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A LECTURE BY

KESHAV KORGAONKAR (BA., LL.B(GEN), DIR&PM, DLL&LW, MPM, DIP CYBER LAW)

Subject: The Employees Provident Fund and Miscellaneous Provisions Act, 1952

The Employees Provident Fund and Miscellaneous Provisions Act, 1952 is

enacted by Central and enforced by both the Central as well as the State Governments.

AIM This Act is enacted to provide a kind of social security to Industrial workers. This social security, however, differs from the social security provided under EC Act or ESI Act. This Act mainly provides retirement or old age benefits. It provides substantial security, timely monetary assistance to Employees and their family members.

APPLICATION This Act is applicable –

(a) to whole of India except the state of Jammu and Kashmir.

(b) To every factory engaged in any industry specified in schedule I to the Act and employees 20 or more persons;

(c) To every other establishment employing 20 or more persons specified by the Central Govt. in this behalf.

(d) Any establishment employing less than 20 persons can also be covered voluntarily

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• On an application made to the CPF commissioner • Stating that the employer and the majority of employees agree to the

applicability of the act to the establishment

(e) An establishment to which this Act applies shall continue to be governed by this Act even if the number of persons employed therein at any time falls below twenty.

This Act is not applicable –

Categories of establishment mentioned in Section 16.

ELIGIBILITY

1. Any person including who is employed by or through a contractor for wages in any kind of work, manual or otherwise in connection with the work of an establishment where the salary is up to Rs.15000/- per month is eligible to be covered under the EPF Scheme.

2. The said person is eligible to be optionally covered where salary exceed Rs.15000/- per month.

3. Any person who is classified as disabled employee working in private establishment where the salary is up to Rs.25000/- per month is eligible to become a member as per the new para 82 of EPF scheme.

4. With effect from 1st November 2008, any person who is classified as an International workman as per Para 83 of EPF scheme should be covered under EPF Scheme and the contributions is payable on the total salary irrespective of where the salary is paid.

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What does this Act include?

This Act includes : (i) Employees’ Provident Fund Scheme (ii) Employees’ Pension scheme (iii) Employees’ Deposit-linked Insurance Scheme.

Some Important Definitions

Basic wages : It means all emoluments earned by an employee while on duty or on leave with wages in accordance with the terms of employment and which are paid or payable in cash to him, but does not include; (i) the cash value of the food concession (ii) allowances payable to him (iii) any presents made by the employer

Employee : It means any person who

• is employed for wages • in connection with the work of an establishment • who gets wages directly or indirectly from the employer • includes any person employed by or through a contractor

Employer :

In relation to a factory establishment, as per section 2(e) of the act, the employer means:

• the owner or occupier,

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• including his agent , • the legal representative of a deceased owner or occupier • manager of the factory

In relation to other establishments

• the person who has the ultimate control over the affairs of the establishment.

IMPORTANT PROVISIONS

SCHEMES

Employees' Provident Fund Scheme for the purpose of establishing the provident fund benefits to the employees.

Employees' Pension Scheme for the purpose of providing superannuation pension, retiring pension or permanent total disablement pension to the employees of any establishment, Widow or widower's pension, children pension or orphan pension payable to the beneficiaries of such employees.

Employees' Deposit-linked Insurance Scheme for the purpose of providing life insurance benefits to the employees of any establishment which the Act applies.

CONTRIBUTION

Each employer shall, in respect of an employee employed by him either directly or through a contractor

• pay 12 percent of the basic wages, dearness allowance and retaining allowance (only in cases where retaining allowance is being paid) payable to such employee subject to maximum Rs.15000 p.m.

Each employee shall contribute to the Provident Fund

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• an amount equalling the contribution made by the employer,

but shall be free to make a contribution over and above the sum made by the employer, but in such a case, there shall be no obligation on the employer to match such excessive contribution made by the employee.

Amount of employee contribution goes PF account (A/c.1 employee share) Out of 12 percent of employers contribution 8.33% subject to maximum Rs.1250/- goes in to the account of pension (A/c. 10). Rest goes in account of PF (A/c.1 employer share). Contribution starts from first day of employment. Contribution is payable on or before 15th of every month. Employer also has to contribute towards: EDLI (A/c.21) at 0.50% of aggregate salary. Administrative charges (A/c.2) on PF at 0.85% or Rs.500/- whichever is higher. In case no employee, Rs. 75/-. Administrative charges on EDLI at 0.01% of aggregate salary or Rs.200/- whichever is higher. In case no employee, Rs. 25/-. Contribution starts from first day of employment. Contribution is payable on or before 15th of every month.

DETERMINATION OF MONEY FROM EMPLOYERS

Section 7.A provides that ANY Provident Fund Commissioner may:

• In a case where a dispute arises regarding the applicability of this Act to an establishment, decide such dispute; and

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• Determine the amount due from any employer under any provision of this Act.

Review of Orders passed under sub-section 1 of section 7(A) Any person

• who is aggrieved by an order passed,

• but from which no appeal has been preferred under the Act and

• who, from the discovery of new and important matter of evidence, desires to have the order made reviewed, may apply for a review of that order to the officer who made the order.

EMPLOYEES’ PROVIDENT FUND APPELLATE TRIBUNAL

• The Central Govt may constitute one or more employees’ provident fund appellate tribunal which shall have jurisdiction in respect of establishments situated in such area as notified in notification constituting the tribunal.

• A tribunal shall consist of only one person who will be the presiding officer

A person cannot be the presiding officer of a tribunal unless he is, or has been, or is qualified to be,-

(i) a judge of a high court; or (ii) a district judge

Appeals to Tribunal Any person

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• who is aggrieved by an order fixing the moneys due from the employers,

• or an order either allowing or denying the review contemplated,

• or an order determining the escaped amounts, can prefer an appeal to the Appellate Tribunal,

• the Tribunal may, after giving sufficient opportunities to all those concerned, pass such orders as it thinks fit, either confirming or altering the order appealed against.

• It may also send the case back to the authority which passed the order appealed against, with such directions for disposing of the case, as it may think fit, or even direct a fresh adjudication.

• No appeal by the employer shall be entertained by a Tribunal unless he has deposited with it seventy-five percent of the amount due from him as determined by an officer referred to in Sec.7A

Orders of Tribunal

• A Tribunal after giving the parties to present their case may pass orders as it think fit or,

• Refer the case back to authority concerned,

• A Tribunal may within five years from the date of its order may amend its order with a view to rectify its mistake.

• A Tribunal shall send a copy of every order passed to the parties to the appeal.

• Any order made by a Tribunal finally disposing of an appeal shall not be questioned in any court of law.

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INTEREST BY EMPLOYER

The employer shall be liable to pay simple interest at the rate of twelve percent per annum or at higher rates on any amount due from him under this Act from the date on which the amount has become due, till the date of its actual payment. The Higher rates of interest specified in the scheme shall not exceed the lending rate of interest charged by any Scheduled Bank. DEDUCTION BY PRINCIPAL EMPLOYER FROM CONTRACTORS BILL

The principal Employer is entitled to deduct the contributions and administrative charges due in respect of the contractor and the contractor's employees from the contractor's bills. The Contractor is entitled to deduct the employee’s contribution from their wages. EMPLOYERF NOT TO REDUCE WAGES

No employer can reduce the wages of any employee either directly or indirectly so as to minimise the liability towards PF. The employer cannot split the total wages payable to employees into several allowances in such a way that the said allowances do not form part of basic wages thereby encouraging the subterfuge of splitting of wages to exclude the PF liability.

RECOVERY OF DAMAGES

Employer is liable to pay damages the moment he commits a default in the payment of any contribution to the Fund, provided that before levying and recovering such damages, the employer shall be given a reasonable opportunity of being heard.

PROTECTION AGAINST ATTACHMENT (1) amount standing to the credit of any member in Fund or of any exempted employee in a provident fund shall not in any way be capable of being assigned or charged and shall not be liable to attachment under any

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decree or order of any court in respect of any debt or liability incurred by the member or the exempted employee, and neither the official assignee appointed under the Presidency Towns Insolvency Act, 1909 (3 of 1909) nor any receiver appointed under the Provincial Insolvency Act, 1920 (5 of 1920), shall be entitled to have any claim on, any such amount. (2) Any amount standing to the credit of a member in the fund or of an exempted employee in a provident fund at the time of his death and payable to his nominee under the Scheme or the rules of the provident fund shall, subject to any deduction authorised by the said Scheme or rules, vest in the nominee and shall be free from any debt or other liability incurred by the deceased or the nominee before the death of the member or of exempted employee and shall also not be liable to attachment under any decree or order of any court. (3) The provisions of sub-section 1 and sub-section 2 shall, so far as may be, apply in relation to the pension or any other amount, payable under the Pension Scheme and also in relation to any amount payable under the Insurance Scheme as they apply in relation to any amount payable out of the Fund. PRIORITY OF PAYMENT OF CONTRIBUTION OVER OTHER DEBTS Where any employer is adjudicated insolvent or, being a company, an order for winding up is made, the amount due - (a) from the employer in relation to an establishment to which any Scheme or the Insurance Scheme applies in respect of any contribution payable to the Fund or, as the case may be, the Insurance Fund damages recoverable under section 14B, accumulations required to be transferred under sub-section 2 of section 15 or any charges payable by him under any other provision of this Act or of any provision of the Scheme or the Insurance Scheme; or (b) from the employer in relation to an exempted establishment in respect of any contribution to the provident fund or any insurance fund in so far as it relates to exempted employees, under the rules of the provident fund or any insurance fund, any contribution payable by him towards the Pension Fund under sub-section 6 of section 17, damages recoverable under section 14B or any charges payable by him to the appropriate Government under any provision of this Act, or under any of the conditions specified under section 17, shall where the liability therefore has accrued before the

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order of adjudication or winding up is made, be deemed to be included among the debts which under section 49 of the Presidency Towns Insolvency Act, 1909 (3 of 1909) or under section 61 of the Provincial Insolvency Act, 1920 (5 of 1920) or under section 530 of the Companies Act, 1956 (1 of 1956), are to be paid in priority to all other debts in the distribution of the property of the insolvent or the assets of the company being wound up, as the case may be.

Duties of Employer’s [Para – 36 & 36A of EPF Scheme, 1952]

(i) To enroll every employee, other than an excluded employee and furnish its details to P.F. authorities in Form-9;

(ii) To obtain declaration in Form-11 from every new employee; (iii) Generation of Monthly ECR & challan;

(iv) Remittence of dues on or before every 15th;

(iv) Family/Nominee details in Form-2 and forward it to the P.F. authority;

(v) To submit initially and as and when there is any change, particulars of

ownership in Form-5A; (vi) The employer is required to endorse the application seeking

settlements / transfers in respect his employees, as and when it becomes due, and forwarded the same to the P.F. authorities for needful action;

(vii) To maintain an inspection note book for recording observation upon

inspection of the establishment by an Inspector;

(viii) To carry out the directions, if any issued, by P.F. authorities for the purpose of carrying out the requirement of the act and the schemes framed thereunder;

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(ix) To exhibit the compliance details for general information of the members, and allow inspection of contribution card details if desired;

Provisions Relating to “Contractors Employees”

� Liability enjoined with the employer of the establishment whose work is done, i.e., the principal employer.

� Provisions apply uniformly with regular employees of the establishment.

� Contractors unit has no locus-standi separately for the purpose of

applicability [Section 2(f) & 6 of the Act];

� Principal employer is empowered to recover the contribution & other charges from the contractor [Section 8A of the Act];

� Principal employer is authorized to obtain requisite details relating to

engagement of contractors employees and other related information from the Contractor;

� The Contractor is liable to submit such details / information to the Principal employer every month / as and when required.[Para 36B of the Scheme];

� Principal employer to secure the requirement from the Contractor and

ensure reporting compliance [Para 30 & 32 of the Scheme];

� Failure/default will entail principal employers’ liability with attendant penal measures.

