The Employees’ Provident Funds and Miscellaneous Provisions (Amendment) Act, 1998

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The Employees’ Provident Funds and Miscellaneous Provisions Act, 1998 (Act No. 10 of 1998) dated 22nd June, 1998 was enacted with in 49 year of Republic of India. The Act contains provisions to amend the provisions of original (Parent) Act i.e. (The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (Act no. 19 of 1952). This Amendment Act under its first section states about its short title and the date on which this Act should come in effect i.e. 22th September, 1997.

The Section 6 of the Parent Act is amended by Section 2 of this Amendment Act of 1998. The original Section 6 of the Act was dealing with the provisions for contributions from employer to the Funds which should be 8 and 1/3rd percent of the basic wages, dearness allowance and retaining allowance payable to employees. But after the Amendment this 8 and 1/3rd percent is replaced with 10 percent. However, the Parent Act itself was speaking for 10 percent when the Central Government deems it necessary in case of any establishment or class of establishments. But such 10 percent appears in Parent Act, was replaced with 12 percent after this Amendment is taken place.

The original Section 7D of the Parent Act providing for constitution of Employees’ Provident Funds Appellate Tribunal and sub section 3 thereof was originally dealing with qualification of persons to be appointed as Presiding Officer of a Tribunal, which should be equal to the qualification of Judge of High Court. However the said Sub Section (3) of the Section 7D of original Act was replaced by new one provided under this Amendment Act, wherein the earlier qualification is maintained and also one substitute qualification is provided by the word ‘or’ i.e. the persons can also be treated as qualified person if he is equally qualified to that of District Judge.

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Similarly, the provision relating to resignation by the Presiding officer is originally provided under Section 7F which was to be made by providing written notice under such Presiding officer’s hand to Central Government. However, the said provision is also amended by this Amendment Act by providing new Sub Sections as Sub Section (2) and (3) and previous provisions is numbered as Sub Section (1). The new Sub Section (2) imposes restriction on removal of Presiding Officer without order of President on the ground proving his misbehavior. And another new Sub Section (3) empowers Central Government as to make provisions of Rules regulating the procedure as to investigation of such misbehavior of Presiding Officer.

Further, the Section 16 originally clarifies the applicability of the Parent Act to such establishments provided under the list of clauses from clause (a) to (d) of Sub Section (1) of Section 16 thereof. The clause (d) of Section 16(1) thereof was stating the applicability of the Parent Act to every establishment newly set up, till the expiry of 3 years’ period from the date of setting up of such establishment. And further an explanation was attached to this provision which was stating for clarification of doubts relating to such newly set up establishment which should not be meant to such establishment which has only changed its location. But, the Amendment Act sought to omit this provision of clause (d) along with this Explanation under its Section 5.

The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 ever treated as a beneficial welfare legislation to ensure health and other benefits to the employees and the employer is under the obligation to deduct the specified percentage or the contribution from the employees’ salary and matching contribution, the entire amount is required to be deposited in the fund. This beneficial nature of this legislation is upheld by Indian judiciary at every occasion not only prior to this Amendment but also after the Parent Act is amended by this Amendment Act. Some of the instances can be given where hon’ble Judiciary has played its role in expressing it valuable opinion over the beneficial nature of this legislation, including the case of Regional Provident Fund Commissioner vs. S.D. College, Hoshiarpur G. Ors. (1996); St. Thomas Hr. Sec. School Vs. Union of India (2014); Regional Provident Fund Commissioner Vs. The Hooghly Mills Co. Ltd. & ors (2012) and many more similar judgments.

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by Faim Khalilkhan Pathan