Provident fund default and damages: statutory levy upheld, with no power to waive damages altogether outside the limited exception.

Section 14-B of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 authorises recovery of damages for an employer's default in remitting provident fund contributions within time, and serves to enforce compliance with a welfare statute protecting employee benefits. The authority may assess the quantum of damages, but outside the limited sick industrial company exception tied to rehabilitation, it cannot waive the levy altogether. Continued deposit of the money with the University did not excuse failure to comply with the statutory duty to deposit it in the Fund. Damages were therefore recoverable, and the challenge to their levy failed.

---

---

Issues: Whether damages under Section 14-B of the Employees Provident Funds and Miscellaneous Provisions Act, 1952 could be levied for default in depositing provident fund contributions and whether the Commissioner had power to waive the penalty altogether.

Analysis: Section 14-B fastens liability on an employer who defaults in payment of contributions or other amounts due under the Act or the schemes, and authorises recovery of damages by way of penalty up to the amount of arrears. The provision reflects the statutory obligation of the employer to remit contributions within the prescribed time, and its object is to enforce compliance with a beneficial welfare legislation protecting employee benefits. The proviso concerning sick industrial companies is a limited exception linked to rehabilitation under Section 4 of the Sick Industrial Companies (Special Provisions) Act, 1985. Outside that exception, the authority under Section 14-B may determine the quantum of damages but cannot waive the levy altogether. Continued deposit of the money with the University after the earlier direction of the Court did not excuse non-compliance with the statutory duty to deposit the amounts in the Fund.

Conclusion: Damages under Section 14-B were rightly recoverable, and the Commissioner was not bound to waive them. The challenge to the levy failed.

---