner and Recovery Officer,
SubRegional Office, Aurangabad,
4. The State of Maharashtra,
Through the Secretary,
Education Department, Mantralaya,
Mumbai – 32. – RESPONDENTS
Mr.C.R.Deshpande and Mr.V.G.Sakolkar, Advocate for the petitioners.
Mr.N.T.Bhagat, AGP for respondent No.1.
Mr.K.B.Choudhary, Advocate for respondent No.2.
Mr.Bushan Kulkarni, Standing Counsel for respondent No.1 in
WP No.845/1998.
( CORAM : RAVINDRA V. GHUGE, J.)
DATE : 17/02/2017
ORAL JUDGMENT :
1. All these writ petitions have been taken up together in view of
the order passed by this Court on 27/01/1998, keeping in view that
a common point of law has been raised by all these petitioners in the
light of Section 16(1)(c) of the E.P.F. and M.P.Act, 1952. For the sake
of clarity, the order dated 27/01/1998 reads as under :
“ Leave to amend.
In all these petitions a common point of lalw has been
urged by the learned counsel for the petitioners in as much as in
view of the provisions of Section 16(1)(c) of the Employees
Provident Funds and Miscellaneous Provisions Act, 1952. The
said act is not applicable to the employees of private schools as
they are entitled for pension etc. Under the M.E.P.S.Act, 1977
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and the Rules thereunder.
Notice before admission returnable on 29/01/1998.
Hamdast granted.
Mr.Chillarge, learned A.G.P. waives service for respondent
No.1.
The Deputy Director of Education Aurangabad, is directed
to depute an Officer from his office to remain present before this
Court on 29.1.1998 to clarify if the above contentions raised by
the learned counsel for the petitioners are supported by the State
Government or otherwise.
Mr.R.G.Deo, learned counsel waives service for respondent
No.2.
Mr.Deshpande, undertakes to serve copies on Mr.Deo,
learned counsel today itself.”
2. After hearing all the sides and while admitting these petitions
by order dated 29/01/1998, this Court arrived at a primafacie
conclusion that all such schools which were covered u/s 16 of the
E.P.F. Act. By the combined reading of Rules 19 and 20 of the MEPS
Rules, 1981 with paragraph No.16 of clause 3.2 of the Secondary
School Code, such schools were exempted from the applicability of
the E.P.F. and M.P. Act. The order dated 29/01/1998 reads as
under :
“ Heard Shri C.R.Deshpande, counsel for petitioner, Shri
R.C.Deo, Standing Counsel for respondent No.2 in Writ Petition
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Nos.379/98, 380/98, 381/98, 389/98 and 390/98 and Shri
Alok Sharma, Additional Standing Counsel for respondent No.2
in Writ Petition Nos.390/98, 401/98 and 402/98 and
Shri.S.V.Chillarge, Assistant Government Pleader for respondent
No.1.
On a combined reading of Rules 19 and 20 of the
Maharashtra Employees of Private Schools (Conditions of
Service) Rules, 1981 and paragraph 16 of Clause 3.2 of the
Secondary School Code, it is primafacie evident that the
provisions of the Provident Funds and Miscellaneous Provisions
Act, 1952 are not applicable to the employees working in
recognised private schools whether aided or unaided.
th
Rule made returnable on 24 February 1998.
In the meanwhile, adinterim stay in terms of prayer
clauses (D) and (E).
Leave to amend. Amendment to be carried our within one
week from today.
Respondent No.1 to file affidavit within two weeks from
today.”
3. When these matters were heard by this Court on 17/06/1998,
it was noted that the issue as to whether the school is an aided
school or not would be a decisive factor.
4. For the sake of clarity, it would be apposite to reproduce
Section 16 of the E.P.F. Act as under :
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“(1) This Act shall not apply
(a) to any establishment registered under the Co
operative Societies Act, 1912 (2 of 1912), or under any other law
for the time being in force in any State relating to cooperative
societies, employing less than fifty persons and working withut
the aid of power ; or
(b) to any other establishment belonging to or under the
control of the Central Government or a State Government and
whose employees are entitled to the benefit of contributory
provident fund or old age pension in accordance with any
Scheme or rule framed by the Central Government or the State
Government governing such benefits ; or
(c) to any other establishment set up under any Central,
Provincial or State Act and whose employees are entitled to the
benefits of contributory provident fund or old age pension in
accordance with any scheme or rule framed under that Act
governing such benefits ;
(d) [ x x x ]
(2) If the Central Government is of opinion that having regard to
the financial position of any class of [establishment] or other
circumstances of the case, it is necessary or expedient so to do,
it may, by notification in the Official Gazette, and subject to
such conditions as may be specified in the notification, exempt
[whether prospectively or retrospectively], that class of
[establishments] from the operation of this Act for such period as
may be specified in the notification.]
: Section 16A was inserted by Act No.33 of 1988, but the
Note
same has not been brought into force.”
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5. Section 16A though was inserted by Act No.33 of 1998 w.e.f.
01/09/1991, the same has not been brought into force, in as much
as it does not fall for the consideration of this Court in these matters.
Section 16A reads as under :
“ 16A Authorising certain employers to maintain provident
fund accounts
(1) The Central Government may, on an application made to it
in this behalf by the employer and the majority of
employees in relation to an establishment employing one
hundred or more persons, authorise the employer, by an
order in writing, to maintain a provident fund account in
relation to the establishment, subject to such terms and
conditions as may be specified in the Scheme :
Provided that no authorisation shall be made under this sub
section if the employer of such establishment had committed any
default in the payment of provident fund contribution or had
committed any other offence under this Act during the three
years immediately preceding the date of such authorisation.
(2) Where an establishment is authorised to maintain a
provident fund account under subsection (1), the employer
in relation to such establishment shall maintain such
account, submit such return, deposit the contribution in
such manner, provide for such facilities for inspection, pay
such administrative charges, and abide by such other
terms and conditions, as may be specified in the Scheme.
(3) Any authorisation made under this section may be
cancelled by the Central Government by order in writing if
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the employer fails to comply with any of the terms and
conditions of the authorisation or where he commits any
offence under any provision of this Act :
Provided that before cancelling the authorisation, the Central
Government shall give the employer a reasonable opportunity of
being heard.”
6. The Hon'ble Apex Court in the matter of M/s D.A.V. College
and Others Vs. Regional Provident Fund Commissioner and others,
[1988 (Suppl) SCC 518] dealt with a somewhat similar situation,
except that the State Rules pertaining to any School Code or
Education Act was not cited before the Hon'ble Apex Court. In its
order (2 paragraphs), the Hon'ble Apex Court has held as under :
“1. Shri S.K. Bagga, learned Counsel appears for the petitioners.
We do not find any substance in the contention of the petitioners
in these cases that the Employees' Provident Funds and
Miscellaneous Provisions Act , 1952 (hereinafter referred to as 'the
Act') has no application to the educational institutions who are
petitioners in these cases. We, therefore, dismiss all these cases.
2. We direct that the petitioners shall comply with the Act and
the schemes framed there under regularly with effect from
1.2.1988. Whatever arrears they have to pay under the Act and
the schemes in respect of the period between 1.3.1982 and
1.2.1988 shall be paid by each of the petitioners within such time
as may be granted by the Regional Provident Fund
Commissioner. If the petitioners pay all the arrears payable from
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1st March, 1982 upto 1st February, 1988 in accordance with the
directions of the Regional Provident Fund Commissioner he shall
not levy any damages for the delay in payment of the arrears.
Having regard to the special facts of these cases the subscribers
(the employees) shall not be entitled to any interest on the
arrears. The Writ Petitions are disposed of accordingly. No costs.”
7. As such, I find it appropriate to rely upon the law laid down by
the Hon'ble Apex Court in Regional Provident Fund Commissioner
Vs. Sanatan Dharam Girls Secondary School and others, [AIR 2007
SC 276]. The Apex Court dealt with the issue as regards whether the
nongovernmental institutions, commonly termed as private
educational institutions, would be covered by the E.P.F.Act or
whether any provision of the School Act introduced by a particular
State would entitle such schools to be exempted in view of Section 16
of the E.P.F. Act.
8. Keeping in view the law laid down by the Hon'ble Apex Court in
the D.A.V. College case (supra), there can be no dispute that
Educational Institutions would be covered by the E.P.F.Act, 1952.
Considering the law laid down in the Sanatan Dharam Case (supra),
the distinction would be that those schools, which are exempted u/s
16 of the E.P.F. Act, would not be covered by the E.P.F. Act and would
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be governed by the Rules introduced by the State Government.
Consequentially, those private schools, which do not fall under the
Rules introduced by the State Government under the Private Schools
Act and are not exempted by Section 16 of the E.P.F. Act, would thus
continue to be covered under the E.P.F. Act.
