The lapse on the part of the Regional Provident Fund Commissioner is more than the Employee and Employer

The Eps 95 pension latest news today:

Why EPFO is insisting that Option under Para No: 26(6) of Employees’ Provident Fund Scheme, 1952 and Option under Proviso to Para No: 11 (3) of Employees’ Pension Scheme, are to be exercised only during the service of the Employee and not after attaining the age of 58 years?

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Para No: 26(6) of Employees’ Provident Fund Scheme, 1952:

This Para No: 26(6) is existing for a long back.

1) Whenever the Wages of an Employee cross the Ceiling of 300/-, 500/-, 1,000/-, 1,600/-, 2,500/-, 3,500/-, 5,000/-, 6,500/- and now 15,000/- from time to time, during his service, he along with the Employer has to make a request in writing to the concerned Regional Provident Fund Commissioner, to allow them to contribute on Full Wages to Provident Fund i.e., both by the Employee and Employer. Then the designated Officer in the Office of the Regional Provident Fund Commissioner i.e., Assistant Provident Fund Commissioner, allows the Employee and Employer to contribute on Full Wages again in writing.

2) When an Employee joins with Wages of more than the Ceiling, he along with his Employer and the Assistant Provident Fund Commissioner has to do the same as stated above.

In both cases, the Employer has to give his consent in writing to pay Administrative Charges @ 0.65% of the Wages (present rate) of the Employee to the Provident Fund Commissioner, 

Here there are two aspects:

1) Submission of the request in writing in the Prescribed Form and giving consent in writing in the Prescribed Form.

2) Actual act of Contributing over and above the Ceiling both by the Employee and Employer. And the actual act of paying Administrative Charges over and above the Ceiling.

Action under (2) was completed in the case of all Employees wherever necessary during the service of the Employee. 

Action under (1) was not discharged both by the Employer and Employee and also the Assistant Provident Fund Commissioner. 

Example: A is an Employee in an Unexempted Establishment. The date of the Appointment is 01-01-1995. 

His starting Wages are 4,000/- as of 01-01-1995 when the Ceiling is 5,000/- i.e., below the Ceiling. His Wages were increased by 300/- per year. Hence he has drawn 4,300/- from 01-01-1996, 4,600/- from 01-01-1997, 4,900/- from 01-01-1998 and 5,200/- from 01-01-1999.

The Employee is Mandatory Member under the Employees’ Provident Fund Scheme, 1952 from 01-01-1995 to 31-12-1998, and from 01-01-1999 he became an “Optional Member” because he reached the Wages of 5,200/- which is more than the Ceiling of 5,000/-. Then he has to submit the request along with his Employer, that he and his Employer contribute 624/- (12% of 5,200/-) equally and also subsequently till Retirement (not till the age of attaining 58 years which is for EPS,’95) whenever his Wages are further increased due to annual increments. 

At the same time the Employer also pays Administrative Charges @ 0.65% on 5,200/- i.e., 34/- instead of 0.65% on Ceiling Wages of 5,000/- i.e., 33/-(Maximum under Ceiling of 5,000/-) i.e., 1/- more (because the rise is marginal by 200/- above Ceiling of 5,000/-) and continues to pay Administrative Charges on the future increase from time to time till retirement. 

And the concerned Regional Provident Fund Commissioner has also accepted the Contribution towards Provident Fund on 5,200/- Wages which are above the Ceiling of 5,000/- from 01-01-1999 without verifying whether the Employees forwarded his request along with the Employer in writing and continued to accept P.F. recovery on Wages which are on the rise every year due to annual increments and also periodical pay revision exceeding Ceiling till retirement. By adding interest as per the rates declared by EPFO from year to year paid as settlement to the Employee on retirement under Para No: 69 of the Provident Fund Scheme.

The Regional Provident Fund Commissioner also accepted Administrative Charges over and above the Ceiling Wages without verifying the consent of the Employer in writing till retirement on increased Wages from time to time. The accepted extra Administrative Charges are not refunded even though there is no written consent from the Employer in this regard.

Even though there is a lapse on the part of the Employee along with the Employer there is also lapse on the part of the Regional Provident Fund Commissioner. 

Further Employee and Employee may not be known because they are working in a Factory whose activity is different in the field of manufacture.

But Regional Provident Commissioner is the implementing authority for EPF & MP Act, 1952 and he must be more responsible. 

However the actual act of Contribution towards Provident Fund over and above the Ceiling  and payment of Administrative Charges over and above the Ceiling took place during the service of the Employee. 

The only act of formally forwarding the request i.e., Option under Para No: 26 (6) of EPFS,’52 is not done during the service of the Employee which is a minor lapse. 

And the minor lapse is also on the part of the Regional Provident Fund Commissioner. And the further lapse on the part of the Regional Provident Fund Commissioner is the acceptance of Administrative Charges over and above the Ceiling. 

Thus the lapse on the part of the Regional Provident Fund Commissioner is more than the Employee and Employer. 

Then is it justifiable for EPFO now to reject 1) Options under Proviso to Para No: 11 (3) of EPS,’95 on the plea that the above Employee not exercised Option under Para No: 26(6) of EPFS,’52 along with the Employer during the service of the Employee, 2) Reverting to Pension under Ceiling after paying Higher Pension for some time, citing the above reason. 3) Not taking further action on the Option of the Employee under Proviso to Para No: 11(3) which was acknowledged due to the above lapse on the part of the Employee and Employer?

The above article is in the case of Employees from Unexempted Establishments where the Employer’s Contribution is on Full Wages and who attained 58 years on or before 31-08-2014 and also applicable to Employees who are going to attain 58 years on or after 01-09-2014 and also from Unexempted Establishments where the Employer’s Contribution is on Full Wages.

G. Srinivasa Rao, Mobile No: 89851 72459 & WhatsApp No: 86398 71817