Dy. Commissioner Employees P. Fund v. J&K State Consumer & Ors.

High Court Legal Services Committee, Jammu, to provided legal aid counsel to the respondent no.3.

04. Be that as it may, considering the fact that the matter is pending since 2007, we have proceeded to appoint Mr. Virender Bhat, learned counsel, who is present in the Court today, to act as an Amicus curiae to represent the interest of respondent no.3 to which he readily agreed.

05. At the outset, it may be mentioned that the Consumer Forum allowed the application filed by respondent no.3 seeking interest on the aforesaid amount for the aforesaid period in the proceeding where the matter was proceeded ex-parte against the petitioner as the petitioner inspite of the proper service of notice did not appear before the Consumer Forum. The plea of respondent no.3-the complainant before the Consumer Forum was that he was an employee of the Jammu Development Authority (JDA) serving as a Khilafwarzi Officer and worked with JDA since 1992 to October 1996 during which time the said service was not pensionable, because of which, the employees of JDA were getting the benefits under the Jammu and Kashmir Provident Funds Act, 1998 by depositing their share of the Contributory Provident Fund (CP Fund) in the Office of the present petitioner with equal contribution from the employer in connection with which a CP Fund account no. JK/J/257/135 was opened in his name. According to respondent no.3, he was contributing his share in the said CP Fund Account till 1996 when the -3- services in JDA were made pensionable resulting in cessation of maintaining CP Fund accounts as they were no more required to contribute for CP Fund. According to the complainant, the amount lying in the CPF account with the petitioner, i.e., ₹ 56,668/- was required to be transferred to the parent department, i.e., JDA by the petitioner along with the prevalent rate of interest but according to the complainant, inspite of numerous requests made by him, the said amount was not transferred by the petitioner but the same was transferred belatedly in the month of May 2005 without any interest, though in respect of other employees who had approached the petitioner, their amounts were duly transferred. Accordingly, alleging deficiency in service the complainant approached the Consumer Forum seeking compensation of ₹ 35000/- with interest @ 6 % on the ground that he has been unduly deprived of the interest which he was entitled to enjoy, along with litigation costs of ₹ 2000/-.

06. As mentioned above, the opposite party, i.e., the present petitioner before the Consumer Forum was duly notified but it seems that the petitioner did not appear before it and accordingly, the Consumer Forum proceeded exparte against the petitioner. The Consumer Forum as per the materials produced before it noted that the Senior Accountant, Deputy Commissioner, J&K, had transferred the amount of ₹ 56,668/- vide Cheque No. 4234914 dated 08.06.2005 the name of the complainant bearing refund No.43737/1436 addressed to FA and CAO of the JDA, Jammu, indicating the share of the complainant as ₹ 29823 /- and that of the as ₹ 26845/- totaling an amount of ₹ 56,668/-. The Consumer Forum also considered the grievance raised by the complainant that the aforesaid amount of ₹ 56,668/- lying with the CP Fund account was to be transferred to the account of the JDA in 1996 -4- itself which would have earned interest at the prevalent rate applicable for the GP Fund subscription but the same was not transferred by the petitioner though in respect of other employees, GP Fund amounts had been transferred along with interest. Accordingly, considering the aforesaid plea of the complainant, the Consumer Forum held that interest from October 1996 i.e., the date when the services of the employees became pensionable, to June 2005 when the CP Fund would have been required to be transferred to JDA on the aforesaid amount of ₹ 56,668/- would be required to be calculated.

07. Against the said decision of the Consumer Forum, the petitioner filed an appeal before the J&K State Consumer Disputes Redressal Commission, Jammu. The grounds taken by petitioner as an appellant before the Consumer Commission were that: i) Though the contribution towards the CP Fund was up to 1996, the complainant did not claim for transfer of his CP fund to the GP Fund Account. ii) Secondly, it was contended that as per SRO 23 issued vide Notification dated 01.02.2005, payment of interest would be restricted only for three years from the date when the subscription ceased. Thus, payment of interest has to be restricted only for three years i.e., from October 1996 to September 1999.