SUPREME COURT RULING ON RESPONSIBILITY OF “PRINCIPAL EMPLOYER”

II. Regulatory points for consideration

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� To be an employee it is necessary that the relationship of master and servant exists;

� For establishing master and servant relationship the authority of the employer to supervise and control the work of the employee is prime requirement;

� In determining the element of supervision and control, physical

presence of the worker or overseeing their operational performance personally by the employer, nor working in the employers’ place are essential. Even working at home of the worker suffice;

� Authority of the employer or employers agent providing specification

requirement of the work and right to rejection has been recognized as adequate yardstick to meet the requirement.

Employment classification attracting liability :-

� Persons engaged by/through contractor with or without the knowledge and/or approval of the employer of the establishment;

� Persons working with the material, finance or otherwise, assistance from the employer or through agent of the employer/contractor;

� Work need not be carried on at employers’ place. Working elsewhere

or even at the home of the worker shall attract the liability. Case reference : 1. Mangalore Ganesh Beedi Works vs. UOI [AIR 1974 (SC) 1832] 2. P.M. Patel & Ors. vs. UOI & Ors. [AIR 1987 (SC) 447] “Contractors Employees” Compliance under the EPF & MP Act, 1952 – Suggested course for safeguarding employers statutory liability:

(1) Obtain copy of the wage/salary payment scroll from the Contractor;

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(2) Ensure remittance of Provident Fund contributions in respect of employees engaged by or through contractors;

(3) Ensure verification/identification process upon entry/exit ;

(4) Obtain requisite details relating to submission of returns in regard to,

contractors employees” on month to month basis;

(5) Periodically verify correctness of direct compliance if any made by the contractor in respect of contract employees;

(6) Correlate release of security deposit with compliance clearance.

PENAL PROVISIONS

Non filing of returns and failure to remit the PF dues is punishable with imprisonment or fine as prescribed in the paragraph 76 of EPF Scheme or with both. An Employer shall be punishable with imprisonment up to three years and fines up to Rs.10000/- as per section 14 of EPF Act and Sections 405/406/409 of Indian Penal Code, if

❖ the employer deducts the workmen share from the wages or other

remuneration of a workman and fails to remit the same through returns.

❖ the employer submits a false return or makes a false declaration

❖ the employer obstructs any Inspector or other official appointed

under the Act for this scheme in discharge of his duties

❖ the employer fails to produce any record for inspection by such

Inspector or Official

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SOME IMPORTANT POINTS FROM EPF SCHEME

2(f)“excluded employee” mean—

(i) an employee who, having been a member of the Fund, withdrew the

full amount of his accumulations in the Fund under clause (a) or (c) of

sub-paragraph (1) of paragraph 69;

(ii) an employee whose pay at the time he is otherwise entitled to

become a member of the Fund, exceeds [fifteen thousand rupees]

per month;

Explanation : --‘Pay’ includes basic wages with dearness allowance [retaining

allowance (if any) and cash value of food concessions 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;

2(g) “family” means—

(i) in the case of a male member, his wife, his children, whether married or

unmarried, his dependant parents and his deceased son’s widow and children:

Provided that if a member proves that his wife has ceased, under the personal

law governing him or the customary law of the community to which the spouses

belong, to be entitled to maintenance she shall no longer be deemed to be a part

of the member’s family for the purpose of this Scheme, unless the member

subsequently intimates by express notice in writing to the Commissioner that she

shall continue to be so regarded; and

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(ii) in the case of a female member, her husband, her children, whether married

or unmarried, her dependant parents, her husband’s dependant parents and her

deceased son’s widow and children:

Provided that if a member by notice in writing to the Commissioner expresses her

desire to exclude her husband from the family, the husband and his dependent

parents shall no longer be deemed to be a part of the member’s family for the

purpose of this Scheme, unless the member subsequently cancels in writing any

such notice.

