Calcutta High Court (Appellete Side)
Caledonian Jute & Industries Ltd. & Anr vs Union Of India & Ors on 20 April, 2026
2026:CHC-AS:612
IN THE HIGH COURT AT CALCUTTA
Constitutional Writ Jurisdiction
Appellate side
Present:
The Hon'ble Justice Shampa Dutt (Paul)
WPA 6138(W) of 2009
with
CAN 1 of 2011 (Old No.123 of 2011)
Caledonian Jute & Industries Ltd. & Anr.
-Vs.-
Union of India & Ors.
With
WPA 28543(W) of 2015
With
CAN 1 of 2016 (Old No.690 of 2016)
Murlidhar Ratanlal Exports Ltd & Anr.
-Vs.-
Ministry of Labour & Employment & Ors.
With
WPA 13484(W) of 2008
with
CAN 1 of 2010 (Old No.10122 of 2010)
With
CAN 2 of 2025
With
RDB Textiles Ltd. & Anr.
-Vs.-
The Regional P.F. Commissioner-I & Ors.
With
WPA 15352(W) of 2008
With
CAN 1 of 2010 (Old No.10786 of 2010)
Page 2 2026:CHC-AS:612
The Angus Company Ltd. & Anr.
-Vs.-
The R.P.F. Commissioner & Ors.
With
WPA 15755(W) of 2011
With
CAN 1 of 2012 (Old No.283 of 2012)
With
CAN 2 of 2022
Shree Gouri Shankar Jute Mills Ltd. & Anr.
-Vs.-
Union of India & Ors.
With
WPA 16240(W) of 2007
with
CAN 1 of 2022
Sri Annapurna Cotton Mills & Industries Ltd.
-Vs.-
Employees Provident Fund Organization & Ors.
With
WPA 16749(W) of 2008
With
CAN 1 of 2022
with
CAN 2 of 2023
with
CAN 3 of 2023
Kanknarrah Co. Ltd. & Anr.
-Vs.-
Union of India & Ors.
With
Page 3 2026:CHC-AS:612
WPA 210(W) of 2015
With
CAN 1 of 2015 (Old No.5128 of 2015)
Murlidhar Ratanlal Exports Ltd. & Anr.
v.
Ministry of Labour & Employment, Govt. of India & Ors.
With
WPA 21252(W) of 2007
with
CAN 1 of 2009 (Old No.9972 of 2009)
With
CAN 2 of 2025
Murlidhar Ratanlal Exports Ltd. & Anr.
-Vs.-
The Regional Provident Fund Commissioner & Anr.
With
WPA 26777(W) of 2023
Tepcon International (I) Ltd. & Anr.
-Vs.-
Union of India & Ors.
With
WPA 2812 of 2010
With
CAN 1 of 2010 (Old No.9581 of 2010)
with
CAN 2 of 2025
with
CAN 3 of 2025
With
M/s. Bally Jute Co. Ltd.
-Vs.-
Regional P.F. Commissioner, Sub Regional Office, Howrah & Ors.
With
Page 4 2026:CHC-AS:612
WPA 2974 of 2010
with
CAN 1 of 2010 (Old No.9583 of 2010)
with
CAN 2 of 2025
with
CAN 3 of 2025
Howrah Mills Company Ltd.& Anr.
-Vs.-
Regional Provident Fund Commissioner & Ors.
With
WPA 31569 of 2008
with
CAN 1 of 2010 (Old No.10784 of 2010)
M/s.Delta Ltd. & Anr.
-Vs.-
Union of India & Ors.
With
WPA 3819(W) of 2008
with
CAN 2 of 2011 (Old No.122 of 2011)
with
CAN 3 of 2023
The Hooghly Mills Company Ltd. & Anr.
-Vs.-
The Regional Provident Fund Commissioner-I & Ors.
With
WPA 4790(W) of 2015
with
CAN 1 of 2024
The Hooghly Mills Company Ltd. & Anr.
-Vs.-
The Central Provident Fund Commissioners & Ors.
With
Page 5 2026:CHC-AS:612
WPA 4932(W) of 2009
with
CAN 1 of 2010 (Old No.9582 of 2010)
The Hooghly Mills Com. Ltd. & Anr.
-Vs.-
Union of India & Ors.
With
WPA 5548(W) of 2009
Kelvin Jute Company Ltd. & Anr.
-Vs.-
The Regional P.F Commissioner-1 & Ors.
With
WPA 7526(W) of 2012
With
CAN 1 of 2010 (Old No.9584 of 2010)
M/s. Northbrook Jute Co. Ltd. & Anr.
-Vs.-
Union of India & Ors.
With
WPA 8290(W) of 2011
with
CAN 1 of 2012 (Old No.287 of 2012)
Naffar Chandra Jute Mills Limited & Anr.
-Vs.-
Union of India & Ors.
With
WPA 8918(W) of 2011
Anil Kumar Bhansali and Anr.
-vs-
Regional Provident Fund Commissioner-II/OIC, Sub-Regional Office,
Barrackpore & Ors.
Page 6 2026:CHC-AS:612
For the Petitioner
(WPA 28543 of 2015) : Mr. Abhrajit Mitra, Sr.Adv.
Mr. Soumya Mazumdar, Sr.Adv.
Mr. Swarajit Dey,
Ms. Ruchika Mall,
Mr. Saptarshi Kar,
Mr. Samriddha Sen.
For the Petitioner
(In WPA 13484 of 2008) :Mr. Soumya Mazumdar, Sr.Adv.
Mr. Pranav Sharma.
For the Petitioner
(In WPA 2974 of 2010) : Mr. Devdas Saha.
For the Petitioner
(In WPA 28543 of 2015) : Mr. Deepak Jain (V/C).
