BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

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Complt.  Case No : 916 of 2009

Date of Institution :  01.07.2009

Date of  Decision  :  23.07.2010

Paramjeet Singh s/o Gurmit Singh, R/o Vill. Balali, Tehsil Mohali, District Mohali.

 ……Complainant

V E R S U S

1]       M/s Peregrine Security Pvt. Ltd. RZ-1A, Kapashera Crossing, New Delhi, through its Chairman & Managing Director.

          Local Branch/Regional Office

2]       M/s Peregrine Security Pvt. Ltd., #625, Sector 16-D, Chandigarh, through  its M.D. & Accounts Manager Sh.Gurbhachan Singh.

3]       M/s Peregrine Security Pvt. Ltd., #625, Sector 16-D, Chandigarh through its Managing Director & Regional Manager Sh.H.S.Mann.

4]       M/s Peregrine Security Pvt. Ltd., SCO No.1, First Floor, Sector 11, Panchkula, through its General Manager.

5]       The Regional Provident Fund Commissioner, Bhavishyanidhi Bhawan, SCO No.5-8, Sector 12, (New Mini Secretariat) Karnal (HR) – 132001 through its Provident Fund Commissioner.

………Opposite Parties.

6]       JCT Electronics Ltd. A-32, Industrial Area, Phase-VIII, SAS Nagar, Mohali, through its Managing Directors. 

.…..Performa Opposite Parties

CORAM:          SH.LAKSHMAN SHARMA                         PRESIDENT

                    SH.ASHOK RAJ BHANDARI            MEMBER

                    MRS.MADHU MUTNEJA                        MEMBER

PRESENT:     Sh.Neeraj Sobti, Adv. for the complainant

Sh.Parhalad Bhatt, L.O. on behalf of OPs No.1 to 4. None for OPs No.5 & 6

PER ASHOK RAJ BHANDARI, MEMBER

1]               Concisely put, the complainant was enrolled with OPs No.1 to 4 for doing the job as Security Guard in the year 2004 . He was employed at the salary of Rs.2470/- p.m. out of which Rs.296.40 (12%) and Rs.30/- were deducted respectively towards EPF and ESI respectively. OPs No.1 to 4 were required to deposit the EPF with EPF Authorities by adding their equal share.  The complainant served OP-6 through OPs 2 & 3 on contractual basis, so the salary was being disbursed through OPs 2 & 3. According to the complainant, he approached OPs 2 & 3 to provide the details of the EPF, which was deposited by them with OP-5, but nothing was done. The complainant alleged that he approached OPs No.1 to 4 so many times, but despite his repeated requests, OPs failed to provide the complete statement of account regarding deductions done by them towards EPF every month as well as total amount of EPF accumulated in his account till date. Therefore, the complainant served OPs No.1 to 4 with a legal notice but to no effect. According to the complainant, he also approached OP-5 under the RTI on 27.05.2009 to which no reply has been received.  As per complainant, the amount deducted towards PF contribution every month was not  deposited by the OPs No.1 to 4 with the concerned PF Commissioner which amounts to deficiency in service on their part. In these circumstances, the present complaint was filed seeking the relief  that OPs No.1 to 4 be directed to pay both the shares i.e. employer + employee (Rs.592/- PM) since the date of joining i.e. June 2004 to May 2006 along with interest @37% as provided under Para No.32-A of the EPF Scheme, 1952 till actual realization and OPs No.1 to 5 be directed to pay Rs.1.00 lac jointly & severally to the complainant towards mental agony and physical harassment caused because of their act as well as to pay litigation cost. 

2]             In the written statement filed by OPs 1 to 4, it has been admitted that the complainant was an employee of OPs. According to OPs, there was no assurance from OPs with regard to deposit of EPF and the deduction of the EPF and thereafter deposition is legal obligation on the part of the employer and the employee.  It has been pleaded by OPs that complainant never approached them to provide the detail of the PF account and statement of the PF account etc. However, in reply to the legal notice, the complainant was supplied all possible information to the complainant except the information relating to the rate/figure of the interest on the PF contribution.  It is further submitted that the PFC (OP-5) itself had laid down the rules and regulations whereby the employer is required to attest the PF withdrawal form for withdrawal of PF or any part thereof so that unnecessary hindrances are waived off and the PFC could exercise the procedure without any delay or demure. In these circumstances, according to OPs 1  to 4, there is no deficiency in service on its part and the complaint against them deserves dismissal.