Explanation -- In either of the above two cases, if the child of a member [or as the

case may be, the child of a deceased son of the member] has been adopted by

another person and if, under the personal law of the adopter, adoption is legally

recognised, such a child shall be considered as excluded from the family of the

member;

26. Classes of employees entitled and required to join the fund

(1)(a) 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 day this paragraph comes into force in such factory or other establishment.

(b) 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 also be entitled and required to become a member of the fund

from the day this paragraph comes into force in such factory or other

establishment if on the date of such coming into force, such employee is a

subscriber to a provident fund maintained in respect of the factory or other

establishment or in respect of any other factory or establishment (to which the

Act applies) under the same employer:

Provided, that where the Scheme applies to a factory or other establishment on

the expiry or cancellation of an order of exemption under section 17 of the Act,

every employee who but for the exemption would have become and continued as

a member of the Fund, shall become a member of the Fund forthwith.

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(2) After this paragraph comes into force in a factory or other establishment,

every employee employed in or in connection with the work or that factory or

establishment, other than an excluded employee, who has not become a member

already shall also be entitled and required to become a member of the Fund from

the date of joining the factory or establishment.

(3) An excluded employee employed in or in connection with the work of a

factory or other establishment, to which this Scheme applies shall, on ceasing to

be such an employee, be entitled and required to become a member of the Fund

from the date he ceased to be such employee.

(4) On re-election of an employee or a class of employees exempted under

paragraph 27 or paragraph 27-A to join the Fund or on the expiry or cancellation

of an order under that paragraph, every employee shall forthwith become a

member thereof.

(5) Every employee who is a member of a private provident fund maintained in

respect of an exempted factory or other establishment and who but for

exemption would have become and continued as a member of the fund shall, on

joining a factory or other establishment to which this Scheme applies, become a

member of the fund forthwith.

(6) Notwithstanding anything contained in this paragraph [an officer not below

the rank of an Assistant Provident Fund Commissioner] may, on the joint request

in writing, of any employee of a factory or other establishment to which this

Scheme applies and his employer, enroll such employee as a member or allow

him to contribute more than rupees [rupees six thousand and five hundred] of his

pay per month if he is already a member of the Fund and thereupon such

employee shall be entitled to the benefits and shall be subject to the conditions of

the Fund, provided that the employer gives an undertaking in writing that he shall

pay the administrative charges payable and shall comply with all statutory

provisions in respect of such employee.

26A. Retention of membership

(1) A member of the Fund shall continue to be member until he withdraws under

paragraph 69 the amount standing to his credit in the Fund or is covered by a

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notification of exemption under section 17 of the Act or an order of exemption

under paragraph 27 or paragraph 27A.

Explanation: In the case of claim for refund by a member under sub-paragraph (2)

of paragraph 69, the membership of the fund shall be deemed to have been

terminated from the date the payment is authorised to him by the authority

specified in this behalf by Commissioner irrespective of the date of claim.

(2) Every member employed as an employee other than an excluded employee, in

a factory or other establishment to which this Scheme applies, shall contribute to

the Fund, and the contribution shall be payable to the Fund in respect of him by

the employer. Such contribution shall be in accordance with the rate specified in

paragraph 29:

Provided that subject to the provisions contained in sub-paragraph (6) of

paragraph 26 and [in paragraph 27], or sub-paragraph (1) of paragraph 27-A,

where the monthly pay of such a member exceeds [six thousand and five hundred

rupees] the contribution payable by him, and in respect of him by the employer,

shall be limited to the amounts payable on a monthly pay of [six thousand and

five hundred rupees] including [dearness allowance, retaining allowance (if any)

and] cash value of food concession]

SOME IMPORTANT POINTS FROM EPS

4. Payment of contribution

(1) The employer shall pay the contribution payable to the Employees' Pension

Fund in respect of each member of the Employees' Pension Fund employed by

him directly or by or through a contractor.

(2) It shall be the responsibility of the principal employer to pay the contributions

payable to the Employees' Pension Fund by himself in respect of the employees

directly employed by him and also in respect of the employees employed by or

through a contractor.

