TMI Blog2012 (1) TMI 319X X X X Extracts X X X X X X X X Extracts X X X X ..... reasons as well. The High Court is guided in the interpretation of the word "so far as may be" on the basis of the principle that statutes does not waste words. The High Court has also relied on the interpretation given to "so far as may be" in the case of Dr. Pratap Singh and another v. Director of Enforcement, Foreign Exchange Regulation Act and others reported in AIR 1985 SC 989. It goes without saying that Foreign Exchange Regulation Act is a fiscal statute dealing with penal provisions whereas the aforesaid expression is to be construed in this Act which is eminently a social welfare legislation. Therefore, the parameters of interpretation cannot be the same. In the instant case, the High Court failed to discern the correct principle of interpretation of a social welfare legislation. High Court missed this well settled principle of interpretation of social welfare legislation while construing the expression "so far as may be" in interpreting the provision of Section 17 (1A)(a) of the Act and unduly restricted its application to the employer of an exempted establishment. We hold that in a case of default by the employer by an exempted establishment, in making its cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1952), the Central Government, hereby exempt the said establishments with effect from dates mentioned against each of them, respectively from the operation of all the provisions of the said scheme, subject to the conditions specified in scheme hereto annexed, which are in addition to the conditions mentioned in the explanation to sub- section (1) of the said section 17. 6. The respondent company comes under Item No. 5 of the notification. Initially the case of the respondent company is that after the grant of exemption it framed a scheme and created a Trust and appointed a Board of Trustees from the Management of the said Trust fund and was thus enjoying exemption under Section 17(1A) (a) of the Act. It is also common ground that there were defaults on the part of the respondent company in making timely payment of dues towards provident fund for the period between October 1999 to October 2000 and then again from November 2000 to July 2002. In view of such admitted defaults, proceedings were initiated against the respondent company and by notices dated 10.9.2003 and 11.10.2003 enclosing therewith the detailed statement of delayed remittance of provident fund and allied dues. A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Judge also held that the damages which are recoverable under Section 14B of the said Act could not go to the hand of the individual affected employee. In case of delayed payment, loss of the individual affected employee is compensated by payment of interest under Section 7Q of the said Act. Since the damages which are recovered are not paid for compensating the losses of the individual employee, the expression so far as may be used in Section 17(1A)(a) of the said Act, does not require liberal interpretation. The said finding was given by the learned Single Judge in the context of the argument made on behalf of the appellant that the Act being social welfare legislation, needs to be liberally construed. 10. The learned Judge ultimately accepted the meaning of the expression so far as may be given by the Constitution Bench of this Court in the case of Dr. M. Ismail Faruqui etc. v. Union of India and others- AIR 1995 SC 605. 11. Thereafter, an appeal was taken to the Division Bench of the High Court by the appellant. The Appellate Court also came to the conclusion that Sections 6, 7A, 8 and 14B of the Act would not be attracted to the defaulting exempted establishment . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... half] may recover from the employer such damages, not exceedings the amount of arrears, as it may thinks fit to impose: Provided that before levying and recovering such damages, the employer shall be given a reasonable opportunity of being heard: Provided further that the Central Board may reduce or waive the damages levied under this section in relation to an establishment which is a sick industrial company and in respect of which a scheme for rehabilitation has been sanctioned by the Board for Industrial and Financial Reconstruction established under section 4 of the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986), subject to such terms and conditions as may be specified in the Scheme. 17. Section 17(1A) which deals with power to grant exemption reads as under: 17 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. (a) any establishment to which this Act applies if, in the opinion of the appropriate Government, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es in accordance with the directions issued by the Central Government from time to time; (iv) transfer, where necessary, the provident fund account of any employee; and (v) perform such other duties as may be specified in the Scheme. 18. Learned counsel for both the parties strenuously urged before us that in this case we are only concerned with the liability of the respondent company in so far as provident fund is concerned. Mr. Prdeep Ghosh, learned senior counsel for the respondent company has very fairly submitted that there are three accounts, namely, provident fund contribution, pension fund contribution and the Insurance fund contribution. The respondent company does not enjoy any exemption in respect of pension fund and insurance fund. Learned counsel further submitted that Section 14B makes a distinction among these three funds namely, provident fund contribution, pension fund contribution and the insurance fund contribution. 19. Ms. Aparna Bhat, learned counsel for the appellant argued that both the Courts i.e. the writ court and the appellate Bench of the High Court placed an erroneous interpretation with regard to application of Section 14B to an exemp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Constitution came into existence. Prior to its enactment, the requirement of having a suitable legislation for compulsory institutional and contributory provident fund in industrial undertakings was discussed several times at various tripartite meetings in which representatives of the Central and State Governments and employees and workers took part. Initially a non-official Bill on the subject was introduced in the Central Legislature in 1948 and was withdrawn with the assurance that the Government would consider the introduction of a comprehensive Bill. Finally, the proposed legislation was endorsed by the conference of Provincial Labour Ministers in January, 1952 and later on the same was introduced in 1952. This Court had occasion to expressly hold that the said Act is a beneficial social welfare legislation to ensure benefits to the employees. In the case of Regional Provident Fund Commissioner v. S.D. College, Hoshiarpur and others reported in (1997) 1 SCC 241, this Court while interpreting Section 14B of the Act held that the Act envisages the imposition of damages for delayed payment (paragraph 10 at page 244 of the report). This Court also held that the Act is a benef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are very pertinent. Relevant excerpts are:- There are also certain administrative difficulties to be set right. There is no provision for inspection of exempted factories; nor is there any provision for the recovery of dues from such factories. An employer can delay payment of provident fund dues without any additional financial liability. No punishment has been laid down for contravention of some of the provisions of the Act. This Bill seeks primarily to remedy these defects . - S.O.R., Gazette of India, 1953, Extra, Pt.II, Sec.2, p.910. 28. Similarly, in respect of Section 17(1A), clause (a) which makes Section 14B applicable to an exempted establishment also came by way of an amendment, namely, by Act 33 of 1988. Here also if we look at the relevant portion of the Statement of Objects and Reasons of Act 33 of 1988 we will find that they are based on certain recommendations of the High level committee to review the working of the Act. Various recommendations were incorporated in the Objects and Reasons and one of the objects of such amendment is as follows:- (viii) the existing legal and penal provisions, as applicable to unexempted establishments, are being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction being the ascertainment of meaning, every consideration brought to bear for the solution of that problem must be devoted to that end alone... 35. Therefore, while construing the statute where there may be some doubt the Court has to consider the statute as a whole - its design, its purpose and the remedy which it seeks to achieve. Chief Justice Sinha of this Court, in State of West Bengal v. Union of India reported in AIR 1963 SC 1241 at 1245, emphasized the importance of construing the statute as a whole. In the words of Chief Justice:- The Court must ascertain the intention of the Legislature by directing its attention not merely to the clauses to be construed but to the entire statute; it must compare the clause with the other parts of the law, and the setting in which the clause to be interpreted occurs . 36. Lord Greene, Master of Rolls, also gave the same direction in Re, Bidie (deceased), [(1948) 2 All ER 995, page 998]. In the words of Master of Rolls the technique should be:- to read the statue as a whole and ask oneself the question: In this state, in this context, relating to this subject-matter, what is the true meaning of that word ? 37. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purpose of the legislation is allowed to be achieved. 42. In coming to the aforesaid conclusion the learned Judges relied on the famous dictum of Lord Denning in Seaford Court Estates Ltd. v. Asher - (1949) 2 All E.R. 155 (CA) wherein the learned Judge stated the position thus: ...A Judge should ask himself the question how, if the makers of the Act had themselves come across this ruck in the texture of it, they would have straightened it out? He must then do so as they would have done. A judge must not alter the material of which the Act is woven, but he can and should iron out the creases. 43. In view of the interpretation of the Act in N.K. Jain (supra) there is no difficulty in construing the provision of Section 17(1A)(a) where it is provided that when an exemption has been granted to an establishment under Clause (a) of sub-section (1), the provision of Sections 6, 7, 8 and 14B of the Act shall, so far as may be apply to the employer of the exempted establishment in addition to such other condition as may be specified in the notification granting such exemption. 44. If we look at sub-section (a) which has been set out hereinbefore, we will find that sub-cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 14B and damages can be levied. The High Court, with great respect, erred by coming to a contrary conclusion. 49. Apart from that the High Court s interpretation of the expression so far as may be as limiting the ambit and width of Section 17(1A)(a) of the Act, in our judgment, cannot be accepted for two reasons as well. 50. The High Court is guided in the interpretation of the word so far as may be on the basis of the principle that statutes does not waste words. The High Court has also relied on the interpretation given to so far as may be in the case of Dr. Pratap Singh and another v. Director of Enforcement, Foreign Exchange Regulation Act and others reported in AIR 1985 SC 989. It goes without saying that Foreign Exchange Regulation Act is a fiscal statute dealing with penal provisions whereas the aforesaid expression is to be construed in this Act which is eminently a social welfare legislation. Therefore, the parameters of interpretation cannot be the same. Even then in Pratap Singh (supra) this Court while construing so far as may be held if a deviation becomes necessary to carry out the purposes of the Act........................ it would be permissible . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apply in relation to the Central Government. In that context this Court held that the expression so far as may be is indicative of the fact that all or any of these provisions may or may not be applicable to the transferee under sub-section (1). The objects behind the said enactment are totally unique and the same was a special law. Apart from this, this Court did not lay down any general principle of interpretation in the application of the expression so far as may be . Their being vast conceptual difference in the legal questions in that case, the interpretation of so far as may be in M. Ismail Faruqui (supra) cannot be applied to the interpretation of so far as may be in the present case. 56. The High Court s interpretation also was in error for not considering another well settled principle of interpretation. It is not uncommon to find legislature sometime using words by way of abundant caution. To find out whether the words are used by way of abundant caution the entire scheme of the Act is to be considered at the time of interpretation. In this connection we may remember the observation of Lord Reid in I.R. Commissioner v. Dowdall O Mahoney Co. reported in (1952) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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