3]             In its separate written statement filed by OP-5, it has pleaded that M/s Peregrine Security Pvt. Ltd. (OP No.4), Panchkula was under a statutory obligation to deposit the EPF amount pertaining to all the employees/complainant. It is stated that the OP No.4 was covered under the EPF Act  w.e.f. 1.1.2001 and it was a duty fastened on it under the act to deposit the Provident Fund accumulations of the employee with the answering OP. Furthermore proceedings under Section 7-A of the EPF and the Misc. Provisions Act, 1952 for determining the outstanding dues have been initiated and a sum of Rs.1,02,539/- has already been assessed & determined to be deposited by OP No.4 out of Rs.30,82,510/- during the enquiry conducted under Section 7-A of the EPF and MP Act.  In these circumstances, according to OP-5, there is no deficiency in service on its part and the complaint deserves dismissal qua it.

4]             In its separate written statement, OP No.6 admitted that the Complainant was an employee of OP No. 2 & 3 and was appointed by M/s Peregrine Security Pvt. Ltd. He was paid his salaries by OP No. 2 & 3 and his PF deductions and contributions were made by the OP No. 2 & 3 with OP-5 and he was assigned duties at various locations of OP-6 by OPs 2 & 3.  It was submitted that OP No. 2 & 3 used to furnish copy of Challans for deposit of provident fund deductions and contribution to show that the provident fund deduction of the employee and employer’s contribution have been deposited by them with the Provident Fund Commissioner. However, the Complainant did not bring to the notice of OP No. 6, any complaint made by him to the Provident Fund Commissioner in respect of non-deposit of the said amount by OPs No.1 to 4 with OP No.5. In these circumstances, according to OP-6, there is no deficiency in service on its part and the complaint deserves dismissal qua it.

5]             We have heard the learned counsel for the complainant and Law Officer on behalf of OPs No.1 to 4 and have gone through the entire record.

6]             As none appeared on behalf of OPs No.5 & 6 on 14.7.2010 when the case was fixed for arguments, we therefore proceed to dispose of this complaint on merits under Rule 4(8) of the Chandigarh Consumer Protection Rules, 1987 read with Section 13(2) of the Consumer Protection Act, 1986 (as amended upto date) even in absence of OPs 5 & 6.   

7]             The basic facts of the case in respect of the complainant having worked as a security guard with OPs No.1 to 4 from June, 2004 to May, 2006 at the salary of Rs.2470/- per month and that he was deputed by these OPs to work at various locations of OP No.6 during the said period, have all been admitted. 

8]             It is also a fact that OPs No.1 to 4 were required to deduct the Provident Fund Contribution and after adding equal share from their side were required to deposit the total amount with OP No.5 on regular basis.  The main grievance of the complainant against the OPs especially OPs No.2 & 3 has been that although he had worked with them for about 2 years, yet his Provident Fund Contribution along with employer’s share were not deposited with OP No.5 on the due dates and also that these OPs failed to provide him the complete statement of account in respect of the deductions made by them towards EPF every month as well as the total amount of EPF accumulations along with interest paid on the same in his account till date.  As per the complainant, all this amounts to deficiency in service on the part of the OPs.

9]             The OPs No.1 to 4 while admitting that the complainant was an employee of the OPs have stated that the complainant never approached them to provide the details of his Provident Fund Account and detailed statement of EPF accounts etc.  and on receiving the legal notice, all possible information was provided to him except the information relating to the rate and amount of interest payable on the PF contributions.  The OPs further say that the complainant was free to make withdrawal from PF account after getting his application attested from the OPs and thus the complainant has suffered no loss.  On these grounds, the OPs say that there is no deficiency in service on their part and therefore, the complaint needs dismissal.