9. The Hon'ble Apex Court in the Sanatan Dharam case (supra)
has dealt with the aspect of the nongovernment educational
institutions (Private institutions in short) being governed by
enactments introduced by the State Governments for the first time.
The Rajasthan Non Government Educational Institutions Act, 1989
was before the Hon'ble Apex Court while considering the effect of the
E.P.F. Act. In the instant case, the State of Maharashtra introduced
the Maharashtra Employees of Private Schools (Conditions of Service)
Regulation Act, 1977 (hereinafter referred to as the 1977 Act) and this
was followed by the introduction of the MEPS Rules, 1981, akin to the
Rajasthan Act of 1989.
10. There is no dispute in all these cases that the petitioners are
such educational institutions which are not owned by the Central
Government or the State Government. Many of these institutions
termed as private schools or colleges, are receiving salary grants and
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non salary grants being extended to such schools.
11. The above fact situation is practically identical to the facts that
were before the Hon'ble Apex Court in the Sanatan Dharam Girls
School case (supra).
12. In order to refer to the facts before the Hon'ble Apex court in
the Sanatan Dharam Case (supra), it would be apposite to reproduce
paragraph Nos. 2 to 13 of the said judgment hereunder :
“2. Brief facts in the matter are as follows:
The Employees' Provident Fund and Misc. Provisions Act (in
short 'the EPF Act ') came into force in 1952. In 1982, vide Gazette
notification by the Government, Educational Institutions were
added in the Schedule of the Act under section 1 (3). The
schedule reads thus:
"(i) any University;
(ii) any college whether or not affiliated to a University
(iii) any school, whether or not recognized or Aided by the
Central or State Government
(iv) any scientific institution
(v) any institution in which research in respect of any matter is
carried on.
(vi) any other institution in which the activity of imparting
knowledge or training is systematically carried on."
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Further in 1988, clause (b) of section 16(1) of the EPF Act,
34.
1952 was substituted by new clauses (b) (c) and (d). The
amended provisions read as under:
" 16 (1) (b): to any other establishment belonging to or under the
control of the Central Government or a State Government and
whose employees are entitled to the benefits of contributory
provident fund or old age person in accordance with any scheme
or rule framed by the Central Government or the State
Government governing such benefits;
(c) to any other establishment set up under any Central
Provincial or State Act and whose employees are entitled to the
benefits of contributory provident fund or old age person in
accordance with any scheme or rule framed under that Act
governing such benefits;
(d) to any other establishment newly set up until the expiry of a
period of three years from the date on which such establishment
is has been set up"
5. The State Government had framed rules known as 'The Rules
for payment of GrantinAid to nongovernmental educational,
cultural and physical educational institutions in Rajasthan,
1963'.
6. Later in 1989 the Rajasthan Legislative Assembly passed
"The Rajasthan NonGovernment Educational Institutions Act,
1989" which came into force from 01.01.1993.
7. On 05.08.1997, the State Government (Finance Department)
issued an order to implement the provisions of the EPF Act , 1952
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on NonGovernmental aided educational institutions employing
20 or more persons.
8. On 24.01.1998, the State Government (Educational
Department) passed an order by which it transferred the existing
Provident Fund amount from the State treasury to the office of
Regional Provident Fund Commissioner.
9. Later on 24.08.1998, the State Government (Finance
Department) passed an order about transfer of Provident Fund
amount from State treasury to the Provident Fund Commissioner.
10. Various Educational Institutions filed 21 writ petitions in the
High Court of Rajasthan, challenging the orders and circulars of
the State Government issued on 05.08.1997, 24.01.1998 and
24.08.1998. The Regional Provident Fund Commissioner also
filed 2 writ petitions in the High Court.
11. The learned Single Judge dismissed the writ petitions filed
by the Regional Provident Fund Commissioner and allowed the
21 writ petitions filed by different Educational Institutions by an
order dated 16.01.2001 stating that the state Act would override
the provisions of EPF Act , 1952 and also observed that the
educational institutions before him would fall under the
exception under the amended section 16 (1) (b) of the EPF Act .
12. Against this order of the learned Single Judge, the RPFC
went on appeal before the Division Bench of the Rajasthan High
Court. However, the Division Bench also observed that the EPF
Act will not apply to the Educational Institutions before the Court
and dismissed the appeals filed by the RPFC.
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13. Further on 23.02.2003, the respondent, Educational
Institution filed the S.B. Civil Writ Petition before the High Court
challenging the order of the State Government directing the Non
Governmental aided Educational Institution employing 20 or
more persons to deposit its contribution with the RPFC. The High
Court disposed off the matter in favour of the Educational
Institution in line with the decision in the matter of Balbari Vidya
Mandir Churu v. State of Rajasthan & others (S.B. Civil Writ
Petition No. 1085/2000). Against this decision of the High Court,
the RPFC went on appeal to the Division Bench of the High Court
which in turn by an order dated 16.09.2002, dismissed the
appeal.”
13. Considering the facts as above, the Hon'ble Apex Court referred
to a similar case in the matter of M.P.Shikshak Congress and others
Vs. R.P.F.Commissioner, Jabalpur, [1999(1) SCC 396] and noted in
paragraph Nos. 17 and 18 as under :
“17. The said orders, however, also refer to an additional period
from 1st of August, 1988 to 1st December, 1988. According to the
appellants, 1st of August, 1988, by virtue of the amended
Section 16(1)(b) of the Employees' Provident Fund and
Miscellaneous Provisions Act , 1952 coming into effect in the
provisions of the 1952 Act are no longer applicable to them.
Section 16(1)(b) provides that the 1952 Act will not apply to any
establishment under the control of the State Government whose
employees are entitled to the benefit of Contributory Provident
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Fund in accordance with any scheme framed by the State
Government conferring such benefits. Whether on 1st of August,
1988, there was any scheme in existence of the State
Government which conferred Contributory Provident Fund
benefit to the employees covered earlier by the Central Act of
1952 or not is a matter which the Regional Provident Fund
Commissioner will have to examine if such a contention is raised
before him by the appellants.
18. We, therefore, remit the matter to the concerned Regional
Provident Fund Commissioner only for the limited purpose of
examining whether for the period 1st of August, 1986 to 1st of
December, 1988 the provisions of Employees' Provident Fund
and Miscellaneous Provisions Act , 1952 are applicable to the
concerned institutions. The orders, however, for the period 1st
August, 1982 to 1st August, 1988 are upheld.”
14. In the Sanatan Dharam Case (supra), while considering the
argument of the parties as regards the effect of the State Private
Schools Act with the Central Legislation, it was noted by the Hon'ble
Apex Court in paragraph No.20 to 24 as under :
“ 20. Further, the counsel stated that, only the Educational
Institutions whose management has been taken over by the
State Government under S e ction 10 of the State Act, 1989 shall
fall within the exception under S ection 16 (1) (b) of the State Act
of 1989. Section 10 reads as follows:
"10. Powers of the State Government to take over management
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(1) notwithstanding anything contained in any law for the time
being in force, whenever it appears to the State Government that
the managing committee of any recognized institution has
neglected to perform any of the duties assigned to it by or under
this Act or the rules made there under or has failed to manage
the institution properly and that it has become necessary in the
public interest to take over the management of such institution, it
may after giving to such managing committee a reasonable
opportunity of showing cause against the proposed action, take
over such management and appoint an administrator to exercise
control over the assets of the Institution and to run the institution
for such period as the State Government may from time to time
fix.
(2) Where, before the expiry of the period fixed under sub
section (1) the State Government is of opinion that it is not
necessary to continue the management of the institution by an
administrator, such management shall be resorted to the
managing committee."
21. While concluding his submissions, the learned senior counsel
stated that the High Court did not take into consideration that
the Central Act is more beneficial for the employees than the
State Act as there is compulsory pension scheme, called "The
Employees Pension Scheme, 1995" under the Central Act .
22. Mr. Aruneshwar Gupta, learned Additional Advocate
General, appearing for the State of Rajasthan, respondent herein
submitted that, in the year 1989 the Government of Rajasthan
enacted the Rajasthan Nongovernment Educational Institutions
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22
Act, 1989. The Act came into force on 01.01.1993. The State
Government after the enactment of the said Act has clearly
occupied the field concerning the deposit of PF of the employees
of NonGovernment Institutions and it clearly overrides the
provisions of the EPF Act , 1952. He submitted that, it is relevant
to mention that the contribution to the PF pertains to Entry 24 of
List III of the Schedule 7 of the Constitution of India. Therefore,
as far as post 1993 period is concerned, the RPFC do not have
any subsisting legal right as that Act of 1989 of Rajasthan shall
prevail and to this extent the issuance of orders dated
05.08.1997, 28.01.1998 and 24.08.1998 by the Government of
Rajasthan amounted to incorrect application of law and the AG
appearing for the state of Rajasthan clearly conceded to the
same before the High Court of Rajasthan. Thus it is clear that the
Educational Institutions are outside the purview of the EPF Act .