For the Petitioner
(In WPA 4790 of 2015
WPA 4932 of 2009) : Mr. Meghajit Mukherjee,
Ms. Sonia Das.
For the Petitioner
(In WPA 16749 of 2008
WPA 26777 of 2023) : Mr. Kumar Gupta,
Mr. Deepak Kumar Jain.
For the Petitioner
(In WPA 31569 of 2008) : Ms. Amrita Pandey,
Mr. Ghanshyam Pandey,
Mr. Dinesh Bachar.
For the Petitioner
(In WPA 2812 of 2010
WPA 6138 of 2009
WPA 8290 of 2011) : Mr. S.K. Singh,
Page 7 2026:CHC-AS:612
Mr. S.K. Sharma,
Mr. R.K. Dubey.
For the Petitioner
(In WPA 210 of 2015) : Mr. Swarajit Dey,
Ms. Ruchika Mall,
Mr. Saptarshi Kar,
Ms. Samridha Sen.
For the Respondent/
P.F Authorities
(In WPA 15352 of 2008,
WPA 31569 of 2008) : Ms. Aparna Banerjee.
For the Petitioners
(In WPA 2812 of 2010,
WPA 6138 of 2009 &
WPA 8290 of 2011) : Mr. S.K. Singh,
Mr. Ravi Kumar Dubey.
For the Petitioner
(In WPA 8918 of 2011) : Mr. Soumya Mazumdar, Sr.Adv.
Mr. Tamoghna Saha.
For the UOI
(In WPA 5548 of 2009) : Ms. Sabita Roy.
For the Petitioner
(In WPA 15352 of 2008) : Mr. Shyamal Sarkar, Sr. adv.
Mr. Kumar Gupta,
Mr. S.K. Poddar,
Mr. Viraj Gupta.
For the Petitioner
(In WPA 3819 of 2008) : Mr. Shyamal Sarkar, Sr. adv.
Mr. Kumar Gupta,
Mr. Meghajit Mukherjee,
Ms. Sonia Das.
Page 8 2026:CHC-AS:612
For the Petitioner
(In WPA 5548 of 2009) : Mr. Shamal Sarkar,
Mr. Kumar Gupta,
Mr. Deepak Kumar Jain.
For the State
(In WPA 5548 of 2009) : Ms. Mousumi Biswas.
For the U.O.I.
(In WPA 5548 of 2009) : Mr. S.N. Dutta.
For the U.O.I.
(In WPA 26777 of 2023) : Mr. Shiv Chandra Prasad,
Mr. Tirtha Chandra Prasad.
For the P.F. Authorities : Mr. Shiv Chandra Prasad.
(In WPA 15352 of 2008
WPA 15755 of 2011
WPA 16240 of 2007
WPA 16749 of 2008
WPA 210 of 2015
WPA 21252 of 2007
WPA 26777 of 2023
WPA 2812 of 2010
WPA 2974 OF 2010
WPA 3819 of 2008
WPA 4790 of 2015
WPA 4932 of 2009
WPA 5548 of 2009
WPA 6138 of 2009
WPA 7526 of 2012
WPA 8290 of 2011
WPA 2974 of 2010
WPA 8918 of 2011)
Judgment reserved on : 18.03.2026
Judgment delivered on : 20.04.2026
Page 9 2026:CHC-AS:612
SHAMPA DUTT (PAUL), J. :
1) Twenty (20) writ applications heard together have
been taken up for delivering judgment vide this one
order, the issue being same in all the writ applications.
1. In: WPA 6138(W) of 2009
2) The writ application has been preferred, praying for
declaration that paragraph 27AA read with Appendix
A(7)&(9) of the Employees Provident Fund Scheme,
1952 is contradictory to the provisions of Section 17
and sub-sections thereto and as such is ultra vires
Section 17 of the Employees Provident Fund &
Miscellaneous Provisions Act, 1952 and therefore, ultra
vires the Act itself.
3) The petitioner has also challenged the notice dated
07.05.2007,10.05.2009, order dated 08.05.2008 and
the impugned order No.R-Ex/WB/28/7A/7B/CA/CC-
VI/959, dated 02.01.2009, issued by the respondent
nos.2 and 3, therein.
4) A Co-ordinate Bench, on hearing the said writ
application decided the issue in the writ application,
vide an order dated 14.11.2011.
5) The Co-ordinate Bench vide the said judgment
dated 14.11.2011 and order held as follows:-
Page 10 2026:CHC-AS:612
“14. Section 17 of the Act empowers the appropriate
government to exempt an establishment from the
provisions of the scheme subject to the conditions
specified in the notification through which such
exemption is granted. So far as the provisions of
the Act is concerned, the extent of its application to
exempted establishments has been specified in
Section 17(1A) of the statute. This issue was
examined by an Honb’le Single Judge of this Court in
the case of Hooghly Mills (supra) and the opinion of
the Court was :-
“43. That apart, the issue which is involved in
this writ petition is different altogether. Here in
the instant case it is nobody’s case that section
14B has no application at all. Even Mr. Sengupta
also submitted that damages can be recovered
under section 14B even from the exempted
establishment for delay of payment of that part
of the contribution which is required to be
remitted to the Pension Fund and/or Insurance
Fund.
44. Besides all these, this Court, cannot
forget to record that when exemption from
Page 11 2026:CHC-AS:612operation of the Employees’ Provident Fund
Scheme, 1952 has been granted to the
petitioners, then how damages can be
recovered from the petitioners by applying
Rule 32A of the said Scheme.”
