EPF Damages Waiver Upheld Under Section 14B Rehabilitation Scheme Exception
- Blog|News|Labour & Industrial Laws|
- 2 Min Read
- By Taxmann
- |
- Last Updated on 22 June, 2026
Latest from Taxmann
Case Details: Central Board of Trustees EPF vs. Konega International (P) Ltd. - [2026] 186 taxmann.com 1094 (HC - Karnataka)
Judiciary and Counsel Details
- Anant Ramanath Hegde, J.
- Smt. M.R. Shalamala, Adv. for the Petitioner.
- J. Pradeep Kumar, Adv. & Mrs K. Sribhoomi Yesaswini for the Respondent.
Facts of the Case
In the instant case, the Petitioner-EPF Board proceeded against the respondent for arrears of the employer’s provident fund contribution. Despite notice, the respondent did not pay. Proceedings were initiated under Section 14B of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952, and damages were levied for the default period.
On appeal, the Appellate Tribunal set aside the Commissioner’s order on the premise that there was no mens rea on the respondent’s part for failing to make timely contributions. Thereafter, the petitioner filed a writ petition challenging the Appellate Tribunal’s order.
It was noted that the respondent was a sick industrial company, and a rehabilitation scheme was sanctioned by the Board for Industrial and Financial Reconstruction.
The High Court observed that though mens rea was not a criterion, there was a valid ground enumerated in the second proviso to Section 14B to waive damages awarded.
High Court Held
The High Court held that the rehabilitation scheme was sanctioned on account of the loss suffered by the company, and that the company’s assets had been auctioned. The amount recovered, the Appellate Tribunal was justified in waiving damages.
Thus, the waiver was upheld because of the benefit available to the respondent under the second proviso to Section 14B of the Act. Accordingly, the writ petition was to be dismissed.
List of Cases Referred to
- Horticulture Experiment Station Gonikoppal, Coorg v. Regional Provident Fund Organisation [2022] 2 taxmann.com 2397 (SC) (para 7)
- Regional Provident Fund Commissioner Employees Provident Fund Organization v. HMT Ltd [2023] 6 taxmann.com 763 (Kar) (para 15)
Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.
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
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
