Provident fund contribution liability starts when the establishment enters the statutory scheme, including qualifying employees who later leave service.

Provident fund liability arises once the establishment is brought within the Employees' Provident Funds Act and Scheme, and the employer's obligation to contribute is not postponed until a formal demand or discovery by the authorities. The text further states that employees who satisfy the qualifying conditions for membership remain covered for contribution purposes even if they later leave service, leaving individual eligibility disputes to be decided by the competent authority under the scheme. On that basis, the employer's contribution demand for the pre-discovery period and for qualifying former employees was treated as valid.

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Issues: (i) Whether the Regional Provident Fund Commissioner could lawfully require the employer to deposit provident fund contributions for the period before the establishment was discovered and the demand was made; (ii) Whether contributions could be demanded in respect of employees who had left service but were found to have satisfied the conditions for membership under the scheme.

Issue (i): Whether the Regional Provident Fund Commissioner could lawfully require the employer to deposit provident fund contributions for the period before the establishment was discovered and the demand was made.

Analysis: The Act and the Scheme were held to operate from the date on which they became applicable to the establishment, and the employer's obligation to contribute was not postponed until the authorities made a formal demand. The earlier Bench decision treating liability as commencing from the date the Scheme came into force was followed, and the contrary views expressed in other High Court decisions were not accepted as sufficient reason to depart from that binding view.

Conclusion: The demand for employer's contribution for the pre-discovery period was valid and within jurisdiction.

Issue (ii): Whether contributions could be demanded in respect of employees who had left service but were found to have satisfied the conditions for membership under the scheme.

Analysis: The scheme made persons who satisfied the qualifying conditions entitled and required to become members of the fund from the relevant date, and the employer's duty to secure membership and make the corresponding contribution was not defeated merely because some employees had subsequently left service. Any factual dispute as to whether individual employees had in fact fulfilled the qualifying conditions was a matter for decision under the scheme by the competent authority after hearing the parties.

Conclusion: The Commissioner was entitled to call upon the employer to make contribution in respect of qualifying employees, including those who had left service.

Final Conclusion: The petitions failed because the employer's liability to contribute arose when the Act and Scheme became applicable, and that liability extended to employees who met the membership conditions notwithstanding later cessation of service.

Ratio Decidendi: Under the Employees' Provident Funds Act, 1952 and the Employees' Provident Funds Scheme, 1952, the employer's obligation to contribute arises from the date the establishment is brought within the statutory scheme, and employees who satisfy the qualifying conditions for membership remain covered for contribution purposes even if they later leave service.

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