10]            On the same lines, OP No.5 (Regional Provident Fund Commissioner, Karnal) has stated that OP No.4 was covered under the EPF Scheme w.e.f. 1.1.2001 and it was its duty under the Act to deposit the PF contributions of the employees along with employer’s share with OP No.5.  It further says that since OPs No.1 to 4 were defaulting in their obligation for making the PF deposits of the complainant, proceedings under Section 7-A of the EPF and Misc. Provisions Act, 1952 for determining the outstanding dues have since been initiated and a sum of Rs.1,02,539/- has already been assessed and determined to be deposited by OP No.4 out of its total liability of Rs.30,82,510/-.  On these grounds, this OP has pleaded that there is no deficiency in service on its part and that the present complaint be dismissed qua it.

11]            OP No.6 also states that the complainant had worked at different locations of the company as he was deputed to work with this OP by OPs NO.2 & 3.  It further says that the complainant was paid his salary by OPs No.2 & 3 and his Provident Fund Contributions were also made by these OPs whereas OP No.6 only assigned duties at the locations.  As per this OP, the complainant did not bring to the notice of OP NO.6 any complaint made by him to the P.F. Commissioner.  It says that so far as this OP is concerned, it had already paid salary to the complainant though OPs No.2 & 3 and therefore, there is no deficiency in service on its part and the complaint needs dismissal qua OP No.6.

12]            One of the contentions of the learned counsel for the OPs 1 to 4 is that the complainant is a resident of Mohali, the office of OP-4 is at Panchkula and the office of the Regional Provident Fund Commissioner (OP-7) is at Karnal but the complaint has been filed at Chandigarh and, therefore, this Forum has no territorial jurisdiction to entertain and try this complaint.  This argument has been opposed by the learned counsel for the complainant. According to him, the offices of OPs 2 & 3 are at Chandigarh.  OPs 2 & 3 are the branch offices of OP-1 the employers of the complainant who have not rendered proper service to him.  OPs 1 to 4 are in fact the different offices of one and the same company.  In view of Section 11 (b) of the Consumer Protection Act, the complaint can be filed at the place where there is branch office of the OP and if there are more than one OPs, then it can be filed with the permission of the Forum at the place where any of the OPs is carrying on business.  The present complaint has already been allowed to be filed at Chandigarh at the request of the complainant.  In view of these provisions, it cannot be said that this Forum does not have the territorial jurisdiction to try this complaint.

13]            The learned counsel for the OPs 1 to 4 has also argued that a separate Act exists for taking action against the defaulting employers if they fail in their obligation under the Act and that quasi judicial proceedings have also been initiated by OP No.5 against OPs 1 to 4 and, therefore, this complaint is not maintainable.  This argument is misconceived.  It cannot be disputed that in view of judgments in the cases of Regional Provident Fund Commissioner, Faridabad Vs. Shiv Kumar Joshi and Babu Ram Joshi-1994 (1) CPC 562 and Captain C.P. Gupta Vs. Indian Airlines Provident Fund Trust through its Principal Officer and others-2003 (3) CLT 46 (NC),  the Regional Provident Fund Commissioner renders service to its subscribers and, therefore, is covered by the Consumer Protection Act.  Similarly, whether it is the employer or the employee who meets the expenses for administering the provident fund is immaterial as the employer also gets benefit of deduction in income tax on the contributions made by it to the Fund and, therefore, the complainant-employee would be a consumer vis-à-vis his employer.  The dispute regarding the subscription to the Provident Fund is, therefore, a consumer dispute and this Forum has the jurisdiction to try the same.