15. In the case of Jiyajeerao, where the additional rate
of interest was sought to be recovered from an exempted
establishment by way of administrative action the same
was found to be impermissible and the Supreme Court
found the stand of the Provident Fund
Commissioner in requiring payment by the
establishment the differential rate to be unjustified
in law. The Supreme Court opined that unless the
appropriate government issued a notification
amending exempted scheme and published the
same in the Official Gazette, the condition 4 of the
impugned notification through which such payment was
mandated to be inapplicable. The contention of the
respondents before me is that by way of making
amendment in the statutory scheme, the defect
pointed out in the decision of Jiyajeerao was being
cured.
Page 12 2026:CHC-AS:612
16. I accept the submission of both learned Additional
Solicitor General and Mr. Mallick that exemption granted
to the petitioners is not absolute and an exempted
establishment does not enjoy immunity from all
obligations to pay provident fund dues in respect of its
employees under the Act. Mr. Supriyo Basu, learned
Additional Government Pleader appeared in these
matters on behalf of the State Government and supported
the stand of the Central Government and the Provident
Fund Authorities. I accept the position that the employees
of an exempted establishment are being seriously
prejudiced as they are drawing far lesser return in
comparison to similarly situated employees of an
establishment covered by the statutory scheme. Mr.
Sengupta has argued that comparative advantages of the
respective employees should not be determined solely on
the basis of monetary returns as members of a trust fund
were enjoying several other benefits being outside the
statutory scheme. One of the advantages he cited was
that for obtaining loan or clearance of dues, they were not
required to go through the bureaucracy of the provident
fund authorities, but these facilities were easily availed
of as in most cases the trust funds were administered
Page 13 2026:CHC-AS:612
from a location close to their workplace. In my opinion
however, rate of return is the fundamental benefit of a
provident fund scheme, and the ancillary benefits in
terms of simpler administrative procedures an employee
of an exempted scheme may be enjoying becomes
insignificant if the fund fetches him return substantially
lesser than that generated through the statutory scheme.
To that extent, in my opinion the scheme run by the
trust funds have become less favourable in
comparison to the statutory scheme for the
employees of the exempted establishments. On the
question of alternative remedy in the form of appeal, I am
not inclined to dismiss these petitions on this ground as
what has been argued before me has been on pure
questions of law and no factual issues are involved for
adjudication in these proceedings. The other point argued
on behalf of the petitioners was that a direction to pay
rate of interest higher than that yielded by the
investments made by the trust funds would be violative
of the provisions of Section 418 (2) of the Companies Act
1956. The said provision prohibits payment of interest at
a rate higher than the rate yielded by such investment in
respect of a provident fund by a company for its
Page 14 2026:CHC-AS:612
employees. The said restriction, however, in my view
operates in respect of rules of the trust fund or
independent contracts between the company and its
employees. The trust fund under the aforesaid provision
cannot provide for payment of interest at a rate higher
than that yielded by their investment. Nor can a company
enter into any agreement with its employees to that
effect. But such restriction cannot extend to
statutory provisions, if made in a valid manner,
providing for a minimum rate of interest.
17. The question that arises in these proceedings
however is not as to whether the provisions or effects of
the schemes run by the trust funds are less favorable
than the statutory scheme but whether by amending
the statutory scheme the exempted establishments
can be directed to bring the rate of return offered to
their employees at par with the statutory scheme.
The ratio of the decision of the Supreme Court in the case
of N. K. Jain does not apply in the facts of these cases
as that decision dealt with the applicability of certain
provisions of the Act itself on exempted establishments.
In these proceedings, the issue is applicability of
certain provisions of the statutory scheme on such
Page 15 2026:CHC-AS:612
establishments. It is not in dispute that the
provisions of the Act apply to the exempted
establishments also. Both learned Additional Solicitor
General and Mr. Mallick placed reliance on the
observation of the Supreme Court in the case of
Jiyajeerao. It was held in this judgment:-
“As regards the exempted establishments, it was rightly
pointed out by the Regional Provident Fund
Commissioner that unless the appropriate
Government issued a notification amending the
exempted scheme and published the same in the
Official Gazette, Condition 4 did not apply to them.
Admittedly, no such notification amending the
exempted scheme framed by the appellant and
Respondent 10 was issued by the State
Government.”
18. Contention of the respondents is that the amendment,
which in the opinion of the Supreme Court would have
justified recovery of the differential rate from an
exempted establishment has already been effected by
introduction of paragraph 27AA to the statutory
scheme and the consequential actions against the
establishments were in tune with the observation of the
Page 16 2026:CHC-AS:612
Supreme Court. I am unable to accept this submission.
What has been observed by the Supreme Court in
Jiyajeerao is that the exempted scheme is required to
be amended to impose obligation on the exempted
establishments to ensure return in terms of paragraph 60
of the statutory scheme. In the statute, there is no specific
reference to any exempted scheme but it appears that
what was referred to as such scheme was the scheme
of the trust fund of an exempted establishment as
an alternative to the statutory scheme. This would
be clear from the following observation of the Supreme
Court in the said decision contained in paragraph 8 of the
Report:-
“The revised terms and conditions did not and could not
have become applicable automatically, and in order to
make them applicable, they were required to be
incorporated by the appropriate Governments in the
notification granting exemption under Section
17(1)(a).”
19. The appropriate government in these cases
however has not varied the conditions of exemption
but on the other hand the statutory scheme itself
has been amended, from following which the
Page 17 2026:CHC-AS:612
concerned establishments have been exempted. It is
the admitted position that in none of these cases the
conditions of exemption contain any clause to the effect
that the petitioners would be required to follow the rate of
interest in accordance with paragraph 60 of the statutory
scheme. Since the establishments of the petitioners have
been exempted from operation of the scheme itself by the
appropriate government, I do not think it would be
permissible under the Act to saddle the petitioners
with additional obligation to meet the differential
rate by amending the statutory scheme itself. As I
have discussed earlier, once an exemption is granted,
the same does not terminate automatically if the
benefits under the establishments’ own scheme
become less favorable vis-Ã -vis the statutory scheme
as held by a Division Bench of this Court in the case
of Electric Lamp Manufactures (supra).
