THE EMPLOYEE’S PROVIDENT

FUND ( FAMILY PENSION

FUND AND DEPOSIT LINKED
INSURANCE FUND) ACT, 1952
Synopsis :
1. The Employee’s Provident Fund ( Family
Pension Fund and Deposit Linked
Insurance Fund) Act, 1952 -Definitions-
contribution, employee, employer,
factory, fund, etc.
2. Provident Fund Scheme,
3. Family Pension Scheme,
4. Employees' Deposit Linked Insurance
Scheme-Scope, Contributions
5. Benefits - Authorities under the Act
6. Powers & Latest judicial pronouncements.
Important Questions:
1. Define contribution. Examine the law relating to contribution by the
employer and employees under the Employees Provident Fund Act,
1952
2. Discuss the mode of recovery of money due from the employer
under the EPF Act, 1952
3. Employee under EPF Act, 1952
 INTRODUCTION
• The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 is a
social welfare legislation to provide for the institution of Provident Fund,
Pension Fund and Deposit Linked Insurance Fund for employees working in
factories and other establishments.
• The Act aims at providing social security and timely monetary assistance to
industrial employees and their families when they are in distress.
• Accordingly, three schemes are in operation under the Act.
• These schemes taken together provide to the employees an old age and
survivorship benefits, a long term protection and security to the employee
and after his death to his family members, and timely advances including
advances during sickness and for the purchase/ construction of a dwelling
house during the period of membership.
• The Act is administered by the Government of India through the Employees'
Provident Fund Organization (EPFO).
• EPFO is one of the largest provident fund institutions in the world in terms of
members and volume of financial transactions that it has been carrying on.
• The Central Government has been constituted Employees' Provident Funds
Appellate Tribunal to exercise the powers and discharge the functions
conferred on such by Employees’ Provident Funds and Miscellaneous
Provisions Act, 1952.
• The Tribunal consist of one person only and appointed by the Central
Government.
Provident Fund schemes for the benefit of the employees had been introduced
by some organisations even when there was no legislation requiring them to do
so. Such schemes were, however, very few in number and they covered only
limited classes/groups of employees. In 1952, the Employees Provident Funds
Act was enacted to provide institution of Provident Fund for workers in six
specified industries with provision for gradual extension of the Act to other
industries/classes of establishments. The Act is now applicable to employees
drawing pay not exceeding Rs. 6,500/- per month. The Act extends to whole of
India except Jammu and Kashmir. The term pay includes basic wages with
dearness allowance, retaining allowance (if any), and cash value of food
concession.
The following three schemes have been framed under the Act by the Central
Government:
(a)The Employees’ Provident Fund Schemes, 1952;
(b)The Employees’ Pension Scheme, 1995; and
(c) The Employees’ Deposit-Linked Insurance Scheme; 1976.
The three schemes mentioned above confer significant social security benefits
on workers and their dependents.
Applicability : According to Section 1(3), the Act, subject to the provisions of
Section 16, applies:
(a)to every establishment which is a factory engaged in any industry specified
in Schedule I and in which twenty or more persons are employed; and
(b)to any other establishment employing twenty or more persons or class of
such establishments which the Central Government may, by notification in
the Official Gazette, specify in this behalf:
Provided that the Central Government may, after giving not less than two
months notice of its intention to do so by notification in the Official Gazette,
apply the provisions of this Act to any establishment employing such number of
persons less than twenty as may be specified in the notification.
Non-applicability of the Act to certain establishments Section 16(1) of the Act
provides that the Act shall not apply to certain establishments as stated
thereunder. Such establishments include
(a)establishments registered under the Co-operative Societies Act, 1912, or
under any other law for the time being in force in any State relating to co-
operative societies, employing less than 50 persons and working without the
aid of power; or
(b)to any other establishment belonging to or under the control of the Central
Government or a State Government and whose employees are entitled to
the benefit of contributory provident fund or old age pension in
accordance with any scheme or rule framed by the Central Government
or the State Government governing such benefits; or
(c) to any other establishment set up under any Central, Provincial or State Act
and whose employees are entitled to the benefits of contributory provident
fund or old age pension in accordance with any scheme or rule framed
under that Act governing such benefits.