14]            So far as the initiation of quasi judicial proceedings by OPs No.5 against OPs 1 to 4 is concerned, the learned counsel for the complainant termed it as an eyewash. According to him the OPs 1 to 4 were covered under the Act since 2001.  They had not deposited PF contributions ever since then but when certain complaints were filed by some persons against OPs who were similarly placed as the complainant, the OP No.5 realised that their mischief is being detected and, therefore, as an eyewash they served a notice on OPs 1 to 4 to pay their dues.  The learned counsel argued on the basis of Annexure R-1 that a squad was formed for inspection of record of the establishment and the squad submitted its report of inspection along with certain observations.  Interestingly, the detailed report of said squad has been withheld by the OP No.5. The learned counsel for the complainant argued that may be, in the said report, it was found that the OPs 1 to 4 were covered under the Act since 2001 but no action was taken against them for not depositing the subscriptions. The complainant and others were working under the OPs 1 to 4 since long.  Annexure R-3 is another letter issued in December, 2008 by OP No.5 asking the OPs to submit the books of accounts viz. Balance Sheet along with Profit &Loss account and schedules/Annexures, Salary/Wages Register, employees deployment list etc.  Ordinarily it should have been done by OP No.5 in the year 2001 or 2002 but the same was not done at that time.  Annexure R-4 is another letter issued in February, 2009 in which it was mentioned that the establishment of OPs 1 to 4 was in existence as on 1.1.2001 and the EPF  Act was applicable to them w.e.f. 1.1.2001 whereas the said Act had been made applicable to them provisionally only w.e.f. 1.3.2006.  The learned counsel argued that OP No.5 were already aware of this fact but asked the OPs 1 to 4 to deposit the dues much later. Otherwise also, even in spite of the report of the squad formed by them, they were sitting over the papers and did not take any step to implement the statutory provisions of the Act which was presumably due to the reason that OP No.5 were hand in glove with OPs 1 to 4 to misappropriate the contributions towards the provident fund of low paid employees such as the complainant.  It is, therefore, clear that OP No.5 who has been enjoined to enforce the Act has itself been found to be violator thereof.  Instead of enforcing the provisions beneficial to the low paid employees, they were sitting over the issue and allowing the defaulters such as OPs 1 to 4 to misappropriate the amounts and enjoy the benefits thereof. It was, therefore, failure on the part of officials of OP-5 in enforcing the Act and if they have now issued a notice or two to OPs 1 to 4, it may be only to meet this complaint and thereafter the case may be filed/closed by just giving a warning to OPs 1 to 4.  Under these circumstances it cannot be accepted that this complaint should not be taken to its logical end, even in view of quasi judicial proceedings initiated by OP No.5 against OPs 1 to 4.

15]            There is another reason as to why this complaint would be maintainable.  The remedies under the Consumer Protection Act have been afforded in addition to the other remedies available to the aggrieved under Section 3 of the C.P. Act,1986.  OP No.5 would be free to take action against OPs 1 to 4 in accordance with law (and under the Act) whereas this remedy is being availed by the complainants for their harassment and deficiency in service on the part of OPs.

16]            The O.P. No.5 in its written statement/reply has taken the plea that the OPs 1 to 4 when asked, submitted the returns to show that they were depositing the payments in the PF account of the complainant and were not defaulters due to which OP No.5 could not take any further action against them.  This appears to be a made up story and could succeed only if OP No.5 were either negligent or in league with them.  Otherwise, OP No.5 could very well know as to what is the establishment code of OPs 1 to 4 and what is the account numbers of its different subscribers.  It is clear from Annexure R-1 to R-23 that the establishment code mentioned in the statements is DL/18769 which pertains to their office at Delhi.  If the officials of the OPs had merely taken a birds’ eye view of the statements submitted by OPs 1 to 4, they would have readily come to know with regard to which employees or offices these statements have been submitted but OP No.5 appears to have been so influenced by OPs 1 to 4 that they did not even think it proper to go through the statements submitted by OPs 1 to 4 as if they were not at all required to render any service (or perform their duty) and were only concerned with their salary for attending the office.  It is, therefore, not a simple case where the OP No.5 were misled by the OPs 1 to 4 by submitting wrong returns of PF account but that OP No.5 themselves appear to be negligent in rendering proper service by not performing their statutory duties with due diligence and care.  There is rather serious dereliction of duty on their part rendering proper and required service to the complainant under the EPF Act.  

17]            The complainant has enclosed a letter issued by OP No.5 dated 26.6.2009 addressed to the ld.Counsel for the complainant stating that the annual statements of accounts has already been issued vide their office Letter No.A/S-III/HR/19661/3128 dated 31.3.2009.  Despite the fact that such detailed statement of accounts has already been supplied by OP No.5 to OPs No.1 to 4, the same has not been provided by these OPs to the complainant till date.  The only statement of account, which has been provided by OP No.1 to4 to the complainant is at Annexure C-4, which is the Contribution Card for currency Period from 1^st April, 2004 to Feb., 2007.  This statement only shows the amount of wages earned by the complainant and also the worker’s as well as employer’s share towards EPF and Pension Fund.  This statement gives no information in respect of the percentage of interest payable on the employees subscription, the employer’s contribution as also the total accumulations in the said accounts upto date date-wise/month-wise.  It also does not give any details in respect of the interest earned by the complainant on his PF account, as such it is an incomplete document and does not provide any guidance to the complainant with regard to the total accumulations lying in his PF Account as maintained by OP No.5 on behalf of Ops No.1 to 4..

