Holding

The EPF Commissioner must exercise the powers of attendance, oath‑examination and document discovery conferred by Section 7A, and failure to do so is a jurisdictional lapse.

Summary

The Food Corporation of India (FCI) was directed by the Employees’ Provident Fund (EPF) Commissioner to deposit contributions for workers employed by contractors at its depots in Rajasthan. FCI contended that it was denied a reasonable opportunity to produce evidence identifying those workers because the Commissioner neither summoned the contractors nor ordered the production of their workers’ lists, despite repeated requests. The High Court dismissed the writ petition, but the Supreme Court examined whether the Commissioner, under Section 7A of the EPF Act, is obligated to exercise the powers conferred on him—attendance, oath‑examination and document discovery—when a party seeks such evidence. The Court held that the Commissioner possesses the same powers as a civil court for trying a suit and must summon persons and require production of documents before determining the amount payable. Consequently, the failure to do so amounted to a jurisdictional lapse, and the appeal was allowed, with the matter remitted to the Commissioner for fresh disposal. The order of the Commissioner and the High Court were set aside.

Issues considered

Whether the EPF Commissioner, exercising powers under Section 7A of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, is bound to summon parties and compel production of documents when a party requests such evidence.
Whether failure to exercise such powers constitutes a jurisdictional error warranting reversal of the Commissioner’s determination of contribution.
Whether the contractors' workers' lists can be compelled as evidence in the Commissioner’s inquiry.

Legislation cited

Code of Civil Procedure, 1908
Contract Labour (Regulation and Abolition) Act, 1970
Employees' Provident Funds and Miscellaneous Provisions Act, 1952s. 7A
Indian Penal Code, 1860s. 193, s. 196, s. 228

Subjects

Employees' Provident FundSection 7AStatutory authorityEvidence productionAttendance and oath‑examinationJurisdictional lapseContractor workersSupreme CourtAppeal

Judgment

.,..
.
FOOD CORPORATION OF INDIA
A
v.
PROVIDENT FUND COMMISSIONER AND ANR.

OCTOBER 26, 1989

[K. JAGANNA1HA SHETIY AND T.K. THOMMEN, JJ.] B

Employees' Provident Funds and Miscellaneous Provisions Act,
1952: Section 7A-Determination of amounts payable by employer as
contribution-Statutory authority-Whether duty bound to summon
evidence when requested by party, before coming to proper conCiusion.

Respondent No. 1-the Provident Fund Conunissioner called
c
upon the appellant-Food Corporation of India to deposit contribution
payable by it under the Employees' Provident Fund and Miscellaneous
Provisions Act, 1952 and the scheme thereunder, in respect of workers
employed by the contractors appointed by the appellant for handling
storing and transporting food grains and other articles in its depots in D
Rajasthan. On appellant's non-compliance, Respondent No. 1 made an
ord_er under Section 7A of the Act determining the amount payable by
the appellant. Against the aforesaid order, the appellant filed writ peti-
tion before the High Court, which dismiss~d the same. Hence the
appeal, by special leave, by the appellant-Corpotation.
E
It W.JIS contended that the appellant was denied a reasonable
opportunity to produce actual proof of identification of workers in
respect of whom contribution was payable inasmuch as Respondent No.
1 neither gave notice to contractors, who were in possession of the
relevant lists of workers, nor made them parties to the proceedings,
despite its repeated requests. f

Allowing the appeal,

HELD: The Commissioner, while conducting an inquiry under
Section 7A of the Employees, Provident Fund ancl Miscellaneous Provi-
sions Act, 1952 has the same powers as are vested in a court under the G
Code of Civil Procedure for trying a suit. Thus, the Commissioner is
authorised to enforce attendance in person and also to examine any
person on oath. He has the power requiring the discovery and produc-
tion of documents. This power was given to the Commissioner to decide
not abstract questions of law, but only to determine actual concrete
differences in. payment of contribution and other dues by identifying the H

755
756 SUPREME COURT REPORTS [1989] Supp. 1 S.C.R.

A workmen. The Commissioner should exercise all his powers to collect
all evidence and collate all material before coming to proper conclusion.
That is the legal duty of the Commissioner. It would be failure to
exercise the jurisdiction particularly when a party to the proceedings
requests for summoning evidence from a particular person. [757H; 758A; F-H/
B In the instant case, the appellant-Corporation had some pro·
blems in collating the lists of all workers engaged in depots scattered at
different places. It requested the respondent-Commissioner to sum·
mon the contractors to produce the respective lists of workers engaged
by them. However, the appellant-Commissioner did not summon the
contractors, nor the lists maintained by them. The matter is, therefore,
c remitted to the Commissioner for fresh disposal. [757F; 759AJ

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4552
of 1989.

From the Judgment and Order dated 23.12.1988 of the Rajas·
D than High Court in C. W.P. No. 13 of 1987.

G.L. Sanghi and Y.P. Rao for the Appellant.

C.S. Vaidyaoathan, S.R. Setia and K.V. Mohan for the
Respondents.