According to Section 16(2), if the Central Government is of opinion that having

regard to the financial position of any class of establishments or other
circumstances of the case, it is necessary or expedient so to do, it may, by
notification in the Official Gazette, and subject to such conditions as may be
specified in the notification, exempt that class of establishments from the
operation of this Act for such period as may be specified in the notification.
Section 2 of the Act explains such expressions which are given below:
(i) “Appropriate Government” means:
(i) in relation to those establishments 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, the Central
Government; and
(ii) in relation to any other establishment, the State Government. [Section
2(a)]
(ii) “Basic Wages” means all emoluments which are earned by an employee
while on duty or on leave or on holiday with wages in either case in
accordance with the terms of the contract of employment and which are
paid or payable in cash to him, but does not include:
(i) the cash value of any food concession;
(ii) any dearness allowance (that is to say, all cash payments by whatever
name called paid to an employee on account of a rise in the cost of
living), house- rent allowance, overtime allowance, bonus, commission
or any other similar allowance payable to the employee in respect of
his employment or of work done in such employment;
(iii) any presents made by the employer. [Section 2(b)]
(v) “Employer” means :
(i) in relation to an establishment which is a factory, the owner or occupier of the
factory, including the agent of such owner or occupier, the legal representative of a
deceased owner or occupier and where a person has been named as a manager of
the factory under clause (f) of sub-section (1) of Section 7 of the Factories Act, 1948,
the person so named; and
(ii) in relation to any other establishment, the person who or the authority which, has
the ultimate control over the affairs of the establishment, and where the said affairs
are entrusted to a manager, managing director, or managing agent, such manager,
managing director or managing agent. [Section 2(e)]
(vii) Exempted Employee : It means an employee to whom a Scheme or the Insurance
Scheme as the case may be would, but for the exemption granted under Section 17,
have applied. [Section 2(ff)]
(viii) Exempted Establishment : It means an establishment in respect of which an
exemption has been granted under Section 17 from the operation of all or any of the
provisions of any Scheme or the Insurance Scheme as the case may be whether such
exemption has been granted to the establishment as such or to any person or class of
persons employed therein. [Section 2(fff)] means :
i. in relation to an establishment which is a factory, the owner or occupier of the
factory, including the agent of such owner or occupier, the legal representative of
a deceased owner or occupier and where a person has been named as a
manager of the factory under clause (f) of sub-section (1) of Section 7 of the
Factories Act, 1948, the person so named; and
ii. in relation to any other establishment, the person who or the authority which, has
the ultimate control over the affairs of the establishment, and where the said
affairs are entrusted to a manager, managing director, or managing agent, such
manager, managing director or managing agent. [Section 2(e)]
 SCHEMES UNDER THE ACT
In exercise of the powers conferred under the Act, the Central Government
has framed the following three schemes:

(A) EMPLOYEES PROVIDENT FUND SCHEME

The Central Government has framed a Scheme called Employees Provident
Fund Scheme. The Fund vests in and is administered by the Central Board
constituted under Section 5A.

Administration of the Fund :

(a)Board of Trustees or Central Board: Section 5A provides for the administration
of the Fund. The Central Government may by notification in the Official
Gazette constitute with effect from such date as may be specified therein,
a Board of Trustees, for the territories to which this Act extends.
(b)The Employees Provident Fund Scheme contains provisions regarding the
terms and conditions subject to which a member of the Central Board may
be appointed and of procedure of the meetings of the Central Board. The
Scheme also lays down the manner in which the Board shall administer the
funds vested in it however subject to the provisions of Section 6AA and 6C
of the Act. The Board also performs functions under the Family Pension
Scheme and the Insurance Scheme.
Class of employees entitled and required to join Provident Fund
Every employee employed in or in connection with the work of a factory or
other establishment to which this scheme applies, other than an excluded
employee, shall be entitled and required to become a member of the fund
from the date of joining the factory or establishment.
The term “excluded employee” has been defined in para 2(f) of the
Employees’ Provident Fund Scheme, 1952 as follows: ‘Excluded employee’
means:
(i) an employee who, having been a member of the Fund, withdraw the full
amount of his accumulations in the Fund under clause (a) or (c) of sub-
paragraph 69;
(ii) an employee whose pay at the time be is otherwise entitled to become a
member of the Fund, exceeds five thousand rupees per month.
Explanation: “Pay” includes basic wages with dearness allowance retaining
allowance (if any) and cash value of food concession admissible thereon.
(iii) An apprentice. Explanation: An apprentice means a person who,
according to the certified standing orders applicable to the factory or
establishment is an apprentice, or who is declared to be an apprentice by
the authority specified in this behalf by the appropriate Government.
Contributions
• As per Section 6, the contribution which shall be paid by the employer to the
Fund shall be 10%, of the basic wages, dearness allowance and retaining
allowance, if any, for the time being payable to each of the employees
whether employed by him directly or through a contractor and the
employees contribution shall be equal to the contribution payable by the
employer.
• Employees, if they desire, may make contribution exceeding the prescribed
rate but subject to the condition that employer shall not be under any
obligation to contribute over and above the contribution payable as
prescribed by the Government from time to time under the Act.
• The Government has raised the rate of Provident Fund Contribution from the
current 8.33% to 10% in general and in cases of establishments specially
notified by the Government, from 10% to 12% with effect from September 22,
1997.
• Each contribution shall be calculated to the nearest rupee, fifty paise or
more to be counted as the next higher rupee and fraction of a rupee less
than fifty paise to be ignored.
• Dearness allowance shall include the cash value of any food concession
allowed to an employee.
• Retaining allowance is the allowance payable to an employee for retaining
his services, when the establishment is not working.
Investment:
• The amount received by way of Provident Fund contributions is invested by
the Board of Trustees in accordance with the investment pattern approved
by the Government of India.
• The members of the Provident Fund get interest on the money standing to
their credit in their Provident Fund Accounts. The rate of interest for each
financial year is recommended by the Board of Trustees and is subject to
final decision by the Government of India.

Advances/Withdrawals:
Advances from the Provident Fund can be taken for the following purposes
subject to conditions laid down in the relevant paras of the Employees
Provident Fund Scheme:
(1) Non-refundable advance for payment of premia towards a policy or
policies of Life Insurance of a member;
(2) Withdrawal for purchasing a dwelling house or flat or for construction of a
dwelling house including the acquisition of a suitable site for the purpose, or
for completing/continuing the construction of a dwelling house, already
commenced by the member or the spouse and an additional advance for
additions, alteration or substantial improvement necessary to the dwelling
house;
3. Non-refundable advance to members due to temporary closure of
any factory or establishment for more than fifteen days, for reasons
other than a strike or due to non-receipt of wages for 2 months or
more, and refundable advance due to closure of the factory or
establishment for more than six months;
4. (i) Non-refundable in case of:
(a) hospitalisation lasting one month or more, or
(b) major surgical operation in a hospital, or
(c) suffering from T.B., Leprosy, Paralysis, Cancer, Mental
derangement or heart ailment, for the treatment of which
leave has been granted by the employer;
ii) Non-refundable advance for the treatment of a member of his
family, who has been hospitalised or requires hospitalisation, for
one month or more:
(a) for a major surgical operation; or
(b) for the treatment of T.B., Leprosy, Paralysis, Cancer, mental
derangement or heart ailment;
(5) Non-refundable advance for daughter/sons marriage, self-
marriage, the marriage of sister/brother or for the post matriculation
education of son or daughter;
(6) Non-refundable advance to members affected by cut in the supply of
electricity;
(7) Non-refundable advance in case property is damaged by a calamity of
exceptional nature such as floods, earthquakes or riots;
(8) Withdrawals for repayment of loans in special cases; and
(9) Non-refundable advance to physically handicapped members for
purchasing an equipment required to minimise the hardship on account
of handicap.

Final withdrawal:
• Full accumulations with interest thereon are refunded in the event of
death, permanent disability, superannuation, retrenchment or migration
from India for permanent settlement abroad/taking employment
abroad, voluntary retirement, certain discharges from employment
under Industrial Disputes Act, 1947, transfer to an establishment/factory
not covered under the Act.
• In other cases, with permission of commissioner or any subordinate
officer to him, a member is allowed to draw full amount when he ceases
to be in employment and has not been employed in any establishment
to which the Act applies for a continuous period of atleast 2 months.
• This requirement of 2 months waiting period shall not apply in cases of
female members resigning from service for the purpose of getting
married.
 COMMON REASONS FOR PROVIDENT FUND WITHDRAWAL WITH APPLICABLE PF
WITHDRAWAL RULES
Here are some reasons for PF withdrawal, along with the applicable rules for
each case-
• In Case of Unemployment : A PF account holder can withdraw up to 75% of
the total accumulated amount if he/she has been unemployed for more
than 1 month after relinquishing employment. This provision also allows the
account holder to withdraw the remaining 25% if the unemployment period
stretches over 2 months.
 For Education : PF account holders can withdraw up to 50% of the total
employee’s contribution to EPF to pay for their higher education or to bear
the education cost of their children after class 10. The funds will be
transferable after contributing a minimum of 7 years towards the EPF
account.
 To Pay for Marriage : The latest PF withdrawal rules also allow an account
holder to withdraw up to 50% of the employee’s share to pay for the
necessary expenses for a marriage. The marriage should be of the individual
concerned, or the account holder’s son, daughter, brother, and sister.
However, this provision can be utilised only after the completion of 7 years
of PF contribution.
• For Specially-abled Individuals : Under the PF withdrawal rules 2024,
specially-abled account holders can withdraw 6 months basic wage
along with dearness allowance, or employee share with interest
(whichever is less), to pay for the cost of equipment. This decision was
made to help ease the financial burden individuals might experience to
purchase expensive equipment.
• For Medical Emergencies : A PF or EPF account holder can also
withdraw the EPF balance to pay for urgent medical treatments for
certain diseases. This facility is allowed for both self-usage or to pay for
treatment of immediate family members. One can withdraw 6 month’s
basic wage and dearness allowance, or the employee share along with
interest, whichever is less.
• To Pay for Existing Debts : Individuals can withdraw 36 months of basic
wage + dearness allowance, or the total of employee and employer
share along with interest to pay their home loan EMIs. However, this
facility is available only after a minimum of 10 year’s contribution
towards the EPF account.
• To Purchase Residential Property or Land Plots : According to PF withdrawal
rules, the account holder is allowed to make a premature withdrawal to
purchase empty land or prefabricated houses. EPFO has allocated a PF
withdrawal limit for this purpose; for example –

• Contribution towards EPF Withdrawal Limit Purpose

24 month’s basic wage and The accumulated funds from To purchase a house, flat, or to
Dearness Allowance the EPF account, including the construct a residential property.
employee and employer’s
share.

36 month’s basic wage plus The accumulated funds along To purchase or construct a
Dearness Allowance with the total interest, whichever residential property or flat.
is lower.

For Home Renovation

• Provident fund new rules also come with a provision to withdraw 12 month’s
basic wage plus Dearness Allowance, as well as the employee’s share with
interest (whichever is smaller) for home alteration, improvement, or
expansion.
• The residential property can be of the PF account holder, owned by his or
her spouse, or owned jointly.
• An individual can avail this facility 2 times, once after 5 years of
completing the residential property, and after 10 years can withdraw
PF amount for the first time.
• Revised EPF withdrawal rules also allow an account holder to withdraw
up to 90% of the accumulated funds after they reach 54 years of age
or a year before retirement/superannuation.
• Also, in case of the sudden demise of an employee (while he or she is
still in service), their nominee/beneficiary can apply for a settlement
(Form 20), or a monthly pension (Form 10D).
• PF withdrawal rules provide adequate flexibility to allow an individual
to cater to various emergency requirements using their savings.
• One can also choose to invest in other high-return investment options,
like Mutual Funds, if they have surplus funds after utilising the withdrawn
amount.
• These investment options offer a higher return than traditional savings
schemes, while tax saving Mutual Funds can also help an individual to
decrease their tax liability.
 (B) Employees’ Pension Scheme
• Under Section 6A, Government has introduced a new pension
scheme styled Employees’ Pension Scheme, 1995 w.e.f. 16.11.1995, in
place of Family Pension Scheme, 1971.
• The Employees’ Pension Scheme is compulsory for all the persons who
were members of the Family Pension Scheme, 1971. It is also
compulsory for the persons who become members of the Provident
Fund from 16.11.1995 i.e. the date of introduction of the Scheme.
• The PF subscribers who were not members of the Family Pension
Scheme, have an option to join this Pension Scheme. The Scheme
came into operation w.e.f. 16.11.1995, but the employees, including
those covered under the Voluntary Retirement Scheme have an
option to join the scheme w.e.f. 1.4.1993.
• Minimum 10 years contributory service is required for entitlement to
pension. Normal superannuation pension is payable on attaining the
age of 58 years. Pension on a discounted rate is also payable on
attaining the age of 50 years. Where pensionable service is less than
10 years, the member has an option to remain covered for
pensionary benefits till 58 years of age or claim return of contribution/
withdrawal benefits.
• The Scheme provides for payment of monthly pension in the following
contingencies:
a) Superannuation on attaining the age of 58 years;
b) Retirement;
c) Permanent total disablement;
d) Death during service;
e) Death after retirement/ superannuation/permanent total
disablement;
f) Children Pension; and
g) Orphan pension.
• The amount of monthly pension will vary from member to member
depending upon his pensionable salary and pensionable service.
• The formula for calculation of monthly members pension is as under:

Members Pension = Pensionable Salary x (Pensionable Service + 2) / 70

• In case where the contributory service is less than 20 years but more
than 10 years, monthly pension is required to be determined as if the
member has rendered eligible service of 20 years. The amount so
arrived shall be reduced at the rate of 3 per cent for every year by
which the eligible service falls short of 20 years, subject to maximum
reduction of 25 per cent.
• A separate formula for pension has been prescribed for the members
of the ceased Family Pension Scheme, 1971.
• In the case of members who contributed to the Family Pension
Scheme for 24 years, the minimum amount of pension will be Rs. 500
per month. Depending upon the retirement date, the amount of
pension for such members may go even beyond Rs. 800 per month.
• The Family Pension members retiring in November, 1995 after having
membership of only 10 years will also get a minimum pension of Rs.
265 p.m.
• In addition, such Family Pension members will get back their full
provident fund including the employers share along with interest
accumulated in their account upto 15.11.1995.
(a) The rate of minimum widow pension is Rs. 450 p.m. The maximum
may go upto Rs. 2,500 p.m. payable as normal members pension
on completion of nearly 33 years of service. Family pension upto Rs.
1,750 p.m. is also payable to the widow of the member who has
contributed only for one month to the pension fund.
(b) In addition to the widow pension, the family is also entitled to
children pension. The rate of children pension is 25 per cent of
widow pension for each child subject to a minimum of Rs. 115 p.m.
per child payable upto two children at a time till they attain the
age of 25 years.
c) If there are no parents alive, the scheme provides for orphan pension @ 75
per cent of the widow pension payable to orphans subject to the minimum
of Rs. 170 p.m. per orphan. The scheme has been amended making
dependent parents eligible for pension. Further disabled children are also
made eligible for life long pension.

• Under the Pension Scheme, the employees have an option to accept the
admissible pension or reduced pension with return of capital.
• In the case of employee opting for 10% less pension than the actual
entitlement, the scheme provides for return of capital equivalent to 100 times
of the original pension in the event of death of the pensioner.
• For example, if the monthly pension is Rs. 2,000 p.m. and the employee opts
for reduced pension of Rs. 1,800 the family will have refund of the capital
amounting to Rs. 2,00,000 on death of the pensioner.
• In addition, the widow and two children will continue to get pension for life or
upto the age of 25 years, as the case may be.
• Under the Scheme, neither the employer nor the employee is required to
make any additional contribution. A Pension Fund has been set up from
16.11.95, and the employers share of PF contribution representing 8.33% of
the wage is being diverted to the said Fund.
• All accumulations of the ceased Family Pension Fund have been merged in
the Pension Fund. The Central Government is also contributing to the Pension
Fund at the rate of 1.16% of the wage of the employees.
 (C) EMPLOYEES’ DEPOSIT-LINKED INSURANCE SCHEME

• The Act was amended in 1976 and a new Section 6B was inserted
empowering the Central Government to frame a Scheme to be called the
Employees’ Deposit-Linked Insurance Scheme for the purpose of providing life
insurance benefit to the employees of any establishment or class of
establishments to which the Act applies.
• The Central Government has accordingly framed the Employees’ Deposits-
Linked Insurance Scheme, 1976. It came into force on the 1st August, 1976.

