Case Note & Summary
The petitioner, Mr. M.V. Kanakaraj, filed a writ petition under Articles 226 and 227 of the Constitution of India seeking directions to the Regional Commissioner, Employees' Provident Fund Organization (EPFO) to pay interest on his provident fund dues from the date of his retirement (25.11.1991) until the date of actual payment. The petitioner had worked with Tata Construction and Projects Ltd. (also known as Tata Davy Limited) as an Engineer from 03.04.1979 to 25.11.1991 and was allotted PF No. KN/10701/286. After his retirement, the petitioner made several representations to the EPFO for settlement of his provident fund account, but the amount was not paid until 08.02.2021. The EPFO contended that as per Paragraph 60(6) of the Employees' Provident Fund Scheme, 1952, no interest is payable for the period prior to 02.03.2017, and that the petitioner was only entitled to interest from 02.03.2017 to 08.02.2021 at 12% per annum under Paragraph 72(7). The court examined the provisions of Paragraph 60(6) and Paragraph 72(7) of the Scheme. It held that Paragraph 60(6) only bars interest for the period during which the amount remained in the fund and does not apply to delay in settlement after retirement. The court reasoned that the petitioner was entitled to interest on the amount from the date of retirement until the date of actual payment. The court directed the EPFO to pay interest at the rate declared under Paragraph 60(1) from year to year for the period from 25.11.1991 to 01.03.2017, and at 12% per annum from 02.03.2017 to 08.02.2021 as per Paragraph 72(7). The writ petition was allowed with the above directions.
Headnote
A) Employees' Provident Fund - Interest on Delayed Payment - Paragraph 60(6) of EPF Scheme 1952 - Petitioner retired in 1991 but PF amount was settled in 2021 - EPFO contended that Paragraph 60(6) bars interest for period prior to 2017 - Court held that Paragraph 60(6) only bars interest for the period during which the amount remained in the fund and does not apply to delay in settlement after retirement - Petitioner entitled to interest from date of retirement till date of payment at the rate applicable under Paragraph 72(7) (Paras 5-8). B) Employees' Provident Fund - Delay in Settlement - Paragraph 72(7) of EPF Scheme 1952 - EPFO directed to pay interest at 12% p.a. for the period from 02.03.2017 to 08.02.2021 as per Paragraph 72(7) - For the period from 25.11.1991 to 01.03.2017, interest at the rate declared under Paragraph 60(1) from year to year (Paras 9-10).
Issue of Consideration
Whether the petitioner is entitled to interest on the delayed payment of provident fund dues from the date of retirement until the date of actual payment, and whether Paragraph 60(6) of the Employees' Provident Fund Scheme, 1952 bars such interest.
Final Decision
Writ petition allowed. The respondent No.1 is directed to pay interest on the provident fund amount from 25.11.1991 to 01.03.2017 at the rate declared under Paragraph 60(1) from year to year, and from 02.03.2017 to 08.02.2021 at 12% per annum as per Paragraph 72(7). The amount shall be paid within eight weeks from the date of receipt of a copy of this order.
Law Points
- Interest on provident fund
- Delay in settlement
- Paragraph 60(6) of EPF Scheme 1952
- Paragraph 72(7) of EPF Scheme 1952
- Employees' Provident Funds and Miscellaneous Provisions Act
- 1952
- Article 226 of Constitution of India