08. The Consumer Commission after hearing the parties was of the view that there has been deficiency in service by the appellant/ petitioner. As regards the plea of the appellant- petitioner that there was no liability to pay interest from ceasing of contribution for more than three years based on SRO 23 dated 01.02.2005, the Consumer Commission was of the view that the said -5- SRO was incorporated in the Second Proviso to Sub part 2 of Para 59 of the Scheme only on 01.02.2020 whereas ceasing of contribution towards the CP Fund started from October 1996 and, as such, since the said SRO does not have retrospective applicability, the said limitation of three years cannot be applied in the present case.

09. The Consumer Commission while referring to Paragraph 77 of the Scheme observed that when the amount standing to the credit of a member or balance thereof after any deductions under Paragraphs 74 and 76 becomes payable, it shall be the duty of the Commissioner of the Provident Fund to make prompt payment as provided under the Scheme and he shall close the account of the member and give notice in writing to the person to whom the amount is payable specifying the amount and tendering payment thereof.

10. The Consumer Commission accepted the plea of the complainant that he had approached the appellant-petitioner many times but every time his request was turned down for ulterior motives and by delaying transfer of the amount without the interest portion, the petitioner has deprived him of due interest which would have accrued to the said account. Learned Consumer Commission further proceeded to hold that there was flagrant violation of the mandates of Paragraphs 74, 76 and 77 of the Scheme, and as per the spirit of the Scheme, the deposit of ₹ 56,668/- should have earned interest from October 1996 to June 2005 when it was paid, and in case interest has been misappropriated then there is commission of cognizable office of criminal breach of trust under RPC and prima facie it appears to be a case of misconduct of the concerned public servant which requires inquiry so that the truth may come out and, accordingly, finding that there was gross inculpable deficiency in rendering service, while dismissing the appeal, the Consumer -6- Commission imposed a composite cost of litigation and damages to the tune of ₹ 30,000/- payable by the appellant for which the State and the Commissioner of the Provident Fund were jointly held liable and directed an administrative inquiry to be held by the Government to find out the delinquent hand who was responsible for such deficiency in service and recover the payable interest and costs from his earnings. The aforesaid decision of the Consumer Commission has been challenged before us.

11. The learned counsel for the petitioner has assailed the said observation of the Consumer Commission on the following grounds: (i) Firstly, it has been submitted that the Consumer Commission has not considered the applicability of SRO 23 which puts a limit on the payable interest to three years only. (ii) Secondly, it has been submitted that it was the obligation of the complainant to make the application in time in terms of Paragraph 77 of the Scheme which he had not done. He did so only in the year 2005 on the basis of which the money was transferred and, as such, there was no deficiency in service. (iii) Further, it has been submitted by learned counsel for the petitioner that the Consumer Commission went beyond its jurisdiction in directing for recovery of interest portion from the person responsible for the delay. It has been submitted that the jurisdiction of the Consumer Commission is clearly defined in Section 15 of the Jammu & Kashmir Consumer Protection Act, 1987 (hereinafter referred to as the “Act”) which does not envisage any such power to the Consumer Commission to direct holding any inquiry, and the jurisdiction of the Consumer Commission -7- is confined to deal with complaints or to entertain appeal against the District Consumer Forums between the State. Apart from these functions, the Act does not confer any jurisdiction to the Consumer Commission to hold any inquiry as well as to impose any liability with regard to any officer or to recover any such amount from the concerned officer who may be responsible for deficiency in service.

12. On the other hand, learned Amicus has submitted before us that first of all, this Court is not sitting as an Appellate Forum and, as such, this Court may not entertain the factual pleas raised for the first time before this Court. It has been submitted that it is clearly evident from the findings of the Consumer Forum as well as the Consumer Commission that there is a concurrent finding of fact as regards the deficiency in service. There is a finding of fact by the Consumer Forum that inspite of the repeated requests by the complainant, the appellant-petitioner did not transfer the CP Fund amount to the GP Fund maintained by the employee. There is thus a concurrent finding of the said fact by the Consumer Commission, and it may not be appropriate for this Court in exercise of jurisdiction under Article 226 of the Constitution to interfere with any such concurrent finding of fact by the Consumer Forum and the Consumer Commission which were competent to render such finding of fact.

13. It has been submitted that, secondly, the direction issued by the Consumer Commission for holding an inquiry cannot be said to be any major penalty and thus beyond its jurisdiction. It was merely to ascertain the state of affairs prevailing in the office of the Employees Provident Fund and as such it cannot be said that any such direction is beyond the jurisdiction of the Consumer Commission. -8-

14. Learned Amicus has also submitted that if the interest which was due was not paid, it can certainly amount to undeserved denial, even if the concerned official had not used the interest portion personally, yet it definitely amounts to denial and depriving the contributor of his due, as such, there is nothing wrong in issuing such a direction, and such power is available to the Consumer Forum under the Consumer Protection Act in addition to the other remedies available under the law and, as such, nothing wrong can be inferred from the said direction issued by the Consumer Commission.

15. We have heard learned counsel for the petitioner and the learned Amicus, and perused the materials on record.

16. We are dealing with an issue pertaining to year 2005 when the complainant alleged that he was deprived of the interest portion which he was duly entitled to after he ceased to contribute in the year 1996 after his service become pensionable under the JDA. We have noted that he had approached the Consumer Forum alleging deficiency in service by the petitioner by denying him the interest portion from October 1996 onwards, and he had specifically stated in his complaint before the Consumer Forum alleging that the petitioner-authority had transferred the CP Fund amounts of all other employees who approached the opposite party office but this was not done in the case of the complainant though the opposite party was under a duty to transfer the CP Fund amounts of all employees. It was also alleged in the said complaint (vide Para -5) that the complainant had approached the opposite party’s office a number of times but the CPF amount of the complainant was transferred only in 2005 and as such there was deficiency in service. The aforesaid allegation made in the complaint could have been rebutted by the opposite party-petitioner herein by filing objections but it appears that they -9- had not chosen to do so as they did not appear before the Consumer Forum inspite of proper service of notice. Based on the aforesaid complaint filed before the Consumer Forum, the Consumer Forum drew its own conclusion and held that the respondent-Provident Fund Commissioner was liable to pay interest on the aforesaid amount with effect from October 1996 to June 2005 when the amount was trasnferred.

17. If a complainant approaches the Consumer Forum with certain specific allegation which was not denied by the opposite party, and if the Consumer Forum comes to a conclusion based on the averments made in the complaint, it cannot be said that any such finding arrived at is irrational and without any basis. Though we have noted that in the appeal preferred by the petitioner before the Consumer Commission, it has been mentioned that the respondent complainant did not claim for his transfer of the CP Account to GP Fund after he ceased his contribution in 1996, the Consumer Commission did not believe the said version of the appellant and upheld the finding of the Consumer Forum.

18. Section 15 of the Act empowers the Consumer Commission to examine the validity of an order passed under Section 12 of the Act by the Consumer Forum and the Consumer Commission cannot pass any order which is beyond the scope of the examination of the validity of an order passed by a Consumer Forum. Section 12 provides for payment of compensation apart from rectifying the other defects by the Consumer Forum. Under Section 12 of the Act, the Consumer Forum can direct the service provider to do one or more of the following things: (a) to remove the defect pointed out by the appropriate laboratory from the goods in question; -10- (b) to replace the goods with new goods of similar description which shall be free from any defect; (c) to return to the complainant the price, or as the case may be, the charges paid by the complainant; (d) to pay such amount as may be awarded by it as compensation to the consumer for any loss or injury suffered by the consumer due to the negligence of the opposite party; (e) to remove the defects or deficiencies in the services in question; (f) to discontinue the unfair trade practice or the restrictive trade practice or not to repeat them; (g) not to offer the hazardous goods for sale; (h) to withdraw the hazardous goods from being offered for sale; (i) to provide for the adequate costs to parties. Therefore, there is no power of the Consumer Forum to direct holding of any enquiry and to fix responsibility and recover any loss from the person responsible for such deficiency in service.