23. Besides, the Central Act itself contemplates non application
of the Central Act in certain situations especially enumerated
under section 16 of the Act of 1952. Section 16 (1)(b) clearly
mentions that the establishments which are under the control of
state government will not fall within the purview of the Central
Act , 1952. Moreover, there is a scheme framed for contributory PF
under the chapter VIII of the Rules of 1993.
24. In conclusion it was submitted by the learned counsel for the
respondent State that in the present fact scenario, the provisions
of section 16(1) (b) of the Central Act , 1952 are attracted and
therefore, the appellant cannot claim any right over the
contributory provident fund of the employees of the Educational
Institutions covered by the Act of 1989.”
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23
15. In dealing with the argument of repugnancy under Article 254
of the Constitution, the Hon'ble Apex Court considered the effect of
Section 16(1) (b) & (c) and concluded that the said provision under
the Central Legislation provides for an exemption from the
applicability of the EPF Act. Consequentially, the Apex Court has
ruled that Article 254(2) has no applicability.
16. In the instant case, the learned Advocates for the respective
sides indicate that when salary and / or nonsalary grants are
extended to private educational institutions, it can be construed to
mean that the State Government has exercised its control over such
Institutions. There is no dispute that even if an institution is without
any grantsinaid, it still needs to be recognized by the competent
authority. Financial and administrative control over private schools
and colleges which are getting grantsinaid, is therefore exercised by
the State Government.
17. In the Sanatan Dharam Case (supra), the Hon'ble Apex Court
considered these aspects in paragraph Nos. 28 to 37, which read as
under :
“28. In order to be covered under the exception to the EPF Act ,
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1952 stated above, following two conditions have to be satisfied
by the establishment seeking to be exempted from the provisions
of the EPF Act , 1952:
1) It must be an establishment belonging to or under the control
of the Central Government or a State Government, and
2) It must be an establishment whose employees are entitled to
the benefit of contributory provident fund or old age pension in
accordance with any scheme or rule framed by the Central
Government or the State Government governing such benefits.
29. We heard the parties in detail. The submissions made by the
learned counsel appearing for the respondents merit acceptance.
It is not in dispute that the respondent institutions have been
paying the provident fund dues to the State Government in
accordance with the Scheme framed by the State Government
under the State Act and thus the employees of the respondent
institutions are entitled to the benefit of the provident fund. By
the orders impugned by the respondentinstitutions, the State
Government has sought to transfer the balance standing to its
credit to the Regional Provident Fund Commissioner. Thus it is
clear that the respondentinstitutions have been paying in
accordance with the Scheme and there is no grievance with
regard to the same.
30. In respect to the contention of the respondent that the
establishment belonging to or under the control of the Central
Government or a State Government, it was submitted that the
establishments must either be (a) belonging to or (b) under the
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25
control of the Central Government or the State Government. In
our view, the two words used in the said Section have different
connotations. The words "belonging to" signifies ownership i.e.
the Government owned institutions would be covered under the
said part and the words "under the control of" signifies control
other than ownership since ownership has already been covered
under the words "belonging to". It must be also noted that the
two words are separated by the word "OR" and therefore these
two words refer to two mutually exclusive categories of
institutions. While the institutions "belonging" to the Central or
the State Government would imply the control of the State but
the privately owned institutions can be "under the control of" the
Government in various ways.
31. Under the State Act itself, the "Control" by the State is in the
following ways:
(a) Under Section 3 of the State Act, the State Government grants
recognition to the "Nongovernment educational institutions".
It was submitted that recognition by the State is of prime
importance for running and operating an educational institution.
The said recognition can be withdrawn on the failure of the
institution to abide by the terms and the conditions of the grant
of recognition.
(b) Under Section 7 of the State Act, the State Government grants
aid to only recognized educational institutions. The aid given by
the State can be used only for the purpose for which the aid has
been given. Under Section 8 , the institutions are thereafter
required to keep accounts in the manner prescribed by the State.
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26
It was submitted that in such manner, the State exercises
Financial Control over the institutions.
(c) Under Section 9 , it has been prescribed that the institutions
shall be governed by a managing committee and Section 10 of
the Act empowers the State to take over management of the
institutions "whatever it appears to the State that the Managing
Committee has neglected to perform the duties assigned to it by
or under the Act or the Rules made thereunder.
(d) Chapter V of the Act relates to properties of the institutions
and the manner in which the institutions can manage the
properties of the institution. It was submitted that under Section
13 of the Act, the institutions have to apply and get the approval
of the competent authority set up under the said Act before
transferring the management of the institution. Under Section 15 ,
restrictions have been placed on the transfer of immovable
properties of the institutions.
(e) Section 14 of the Act prohibits closure of any institution or its
class or the teaching of any subject therein without notice in
writing to the competent authority. It was submitted that the
government thus has Functional control over the institution.
(f) Chapter VI of the State Act deals with recruitment and removal
etc. of employees. Their salary, conditions of service, provident
fund, code of conduct are all prescribed under the Act. The Act
further prescribes setting up of a Tribunal for resolution of the
disputes whose decision is final and binding on the parties.
32. The State Government also exercises Administrative Control
over the institution. Section 17 deals with the manner of
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27
recruitment and Section 18 deals with the procedure in which the
employees may be removed or dismissed or reduced in rank.
Section 28 permits the State Government to prescribe the code of
conduct of the employees and Section 29 enjoins upon the
institutions not to give to its employees a pay lesser than the
scales of pay and the allowances paid to similar categories of
the State Government.
33. In our view, the State Act is a complete code in itself with
regard to the educational institutions and the State Government
exercises substantive control over the institutions even though
the institutions are not "owned" by it. The word "control" has not
been defined under the EPF Act , 1952.
34. However, this Court in Shamrao Vithal Coop. Bank Ltd. vs.
Kasargode Panduranga Maliya, (1972) 4 SCC 600 at page 604
has cited with approval the meaning of the word "control" as it
appears at page 442 of Words & Phrases Vol.9, Permanent
Edition as under:
"The word "control" is synonymous with superintendence,
management or authority to direct, restrict or regulate."
In the case of State of Mysore vs. Allum karibasappa, (1974) 2
SCC 498 at page 501, this Court defined the words "word
control" as under:
"The word "control" suggests check, restraint or influence Control
is intended to regulate and hold in check and restrain from
action."
35. We further observe that the State Government has the power
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28
of Superintendent or the authority to direct, restrict or regulate
the working of the educational institutions. It was, therefore,
submitted that the institutions had satisfied both the conditions
(i) and (ii) mentioned above and as such they would fall within
the exception contained under Section 16(1)(B) of the EPF Act,
1952.
36. In this context we may refer to the decision cited by the
appellant in the case of M.P. Shikshak Congress vs. R.P.F.
Commnr ., (1999) 1 SCC 396, in which it was stated that the
provisions of the E.P.F. Act apply in supersession of the State Act .
This contention is not correct; the said case is clearly
distinguishable on facts as has been noted in the judgment
itself. The State Act did not provide for establishment of any
Scheme as has been provided under the provisions of the State
Act in the State of Rajasthan. In this regard, this Court noted as
under:
"12..... The Act did not even provide for any scheme for setting up
a provident fund. The Act incidentally required that the
institutional contribution to any existing provident fund scheme
should be paid into the institutional fund set up under the said
Act."
37. In addition to the above, the said case is also distinguishable
with regard to the contention of repugnancy and Article 254(2) of
the Constitution. In the said case, the Act in relation to the State
of Madhya Pradesh came into force prior to the application of the
provisions of the EPF Act , 1952 on educational institutions and
therefore the benefit of Art. 254(2) was not available to it. In the
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29
present case, however, admittedly the State Act has been
enacted and has received the assent of the president subsequent
to the applicability of the EPF Act , 1952 on the educational
institutions. In this regard, this Court in the said case noted as
under:
"13. It was by reason of the notification of 06.03.1982 that the
Central Act was extended to educational institutions. The
Employees' Provident Funds and Miscellaneous Provisions Act ,
1952, therefore, became applicable to educational institutions in
the State of Madhya Pradesh for the first time on 631982. This
was much later than the enactment of the State Act 20 of 1978.
The parliamentary enactment, therefore, would prevail over the
State Act 20 of 1978, assuming that the State Act of 1978 created
or effected any scheme for provident fund. Article 254(2 ),
therefore, has no application in the present case."
18. The M.E.P.S. Act, 1977 has received the assent of the President
on 16/03/1978. The said assent was published in the Maharashtra
Government Gazette, Part IV on 20/03/1978 and has, therefore, been
brought into effect from the said date.