20. The decision of the Full Bench of the Patna High Court
in the case of Tata Iron and Steel Company does not
assist the respondents’ case.
This was a decision on the question as to whether
protection against attachment in a decree applies to such
a scheme or not. Under the provisions of Section 10 of the
Page 18 2026:CHC-AS:612
Act any sum standing to the credit of an employee in the
fund is immuned from attachment. Such protection was
held to cover employees of an exempted establishment as
well, in respect of provident fund managed by the trust
fund. This judgment cannot be held to be the ratio
for the proposition that provisions of the statutory
scheme can be made applicable by making an
amendment in the statutory scheme itself to
establishments exempted from operation of the
statutory scheme.
21. The decision of the Karnataka High Court in the
case of Binny Mills however is directly on this point and
in this judgment, the Division Bench of the Karnataka
High Court has specifically come to a finding that the
provisions mandating payment of differential by an
exempted establishment is valid. In this judgment it
has been observed that exemption under Section 17
is granted subject to the condition granted that the
employees of the exempted establishments are not
given benefit less favourable than the other
establishments which are covered under the Act and the
Scheme and it is on this condition such exemption was
granted. It was held:-
Page 19 2026:CHC-AS:612
Having regard to the entire object of the Act, Scheme and
the provisions regarding the conditions to be imposed for
exemption can only be to add to the advantage of the
employees and not to their detriment. If the Provident
Fund Authorities have called upon the appellant-
establishment to maintain the minimum benefits
available under the Act and the Scheme, they are well
within their powers and in fact acting under a duty to
ensure effective implementation of the Act and the
Scheme.
22. The judgment of the Karnataka High Court is based
on two basic reasoning. One is that the scheme is for
better benefit for the employees and the second is that
even in respect of an exempted scheme the appropriate
government does not lose its hold and there are built-
in safeguards in Section 17 itself to protect the interests
of the employees and Section 17 (4) is one such
safeguard. While I accept that exemption under the
aforesaid provision is granted for better benefit of
the employees and if the rate of interest given by
the trust fund is lower than the rate fixed under
paragraph 60 of the Scheme would render the
scheme of the exempted establishments less
Page 20 2026:CHC-AS:612
favourable vis-a-vis the statutory scheme, in my
opinion this drawback cannot be remedied by
amending the statutory scheme itself. The proper
course in such a situation would be to cancel the
exemption already granted, or imposition of an
additional condition in the exemption notification
by the appropriate government for maintaining the
statutory rate. I agree with the view of the Karnataka
High Court that in-built safeguards are there under the
provisions of Section 17(4) of the Act itself, but the
provisions of the said subsection has not been invoked
here. What has been done is amendment of the
statutory scheme itself. Mr. Mallick at the initial stage
had argued that amendment of the scheme also has the
force of a statute, But I do not think amendment of
the scheme would bring the same at par with
statutory provisions, and can be treated as
amendment to the Act itself.”
6) The Learned Co-ordinate Bench, on considering the judgment
passed in WPA 12477(W) of 2007 (Loomtex Engineering Pvt.
Ltd. & Ors. Vs. Chief Provident Fund Commissioner & Ors.),
held:-
Page 21 2026:CHC-AS:612
23. The other authority cited on behalf of the
respondents is an unreported judgment of this Court in
W.P. No. 12477(W) of 2007, (Loomtex Engineering
Pvt. Ltd. & Ors. Vs. Chief Provident Fund
Commissioner & Ors.). In this case legality of certain
summons issued against the petitioners under Section
7A of the Act was under challenge.
The demand was in respect of similar dues. As it has
been recorded in the said judgment, it was argued by
the petitioners therein that provisions of Appendix A
did not cast any obligation on them to make good the
deficiency in payment of interest. I have quoted in the
earlier part of this judgment the observation of the
Hon’ble Single Judge as regards the applicability of the
said Appendix to the scheme and paragraph 7, 9 and
28 thereof. This judgment deals directly with the
point raised in this writ petition in which
obligation of an establishment to pay the
differential rate of interest has been upheld. I
have expressed my own views on the subject,
considering the relevant provisions of the law but in
the light of this judgment, I do not think it would be
Page 22 2026:CHC-AS:612
appropriate for me to grant relief to the petitioners
taking a wholly different view.”
7) The learned Co-ordinate Bench then referred the matter to be
decided before a larger bench, as the Co-ordinate Bench
differed with the view of the Single Judge, in (Loomtex
Engineering Pvt. Ltd. & Ors. Vs. Chief Provident Fund
Commissioner & Ors.) (Supra).
8) The issue in reference was as follows:-
“The question on which I am respectfully differing with the
judgment of an Hon’ble Single Judge of this Court in W.P.
No. 12477(W) 2002 is:-
Whether the provisions of paragraph 27AA of the
Employees Provident Fund Scheme read with clauses
7 and 9 of Appendix A of the said scheme can be
imposed on establishments exempted under the
provisions of Section 17 of the Act from following
the said scheme?”
9) The larger bench on deciding the issue in reference vide an
order dated 05.02.2018, directed as follows:-
“It is not in dispute that all the establishments have
been enjoying such exemption till date. Therefore, the
issue before the learned Single Judge in this bunch of
Page 23 2026:CHC-AS:612writ petitions was the obligation of the employers
to pay the differential rate of interest under the
said Scheme, in case of failure of the respective
Board of Trustees, to make it good.