19. Therefore, the Consumer Commission could not have gone beyond the nature of the relief which could be granted by the Consumer Forum by holding an inquiry as it could only examine the validity of the order passed by the Consumer Forum but cannot grant a relief which cannot be granted by the Consumer Forum.

20. The Consumer Commission and for that matter the Consumer Forum, being creatures of a special statute can exercise only such functions as may be prescribed by the statute and cannot go beyond the functions and powers prescribed by the statute. We are of the view that as the Consumer Forum had given a finding as regards the alleged non-responsiveness of the authorities in -11- not transferring the amount lying in the CPF account of the complainant to the GPF account, inspite of repeated requests by the complainant, the refusal of the Consumer Commission to interfere with the said finding by the Consumer Forum, inspite of the assertion to the contrary made at the appellate stage by the appellant-petitioner, cannot be said to be an arbitrary decision by the Consumer Commission.

21. Under the circumstances, if we uphold the finding of the Consumer Forum that office of the Provident Fund Commissioner did not act and transfer the amount inspite of the repeated requests, that would certainly amount to a deficiency in service by the office of the petitioner.

22. It is not denied before us by the Commissioner of Provident Fund that it would be liable to pay interest, but it was contended that it will be restricted to only three years, based on SRO 23 issued on 01.02.2005.

23. We are in agreement with the finding and observation made by the Consumer Commission that the SRO 23 was issued in February 2005 and the cause of action accrued prior to it, i.e., in October 1996 when the Commissioner of Provident Fund was liable to transfer the amount and as such the said SRO 23 is not applicable in the present case till 01.02.2005.

24. We are of the view that as the said SRO 23 issued on 01.02.2005 does not have retrospective application, interest would be liable to be paid by the Commissioner from October 1996 when the amount liable to be transferred from the CP Fund Account till 31.01.2005. The applicability of the SRO 23 will arise w.e.f. 01.02.2005 in which event, the interest will cease to apply after 01.02.2005. To that extent, we are also not inclined to interfere with the finding of the Consumer Commission as the Commissioner of the Provident -12- Fund would be required to pay interest up to 31.01.2005 as there was no such bar till such period.

25. However, as regards the other submission made before us that the Consumer Commission has no jurisdiction to pass any direction to the Government to hold any inquiry and fix the liability on the concerned official responsible for the delay, we are of the view that such a direction will not be within the jurisdiction of the Consumer Commission, as its power and jurisdiction would be confined to determine the validity of the order of the Consumer Forum and also to decide as to whether there was deficiency in service or not and what would be the consequences for deficiency in service and for payment of compensation etc., but any direction beyond that would be beyond the jurisdiction of Consumer Commission.

26. Accordingly, we would hold that the aforesaid direction of the Consumer Commission cannot be said to be mandatory but can be treated to be an observation, and it will be left to the wisdom of the authorities concerned to take such appropriate actions as they may deem fit in terms of such observation.

27. For the reasons discussed above, subject to what we have stated about the interest, which is payable up to 31.01.2005, and about the direction to hold enquiry to fix responsibility and to take consequential action, as not mandatory, the order impugned in the present petition does not need any interference from our end.

28. Hence, the writ petition is dismissed in terms of the above observations and directions. (PUNEET GUPTA) (N.KOTISWAR SINGH) JUDGE CHIEF JUSTICE JAMMU 30.05.2023 SUNITA/PS