The Judgment of the Court was delivered by

K. JAGANNATHA SHETTY, J. Special leave granted.

Having heard counsel on both sides and having perused the
F material on record, we are of opinion that the matter requires recon-
sideration by the Provident Fund Commissioner.

The Food Corporation of India has depots located at various
places in Rajasthan for handling storing and transporting food grains
and other articles. It has appointed contractors for execution of such
a works and the contractors in turn engaged some workers. In respect of
sul:h workers, the Provident Fund Commissioner called upon the
Corporation to deposit contribution payable under the Employees,
Provident Fund Acr and the scheme framed thereunder. When there
was non-compliance, the Commissioner made an order under section
7A of the said Act determining amount payable by the Corporation .
H Being aggrieved by that determination, the Cmporation moved the
...
F.C.l. v. P.F. COMMR. [SHEITY, J.] 757

High Court for relief under Art. 226 of the Constitution. The High A
Court has dismissed the petition. Hence the Corporation has appe.aled
to this Court.

The grievance complained of by the Corporation is that it was
denied of reasonable opportunity to produce material in proof of
identification of the workers in respect of whom the contribution was B
payable. It is urged that the contractors are in possession of the rele-
vant lists and the Commissioner has not even given notice to con-
-· tractors nor made them parties to the proceedings in spite of repeated
requests made by the Corporation. Counsel for the Union of Work-
men, however, contended that under the provisions of the Contract
Labour (.Reguiation and Abolition) Act, 1970 the Corporation being
c
the principal employer has to maintain list of workers; that it has failed
to produce such list and, therefore, it cannot throw the burden on the
contractors to prove the case.

We have carefully perused the Commissioner's order and also
the order of the High Court. The total amount ordered to be payable D
comes to about Rs.22,48,000 in respect of the employees of depots
• namely: Udaipur, Jaipur, Ajmer, Badmer and Sawai Madhopur. The
Commissioner has also directed the Divisional Officer, Jaipur to
deposit the Provident Fund Contribution i.e. Rs.18,72, 194 to the Fund
being maintained by the trustees of the establishment. It is indeed a
large amount for the determination of which the Commissioner has E
only depended upon the lists furnished by the workers. Union. It is no
doubt true that the employer and contractors are both liable to main-
lain registers in respect of the workers employed. But the Corporation
seems to have some problems in collating the lists of all workers
engaged in depots scattered at different places. It has requested the
,, ~
Commissioner to summon the contractors to produce the respective F
lists of workers engaged by them. The Commissioner did not summon
' the Contractors nor the lists maintained by them. He has stated that
the Corporation has failed to Pi:9duce the evidence.

The question, in our opinion, is not whether one has failed to
produce evidence. The question is whether the Commissioner who is G
the statutory authority has exercised powers vested in him to collect
the relevant evidence before determining the amount payable under
the said Act.
...
~

-··C It is of importance to remember that the Commissioner while
conducting an inquiry under section (7A) has the same powers as are H
758 SUPREME COURT REPORTS (1989] Supp. 1 S.C.R. ....->
vested in a Court under the Code of Civil Procedure for trying a suit.
A
The section reads as follows:

"S. 7(A) Determination of Moneys due from Employer-
(1) The Central Provident Fund Commissioer, any Deputy
I"
Provident Commissioner or any Regional Provident Fund
B _;~
Commissioner may, by order determine the amount due
from any employer under any provision of this Act (the
scheme or the Family Pension Scheme or the Insurance
Scheme as the case may be) and for this purpose may
conduct such inquiry as he may deem necessary.
·-
(2) The Officer conducting the inquiry under sub-section
0 (1) shall, for the purposes of such inquiry, have the same
powers as are vested in a Court under the Code of Civil
Procedure, 1908, for trying a suit in respect of the following
matters, namely:

D (a) enforcing the attendance of any person or examining
him on oath;

(b) requiring the discovery and production of documents; •
(c) receiving evidence on affidavit;

(d) issuing commissions for the examination of witnesses.

and any such inquiry shall be deemed to be a judicial proceeding
within the meaning of Sections 193 and 228, and for the1)urpose of
Section 196 of the Indian Penal Code."
F
It will be seen from the above provisions that the Commissioner ,.. ...
is authorised to 'enforce attendance in person and also to examine any
person on oath. He has the power requiring the discovery and produc-
tion of documents. This power was given to the Commissioner to
de~ide not abstract questions of law, but only to determine actual
0 concrete differences in payment of contribution .and other dues by
identifying the workmen. The Commissioner should exercise all his
powers to collect all evidence and collate all material before coining to
proper conclusion. That is the legal duty of the Commissioner. 1t )

would be failure to exercise the junsdiction.particularly when.a party
to the proceedings requests for summoning evidence from a particular
person.
>-
H
F.C.l. v. P.F. COMMR. [SHETIY, J.J 759

We, therefore, allow the appeal and reverse the order of the A
Commissioner and that of the High Court. The matter stands remitted
to the Commissioner to dispose it of afresh and in accordance with law
and in the light of the observation made.

The parties shall appear before the Commissioner to receive j;
further orders on December 12, 1989. The Commissioner, shall dis-
pose of the matter within three months thereafter.

N.P.V. Appeal allowed.

···~

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