Features Of Employees Deposit Linked Insurance Scheme

• EDLI applies to all employees with a basic salary under Rs. 15,000/- per month.
If the basic salary is above Rs. 15,000 per month, the maximum benefit is
capped at Rs. 6 lakh. With effect from 28.04.2021, the EPFO has increased the
maximum benefit to Rs.7 lakh.
• The claim amount under EDLI is 35 times the average monthly salary in the
past 12 months, subject to a maximum of Rs 7 lakh.
• There is no need for the employees to contribute to EDLI. Their contribution is
required only for EPF.
• Under the EDLI, a bonus of Rs. 1,50,000/—is available. With effect from
28.04.2021, the bonus has increased to Rs.1.75 lakh.
• The Ministry increased the minimum benefit amount to Rs.2.5 lakh in Feb 2018,
which was valid for two years. The EPFO has extended this minimum amount
of Rs.2.5 lakh with retrospective effect from 15th Feb 2020.
• Any organisation that has more than 20 employees needs to register for EPF.
Therefore, any employee who has an EPF account automatically becomes
eligible for the EDLI scheme.
• There are no exceptions to the insurance coverage provided by EDLI. It
protects the insured person round the clock, all around the world.
• An employer can opt for another group insurance scheme, but the benefits
offered must be equal to or more than those offered under EDLI.
• As per the provisions of the EDLI, the contribution of an employer must be
0.5% of the basic salary or a maximum of Rs. 75 per employee per month. If
there is no other group insurance scheme, the maximum contribution is
capped at Rs. 15,000/- per month.
• For all calculations under EDLI, the dearness allowance must be added to
the basic salary.

EDLI Scheme Eligibility

• The following criteria need to be fulfilled for an employee to avail of
coverage under EDLI:
• Employees' basic salary is up to Rs.15,000. When the employee's salary
exceeds Rs.15,000, the maximum benefit paid under the EDLI will be Rs.7
lakhs.
• The employee's organisation should have more than 20 employees to opt for
the EDLI scheme.
Benefits Of EDLI Scheme
• The EDLI scheme gives free insurance coverage to an employee's family
members in the event of his/her death during the term of active service.
• The employer's contribution towards EDLI is minimal, but the benefit paid
under the scheme is significant to assist the deceased employee's family
financially.
• There are no exclusions under the EDLI scheme. Thus, every employee is
covered, irrespective of their designation or salary.
• The employee's family will receive the death benefit even if the employee
dies in a foreign country.
• The EDLI scheme is an employee welfare measure promoted by employers
and the government; thus, life insurance benefits are guaranteed.
• The EDLI scheme boosts employees' morale by giving insurance coverage to
employees and securing their family members after their death.
• The chief motive of the EDLI scheme is to offer financial security to the
policyholder’s (deceased person) family members. Family members mean
spouses, unmarried daughters or male children up to 25 years of age. The
employee cannot choose which of the three schemes, EPF, EPS or
EDLI, he/she wants to opt for, but they are transferable with any change in
the job. The new employer will continue to make payments in the existing
account only.
Contribution By Employee & Employer To EPS, EPF And EDLI
The employer makes the contribution to these schemes on behalf of the
employees. The employee contribution is deducted from the salary before they
credit the salary. Employees themselves need not make any direct payment to
these schemes. Contributions by the employee and employers are as follows

EPFO Scheme Employee Employer

Contribution Contribution
EPF 12% of Basic + DA 3.67% of Basic +DA
EPS N/A 8.33% of Basic + DA
EDLI N/A 0.5% (max Rs 75)