19. While concluding in the Sanatan Dharam Case (supra), the
Hon'ble Apex Court observed in paragraph No.39, 40 and 41 as
under :
“39. Learned counsel appearing for the respondent in C.A. Nos.
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715737 of 2005 also drew our attention to the counter affidavit
filed on behalf of the State of Rajasthan and the educational
institutions. It is submitted that the order of recovery is patently
illegal and unjustified because of the fact that the respondent
institution does not come under the purview of the Act of 1952.
He would further submit that after the amendment was made in
Section 16 of the Act by the EPF and Miscellaneous Provisions
Amendment Act (33 of 1988) all establishments belonging to or
under the control of the Central Government or State Government
have been exempted from the provisions of the Act. Arguing
further, he submitted that the words in Section 2(b) and 2(a) are
so clear and unambiguous that no further interpretation need be
made to amplify the same and that the provisions made in the
enactment of 1989 make it clearer that the respondent institution
is a recognized educational institution managed by the private
management and is within the effective management of the State
Government and, therefore, it is entitled to be excluded from the
applicability of the Central Act , 1952.
40. Learned counsel appearing for the respondents in all the
other appeals adopted the arguments of Mr. Sushil Kumar Jain.
41. For the foregoing reasons, all the civil appeals filed by the
Regional Provident Fund Commissioner stand dismissed and the
judgment and order passed by the Division Bench of the High
Court dated 16.09.2002 and all the judgments on different dates
by different Division Benches stand affirmed. No costs.”
20. In the light of the above, considering the law laid down by the
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Hon'ble Apex Court in the D.A.V.College case (supra) and the
Sanatan Dharam Girls School case (supra), it is apparent that those
private schools and colleges, which are controlled or owned by the
State Government would be covered by Rule 19 and 20 of the
M.E.P.S.Rules, which read as under :
"19. Pension.
An employee of an aided secondary school and aided Junior
College of Education working on full time basis and retiring
on or after 1st April 1966 and an employee of an aided
primary school working on full time basis and retiring on or
after the 1st April 1979 but who have opted for pension and
the employee appointed on or after the abovementioned
respective dates shall be eligible for pension at the rates and
in accordance with the rules as are sanctioned by
Government specifically to the employees of private schools.
20.
Provident Fund.
(1) Every employee (not being an employee who has opted
for pension) of an aided or unaided school working on a full
time basis or every employee employed on parttime basis in
more than one school run by the same Management and
doing fulltime load of work in these schools, shall subscribe
to the Contributory Provident Fund under the Contributory
Provident Fund Rules (Bombay) as in force from time to time.
(2) Every employee of an aided private secondary school
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32
working on a full time basis who was appointed before the
st
1 April 1966 and who had exercised in writing his option for
a Contributory Provident Fund Scheme shall subscribed to
that Fund as per rules made by Government and are in force
in this behalf.”
21. As a result, all such employees (except those who have opted for
pension) working in aided or unaided schools are mandated to
subscribe to the contributory provident fund under the Contributory
Provident Fund Rules (Bombay). Consequentially, keeping in view
that the State Government has administrative control even if a school
or college is not operated on grantinaid basis, Rule 20(1) would
make it mandatory for every employee, who has not opted for
pension, to subscribe to the C.P.F. notwithstanding whether he is
working full time or part time in an aided or unaided school.
22. In all these matters before the Court, the periods for which
recovery is initiated by the respondent A.P.F.C. is post introduction of
Rule 20 under the 1981 Rules, which were brought into effect on
16/07/1981. These rules have been framed under Section 16(1) and
(2) of the M.E.P.F. Act, 1977. In this view of the matter, it is quite
evident that after the introduction of Rule 20 from 16/07/1981, the
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33
authority under the E.P.F. Act would have no jurisdiction to recover
P.F.dues in relation to every employee who has subscribed to the
C.P.F. If any period of service for which P.F. Contributions are due
from any educational institution prior to 16/07/1981, the P.F.
Authorities under the E.P.F. Act could exercise jurisdiction for
recovering the dues.
23. In the light of the above, these petitions are allowed. The
impugned orders issued by the competent authority under the E.P.F.
Act covering the periods after 16/07/1981, stand quashed and set
aside. Wherever such recoveries pertain to the periods prior to the
said date 16/07/1981, the E.P.F. Authorities could exercise
jurisdiction.
24. However, before parting with these matters,I deem it necessary
to issue directions to the State Government/respondent No.1 herein
to cause an enquiry into the C.P.F. Contributions of all these
petitioners / institutions and all such managements in the State of
Maharashtra considering the effect of Rule 20(1) of the 1981 Rules
only to ensure that contributions of all employees under Rule 20(1)
are not due and pending. Since provident Fund is a part of beneficial
legislation, it would be necessary for the State Government to ensure
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34
that no recoveries or dues escape their attention. The competent
department of the State Government would therefore be at liberty to
address each of these petitioners and all such institutions in the
State and call for information as it may deem necessary so as to
scrutinize and assess whether any dues are outstanding under Rule
20(1) of the M.E.P.S.Rules. After considering the replies of these
petitioners and such managements, respondent No.1 would be
entitled to pass necessary orders for ensuring the payments under
the C.P.F. This is intended to ensure the scrupulous compliance of
Rule 19 and 20 of the MEPS Rules.
25. In the event there are any P.F. accumulations with the E.P.F.
Authorities, the same shall be transferred to the C.P.F. Accounts of
each employee, considering the observations of the Hon'ble Apex
Court in the Sanatan Dharam Girls case (supra).
26. The State of Maharashtra, through its Department of
Education, shall comply with the directions set out in paragraph
No.25 above and shall complete the process of inquiry all over the
State within a period of six months. The Secretary, Department of
Education, shall report compliance to the Registrar (Judicial) at the
Aurangabad Bench on or before 31/10/2017.
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35
27. Rule is, therefore, made partly absolute in the above trms.
28. All pending civil applications do not survive and stand disposed
of.
( RAVINDRA V. GHUGE, J.)
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IN THE HIGH COURT OF JUDICATURE OF BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO. 391 OF 1998
WITH
CIVIL APPLICATION NO. 11151 OF 2014
Balasaheb Dempurikar Vidhya Mandir,
Umari, Tq. And Dist.Parbhani,
Through its Head Master,
Balaji Eknath Kamble,
Age38 years, OccuService,
R/o Umari, Tq. And Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.3277 of 1997
WITH
CIVIL APPLICATION NO.11124 OF 2014
Dnyanopasak Arts and Commerce College,
at Jintur,
Through its Acting Principal
Prakash Laxman More,
an Educational Institution,
run by Dnyanopasak Shikshan Mandal
at Parbhani, an institution registered
under the Societies Registration Act and
Bombay Public Trusts Act,
running educational institutions
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2
in the District of Parbhani – PETITIONER
VERSUS
1. Sub Regional Provident Fund Commissioner,
having office at Aurangabad,
2. The Commissioner of Provident Fund
for State of Maharashtra,
having office at Bombay,
3. Union of India,
Through Ministry of Labour,
Central Secretariat,
New Delhi,
4. The Special Recovery Officer,
attached to SubRegional
Provident Fund commissioner's Office,
at Aurangabad,
5. Swami Ramanand Teerth Marathwada
University,
through itsRegistrar,
Dnyan Teerth,
Vishnupuri, Nanded – RESPONDENTS
WITH
WRIT PETITION NO.379 OF 1998
WITH
CIVIL APPLICATION NO.11179 OF 2014
Narshinh Vidhya Mandir,
Pokharni, Tq. And Dist.Parbhani,
Through its Head Master,
Sy.Kaja Sy.Nijam,
Age39 years, OccuService,
R/o Pokharni, Tq. And Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
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3
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.380 OF 1998
WITH
CIVIL APPLICATION NO.2270 OF 2017
Pandit Jawaharlal Nehru
Vidhya Mandir, Shingnapur,
Tq. and Dist.Parbhani,
through its Head Master
Khating Rangnath Laxmanrao,
Age36 years,
R/o Singnapur, Tq. Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.381 OF 1998
WITH
CIVIL APPLICATION NO.2268 OF 2017
Rajarshi Shahu Maharaj Vidhya Mandir,
Arvi, through,
its Head Master,
