Authority: High Court at Calcutta, Circuit Bench at Jalpaiguri

Order Date: 12.06.2026

Case Overview

  • Parties: Petitioner – Mahesh Gurbaxani; Respondents – State of West Bengal & Anr.; PF Authority – represented by Mr. Bhaskar Roy Mahasaya.
  • Proceeding Origin: Complaint lodged by Dil Bahadur Sherpa, Enforcement Officer, Employees Provident Fund Organization on 07.09.2015, alleging that Dimdima Tea Garden, Birpara deducted Rs 20,37,276 from employee wages as the employee’s share of EPF contribution for Feb‑2015 to Jul‑2015 but failed to deposit the amount with the statutory fund.
  • Criminal Case: FIR registered as Birpara Police Station Case No. 185 of 2015 (dated 07.09.2015) under Sections 406/409 IPC read with Section 14 of the Employees' Provident Funds & Miscellaneous Provisions Act, pending before the Additional Chief Judicial Magistrate, Alipurduar (GR Case No. 2597 of 2015).
  • Petitioner’s Position: Mahesh Gurbaxani was an Independent (non‑executive) Director of Dimdima Tea Garden and resigned on 01.01.2015, i.e., one month before the period of alleged default.
  • Company’s Payment: The outstanding EPF amount of Rs 20,37,276 was eventually paid by the company in 2018 (three years after the default). The PF Authority accepted the payment; the PF Commissioner certified receipt of contributions for TRRN Nos. 4751804001340, 4751804001341, 4751907003213, 144751806002421, 4751907003206, 14751907003205, 4751804001342, 4751806002416.
  • Respondent’s Argument: Acknowledged that the dues were paid but emphasized the three‑year delay and submitted a written instruction dated 17.07.2025 confirming full receipt of the employee’s share.
  • Legal Precedents Cited:
  • Shiv Kumar Jatia vs. State of NCT of Delhi – vicarious liability of directors requires specific allegation of active role and mens rea.
  • Horticulture Experiment Station vs. Regional Provident Fund – default in EPF contribution triggers Section 14B damages irrespective of mens rea.
  • Dayle De' Souza vs. Government of India – a corporate entity cannot be imprisoned but may be fined; prosecution must fail if the company cannot be prosecuted.
  • Section 14A of EPF Act – persons in charge of the company at the time of offence can be deemed guilty, provided specific allegations are made.
  • Multiple Supreme Court judgments (Kamalkishor Shrigopal Taparia, K.S. Mehta, National Small Industries Corp., N.K. Wahi, S.M.S. Pharmaceuticals, Pooja Ravinder Devidasani) emphasizing that mere directorship without active involvement does not attract criminal liability.
  • Court’s Reasoning: The petitioner resigned before the default period; no specific averments linked him to the EPF default; the company (the employer) is the liable entity under the EPF Act; the payment has been made and accepted; therefore, the offence is not prima facie established against the petitioner.

Final Outcome

  • The revision application (CRR 179 of 2025) is allowed.
  • The criminal proceeding (Birpara Police Station Case No. 185 of 2015) is quashed with respect to Mahesh Gurbaxani.
  • All connected applications are disposed; any interim orders are vacated.
  • The trial court is directed to comply with this judgment and furnish a certified copy as required.

Topics: EPF Default, Director Liability