After careful scrutiny of the subject matter of challenge
of the writ application of Loomtex Engineering Pvt.Ltd.
& Ors., which is produced before us by the department
on requisition as also after considering the judgment
dated September 14, 2007 delivered by the learned
Single Judge in the above writ application, we find that
admittedly the exemption of the above establishment
from the provisions of the said Scheme, was cancelled
as far back as in the month of September, application
2003. The above writ application was filed challenging
the summons issued to them on subsequent date, i.e.
on May 9, 2007. Taking into the aforesaid facts and
circumstances of the case, the learned Single Judge
framed the two issues as recorded hereinabove for
decision taking into consideration the admitted
fact of enjoying exemption by the establishment
till 2003 as also the fact that no restraining order
was in force on the date of delivery of the judgment.
Page 24 2026:CHC-AS:612
Therefore, the judgment delivered in case of an
establishment, which was not of an exempted
category, was considered by the learned Single
Judge with further observation that exemption from
applying the provisions of Appendix A of the said
Scheme did not arise merely because of pendency of
the writ petition challenging the order of cancellation of
exemption.
We find that the status of Loomtex Engineering
Pvt. Ltd.& Ors. and those of the petitioners in
this bunch of writ petitions, were not similar so
far as the question of exempted category and/or
unexempted category was concerned. Therefore,
the Loomtex Engineering Pvt. Ltd. & Ors. (supra)
was neither the decision on the issue involved in
this bunch of writ petitions nor there was any
scope to arrive at a conclusion with regard to the
issues involved in this a bunch of writ petitions, as
discussed hereinabove.
It will not be out of context to observe that a decision is
not an authority for a proposition, which has not fallen
for its consideration. Reliance may be made to the
decision in the case of Punjab National Bank -Vs- R.
Page 25 2026:CHC-AS:612L. Vaid, reported in AIR 2004 SC 4269 and the
relevant portion of the above decision is quoted below:-
“We find that the High Court has merely referred to the
decision in R.K. Jain’s case (supra) without even
indicating as to applicability of the said decision and
as to how it has any relevance to the facts of the case.
It would have been proper for the High Court to
indicate the reasons and also to spell out clearly as to
the applicability of the decision of the facts of the case.
There is always peril in treating the words of a
judgement as though they are words in a Legislative
enactment and it is to be remembered that judicial
utterances are made in the setting of the facts of a
particular of the case. Circumstantial flexibility, one
additional or different fact may make a difference
between conclusion in two cases. Disposal of cases
by merely placing reliance on a decision is not
proper. Precedent should be followed only so far as it
marks the path of justice, but you must cut out the
deadwood and trim off the side branches else you will
find yourself lost I thickets and branches, said Lord
Denning, while speaking in the matter of applying
precedents. The impugned order is certainly vague.”
Page 26 2026:CHC-AS:612
The above proposition of law was reiterated and relied
upon the by the Apex Court time and again and one of
such decisions, was that of State of Gujarat Vs-
Akhil Gujarat Pravasi V.S. Mahamandal, reported
in (2004) 5 SCC 155 and the relevant portion of the
above decision is quoted below:-
“It is trite that any observation made during the
course of reasoning in a judgment should not be
read divorced from the context in which it was
used.”
Therefore, we are of the considered view, that the
unreported decision of Loomtex Engineering Pvt. Ltd. &
Ors. (supra), is not a conflicting judgment so far as the
present writ petitions are concerned.
Accordingly, it is not required for us to give reply
to the terms of reference as indicated
hereinabove and the learned Single Judge is free
to grant relief to the petitioners on the basis of
his independent findings with regard to the
applicability of the provisions of clauses 7, 9 and
28 of Appendix A read with paragraph 27AA of
Employees Provident Fund Scheme in respect of
Page 27 2026:CHC-AS:612
the establishments of the petitioners, which have
been enjoying exemptions under the provisions of
Section 17 of the Employees Provident Fund and
Miscellaneous Provisions Act, 1952.
This bunch of writ petitions are remitted back to
the learned Single Judge for his consideration in
accordance with law without being influenced by
the order passed by this Court in Loomtex
Engineering Pvt.Ltd. & Ors. (supra).”
10) Now the matter is before this Court to pass the final orders
in WPA 6138(W) of 2009, Caledonian Jute & Industries Ltd.
& Anr. vs Union of India & Ors. as per the direction of the
larger bench, along with 19 other writ applications on
similar issue in the said bunch of writ applications. In
course of hearing, three (3) more writ applications on similar
issue have been added and are taken together for disposal,
in all 20 (twenty).
In: WPA 28543(W) of 2015
11) The writ application has been preferred praying for direction
upon the respondent to recall, rescind and/or cancel the letter
dated 20 November, 2015.
Page 28 2026:CHC-AS:612
12) Vide the impugned order dated 20.04.2015, the respondent
no.3 issued a notice upon the petitioner therein by stating as
follows:
“It is pertinent to mention for your record, that as
the establishment had been granted exemption
under section 17(1)(a) of the EPF & MP Act, 1952,
by the Appropriate Authority, vide Notification
No.473-LW/LW/1A-70/59 dated 25/01/1960
so the said exemption shall be subject to the
terms and conditions as given in Appendix-A
under Para 27AA of the EPF Scheme, 1952.
Further, in consequence of such exemption the
PF Trust Board has been established and
continuing operation in terms of the provision
under u/s 17(1A)(a) to (d) of Act.”
13) The authority then proceeded to direct the petitioner to
pay the loss/deficient as determined by authority, hence
the writ application.
