Company Liable for EPF Delay Damages as Separate Entity | HC

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Damages under Section 14B of the EPF Act

Case Details: Janatha Tile Works Ltd. vs. Employees Provident Fund Organization - [2025] 181 taxmann.com 639 (HC - Kerala)

Judiciary and Counsel Details

  • Anil K. Narendran & Muralee Krishna S., JJ.
  • B. Sajeev Kumar, Adv. for the Petitioner.
  • Abraham P. Meachinkara, Adv. for the Respondent.

Facts of the Case

In the instant case, the appellant company was directed to pay damages under Section 14B of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, for the delay in payment of contributions to the Employees’ Provident Fund.

The appellant filed a writ petition seeking a declaration that it was not liable to pay damages and interest pursuant to the order of the Assistant Provident Fund Commissioner. The Writ petition was dismissed by the Single Judge.
The appellant filed an instant writ appeal contending that previous management had transferred ownership and management of the company to its workers, who were then running the company, and on that basis sought that the proceedings be interdicted.

High Court Held

The High Court held that once a default in payment of the contribution is admitted, the employer is liable to pay damages for the delay in payment of the Employees’ Provident Fund Contribution. Further, since a company is a legal person, separate and distinct from its individual members, the appellant company was liable to pay damages for the delay in payment of the Employees’ Provident Fund contribution.
Therefore, there was no reason to interfere with the impugned judgment of the Single Judge, and the instant writ appeal was to be dismissed.

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Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied