UNION OF INDIA v. MARAYAN BANNAPPA PAKKANAVAR — 1987 DIGILAW 12 (KAR)

K. A. SWAMI, J. ( 1 ) THIS appeal, by the defendants, is preferred against the judgment and decree dated 25-11-1976 passed by the Principal civil Judge, Belgaum, in R. A. No. 342 of 1971 reversing the judgment and decree dated 19-8-1971 passed by the Principal munsiff, Belgaum, in O. S. No. 213 of 1967. ( 2 ) THE Trial Court dismissed the suit on the grounds that it was not maintainable as no notice under Sec. 80 of the code of Civil Procedure, 1908 (for short, the -Code'), was issued ; that having regard to sub-section (4) of Section 7a of the Employees. Provident Funds and miscellaneous Provisions Act, 1952 (for short, the 'act'), the suit was not maintainable. In the appeal, the learned Civil judge held that the suit, as against defendants 1, 4, 5 and 6, was not maintainable as no notice under Section 80 of the Code was issued and the suit as against defendants 2 and 3 was maintainable, even though, the Provident Fund Commissioner purported to act in exercise of the powers conferred under Sec. 7 A of the Act, but in fact he acted outside the scope of the act ; that no notice under section 80 of the Code, was necessary. The Lower appellate Court also held that the plaintiff factory had employed less than 20 persons at the relevant point of time ; therefore, the provisions of the Act were not applicable. Accordingly, he allowed the appeal as against defendants 2 and 3 and decreed the suit against the Provident fund Commissioner and Provident Fund inspector, and restrained them from enforcing the provisions of the Act. ( 3 ) SRI Shylendra Kumar, learned counsel appearing for the appellants, submits that notice under Sec. 80 of the code is necessary inasmuch as defendants 2 and 3 are public officers ; that the relief of permanent injunction as sought for by the plaintiff cannot be granted as it amounts to and results in, preventing the public officers from enforcing vaild law ; that the jurisdiction of Civil Court was taken away by the provisions contained in Sec. 7a (4 of the Act. ( 4 ) ON the contrary, Sri G. B. Shastri, learned Counsel appearing for the Plaintiff-Respondent-1, submits that defendants 2 and 3 (respondents 2 and 3) are not public officers. ( 4 ) ON the contrary, Sri G. B. Shastri, learned Counsel appearing for the Plaintiff-Respondent-1, submits that defendants 2 and 3 (respondents 2 and 3) are not public officers. Therefore, no notice as required under Sec. 80 of the Code is necessary, that as the plaintiff does not employ more than 20 persons the provisions of the Act are not at all attracted ; that in the suit the validity of the order passed under Section 7a (4) of the Act, is not challenged ; that the suit is for permanent injunction ; therefore, the bar contained in Section 7a (4) of the Act is not attracted. ( 5 ) HAVING regard to the aforesaid contentions, the following points arise for consideration in this appeal : (1) Whether the suit as against defendants 2 and 3 (respondents 2 and 3) is maintainable in the absence of notice under Section 80 of C. P. C. ? (2) Whether the relief prayed for by the plaintiff cannot be granted having regard to the facts and circumstances of the case ? (3) Whether the suit is barred by sec. 7a (4) of the Act ? point No. 1: ( 6 ) THE contention of the plaintiff- appellant that defendants 2 and 3 are not public officers cannot at all be sustained. Section 2 (17) of the Code defines the expression "public Officer". Several descriptions of the expression "public officer" are given in clauses (a) to (h) thereof. For our purpose clause (h) is relevant and it is as follows :-"2 (17) "public Officer" means person falling under one of the following descriptions, namely : (a)to (g): (h) Every Off cer in the service or pay of the Government or remunerated by fees or commission for the performance of any public duty. "for our purpose Clauses (a) to (g) are not relevant inasmuch as they are not attracted. From Clause (h) it is clear that every officer in the service or pay of the Government, or remunerated by fees or commission for the performance of any public duty is "public Officer". As per sub-section (1) of Section 5d of the Act, central Government is the authority to appoint a Central Provident Fund Commissioner who is the Chief Executive Officer of the Central Board and he is subject to the general control and superintendence of the Central Board. As per sub-section (1) of Section 5d of the Act, central Government is the authority to appoint a Central Provident Fund Commissioner who is the Chief Executive Officer of the Central Board and he is subject to the general control and superintendence of the Central Board. Under Sub-section (2) thereof, the Central Government is also an authority to appoint as many deputy Provident Fund Commissioners, regional Provident Fund Commissioners and other officers whose maximum monthly salary is not less than five hundred rupees as it may consider necessary to assist the Central Provident Fund Commissioner in the discharge of his duties. The requirement of monthly salary not being less than five hundred rupees is applicable in respect of other Officer and not in respect of Deputy Provident Fund commissioners and Regional Provident fund Commissioners. Provident Fund inspectors as per Section 13 of the Act, are appointed by the appropriate Government. The expression "appropriate government'' is also defined. According to this definition in relation to an establishment belonging to, or under the control of, the Central Government or in relation to an establishment connected with a railway company, a major port, a mine or an oil field or a controlled industry, or in relation to an establishment having departments or branches in more than one State, Central Government, and in relation to any other establishment, the state Government -. Thus, in the instant case, the State Government, is the authority to appoint the Provident Fund inspectors. Defendants 2 and 3 discharge the public duties. The Act imposes certain duties to be discharged by defendants 2 and 3. The Act is interpreted by the supreme Court in Sayaji Mills Ltd. v. Regional Provident Fund Commissioner ( AIR 1985 SC 323 ), as a beneficial legislation intended to serve the interest of the employees. Thus, defendants 2 and 3 discharge public duty under the Act. It is their duty to advance and protect the interest of the employee. ( 7 ) SRI Shastri, learned Counsel for the plaintiff-1st respondent, contends that the defendants 2 and 3 are not paid either by the Central Government or by the State Government. Therefore, they cannot be considered either as Government servants or as public officers merely because they are appointed bv the Central government or by the State Government. 72 The payment of salary is not a deciding factor. Therefore, they cannot be considered either as Government servants or as public officers merely because they are appointed bv the Central government or by the State Government. 72 The payment of salary is not a deciding factor. No doubt, under the provisions of the Act, it is the Central board which pays the salary from out of the Central Provident Fund. But the fact remains that they are appointed by the central and the State Governments respectively and they perform public duties. Their services are governed by sub section (6) of Section 5d of the Act. The provident Fund Inspector is also deemed to be a public servant within the meaning of Section 21 of the Indian Penal Code as per sub-section (3) of Section 13 of the act. Sri Shastri, learned Counsel for the plaintiff appellant has placed reliance on a decision of this Court in State of mysore and another v. City Improvement trust Board. Mysore (1969 (1) Mys. L. J. 337 ). That was a case in which the officer of the State Government was deputed to the B. D. A. , and it was held that while on deputation he could not be considered to be a Government servant. No principle of law is stated there. All that can be said is that the decision in that case has to be read in the light of the facts of that case. "learned Counsel has also placed reliance on a decision of the High court of Patna in Kamta Prasad Singh and another v. The Regional Food Corporation of India and others (AIR 1974 Patna 376 ). That was a case in which it was held that an employee of the Corporation was not a Government servant. There- fore, he was a public Officer. The decision proceeded on the basis that the corporation employee was not a public servant. Other descriptions provided in the definition such as Clause (h) of Section 2 (17) of the Code were not at all considered. Therefore, it is not possible to apply that decision to the case on hand. There- fore, he was a public Officer. The decision proceeded on the basis that the corporation employee was not a public servant. Other descriptions provided in the definition such as Clause (h) of Section 2 (17) of the Code were not at all considered. Therefore, it is not possible to apply that decision to the case on hand. "having regard to the fact that defendants 2 and 3 are appointed by the central and State Government respectively; their services are controlled by the central and the State Government; they perform public duties; their salaries or remunerations are paid from out of the central Provident Fund, the requirements of Clause (h) of Section 2 (17) of the code are satisfied. As such they are public officers. Hence, notice under section 80 of the Code ought to have been served before filing the suit. "in Bihari Chowdhary and another v. State of Bihar and others ( AIR 1984 SC 1043 ), it has been held that a suit against the Government or a public officer, to which the requirement of a prior notice under Sec. 80 of the Code is attracted, cannot be validly instituted until the expiration of the period of two months next after the notice in writing has been delivered to the authorities concerned in the manner prescribed for in the Section and if filed before the expiry of the said period, the suit has to be dismissed as not maintainable. "however, it is contended that the action of the second defendant in passing the order dated 29-11-1966 Ext. P-2 under Section 7a of the Act, was without the authority of law inasmuch as at no point of time the plaintiff employed 20 persons, therefore, the provisions of the Act were not applicable. Hence, no order directing the plaintiff to remit a sum of Rs. 166-50 to Account No. 1 and Rs. 4 40 to Account No. II of the Employees provident Fund Accounts maintained at the State Bank of India within a week of the receipt of the order would have been passed and as such the order being without jurisdiction could not be considered to be within the provisions of the Act, hence notice under Section 80 of the code was not required to be given. This contention presums in favour of the plaintiff that he had not at any point of time employed twenty or more persons. Thus the Court has to proceed on the basis that the plaintiff at no point of time employed 20 workers. In order to determine the question as to whether the provisions of the Act are attracted to the plaintiff establishment or not, the condition precedent namely issuing of notice under section 80 of the Code has to be satisfied. It is then only the suit can be maintained. Therefore, the contention is devoid of merit and it is accordingly rejected. It is next contended that Exhibit p-12 rated 28-9-1966 amounts to notice under Sec. 80 of the Code. Therefore, notice as required by law has been issued. The case of the plaintiff throughout has been that no notice under Section 80 of the Code is necessary. Exhibit P-12 has never been relied upon as satisfying such a requirement. Exhibit P-12 is only a letter written to the Provident Fund inspector. Such a letter cannot at all be considered to be a notice as required under Section 80 of the Code. Secondly, such a letter cannot at all be construed as notice to the second defendant. Third defendant is only a subordinate to the second defendant. As long as there is no notice to the second defendant, the suit cannot be maintained. Hence, the contention is rejected. Accordingly, point No. 1 is answered in the negative and against the plaintiff. Point Nos. 2 and 3 : ( 8 ) POINTS 2 and 3 are inter-connected. Therefore, they are considered together. ( 9 ) THE plaintiff has prayed for a decree in the following terms :-" (A) Permanent injunction against all the defendants restraining them all from acting and enforcing the Provisions of E. P. F. Act, and scheme framed thereunder against plaintiff ; b) Costs of the suit; c) Any other relief to which the plaintiff is entitled to. "in this case, it is not in dispute that the suit is filed after the order dated 29 11- 1966 passed under Section 7a of the Act by the second defendant, is served upon the plaintiff. That order is passed after notice to the plaintiff and also after due enquiry. "in this case, it is not in dispute that the suit is filed after the order dated 29 11- 1966 passed under Section 7a of the Act by the second defendant, is served upon the plaintiff. That order is passed after notice to the plaintiff and also after due enquiry. It has been held by the 2nd defendant that the provisions of the Act are attracted to the plaintiff-establishment, therefore, he has to remit the amounts stated therein. The ground on which the aforesaid relief of injunction not to enforce the Act against the plaintiff is sought for, is that the plaintiff never employed 20or more employees, therefore, the provisions of the Act are not attracted. It is this fact which is held against the plaintiff in the order passed under section 7a (1) of the Act. It is passed after holding due enquiry as per Sub-Sectiors (2) and (3) of Section 7a of the Act. The order made under Section 7a of the Act, as per sub-section (4) thereof, shall be final and shall not be questioned in any court of law. The effect of the decree sought for by the plaintiff is nothing but to nullify the order dated 29-11-1966. Thus the relief sought for by the plaintiff urder the garb of permanent injunction has the effect of setting aside the order passed under Section 7a of the 'act. No relief which has an effect of nullifying the order passed under Section 7a of the Act can be granted by a civil court. The plaintiff by cleverly wording the prayer in the plaint, cannot be allowed to defeat or overcome the bar contained in sub-section (4) of Section 7a of the Act. It is not as though there is no remedy under the Act. Section 7a provides for holding an elaborate enquiry before an order is passed under Sub-Sec. (1) of Section 7a of the act. The officer conducting the enquiry under sub-section (1) of Section 7 A of the Act, has the same powers as are vested in a Court under the Code of Civil procedure for trying a suit in respect of matters such as (a) enforcing the attendance of any person or examining him on oath; (b) requiring the discovery and production of documents; (c) receiving evidence on affidavit; (d) issuing commission for the examination of witnesses. Further such an enquiry is deemed to be a judicial proceeding within the meaning of Sections 193 and 228 and for the purpose of Section 196 of the Indian Penal codu. Sub-section (3) of Section 7a of the Act further provides that no order determining the amount due from any employer shall be made under sub section (1), unless the employer is given a reasonable opportunity of representing his case. Thus all the trappings of a judicial proceeding are grafted into the process of determination to be made under Section 7a (1) of the Act. Even thereafter, if the employer feels aggrieved by the order it is open to him to challenge the same under Articles 226 or 227 or both of the Constitution. The bar contained in sub-section (4) of Section 7a of the act has to be appreciated in the background of the object of the Act The Act is a beneficial legislation and it is intended to serve interest of the employees. Even after the determination is made after holding a due enquiry under Section 7a of the Act to the effect that the provisions of the Act are attracted and the employer is liable to deposit the amount as per the provisions of the Act, and such a determination inspite of the provisions contained in sub section (4) of Section 7a of the Act, is held to be open to challenge by seeking relief in a civil court either in the form of an injunction or declaration, it will be nothing but defeating the very Act itself in as much as the enforcement authority will not be able to enforce the Act, until the proceeding before a civil Court attains finality, which, having regard to several stages including an appeal and further appeal have to be covered, before it attains finality, is possible only after a decade or two and by that time many of the employees would, be either out of employment or have left the world for ever. Keeping this aspect in view and also the fact that an aggrieved employer has a remedy against the order passed under Section 7a of the Act under Articles 226 and 227 of the Constitution, the Parliament in its wisdom has excluded the jurisdiction of a civil Court and has issued statutory injunction that the order made under section 7a of the Act shall not be questioned in any court of law. A party cannot be allowed to over-come or avoid such a statutory injunction by seeking a prayer in a civil Court in such a manner so as to make it appear that apparently the order passed under Section 7a of the Act is not challenged, though, in effect and in substance the relief, if granted would result in nullifying the order passed under Section 7a of the Act. Therefore having regard to the fact that, in the instant case, if the decree as prayed for is granted, it results in setting aside or nullifying the order passed under Section 7a of the Act, the Civil Court has no jurisdiction to grant such a relief. ( 10 ) ACCORDINGLY, Point No. 2 is answered in the negative and Point No. 3 in the affirmative. ( 11 ) FOR the reasons stated above, the appellants are entitled to succeed. Accordingly, the appeal is allowed. The judgment and decree of the lower appellate Court are set aside and that of the trial Court are restored with costs. Appeal allowed with costs. --- *** --- .