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Provided that the Central Government shall pay the contribution payable to the

Employees’ Pension Fund in respect of an employee who is a person with

disability under the Persons with Disabilities (Equal Opportunities, Protection of

Rights and Full Participation) Act, 1995 (1 of 1996) and under the National Trust

for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and

Multiple Disabilities Act, 1999 (44 of 1999) respectively, up to a maximum period

of three years from the date of commencement of membership of the Fund.

6. Membership of the Employees' Pension Scheme

Subject to sub-paragraph (3) of paragraph 1, the Scheme shall apply to every

employee --

(a) who on or after the 16th November, 1995, becomes a member of the

Employees' Provident Fund Scheme, 1952, or of the Provident Funds of the

factories and other establishments exempted by the appropriate Government

under section 17 of the Act, or in whose case exemption has been granted under

paragraph 27 or 27-A of the Employees' Provident Fund Scheme, 1952, from the

date of such membership; (b) who has been a member of the ceased Employees'

Family Pension Scheme, 1971 before the commencement of this Scheme from

16th November, 1995; (c) Who ceased to be a member of the Employees' Family

Pension Scheme, 1971 between 1st April, 1993 and 15th November, 1995 and

opts to exercise his option under Paragraph7; (d) who has been a member of the

Employees' Provident fund or of Provident Funds of factories and other

establishments exempted by the appropriate Government under section 17 of the

Act or in whose case exemption has been granted under Paragraph 27 or 27A of

the Employees' Provident Fund Scheme, 1952, on 15 th November, 1995 but not

being a member of the ceased Employees' Family Pension Scheme, 1971 opts to

exercise his option under paragraph 7]. 13. Subs. by G.S.R.134 dated 28th

February, 1996 (w.e.f. 16th March, 1996) Explanation – An employee shall cease

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to be the member of Pension Fund from the date of attaining 58 years of age or

from the date of vesting admissible benefits under the Scheme, whichever is

earlier.

6A. Retention of membership

A member of the Employees' Pension Fund shall continue to be such member till

he attains the age of 58 years or he avails the withdrawal benefit to which he is

entitled under para 14 of the Scheme, or dies, or the pension is vested in him in

terms of para 12 of the Scheme, whichever is earlier." ] 14. Inserted by G.S.R.

dated 22nd February 1999 (w.e.f. 6.3.99)

7. Option for joining the Scheme—

(1) Members referred to under sub-para (c) of Paragraph 6 who have died

between 1st April, 1993 and 15th November, 1995 shall be deemed to have

exercised the option of joining the Scheme on the date his death.

(2) Members referred to in sub-paragraph (c) of paragraph 6 who are alive shall

have the option to join the Scheme as per the provisions of paragraph 17 from the

date of exit from the employment.

(3) Members referred to in sub-paragraph (d) of paragraph 6 shall have the option

to join the Scheme as per the provisions of Paragraph 17 from 16th November,

1995.] 15. Subs. by G.S.R.134 dated the 28th February, 1996 (w.e.f 16th March,

1996)

20. Duties of Employers.

(1) Every employer shall send to the Commissioner within three months of the

commencement of this Scheme, a consolidated return of the employees entitled

to become members of the Employees' Pension Fund showing the basic wage,

retaining allowance, if any, and dearness allowance including the cash value of

any food concession paid to each of such employees;

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Provided that if there is no employee who is entitled to become a member of the

Employees' Pension Fund, the employer shall send a "Nil" return.

(2) Every employer shall send to the Commissioner within fifteen days of the close

of each month a return in respect of the employees leaving service of the

employer during the preceding month.

Provided that if there is no employee leaving service of the employer during the

preceding month the employer shall send a "NIL" return.

(3) Every employer shall maintain such accounts in relation to the amounts

contributed by him to the Employees' Pension Fund as the Central Board may,

from time to time, direct and it shall be the duty of every employer to assist the

Central Board in making such payments from the Employees' Pension Fund to his

employees as are sanctioned by or under the authority of the Central Board.

