Schemes under Act - Employees Provident Fund & Miscellaneous Provision Act(1952), Industrial Laws Video Lecture | Industrial Laws - B Com

hello friends today we will discuss all
the concepts related to Employees
Provident Fund and miscellaneous
provisions Act 1952 this topic is a part
of IPCC paper - law ethics and
communications and it's number that is
chapter 5 and as for me I am CA Paradiso
now your mentor for this particular
chapter then let's check out what's the
main objective of the Employees
Provident Fund and miscellaneous
provision Act here the main intention is
to enforce all the provisions related to
three things firstly a Provident Fund
scheme secondly a pension scheme and
thirdly deposit linked Insurance Scheme
let's consider the most important
concept of the chapter you could get an
out-and-out theoretical question then
please explain the Provident Fund scheme
as per Section six the entire answer
would be completed in six simple points
firstly the scheme has to be framed by
the central government in the Official
Gazette the scheme should provide for
Provident funds benefit once the scheme
is framed the Provident Fund will be set
up the fund would be administered by the
central board of trustees the employer
would contribute maximum ten percent of
the basic wages and here allowance and
retaining allowance the employee would
contribute minimum ten percent of basic
wages plus dearness allowance plus
retaining allowance and the final point
is that this scheme would provide for
all the matters which are specified in
schedule 2 of this act let's consider an
alternate theory question on the pension
scheme the entire answer would be
completed in six simple points here we
go the scheme should be framed by the
central government in the document
called the efficient
the vent the scheme should provide for
pension benefits once the scheme is
framed the employer should set up a
pension fund this bond should be
installed by the Central Board of
Trustees the employer will contribute
eight point three two percent of basic
wages during allowance and retaining
allowance the scheme should provide for
all the matters which are specified in
schedule three of the Act
another third question for you is a
deposit linked Insurance Scheme as per
Section 60 the scheme should be seemed
by the central government in the
Official Gazette that he will provide
for life insurance benefits and once the
scheme is framed a fund would be set up
and this would be admin stored by the
central board of trustees the employer
would contribute one percent of the
basic wages plus dearness allowance plus
retaining allowance finally this scheme
should provide for all the matters which
are specified in schedule four of the
Act sense let's consider the exact
meaning of the central board of trustees
and also the composition of the central
board of trustees the central board of
trustees is constituted by therefore
notification in the Official Gazette by
the central government the central board
of trustees will manage the Provident
Fund pension fund insurance fund which
is set up on the section 6 6 a and 6 C
respectively the central board of
trustees will consist of the following
persons and each of them will be
appointed by the central government
the Central Board of Trustees will
comprise off forcely the central problem
fund Commissioner the Chairman white
Jemma maximum 15 central government and
state government officials and finally
maximum ten representatives of the
employer and employees each now what
about an executive come team the
executive committee has been described
in Section five doubling the executive
committee is constituted by the open
notification in the Official Gazette by
the central government the main
objective of setting up the executive
committee is to assist the functions of
the central board of trustees a consists
of the following persons and please
remember each of them would be appointed
by the central government the central
province and commissioner the chairmen
maximum to central government officials
and finally migrant three central
government officials and representatives
of the employer and employees each let's
consider the meaning of an employee only
that employee who would be defined under
Section 2's would be eligible to claim
the benefit of Provident Fund pensions
and insurance so let's check out who are
these employees an employer your would
mean any person including an apprentice
and employed even indirectly through a
contractor and finally please remember
that employer has the same meaning which
is given in payment of bonuses 1965
let's consider the establishment to
which this act is applicable now why
this is important if it only is you are
an employee defined in section 2 and
that to open establishments covered
under Section 1 subsection 3
then only you will have a right to claim
robbing fund pension and insurance
benefits so let's check out step-by-step
in six points what kind of
establishments are covered under section
one subsection three so here we go
firstly it's applicable to every factory
but the factory should fulfill two
conditions condition number one the
factory should be engaged in a schedule
one industry and condition number two
such a factitious have minimum twenty
employees then any establishment with
minimum two employees but please
remember the ones the number of
employees crosses 20 this act will be
applicable even if subsequently the
number of employees falls below twenty
fair enough
any establishment which would be
notified by the open notification in the
Official Gazette by the central
government evenness lesser than 20
employees so there's an additional and
interesting point that they employer and
the majority of the employees can make
an application to the central problem
fund commissioner and as he is inspired
he would make this as applicable to such
an establishment so broadly there are
four categories for see a factory
secondly an establishment with 20
employees thirdly
an establishment notified by the
appropriate government and fourthly
voluntarily
where they approached the Central
Provident Fund commit a frequently asked
question is what is the minimum
contribution under Section six here we
go just in four sentences your entire
answer will be complete
firstly an employee contribute minimum
ten percent of the basic wages plus
dearness allowance plus retaining alarms
dearness allowance is given by the
employer to the employee just to cope up
with a high cost of living
retaining allowance is given by the
employer to the employee in order to
retain the employee and lastly please
remember the Tector contribution amount
is a flat agent then it should be
rounded off to the nearest rupee now
what about basic wages basic wages would