Shri Laxman Sakharamji Thorat,
Age35 years,
Arvi, Tq. And Dist. Parbhani – PETITIONER
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4
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.388 OF 1998
WITH
CIVIL APPLICATION NO.404 OF 2013
Punyashlok Ahilayabai Holkar Vidhya Mandir,
Pimpalgaon, Tq. And Dist. Parbhani,
Through its Head Master,
Shri Kishan Kondiba Khandare,
Age40 years, OccuService,
R/o Laxman Nagar, Pimpalgaon,
Tq. and Dist. Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.389 OF 1998
WITH
CIVIL APPLICATION NO.2267 OF 2017
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5
Dnyaneshwer Vidhya Mandir
Purna (J) Dist.Parbhani,
Through its Head Master,
Shri Gadale Shamrao Gangaram,
Age31 years, OccuService,
R/o Purna, Dist.Parbhani. – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.390 OF 1998
WITH
CIVIL APPLICATION NO.2265 OF 2017
Late Munjaji Vithalrao Shinde Vidhya Mandir,
Khanapur, Tq. And Dist.Parbhani,
Through its Head Master,
Sheshrao Tukaram Garud,
Age39 years, OccuService,
R/o Khanapur Area,
Tq. and Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
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6
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.401 OF 1998
WITH
CIVIL APPLICATION NO.2271 OF 2017
Lalbahadur Shastri Vidhya Mandir,
Takali, Tq. And Dist. Parbhani,
Through its Head Master,
Shri Ramesh Rajaramji Bhagwat,
Age32 years, OccuService,
R/o Takli, Tq. And Dist.Parbhani – PETITIONER
VERSUS
1. The State of Maharashtra,
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.402 OF 1998
WITH
CIVIL APPLICATION NO.2272 OF 2017
Yeshvantrao Chavan Vidhya Mandir,
Takali (B), Tq. And Dist.Parbhani,
Through its Head Master,
Shri Uttam Abaji Bharose,
Age034, OccuService,
R/o Takali (B), Tq. And Dist.Parbhani, – PETITIONER
VERSUS
1. The State of Maharashtra,
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7
2. Assistant Provident Fund Commissioner,
Sub – Regional Provident Fund Officer,
Aurangabad,
3. The Parbhani District Co.op.Bank Ltd.,
Jawaharlal Nehru Road,
Parbhani,
Through its agent – RESPONDENTS
WITH
WRIT PETITION NO.845 OF 1998
WITH
CIVIL APPLICATION NO.1199 OF 2013
1. Little Flower School,
ParaliVaijanath,
District Beed,
Through its Principal,
Shri Abdul Baseer Muniruddin
Siddiqui, Age43 years,
OccuService,
R/o ParaliVaijanath,
Taluka Parali – Vaijanath,
District : Beed,
2. Modern Education Society,
ParaliVaijanath,
Taluka ParaliVaijanath,
District Beed,
Through its Secretary,
Bhanudas Madhavrao Deshmukh,
Age55 years, OccuAgriculture,
R/o Parali Vaijanath,
Tal.Parali Vaijanath,
Dist. Beed – PETITIONERS
VERSUS
1. The Union of India,
2. The Regional Provident Fund
Commissioner, Bombay and Goa
Region, Bandra, Mumbai – 400 051
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3. The Assistant Provident Fund
Commissioner and Recovery Officer,
SubRegional Office, Aurangabad,
4. The State of Maharashtra,
Through the Secretary,
Education Department, Mantralaya,
Mumbai – 32. – RESPONDENTS
Mr.C.R.Deshpande and Mr.V.G.Sakolkar, Advocate for the petitioners.
Mr.N.T.Bhagat, AGP for respondent No.1.
Mr.K.B.Choudhary, Advocate for respondent No.2.
Mr.Bushan Kulkarni, Standing Counsel for respondent No.1 in
WP No.845/1998.
( CORAM : RAVINDRA V. GHUGE, J.)
DATE : 17/02/2017
ORAL JUDGMENT :
1. All these writ petitions have been taken up together in view of
the order passed by this Court on 27/01/1998, keeping in view that
a common point of law has been raised by all these petitioners in the
light of Section 16(1)(c) of the E.P.F. and M.P.Act, 1952. For the sake
of clarity, the order dated 27/01/1998 reads as under :
“ Leave to amend.
In all these petitions a common point of lalw has been
urged by the learned counsel for the petitioners in as much as in
view of the provisions of Section 16(1)(c) of the Employees
Provident Funds and Miscellaneous Provisions Act, 1952. The
said act is not applicable to the employees of private schools as
they are entitled for pension etc. Under the M.E.P.S.Act, 1977
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and the Rules thereunder.
Notice before admission returnable on 29/01/1998.
Hamdast granted.
Mr.Chillarge, learned A.G.P. waives service for respondent
No.1.
The Deputy Director of Education Aurangabad, is directed
to depute an Officer from his office to remain present before this
Court on 29.1.1998 to clarify if the above contentions raised by
the learned counsel for the petitioners are supported by the State
Government or otherwise.
Mr.R.G.Deo, learned counsel waives service for respondent
No.2.
Mr.Deshpande, undertakes to serve copies on Mr.Deo,
learned counsel today itself.”
2. After hearing all the sides and while admitting these petitions
by order dated 29/01/1998, this Court arrived at a primafacie
conclusion that all such schools which were covered u/s 16 of the
E.P.F. Act. By the combined reading of Rules 19 and 20 of the MEPS
Rules, 1981 with paragraph No.16 of clause 3.2 of the Secondary
School Code, such schools were exempted from the applicability of
the E.P.F. and M.P. Act. The order dated 29/01/1998 reads as
under :
“ Heard Shri C.R.Deshpande, counsel for petitioner, Shri
R.C.Deo, Standing Counsel for respondent No.2 in Writ Petition
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Nos.379/98, 380/98, 381/98, 389/98 and 390/98 and Shri
Alok Sharma, Additional Standing Counsel for respondent No.2
in Writ Petition Nos.390/98, 401/98 and 402/98 and
Shri.S.V.Chillarge, Assistant Government Pleader for respondent
No.1.
On a combined reading of Rules 19 and 20 of the
Maharashtra Employees of Private Schools (Conditions of
Service) Rules, 1981 and paragraph 16 of Clause 3.2 of the
Secondary School Code, it is primafacie evident that the
provisions of the Provident Funds and Miscellaneous Provisions
Act, 1952 are not applicable to the employees working in
recognised private schools whether aided or unaided.
th
Rule made returnable on 24 February 1998.
In the meanwhile, adinterim stay in terms of prayer
clauses (D) and (E).
Leave to amend. Amendment to be carried our within one
week from today.
Respondent No.1 to file affidavit within two weeks from
today.”
3. When these matters were heard by this Court on 17/06/1998,
it was noted that the issue as to whether the school is an aided
school or not would be a decisive factor.
4. For the sake of clarity, it would be apposite to reproduce
Section 16 of the E.P.F. Act as under :
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“(1) This Act shall not apply
(a) to any establishment registered under the Co
operative Societies Act, 1912 (2 of 1912), or under any other law
for the time being in force in any State relating to cooperative
societies, employing less than fifty persons and working withut
the aid of power ; or
(b) to any other establishment belonging to or under the
control of the Central Government or a State Government and
whose employees are entitled to the benefit of contributory
provident fund or old age pension in accordance with any
Scheme or rule framed by the Central Government or the State
Government governing such benefits ; or
(c) to any other establishment set up under any Central,
Provincial or State Act and whose employees are entitled to the
benefits of contributory provident fund or old age pension in
accordance with any scheme or rule framed under that Act
governing such benefits ;
(d) [ x x x ]
(2) If the Central Government is of opinion that having regard to
the financial position of any class of [establishment] or other
circumstances of the case, it is necessary or expedient so to do,
it may, by notification in the Official Gazette, and subject to
such conditions as may be specified in the notification, exempt
[whether prospectively or retrospectively], that class of
[establishments] from the operation of this Act for such period as
may be specified in the notification.]
: Section 16A was inserted by Act No.33 of 1988, but the
Note
same has not been brought into force.”
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5. Section 16A though was inserted by Act No.33 of 1998 w.e.f.
01/09/1991, the same has not been brought into force, in as much
as it does not fall for the consideration of this Court in these matters.
Section 16A reads as under :
“ 16A Authorising certain employers to maintain provident
fund accounts
(1) The Central Government may, on an application made to it
in this behalf by the employer and the majority of
employees in relation to an establishment employing one
hundred or more persons, authorise the employer, by an
order in writing, to maintain a provident fund account in
relation to the establishment, subject to such terms and
conditions as may be specified in the Scheme :
Provided that no authorisation shall be made under this sub
section if the employer of such establishment had committed any
default in the payment of provident fund contribution or had
committed any other offence under this Act during the three
years immediately preceding the date of such authorisation.
(2) Where an establishment is authorised to maintain a
provident fund account under subsection (1), the employer
in relation to such establishment shall maintain such
account, submit such return, deposit the contribution in
such manner, provide for such facilities for inspection, pay
such administrative charges, and abide by such other
terms and conditions, as may be specified in the Scheme.