(4) Notwithstanding anything contained in this paragraph, the Central Board may

issue such directions to the employers for the purpose of implementing the

Scheme, and it shall be the duty of every employer to carry out such directions.

21. Employer to furnish particulars of ownership.

Every employer in relation to a factory or other establishment to which the Act

applies or is applied hereafter shall furnish to the Commissioner particulars of all

the branches and departments, owners, occupiers, directors, partners, managers

or any other person or persons who have the ultimate control over the affairs of

such factory or establishment and also send intimation of any change in such

particulars, within fifteen days of such change, to the Commissioner by registered

post.

22. Duties of contractors

Every contractor shall, within seven days of the close of every month, submit to

the principal employer a statement showing the particulars in respect of

employees employed by or through him in respect of whom contributions to the

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Employees' Pension Fund are payable and shall also furnish to him such

information as the principal employer is required to furnish under the provisions

of this Scheme to the Commissioner.

SOME IMPORTANT POINTS FROM EDLI

8. Mode of payment of contribution. –

(1) The contribution by the employer shall be remitted by him together with

administrative charges at such rate as the Central Government may fix from time

to time under sub-section 4 of Section 6C of the Act, to the Insurance Fund within

fifteen days of the close of every month by a separate bank draft or cheque or by

remittance in cash in such manner as may be specified in this behalf by the

Commissioner. The cost of remittance if any, shall be borne by the employer.

(2) It shall be the responsibility of the employer to pay the contribution payable

by himself in respect of the employees directly employed by him and also in

respect of the employees employed by or through a contractor.

(3) The Central Government shall credit its contribution to the Insurance Fund as

soon as possible after the close of every financial year.

(4) The Commissioner shall deposit the bank draft or cheque received from the

employers in the State Bank of India or any Bank specified in the First Schedule to

the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of

1970).

9. Employer’s contribution not to be deducted from the wages of the

employees. –

Notwithstanding any contract to the contrary, the employer shall not be entitled

to deduct the employer�s contribution payable by him under this Scheme from

the wages of the employees or to recover it from them in any other manner.

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10. Assurance benefit to whom payable. –

(1) The nomination made by an employee under Employees� Provident Funds

Scheme, 1952, or under the provident fund exempted under section 17 of the Act,

as the case may be, shall be treated as nominations under this Scheme and the

assurance amount shall become payable to such nominee or nominees.

(2) If no nomination subsists or if the nomination relates only to part of the

amount standing to his credit in the Fund or of a provident fund exempted under

section 17 of the Act, as the case may be, the whole amount or the part thereof

to which the nomination does not relate, as the case may be, shall become

payable to the members of his family in equal shares:

Provided that no share shall be payable to –

(a) sons who have attained majority;

(b) sons of a deceased son who have attained majority;

(c) married daughters whose husbands are alive;

(d) married daughters of a deceased son whose husbands are alive;

if there is any member of the family other than those specified in clauses (a), (b),

(c) and (d): Provided further that the widow or widows, and the child or children

of a deceased son shall receive between them in equal parts only the share which

that son would have received if he had survived the employee and had not

attained the age of majority at the time of his death.

(3) In any case to which the provisions of sub-paragraphs 1 and 2 do not apply the

hold amount shall be payable to the person legally entitled to it.

(4) If a person who is eligible to receive assurance Scheme benefit of the

deceased member in terms of sub-paragraph 1,2 or 3 is charged with the offence

of murdering the member or for abetting in the commission of such an offence,

his claim to receive assurance benefit shall remain suspended till the conclusion

of the criminal proceedings instituted against him. If on the conclusion of the

criminal proceedings, the person concerned is : -

(a) convicted for the murder or abetting the murder of the member, he shall be

debarred from receiving his share of deposit linked assurance benefit which shall

be payable to other eligible members of any of the family; or

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(b) acquitted of the charge of murdering or abetting in the murder of the

member, his share shall be payable to him.

Explanation. – For the purpose of this paragraph an employee’s posthumous

child, if born alive, shall be treated in the same way as a surviving child born

before his death.