In: WPA 13484(W) of 2008
14) The writ application has been preferred praying for
declaration that provisions of Para 27AA of the
Employees‟ Provident Fund Scheme, 1952 in particular
clauses 7 and 9 of Appendix “A” thereto transgress
Page 29 2026:CHC-AS:612
and/or are ultra virus the Employees‟ Provident Fund
and Miscellaneous Provisions Act, 1952, illegal, null
and void.
15) The petitioner has further prayed for direction upon the
respondents to cancel the impugned show cause
notices dated March 15, 2007 and May 9, 2007 and
quash the proceeding allegedly under Section 7A
and/or 7B initiated on the basis thereof of the EPF Act,
against the petitioner No.1 and also from taking any
steps or further steps or proceeding with or continuing
with the impugned proceedings under Section 7A or 7B
of the 1952 Act, for differential interest under Para
27AA of the 1952 Scheme, in any manner whatsoever.
In: WPA 15352(W) of 2008
16) The writ application has been preferred praying for
declaration that clauses 7 and 9 of Appendix ‘A’ of
Paragraph 27AA of the Provident Fund Scheme, 1952
are ultra vires the Employees’ Provident Fund and
Miscellaneous Provisions Act, 1952; Companies Act,
1956 and inconsistent with Income Tax Rules and are
null and void; and further declaration that Clause 7
and Clause 9 of Appendix ‘A’ of Paragraph-27AA of the
Employees’ Provident Fund Scheme, 1952 are beyond
Page 30 2026:CHC-AS:612
the scope of Schedule II referred to in Clause 5 of
Employees’ Provident Fund and Miscellaneous
Provisions Act, 1952 and as such are illegal, null and
void; declaration that the rate declared by the Central
Government for the years 2001-02 to 2005-06 are in
violation of the provisions of Employees’ Provident
Fund Scheme, 1952 and as such are illegal, null and
void and ultra vires the Employees’ Provident Fund and
Miscellaneous Provisions Act, 1952 and Employees’
Provident Fund Scheme, 1952; declaration that
Provisions of Paragraph-27AA of the Employees’
Provident Fund Scheme, 1952 are not applicable to the
Petitioner No. 1 being an exempted establishment,
declaration that the order dated 28th November,
2007/4th December, 2007 passed by the Respondent
No. 1 is illegal, null and void and is to be set aside and
not binding on the Petitioner No. 1, declaration that
proceeding under Section 7C of the Employees’
Provident Fund and Miscellaneous Provisions Act, 1952
initiated by the Regional Provident Fund
Commissioner-I, West Bengal are illegal, null and void.
In: WPA 15755(W) of 2011
Page 31 2026:CHC-AS:612
17) The writ application has been preferred praying for
declaration that paragraph 27AA of the Employees
Provident Fund Scheme, 1952 and/or Appendix “A”
thereto, transgress the said Act, the Companies Act
and the Income Tax Rules and is ultra-vires the
Constitution of India and null and void and
commanding the respondents and each of them, in
particular the respondent nos.1 and 2 to forthwith
withdraw, rescind and/or cancel the impugned orders
dated August 12, 2011 and September 1, 2011.
In: WPA 16240(W) of 2007
18) The writ application has been preferred praying for a
declaration that Clauses 7 and 28 of Appendix “A” of
para 27 AA of the Employees‟ Provident Funds Scheme,
1952 is ultravires the Section 17(1-B) of the Employees‟
Provident Fund & Miscellaneous Provision Act, 1952. A
writ in the nature of prohibition commanding the
respondents as well as the Court below not to proceed
the Case No.C 209/07 pending before the Court of the
Judicial Magistrate, 1st Court, Barrackpur.
In: WPA 16749(W) of 2008
Page 32 2026:CHC-AS:612
19) The writ application has been preferred praying for
declaration that provisions of paragraph-27AA of the
Employees’ Provident Fund Scheme, 1952 transgress
and/or are ultra virus the Employees’ Provident Fund
and Miscellaneous Provisions Act, 1952, Companies
Act, Income Tax Rules and are illegal, null and void
and directing the respondents and their servants and
agents to withdraw, rescind and/or cancel the
impugned summons dated April 17, 2007 and/or the
proceedings under Section 7A of the Provident Fund
Act against the petitioner no.1, for differential interest
under paragraph 27AA of the 1952 Scheme.
In: WPA 210(W) of 2015
20) The writ application has been preferred praying for
direction upon the respondent to recall and/or cancel
the letter dated 12th December, 2014.
In: WPA 21252(W) of 2007
21) The writ application has been preferred praying for
direction upon the respondent to recall and cancel the
impugned notice dated September 11, 2007.
In: WPA 26777(W) of 2023
22) The writ application has been preferred praying for
declaration that provisions of paragraph-27AA of the
Page 33 2026:CHC-AS:612
Employees’ Provident Fund Scheme, 1952 and the
Appendix thereto transgress and/or are ultra vires,
inter alia, the Employees’ Provident Fund and
Miscellaneous Provisions Act, 1952, unconstitutional
and are illegal, null and void and for a direction upon
the respondent no.1 to withdraw and/or cancel the
impugned notice dated April 27, 2023 and the show-
cause notice and memo both dated August 16, 2023
and/or the proceedings initiated thereunder against
the petitioner No.1.
In: WPA 2812(W) of 2010
23) The writ application has been preferred praying for
declaration that para 27AA of the EPF Scheme, 1952 is
not applicable to the exempted establishment of the
petitioner, declaration that para 27AA of the EPF
Scheme, 1952 is ultra vires Section 17(1A)(d) of the
EPF & MP Act, 1952, and praying for direction upon
the respondents to recall the order dated 08.02.2008
passed under Section 7A of the said Act and the order
dated 07.01.2010 passed under Section 7B of the said
Act and also notice dated 03.02.2010.