(3) Any authorisation made under this section may be
cancelled by the Central Government by order in writing if
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the employer fails to comply with any of the terms and
conditions of the authorisation or where he commits any
offence under any provision of this Act :
Provided that before cancelling the authorisation, the Central
Government shall give the employer a reasonable opportunity of
being heard.”
6. The Hon'ble Apex Court in the matter of M/s D.A.V. College
and Others Vs. Regional Provident Fund Commissioner and others,
[1988 (Suppl) SCC 518] dealt with a somewhat similar situation,
except that the State Rules pertaining to any School Code or
Education Act was not cited before the Hon'ble Apex Court. In its
order (2 paragraphs), the Hon'ble Apex Court has held as under :
“1. Shri S.K. Bagga, learned Counsel appears for the petitioners.
We do not find any substance in the contention of the petitioners
in these cases that the Employees' Provident Funds and
Miscellaneous Provisions Act , 1952 (hereinafter referred to as 'the
Act') has no application to the educational institutions who are
petitioners in these cases. We, therefore, dismiss all these cases.
2. We direct that the petitioners shall comply with the Act and
the schemes framed there under regularly with effect from
1.2.1988. Whatever arrears they have to pay under the Act and
the schemes in respect of the period between 1.3.1982 and
1.2.1988 shall be paid by each of the petitioners within such time
as may be granted by the Regional Provident Fund
Commissioner. If the petitioners pay all the arrears payable from
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1st March, 1982 upto 1st February, 1988 in accordance with the
directions of the Regional Provident Fund Commissioner he shall
not levy any damages for the delay in payment of the arrears.
Having regard to the special facts of these cases the subscribers
(the employees) shall not be entitled to any interest on the
arrears. The Writ Petitions are disposed of accordingly. No costs.”
7. As such, I find it appropriate to rely upon the law laid down by
the Hon'ble Apex Court in Regional Provident Fund Commissioner
Vs. Sanatan Dharam Girls Secondary School and others, [AIR 2007
SC 276]. The Apex Court dealt with the issue as regards whether the
nongovernmental institutions, commonly termed as private
educational institutions, would be covered by the E.P.F.Act or
whether any provision of the School Act introduced by a particular
State would entitle such schools to be exempted in view of Section 16
of the E.P.F. Act.
8. Keeping in view the law laid down by the Hon'ble Apex Court in
the D.A.V. College case (supra), there can be no dispute that
Educational Institutions would be covered by the E.P.F.Act, 1952.
Considering the law laid down in the Sanatan Dharam Case (supra),
the distinction would be that those schools, which are exempted u/s
16 of the E.P.F. Act, would not be covered by the E.P.F. Act and would
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be governed by the Rules introduced by the State Government.
Consequentially, those private schools, which do not fall under the
Rules introduced by the State Government under the Private Schools
Act and are not exempted by Section 16 of the E.P.F. Act, would thus
continue to be covered under the E.P.F. Act.
9. The Hon'ble Apex Court in the Sanatan Dharam case (supra)
has dealt with the aspect of the nongovernment educational
institutions (Private institutions in short) being governed by
enactments introduced by the State Governments for the first time.
The Rajasthan Non Government Educational Institutions Act, 1989
was before the Hon'ble Apex Court while considering the effect of the
E.P.F. Act. In the instant case, the State of Maharashtra introduced
the Maharashtra Employees of Private Schools (Conditions of Service)
Regulation Act, 1977 (hereinafter referred to as the 1977 Act) and this
was followed by the introduction of the MEPS Rules, 1981, akin to the
Rajasthan Act of 1989.
10. There is no dispute in all these cases that the petitioners are
such educational institutions which are not owned by the Central
Government or the State Government. Many of these institutions
termed as private schools or colleges, are receiving salary grants and
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non salary grants being extended to such schools.
11. The above fact situation is practically identical to the facts that
were before the Hon'ble Apex Court in the Sanatan Dharam Girls
School case (supra).
12. In order to refer to the facts before the Hon'ble Apex court in
the Sanatan Dharam Case (supra), it would be apposite to reproduce
paragraph Nos. 2 to 13 of the said judgment hereunder :
“2. Brief facts in the matter are as follows:
The Employees' Provident Fund and Misc. Provisions Act (in
short 'the EPF Act ') came into force in 1952. In 1982, vide Gazette
notification by the Government, Educational Institutions were
added in the Schedule of the Act under section 1 (3). The
schedule reads thus:
"(i) any University;
(ii) any college whether or not affiliated to a University
(iii) any school, whether or not recognized or Aided by the
Central or State Government
(iv) any scientific institution
(v) any institution in which research in respect of any matter is
carried on.
(vi) any other institution in which the activity of imparting
knowledge or training is systematically carried on."
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Further in 1988, clause (b) of section 16(1) of the EPF Act,
34.
1952 was substituted by new clauses (b) (c) and (d). The
amended provisions read as under:
" 16 (1) (b): to any other establishment belonging to or under the
control of the Central Government or a State Government and
whose employees are entitled to the benefits of contributory
provident fund or old age person in accordance with any scheme
or rule framed by the Central Government or the State
Government governing such benefits;
(c) to any other establishment set up under any Central
Provincial or State Act and whose employees are entitled to the
benefits of contributory provident fund or old age person in
accordance with any scheme or rule framed under that Act
governing such benefits;
(d) to any other establishment newly set up until the expiry of a
period of three years from the date on which such establishment
is has been set up"
5. The State Government had framed rules known as 'The Rules
for payment of GrantinAid to nongovernmental educational,
cultural and physical educational institutions in Rajasthan,
1963'.
6. Later in 1989 the Rajasthan Legislative Assembly passed
"The Rajasthan NonGovernment Educational Institutions Act,
1989" which came into force from 01.01.1993.
7. On 05.08.1997, the State Government (Finance Department)
issued an order to implement the provisions of the EPF Act , 1952
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on NonGovernmental aided educational institutions employing
20 or more persons.
8. On 24.01.1998, the State Government (Educational
Department) passed an order by which it transferred the existing
Provident Fund amount from the State treasury to the office of
Regional Provident Fund Commissioner.
9. Later on 24.08.1998, the State Government (Finance
Department) passed an order about transfer of Provident Fund
amount from State treasury to the Provident Fund Commissioner.
10. Various Educational Institutions filed 21 writ petitions in the
High Court of Rajasthan, challenging the orders and circulars of
the State Government issued on 05.08.1997, 24.01.1998 and
24.08.1998. The Regional Provident Fund Commissioner also
filed 2 writ petitions in the High Court.
11. The learned Single Judge dismissed the writ petitions filed
by the Regional Provident Fund Commissioner and allowed the
21 writ petitions filed by different Educational Institutions by an
order dated 16.01.2001 stating that the state Act would override
the provisions of EPF Act , 1952 and also observed that the
educational institutions before him would fall under the
exception under the amended section 16 (1) (b) of the EPF Act .
12. Against this order of the learned Single Judge, the RPFC
went on appeal before the Division Bench of the Rajasthan High
Court. However, the Division Bench also observed that the EPF
Act will not apply to the Educational Institutions before the Court
and dismissed the appeals filed by the RPFC.
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13. Further on 23.02.2003, the respondent, Educational
Institution filed the S.B. Civil Writ Petition before the High Court
challenging the order of the State Government directing the Non
Governmental aided Educational Institution employing 20 or
more persons to deposit its contribution with the RPFC. The High
Court disposed off the matter in favour of the Educational
Institution in line with the decision in the matter of Balbari Vidya
Mandir Churu v. State of Rajasthan & others (S.B. Civil Writ
Petition No. 1085/2000). Against this decision of the High Court,
the RPFC went on appeal to the Division Bench of the High Court
which in turn by an order dated 16.09.2002, dismissed the
appeal.”
13. Considering the facts as above, the Hon'ble Apex Court referred
to a similar case in the matter of M.P.Shikshak Congress and others
Vs. R.P.F.Commissioner, Jabalpur, [1999(1) SCC 396] and noted in
paragraph Nos. 17 and 18 as under :
“17. The said orders, however, also refer to an additional period
from 1st of August, 1988 to 1st December, 1988. According to the
appellants, 1st of August, 1988, by virtue of the amended
Section 16(1)(b) of the Employees' Provident Fund and
Miscellaneous Provisions Act , 1952 coming into effect in the
provisions of the 1952 Act are no longer applicable to them.
Section 16(1)(b) provides that the 1952 Act will not apply to any
establishment under the control of the State Government whose
employees are entitled to the benefit of Contributory Provident
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Fund in accordance with any scheme framed by the State
Government conferring such benefits. Whether on 1st of August,
1988, there was any scheme in existence of the State
Government which conferred Contributory Provident Fund
benefit to the employees covered earlier by the Central Act of
1952 or not is a matter which the Regional Provident Fund
Commissioner will have to examine if such a contention is raised
before him by the appellants.