mean all wages which are received in
cash but excluding cash value food any
allowance that is house rent allowance
journal allowance retaining allowance
bonus or Commission and also excluding
any kind of present from the employer
now what about the powers of the
inspectors the inspectors would be
appointed by the government by therefore
notification in the Official Gazette
just to ensure whether the provisions of
the employees problem funds and
miscellaneous provisions Act have been
followed or not but the best part for
you is that the powers of the inspector
are same as the payment of bonus act so
you can refer to the slides
given in payment of bonus act for the
same now what about departments
undertakings and branches the best part
is that even this is the same as the
content in payment of bonds that so you
can refer to the relevant slide for the
same now please listen to this very
carefully what is the clearly related to
attachment of provident fund balance
nothing when a person becomes insolvent
Londo he is declared to be involved by
the court a person called the official
assignee is appointed to dispose of his
assets and pay off his luggages
suckee illegal assigning has been given
the power of a catchment of property of
the involved person but what about the
problem fund balance let's check it step
by step just in three simple points
falsely any balance of the problem for
the count with the employer will not be
liable for any attachment under the
order of the code no fulfill assignee
will not have any claim over this amount
and section 10 is applicable even if any
balance is payable to the legal hairs of
the deceased employed so friends you can
be rest assured the section time adds
totally and completely in favor of the
employee what are specifically exempted
establishments covered under section 16
let's consider them step by step
firstly section 16 gives the power to
the central government to exempt certain
establishments from the applicability of
this act by therefore notification in
the Official Gazette so it is very clear
that only those are some events which
are stated by the central government in
the notification will not be able to
make any contribution to problem fund
pension or life insurance following
establishments are specifically exempt
any establishment which is set up by the
central government or the state
government any establishment which is
set up on the central or state act
any newly set of establishment to three
years and lastly any cooperative society
which is having maximum 50 employees and
working without the aid of power
continuing section 16 please remember
that any other stablishment may be
exempted by the AG by the open
notification in do G after considering
the financial position and the relevant
circumstances such an exemption will be
granted only for a specific period and
subject to certain conditions now what
are authorized establishment authorized
establishments are defined under Section
16 okay now this section gives the power
to the appropriate government to
authorize certain establishments to
maintain a broaden from the ground all
right
the employer and a majority of the
employees will make an application fee
appropriate government and if the
appropriate government is satisfied then
it will grant the oxidization subjected
to following conditions now the
conditions are given in the next slide
if these particular conditions are not
fulfilled then the authorization would
be cancelled but only after giving an
opportunity to be hot now that's really
really fair enough they just can't
cancel the license just like that they
definitely will have to give an
opportunity to the establishment to be
hot now let's consider what are the
conditions
firstly the establishment should follow
the terms and conditions they should
submit are needed or they should pay the
administrative charges to the government
they should also maintain the problem
fund they should provide facilities to
the inspectors and also deposit the
contributions into the fund until as
these conditions are not fulfilled they
will not be allowed to continue with
your Provident Fund account now let's
consider
the provision related to transfer of any
Provident Fund balance
this is governed by section 17 and let's
check out what the section 17 state
section 17 a permit the transfer of
balance in any provenance and account in
case of transfer of employment so of
course this is an advantage there the
employee leaves one employment and
joined another employment the transfer
would be totally at the option of the
employee the amount could be transferred
to the new establishment it will not
make any difference whether the
employees problem fund and miscellaneous
notions act is applicable to the new
establishment or not let's consider what
is the provisions given in section 17 be
related to transfer of business see
friends when section 17 B applies it
states that when an establishment
transfers his business to another
establishment by the a of sale gift or
liens then the transferor in the
transferring are jointly and severally
liable for the contribution however the
transferee is jointly liable only to the
extent of the assets which are acquired
from the transfer or friends let's
consider a practical question related to
section 17 B please read the question
very very carefully X group of Industry
is sold as business to Y group of
industries X group of industries has
already made 25% of the contribution to
PF which was due before the date of sale
Y group of industries refused to bear
the remaining 75% liability now please
remember whenever any practical question
appears you have to answer in a simple
three-step manner step number one go to
the section
number two state what's happening in the
above case and step number three give
your conclusion so friends the same
thing which I explained to you right now
if you have to pin it down and how will
it appeal check this out
firstly we would write as per Section 17
a or B why ever written dot the dot
because you already know the contents
then you will state in the above case
and finally our conclusion would be that
why group of industries is definitely
liable for the contribution friends
let's check out what's the final summary
well all the concepts related to
Employees Provident Fund and
miscellaneous provisions as have been
explained in the order of the sections
of the Act all the theoretical concepts
having combined with practical cases
wherever possible and for best results
you could prepare a list of sections for
revision and future reference so friends
all the best and happy studying so
friends this is the a parody Cena
signing over to chapter Employees
Provident funds and miscellaneous
provisions Act thank you for being such
a wonderful audience