In: WPA 2974(W) of 2010
Page 34 2026:CHC-AS:612
24) The writ application has been preferred praying for a
declaration that paragraph 27AA read with Appendix
A(7) & (9) of the Employees Provident Fund Scheme,
1952 is contradictory to the provisions of Section 17
and sub-sections thereto and as such is ultra vires the
Section 17 of the Employees Provident Fund &
Miscellaneous Provisions Act, 1952 and therefore, ultra
vires the Act itself and declaration that the impugned
order passed on 11th March, 2008 and 10th January,
2010 under Sections 7A and 7B of the said Act and
Memo being No. WB/HWR/WB/76, 85 & 86/R-
Recovery/1600 dated 03.02.2010 issued by the
Assistant Provident Fund Commissioner, EPFO, SRO,
Howrah are bad and liable to be quashed and/or set
aside and also the Memo WB/HWR/WB/76,85 & 86/R-
Recovery/1600 dated 03.02.2010 issued by the
Assistant Provident Fund Commissioner, EPFO, SRO,
Howrah.
In: WPA 31569(W) of 2008
25) The writ application has been preferred, praying for
declaration that provisions of paragraph 27AA of the
Employees Provident Fund Scheme, 1952 transgress
and/or are ultra vires the Employees‟ Provident Fund
Page 35 2026:CHC-AS:612
and Miscellaneous Provisions Act, 1952, Companies
Act, Income Tax Rules and are illegal, null and void
and praying for direction upon the respondent
provident fund authorities to cancel the impugned
orders September 26, 2008 and November 27, 2008
and all other proceedings under paragraph 27 AA of the
1972 Scheme.
In: WPA 3819(W) of 2008
26) The writ application has been preferred praying for
quashing of the order dated January 28, 2008 and
order dated November 8, 2005 and declaration that
paragraph 27AA of the Employees‟ Provident Fund
Scheme, 1952 is ultra vires the Constitution of India.
In: WPA 4790(W) of 2015
27) The writ application has been preferred praying for
declaration that the provisions of paragraph 27AA of
the 1952 Scheme And Appendix “A” thereto transgress
and/or are ultra vires the EPF Act and Companies Act,
1956 and are illegal and null and void and/or has no
application to exempted establishment and also
praying for direction upon the respondents to recall
and or withdraw impugned memo dated April 30, 2014,
Page 36 2026:CHC-AS:612
October 30, 2014, November 11, 2014, November 13,
2014, January 29, 2015.
In: WPA 4932(W) of 2009
28) The writ application has been preferred praying for
declaration that provisions of paragraph 27AA of the
Employees‟ Provident Fund Scheme, 1952 transgress
and/or are ultra virus the Employees‟ Provident Fund
and Miscellaneous Provisions Act, 1952, Companies
Act, Income Tax Rules and are illegal, null and void
and direction upon the respondents to withdraw
and/or cancel the impugned order dated February 16,
2009.
In: WPA 5548(W) of 2009
29) The writ application has been preferred praying for
declaration that provisions of paragraph 27AA of the
Employees Provident Fund Scheme, 1952 transgress
and/or are ultra vires the Employees‟ Provident Fund
and Miscellaneous Provisions Act, 1952, Companies
Act, Income Tax Rules and are illegal, null and void
and not enforceable and direction upon the
respondents to withdraw and cancel the impugned
order dated February 27, 2009 and all other
proceedings under paragraph 27AA of 1952 Scheme.
Page 37 2026:CHC-AS:612
In: WPA 7526(W) of 2012
30) The writ application has been preferred praying for
declaration that provisions of paragraph 27AA of the
Employees Provident Fund Scheme, 1952 transgress
and/or are ultra vires the Employees‟ Provident Fund
and Miscellaneous Provisions Act, 1952, Companies
Act, Income Tax Rules and are illegal, null and void
and praying for direction upon the respondents to
withdraw and or cancel the impugned orders dated
July 31, 2008 and September 30, 2008 and all order of
attachment issued there under including the order
dated November 4, 2008, and all other proceedings
under paragraph 27AA of the EPF Scheme.
In: WPA 8290(W) of 2011
31) The writ application has been preferred praying for a
declaration that paragraph 27AA of the Employees
Provident Fund Scheme, 1952 is contradictory to the
provisions of Section 17 and sub-sections thereto and
as such is ultra vires the Section 17 of the Employees
Provident Fund & Miscellaneous Provisions Act, 1952
and therefore, ultra vires the Act itself and praying for
direction upon the respondents to withdraw and or
cancel and/or withdraw the impugned proceeding
Page 38 2026:CHC-AS:612
under paragraph 26B of the Employees Provident Fund
Scheme, 1952 and also orders dated 04.03.2011,
31.03.2011 and 13.04.2011 passed by the Regional
Provident Fund Commissioner-II/OIC, Sub-Regional
Office, Barrackpore.
In: WPA 8918(W) of 2011
32) The writ application has been preferred praying for a
declaration that para 27AA of the Employees‟ Provident
Fund Schemes, 1952 is ultra vires Section 17(1A)(d) of
the Employees Provident Funds and Miscellaneous
Provisions Act, 1952 to the extent it purports to impose
liability on the employer to make good the loss of
interest to a member, for following the investment
pattern by the Board of Trustees in accordance with
the provisions of Section 17(1A)(d) of the EPF & MP Act,
1952 and also for following the conditions of
notification granting exemption and direction upon the
respondents to cancel and withdraw the order dated 1st
March, 2011 passed by the respondent No.1, and the
recovery certificate dated 11th April, 2011 issued by the
respondent No.2.