18]            The ld.Counsel for the complainant has also argued that because the complainant became member of the Fund and deductions from his salary were started by OPs No.1 to 4 with effect from June, 2004 to May, 2006, the complainant could withdraw from the PF Contribution after subscribing to it for 5 years.  In the absence of the complete information with regard to the total accumulation lying in the PF Account, he could not make any withdrawal from the same.  It is also true that there may be number of employees, who are being dealt with by the OPs in a similar manner, which tantamounts to not only deficiency in rendering proper service by OP No.1 to 4 and 5 but is also an unfair trade practice being adopted by OPs No.1 to 4.  There is a lot of merit in the contentions of the complainant.

19]            Keeping in view the above detailed analysis of the entire case, it is clearly established that there is serious deficiency of service not only on the part of OPs No.1 to 4  but also OP No.5.  In both the cases, the OPs in question have not done their duty as was assigned to them as they were duty bound to perform the same.  In the case of OPs No.1 to 4, they have also indulged in an unfair trade practice as explained in details in the foregoing.  Due to inaction on the part of OPs No.1 to 4 and  negligence and/or connivance on the part of OP No.5 with the other OPs, the complainant has suffered immensely not only in terms of financial and monetary loss but also undergone a lot of physical harassment, mental agony and pain especially in view of the fact that the complainant was a low paid employee in private service with no security of service available to him.  He also did not have any fixed tenure of service.  Therefore, the subscriptions made by him towards PF as also the contribution made by the OPs No.1 to 4 to the EPF along with interest were extremely important for the complainant from where he could meet his urgent essential personal needs as this was the only source of cash reserve for him.  In the present case, he has been fully deprived of using his own money lying in the PF Account.

20]            In view of the above detailed discussion, in our considered opinion, the present complaint has a lot of merit, weight and substance and therefore, it deserves acceptance.  We therefore, allow the complaint in favour of the complainant and against the OPs and pass the following order:-

i)         OPs 1 to 4 are directed to pay to the complainant both the shares i.e. employee’s and employer’s share at the rate of Rs.592/- per month from the date of joining of the complainant with them in June, 2004 till the date of his leaving the OP organization in May, 2006.

ii)        OPs No.1 to4 shall further pay compensation of Rs.40,000/- to the complainant for causing physical harassment, mental agony and pain to him on account of various irregularities committed by them in maintaining his provident fund account and not ever supplying to him any information with regard to the balance accumulated in the said PF account.

iii)       OPs No.1 to 4 shall also pay Rs.5000/- as litigation cost to the complainant.

iv)      The OP No.5 shall pay compensation of Rs.10,000/- to the complainant on account of its deficiency in service in not properly supervising and monitoring the EPF account of the complainant and not taking any action against OPs No.1 to 4 for a number of years even though the said OPs had committed serious irregularities in respect of EPF account of the complainant.   

v)        OP No.5 shall decide the proceedings initiated by them against OPs 1 to 4 under Section 7-A of the Employees Provident Fund and M.P.Act, 1952 within 45 days from the receipt of copy of this order without taking into consideration the compensation awarded to the complainant in the present case.

21]            The aforesaid order shall be complied with and the respective amounts shall be paid by the OPs No.1 to 5 within a period of 45 days from the date of receipt of certified copy of this order, failing which they shall pay the above said awarded amount along with interest @18% per annum as calculated from the date of filing the complaint i.e. 1.7.2009 till the date of actual payment besides paying the litigation cost of Rs.5,000/-.  The liability of the Ops to pay the awarded amounts shall be joint & several.

22]            Since there is no deficiency in service on the part of OP No.6 nor any relief is claimed against it by the complainant, the complaint qua OP No.6 stands dismissed with no order as to costs.

23]            Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

23^rd July, 2010                                                         Sd/-

(LAKSHMAN SHARMA)

PRESIDENT

                                                                Sd/-

                                                        (ASHOK RAJ BHANDARI)

MEMBER

                                                                   Sd/-

(MADHU MUTNEJA]

MEMBER

“Om”