18. We, therefore, remit the matter to the concerned Regional
Provident Fund Commissioner only for the limited purpose of
examining whether for the period 1st of August, 1986 to 1st of
December, 1988 the provisions of Employees' Provident Fund
and Miscellaneous Provisions Act , 1952 are applicable to the
concerned institutions. The orders, however, for the period 1st
August, 1982 to 1st August, 1988 are upheld.”
14. In the Sanatan Dharam Case (supra), while considering the
argument of the parties as regards the effect of the State Private
Schools Act with the Central Legislation, it was noted by the Hon'ble
Apex Court in paragraph No.20 to 24 as under :
“ 20. Further, the counsel stated that, only the Educational
Institutions whose management has been taken over by the
State Government under S e ction 10 of the State Act, 1989 shall
fall within the exception under S ection 16 (1) (b) of the State Act
of 1989. Section 10 reads as follows:
"10. Powers of the State Government to take over management
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(1) notwithstanding anything contained in any law for the time
being in force, whenever it appears to the State Government that
the managing committee of any recognized institution has
neglected to perform any of the duties assigned to it by or under
this Act or the rules made there under or has failed to manage
the institution properly and that it has become necessary in the
public interest to take over the management of such institution, it
may after giving to such managing committee a reasonable
opportunity of showing cause against the proposed action, take
over such management and appoint an administrator to exercise
control over the assets of the Institution and to run the institution
for such period as the State Government may from time to time
fix.
(2) Where, before the expiry of the period fixed under sub
section (1) the State Government is of opinion that it is not
necessary to continue the management of the institution by an
administrator, such management shall be resorted to the
managing committee."
21. While concluding his submissions, the learned senior counsel
stated that the High Court did not take into consideration that
the Central Act is more beneficial for the employees than the
State Act as there is compulsory pension scheme, called "The
Employees Pension Scheme, 1995" under the Central Act .
22. Mr. Aruneshwar Gupta, learned Additional Advocate
General, appearing for the State of Rajasthan, respondent herein
submitted that, in the year 1989 the Government of Rajasthan
enacted the Rajasthan Nongovernment Educational Institutions
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Act, 1989. The Act came into force on 01.01.1993. The State
Government after the enactment of the said Act has clearly
occupied the field concerning the deposit of PF of the employees
of NonGovernment Institutions and it clearly overrides the
provisions of the EPF Act , 1952. He submitted that, it is relevant
to mention that the contribution to the PF pertains to Entry 24 of
List III of the Schedule 7 of the Constitution of India. Therefore,
as far as post 1993 period is concerned, the RPFC do not have
any subsisting legal right as that Act of 1989 of Rajasthan shall
prevail and to this extent the issuance of orders dated
05.08.1997, 28.01.1998 and 24.08.1998 by the Government of
Rajasthan amounted to incorrect application of law and the AG
appearing for the state of Rajasthan clearly conceded to the
same before the High Court of Rajasthan. Thus it is clear that the
Educational Institutions are outside the purview of the EPF Act .
23. Besides, the Central Act itself contemplates non application
of the Central Act in certain situations especially enumerated
under section 16 of the Act of 1952. Section 16 (1)(b) clearly
mentions that the establishments which are under the control of
state government will not fall within the purview of the Central
Act , 1952. Moreover, there is a scheme framed for contributory PF
under the chapter VIII of the Rules of 1993.
24. In conclusion it was submitted by the learned counsel for the
respondent State that in the present fact scenario, the provisions
of section 16(1) (b) of the Central Act , 1952 are attracted and
therefore, the appellant cannot claim any right over the
contributory provident fund of the employees of the Educational
Institutions covered by the Act of 1989.”
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15. In dealing with the argument of repugnancy under Article 254
of the Constitution, the Hon'ble Apex Court considered the effect of
Section 16(1) (b) & (c) and concluded that the said provision under
the Central Legislation provides for an exemption from the
applicability of the EPF Act. Consequentially, the Apex Court has
ruled that Article 254(2) has no applicability.
16. In the instant case, the learned Advocates for the respective
sides indicate that when salary and / or nonsalary grants are
extended to private educational institutions, it can be construed to
mean that the State Government has exercised its control over such
Institutions. There is no dispute that even if an institution is without
any grantsinaid, it still needs to be recognized by the competent
authority. Financial and administrative control over private schools
and colleges which are getting grantsinaid, is therefore exercised by
the State Government.
17. In the Sanatan Dharam Case (supra), the Hon'ble Apex Court
considered these aspects in paragraph Nos. 28 to 37, which read as
under :
“28. In order to be covered under the exception to the EPF Act ,
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1952 stated above, following two conditions have to be satisfied
by the establishment seeking to be exempted from the provisions
of the EPF Act , 1952:
1) It must be an establishment belonging to or under the control
of the Central Government or a State Government, and
2) It must be an establishment whose employees are entitled to
the benefit of contributory provident fund or old age pension in
accordance with any scheme or rule framed by the Central
Government or the State Government governing such benefits.
29. We heard the parties in detail. The submissions made by the
learned counsel appearing for the respondents merit acceptance.
It is not in dispute that the respondent institutions have been
paying the provident fund dues to the State Government in
accordance with the Scheme framed by the State Government
under the State Act and thus the employees of the respondent
institutions are entitled to the benefit of the provident fund. By
the orders impugned by the respondentinstitutions, the State
Government has sought to transfer the balance standing to its
credit to the Regional Provident Fund Commissioner. Thus it is
clear that the respondentinstitutions have been paying in
accordance with the Scheme and there is no grievance with
regard to the same.
30. In respect to the contention of the respondent that the
establishment belonging to or under the control of the Central
Government or a State Government, it was submitted that the
establishments must either be (a) belonging to or (b) under the
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control of the Central Government or the State Government. In
our view, the two words used in the said Section have different
connotations. The words "belonging to" signifies ownership i.e.
the Government owned institutions would be covered under the
said part and the words "under the control of" signifies control
other than ownership since ownership has already been covered
under the words "belonging to". It must be also noted that the
two words are separated by the word "OR" and therefore these
two words refer to two mutually exclusive categories of
institutions. While the institutions "belonging" to the Central or
the State Government would imply the control of the State but
the privately owned institutions can be "under the control of" the
Government in various ways.
31. Under the State Act itself, the "Control" by the State is in the
following ways:
(a) Under Section 3 of the State Act, the State Government grants
recognition to the "Nongovernment educational institutions".
It was submitted that recognition by the State is of prime
importance for running and operating an educational institution.
The said recognition can be withdrawn on the failure of the
institution to abide by the terms and the conditions of the grant
of recognition.
(b) Under Section 7 of the State Act, the State Government grants
aid to only recognized educational institutions. The aid given by
the State can be used only for the purpose for which the aid has
been given. Under Section 8 , the institutions are thereafter
required to keep accounts in the manner prescribed by the State.
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It was submitted that in such manner, the State exercises
Financial Control over the institutions.
(c) Under Section 9 , it has been prescribed that the institutions
shall be governed by a managing committee and Section 10 of
the Act empowers the State to take over management of the
institutions "whatever it appears to the State that the Managing
Committee has neglected to perform the duties assigned to it by
or under the Act or the Rules made thereunder.
(d) Chapter V of the Act relates to properties of the institutions
and the manner in which the institutions can manage the
properties of the institution. It was submitted that under Section
13 of the Act, the institutions have to apply and get the approval
of the competent authority set up under the said Act before
transferring the management of the institution. Under Section 15 ,
restrictions have been placed on the transfer of immovable
properties of the institutions.
(e) Section 14 of the Act prohibits closure of any institution or its
class or the teaching of any subject therein without notice in
writing to the competent authority. It was submitted that the
government thus has Functional control over the institution.
(f) Chapter VI of the State Act deals with recruitment and removal
etc. of employees. Their salary, conditions of service, provident
fund, code of conduct are all prescribed under the Act. The Act
further prescribes setting up of a Tribunal for resolution of the
disputes whose decision is final and binding on the parties.
32. The State Government also exercises Administrative Control
over the institution. Section 17 deals with the manner of
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recruitment and Section 18 deals with the procedure in which the
employees may be removed or dismissed or reduced in rank.
Section 28 permits the State Government to prescribe the code of
conduct of the employees and Section 29 enjoins upon the
institutions not to give to its employees a pay lesser than the
scales of pay and the allowances paid to similar categories of
the State Government.
33. In our view, the State Act is a complete code in itself with
regard to the educational institutions and the State Government
exercises substantive control over the institutions even though
the institutions are not "owned" by it. The word "control" has not
been defined under the EPF Act , 1952.