However, under Section 17 (2A) of the Employees' Provident Fund and

Miscellaneous Provisions Act 1952, an employer can stop contributing to the
EDLI scheme if they opt for a better employee insurance policy under a
different scheme.
Calculation Of EDLI Charge
• The registered nominee will receive a lump-sum payout in the event of the
death of the insured person.
• If no nominee or beneficiary is registered, then the amount would be paid to
the legal heir.
• With effect from 28.04.2021, the pay-out to be awarded will be calculated as
under:
• 30 days x Average Monthly salary of the Employee for the last 12 months
(capped at Rs 15,000).
• Furthermore additional bonus of Rs. 2,50,000 will also be given
• Total = Rs 4,50,000 (15,000*30 days) + Rs. 2,50,000 (Bonus) = Rs 7,00,000 benefit.
• Therefore, the maximum payout under EDLI is capped at Rs. 7,00,000/-.

DETERMINATION OF MONEYS DUE FROM EMPLOYERS

(i) Determination of money due
• Section 7A vests the powers of determining the amount due from any
employer under the provisions of this Act and deciding the dispute
regarding applicability of this Act in the Central Provident Fund
Commissioner, Additional Provident Fund Commissioner, Deputy Provident
Fund Commissioner, or Regional Provident Fund Commissioner. For this
purpose he may conduct such inquiry as he may deem necessary.
• Central Government has already constituted Employees Provident Fund
Appellate Tribunal, consisting of a presiding officer who is qualified to be a
High Court Judge or a District Judge with effect from 1st July, 1997 in
accordance with provisions of Section 7D.
• The term, service conditions and appointment of supporting staff are
governed by Sections 7E to 7H. Any person aggrieved by
order/notification issued by Central Government/ authority under Sections
1(3), 1(4), 3, 7A(1), 7C, 14B or 7B (except an order rejecting an application
for review) may prefer an appeal. The tribunal shall prescribe its own
procedure and have all powers vested in officers under Section 7A.
• The proceedings before the tribunal shall be deemed to be a judicial
proceeding within the meaning of Sections 193 and 228 and for Section
196 of Indian Penal Code and Civil, 1908, it shall be deemed to be a Civil
Court for all purposes of Section 195 and Chapter XXVI of Code of
Procedure.
• The appellant can take assistance of legal practitioner and the
Government shall appoint a presenting officer to represent it.
• Any order made by the Tribunal finally disposing of the appeal cannot be
questioned in any Court.
(ii) Mode of recovery of moneys due from employers
• Section 8 prescribes the mode of recovery of moneys due from employers by
the Central Provident Fund Commissioner or such officer as may be authorised
by him by notification in the Official Gazette in this behalf in the same manner
as an arrear of land revenue. Recovery of arrears of Provident Fund cannot be
effected from unutilised part of cash-credit of an industrial establishment

(iii) Recovery of moneys by employers and contractors

• Section 8A lays down that the amount of contribution that is to say the
employer’s contribution as well as the employee’s contribution and any
charges for meeting the cost of administering the Fund paid or payable by an
employer in respect of an employee employed by or through a contractor,
may be recovered by such employer from the contractor either by deduction
from any amount payable to the contractor under any contract or as a debt
payable by the contractor.
• A contractor from whom the amounts mentioned above, may be recovered
in respect of any employee employed by or through him, may recover from
such employee, the employee’s contribution under any scheme by deduction
from the basic wages, dearness allowance and retaining allowance, if any,
payable to such employee.
• However, notwithstanding any contract to the contrary, no contractor shall be
entitled to deduct the employer’s contribution or the charges referred to
above from the basic wages, dearness allowance and retaining allowance
payable to an employee employed by or through him or otherwise to recover
such contribution or charges from such employee.
 Case Laws

Case1 : The Daily Pratap V. The Regional Provident Fund Commissioner Punjab
Haryana, Himachal Pradesh and union territory, Chandigarh, Air 1999 SC 2015

Case2: Regional Provident Fund Commissioner v. Sanatandharam girls

Secondary School And Others, (2007) 1 SCC 268

Case3: District Exhibitors’ Association Muzaffar Nagar And others v. Union Of

India And Others, 1991 Air 1381

Case4: The Regional Provident Fund Commissioner v. Central arecanut &

Cocoa Marketing And Processing Co-operative limited (2006) 2 SCC 381