Page 39 2026:CHC-AS:612 Conclusion:-
33) On hearing the learned counsels for the parties and on
perusal of the written notes of argument filed by the
respective parties and also considering the view of the
learned Co-ordinate Bench dated 14.11.2011 in WPA
6138(W) of 2009, along with the direction in order
dated 05.02.2018 of the larger/Division Bench in
reference, the following is evident:-
a) Section 17 of the Employees Provident Funds and
Miscellaneous Provision Act, 1952, lays down the
power of the appropriate government to exempt.
Section 17 EPF Act:- Power to exempt.–(1) The
appropriate Government may, by notification in the
Official Gazette and subject to such conditions as
may be specified in the notification, [exempt,
whether prospectively or retrospectively, from the
operation] of all or any of the provisions of any
Scheme………….”
b) Para 27AA of the Employees Provident Funds
Scheme lays down:-
“27-AA. Terms and conditions of
exemption.- All exemptions already
granted or to be granted hereafter under
Section 17 of the Act or under paragraph
27-A of the scheme shall be subject to the
Page 40 2026:CHC-AS:612terms and conditions as given in the
appendix A.”
c) Para 27AA of the EPF scheme has been brought in by
way of an amendment (with effect from 06.01.2021) to
the scheme and made applicable to the exemption
granted under Section 17 of the EPF Act.
d) One option would be to cancel or surrender or
withdraw the exemption which has been granted to the
establishments under Section 17 of the Act, by the
appropriate government, if the terms and conditions of
Para 27AA of the scheme are more favourable, than
the conditions specified in the notification
granting exemption under 17 of the Act.
e) The other option would be that, though Para 27AA of
the EPF scheme lays down the terms and conditions of
exemption and also makes it applicable to all
exemptions already granted or to be granted under
Section 17 of the Act or under Para 27A of the scheme,
which shall be subject to the terms and conditions as
given in appendix „A‟, the same can be made
applicable to an exempted establishment, only by
the appropriate government, which granted exemption
to an establishment, by modification of and or
amendment to the notification granting exemption
Page 41 2026:CHC-AS:612
in the official gazette, on such conditions as may
be specified in the notification and while doing so
could exempt, whether prospectively or
retrospectively from the operation of all or any of
the provisions of the scheme.
f) Thus Section 17 EPF Act gives strength to the
argument of the petitioners that when such exempted
establishments have been exempted from the provision
of the scheme, an amendment to the said scheme (Para
27AA) would also not apply to such establishment. But
the mischief here has been caused by the wording in
Para 27AA of the scheme. The said mischief can be
undone only by acting as per Section 17 of the EPF
Act, which granted the initial exemption.
g) As such, by way of an (amended) exemption
notification in the official gazette, by the appropriate
government herein, Para 27AA of the EPF scheme can
be made applicable to such exempted establishments,
granted exemption under Section 17 of the Act.
34) Section 17 of the EPF Act, by itself is very specific
and clear to the extent that:-
Page 42 2026:CHC-AS:612 i. Such exemption has to be granted by the
appropriate government, by notification in the
official gazette.
ii. Such exemption has to be subject to such
conditions as may be specified in the
notification.
As such without the conditions being
specified in the notification, the same cannot
be made applicable to an establishment being
granted exemption under Section 17 of the
Act.
iii. The said notification granting exemption could
be prospective or retrospective, from the
operation of all or any of the provisions of any
scheme.
As such for such conditions and provisions of
any scheme to be made applicable to an
exempted establishment, the same would
have to be done by the appropriate
government by notification in official gazette,
as per Section 17 of the EPF act and without
compliance of the provision of Section 17 EPF
act, the provision of the scheme herein, being
Page 43 2026:CHC-AS:612
para 27AA, is not applicable to the
establishments, who have been granted
exemption under Section 17 of the EPF Act.
35) The following observations of the Supreme Court in
Jiyajeerao Cotton Mills Ltd. vs Dev Kumar Holani
& Ors., (1998) AIR (SC) 2480, are clear on the said
issue:-
“9. ………unless the appropriate Government
issued a notification amending the exempted
scheme and published the same in the
Official Gazette, Condition 4 did not apply to
them. Admittedly, no such notification
amending the exempted scheme framed by
the appellant and Respondent 10 was issued
by the State Government.”………
9. ………………”The revised terms and
conditions did not and could not have
become applicable automatically, and in
order to make them applicable, they were
required to be incorporated by the
appropriate Governments in the notification
granting exemption under Section 17(1)(a).”
19. The appropriate government in these
cases however has not varied the conditions
of exemption but on the other hand the
statutory scheme itself has been amended,
from following which the concerned
Page 44 2026:CHC-AS:612
establishments have been
exempted……………….”
36) Accordingly, the writ application (20) herein are
all disposed of on holding that:-
a) Para 27AA of the employees provident fund
scheme, with appendix „A‟ is not ultra vires of
the employees provident fund and miscellaneous
provisions act, 1952.
b) Para 27AA of the employees provident fund
scheme, 1952 with appendix ‘A’ is not
applicable to the establishments exempted
under Section 17 of the EPF Act, unless and
until, the conditions of exemption is modified
by way of an amendment in a notification
published in official gazette making the
provision of Para 27AA of the EPF scheme
applicable to such exempted establishment.
c) Thus, all notices and orders challenged in the
writ applications herein, issued stating non
compliance/violation of Para 27AA/appendix „A‟
of the employees provident fund scheme, 1952,
are hereby quashed and set aside.
Page 45 2026:CHC-AS:612
37) Applications, if any, connected thereto stand
disposed of consequently.
38) Interim order, if any, stands vacated.
39) Photostat certified copy of this order, if applied for,
be given to the parties on priority basis upon
compliance of all formalities.
[Shampa Dutt (Paul). J]