34. However, this Court in Shamrao Vithal Coop. Bank Ltd. vs.
Kasargode Panduranga Maliya, (1972) 4 SCC 600 at page 604
has cited with approval the meaning of the word "control" as it
appears at page 442 of Words & Phrases Vol.9, Permanent
Edition as under:
"The word "control" is synonymous with superintendence,
management or authority to direct, restrict or regulate."
In the case of State of Mysore vs. Allum karibasappa, (1974) 2
SCC 498 at page 501, this Court defined the words "word
control" as under:
"The word "control" suggests check, restraint or influence Control
is intended to regulate and hold in check and restrain from
action."
35. We further observe that the State Government has the power
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of Superintendent or the authority to direct, restrict or regulate
the working of the educational institutions. It was, therefore,
submitted that the institutions had satisfied both the conditions
(i) and (ii) mentioned above and as such they would fall within
the exception contained under Section 16(1)(B) of the EPF Act,
1952.
36. In this context we may refer to the decision cited by the
appellant in the case of M.P. Shikshak Congress vs. R.P.F.
Commnr ., (1999) 1 SCC 396, in which it was stated that the
provisions of the E.P.F. Act apply in supersession of the State Act .
This contention is not correct; the said case is clearly
distinguishable on facts as has been noted in the judgment
itself. The State Act did not provide for establishment of any
Scheme as has been provided under the provisions of the State
Act in the State of Rajasthan. In this regard, this Court noted as
under:
"12..... The Act did not even provide for any scheme for setting up
a provident fund. The Act incidentally required that the
institutional contribution to any existing provident fund scheme
should be paid into the institutional fund set up under the said
Act."
37. In addition to the above, the said case is also distinguishable
with regard to the contention of repugnancy and Article 254(2) of
the Constitution. In the said case, the Act in relation to the State
of Madhya Pradesh came into force prior to the application of the
provisions of the EPF Act , 1952 on educational institutions and
therefore the benefit of Art. 254(2) was not available to it. In the
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present case, however, admittedly the State Act has been
enacted and has received the assent of the president subsequent
to the applicability of the EPF Act , 1952 on the educational
institutions. In this regard, this Court in the said case noted as
under:
"13. It was by reason of the notification of 06.03.1982 that the
Central Act was extended to educational institutions. The
Employees' Provident Funds and Miscellaneous Provisions Act ,
1952, therefore, became applicable to educational institutions in
the State of Madhya Pradesh for the first time on 631982. This
was much later than the enactment of the State Act 20 of 1978.
The parliamentary enactment, therefore, would prevail over the
State Act 20 of 1978, assuming that the State Act of 1978 created
or effected any scheme for provident fund. Article 254(2 ),
therefore, has no application in the present case."
18. The M.E.P.S. Act, 1977 has received the assent of the President
on 16/03/1978. The said assent was published in the Maharashtra
Government Gazette, Part IV on 20/03/1978 and has, therefore, been
brought into effect from the said date.
19. While concluding in the Sanatan Dharam Case (supra), the
Hon'ble Apex Court observed in paragraph No.39, 40 and 41 as
under :
“39. Learned counsel appearing for the respondent in C.A. Nos.
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715737 of 2005 also drew our attention to the counter affidavit
filed on behalf of the State of Rajasthan and the educational
institutions. It is submitted that the order of recovery is patently
illegal and unjustified because of the fact that the respondent
institution does not come under the purview of the Act of 1952.
He would further submit that after the amendment was made in
Section 16 of the Act by the EPF and Miscellaneous Provisions
Amendment Act (33 of 1988) all establishments belonging to or
under the control of the Central Government or State Government
have been exempted from the provisions of the Act. Arguing
further, he submitted that the words in Section 2(b) and 2(a) are
so clear and unambiguous that no further interpretation need be
made to amplify the same and that the provisions made in the
enactment of 1989 make it clearer that the respondent institution
is a recognized educational institution managed by the private
management and is within the effective management of the State
Government and, therefore, it is entitled to be excluded from the
applicability of the Central Act , 1952.
40. Learned counsel appearing for the respondents in all the
other appeals adopted the arguments of Mr. Sushil Kumar Jain.
41. For the foregoing reasons, all the civil appeals filed by the
Regional Provident Fund Commissioner stand dismissed and the
judgment and order passed by the Division Bench of the High
Court dated 16.09.2002 and all the judgments on different dates
by different Division Benches stand affirmed. No costs.”
20. In the light of the above, considering the law laid down by the
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Hon'ble Apex Court in the D.A.V.College case (supra) and the
Sanatan Dharam Girls School case (supra), it is apparent that those
private schools and colleges, which are controlled or owned by the
State Government would be covered by Rule 19 and 20 of the
M.E.P.S.Rules, which read as under :
"19. Pension.
An employee of an aided secondary school and aided Junior
College of Education working on full time basis and retiring
on or after 1st April 1966 and an employee of an aided
primary school working on full time basis and retiring on or
after the 1st April 1979 but who have opted for pension and
the employee appointed on or after the abovementioned
respective dates shall be eligible for pension at the rates and
in accordance with the rules as are sanctioned by
Government specifically to the employees of private schools.
20.
Provident Fund.
(1) Every employee (not being an employee who has opted
for pension) of an aided or unaided school working on a full
time basis or every employee employed on parttime basis in
more than one school run by the same Management and
doing fulltime load of work in these schools, shall subscribe
to the Contributory Provident Fund under the Contributory
Provident Fund Rules (Bombay) as in force from time to time.
(2) Every employee of an aided private secondary school
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working on a full time basis who was appointed before the
st
1 April 1966 and who had exercised in writing his option for
a Contributory Provident Fund Scheme shall subscribed to
that Fund as per rules made by Government and are in force
in this behalf.”
21. As a result, all such employees (except those who have opted for
pension) working in aided or unaided schools are mandated to
subscribe to the contributory provident fund under the Contributory
Provident Fund Rules (Bombay). Consequentially, keeping in view
that the State Government has administrative control even if a school
or college is not operated on grantinaid basis, Rule 20(1) would
make it mandatory for every employee, who has not opted for
pension, to subscribe to the C.P.F. notwithstanding whether he is
working full time or part time in an aided or unaided school.
22. In all these matters before the Court, the periods for which
recovery is initiated by the respondent A.P.F.C. is post introduction of
Rule 20 under the 1981 Rules, which were brought into effect on
16/07/1981. These rules have been framed under Section 16(1) and
(2) of the M.E.P.F. Act, 1977. In this view of the matter, it is quite
evident that after the introduction of Rule 20 from 16/07/1981, the
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authority under the E.P.F. Act would have no jurisdiction to recover
P.F.dues in relation to every employee who has subscribed to the
C.P.F. If any period of service for which P.F. Contributions are due
from any educational institution prior to 16/07/1981, the P.F.
Authorities under the E.P.F. Act could exercise jurisdiction for
recovering the dues.
23. In the light of the above, these petitions are allowed. The
impugned orders issued by the competent authority under the E.P.F.
Act covering the periods after 16/07/1981, stand quashed and set
aside. Wherever such recoveries pertain to the periods prior to the
said date 16/07/1981, the E.P.F. Authorities could exercise
jurisdiction.
24. However, before parting with these matters,I deem it necessary
to issue directions to the State Government/respondent No.1 herein
to cause an enquiry into the C.P.F. Contributions of all these
petitioners / institutions and all such managements in the State of
Maharashtra considering the effect of Rule 20(1) of the 1981 Rules
only to ensure that contributions of all employees under Rule 20(1)
are not due and pending. Since provident Fund is a part of beneficial
legislation, it would be necessary for the State Government to ensure
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that no recoveries or dues escape their attention. The competent
department of the State Government would therefore be at liberty to
address each of these petitioners and all such institutions in the
State and call for information as it may deem necessary so as to
scrutinize and assess whether any dues are outstanding under Rule
20(1) of the M.E.P.S.Rules. After considering the replies of these
petitioners and such managements, respondent No.1 would be
entitled to pass necessary orders for ensuring the payments under
the C.P.F. This is intended to ensure the scrupulous compliance of
Rule 19 and 20 of the MEPS Rules.
25. In the event there are any P.F. accumulations with the E.P.F.
Authorities, the same shall be transferred to the C.P.F. Accounts of
each employee, considering the observations of the Hon'ble Apex
Court in the Sanatan Dharam Girls case (supra).
26. The State of Maharashtra, through its Department of
Education, shall comply with the directions set out in paragraph
No.25 above and shall complete the process of inquiry all over the
State within a period of six months. The Secretary, Department of
Education, shall report compliance to the Registrar (Judicial) at the
Aurangabad Bench on or before 31/10/2017.
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27. Rule is, therefore, made partly absolute in the above trms.
28. All pending civil applications do not survive and stand disposed
of.
( RAVINDRA V. GHUGE, J.)
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