SC Allows Clubbing Of Two Establishments As One For The Purposes Of The PF

SC allows clubbing of two establishments as one for the purposes of the PF as there was unity of ownership, management, control, finance, labour and functional integrity

In a landmark judgement the Supremem Court ruled that "When two establishments are run by the same family under a common management with common work force and with financial integrity, they are expected to be treated as branches of one establishment for the purposes of the Provident Fund Act".

In appeal case L.N. Gadodia & Sons & ANR. Vs. Regional Provident Fund Commissioner, the firm argued that the authorities had clubbed two establishments as one and demanded provident fund contribution from both. It argued that they were in separate business enterprises and registered as separate private limited companies.

However, the Delhi high court and the Supreme Court accepted the contention of the PF Commissioner that they were not separate entities. It said that the tests in such cases was whether there was unity of ownership, unity of management and control, unity of finance and unity of labour and unity of functional integrity.

Regards,

Kamal
7th October 2011 From India, Pune

Dear Kamal, Do you have any supporting annexure from supreme court in the subject matter if any, please enclosed Regards Ravi Rudra Singh
7th October 2011 From India, Dehra Dun

Dear All,
I am adding few more files on clubbing of establishment for EPF coverage.
I request the members to go through them and add few more valuable points on this issue for the benefit of our fellow members.
with warm regards,
S.Sethupathy,
Excellent HR Services.
7th October 2011 From India, Coimbatore

Attached Files (Download Requires Membership)

EPF-Clubing two units Sec 2 and 7A.zip (4.12 MB, 399 views)