Nagpur: Employees Provident Fund Office (EPFO), Nagpur dealt a severe blow to Shantinagar headquartered pharmaceutical company, Unijules Life Sciences Limited, which defaulted in depositing its employees’ provident fund subscriptions with the EPFO, and recovered Rs 2,48,94,005, payable to company as insurance claim. As many as 410 employees, who were retrenched by the company, are thus benefited with their EPF dues on the eve of Diwali.
According to details, Unijules Life Sciences Ltd company’s head quarters are at Shantinagar while its manufacturing unit is based at Kalmeshwar. The company defaulted in depositing the EPF subscriptions of its 410 employees, from March 2012 to March 2015, with EPFO Nagpur. The EFP deduction is 12% of an employee’s basic salary and the company adds to it the equal amount as company’s share and the total is deposited with the EPFO. During enquiry, the EPFO found that the company defaulted in depositing the employees’ EPF subscriptions and also retrenched its 410 employees from Kalmeshwar based factory, and stopped production.
The aggrieved employees repeatedly demanded their EPF dues of 3 years, but the company did not take any action to pay their dues. When the employees approached the EPFO, it ordered the company to deposit Rs 2,48,94,005 with the EPFO, which the company failed to do. As result, the company’s Axis Bank account (Lakadganj) was freezed in August 2015, but there was no sufficient balance in the account.
Rs 5 crore demanded as compensation
The company had insured the factory for Rs 5 crore. The company claimed the insured amount due to fire accidents and heavy rains in the factory in June 2013, February 2014 and July 2014 in which company’s raw material, machinery and equipment, goods and records, etc, were destroyed. The necessary panchanama was made and Rs 5 crore were claimed from Oriental Insurance Company. The company however settled the claim to the tune of Rs 3 crore.
SBI too had claimed recovery
The company had borrowed crores worth loan from State Bank of India (SBI), branch at Kolaba (Mumbai). When factory was shut down, the SBI lodged its claim for recovery of loan overdue. EPFO had sent to letter to the company informing it that under EPF Clause 11, the EPFO has first claim on its liabilities, and it is the personal liability of the company, failing which the company will have to face legal action, and the insurance company was also accordingly intimated.
Oriental Insurance Co. was hesitant
Oriental Insurance Company was hesitant to listen to EPFO, and as it had received SBI’s letter before EPFO’s intimation, it had set the mind to first address the claims of SBI. As EPFO was very strict with the company, the company approached the regional office of EPF, but in vain. Ultimately, the insurance company on October 15 handed a cheque of Rs 2,48,94,005 to EPFO, and made payment of Rs 10 lakh to Employees State Insurance Corporation (ESIC). Remainder (of Rs 3 crore) amount was paid to SBI.
Surprisingly, the company which had claimed that its all factory material, raw material and other things were destroyed in fire restarted functioning. EPFO report says that the company has not taken back the old employees and its Kalmana unit has started functioning.
It was a step in social interest
EPF Commissioner, Nagpur, Agnimesh Mishra said that the step take against the company was in social interest. Though in the beginning the Unijules and Oriental Insurance Co. tried to pressurize the EPFO, but as it was the question of saving the affected employees from exploitation, the EPFO acted tough to protect the poor employees. According to him, once any company is shut down, the first right of benefits goes to employees, and the EPF amount is a part of the benefit.
Even Assistant Commissioner EPF, R R Verma held the similar views. If we had become late in taking suitable measures to protect the employees, the insurance company would have paid the whole amount of Rs 3 crore to the SBI, he added. According to him, The EPFO recovered Rs 53,92,439 as EPF; Rs 31,09,384 as interest on it and Rs 63,92,182 as penalty.
Company at a glance
Under the provisions of Companies Act, Unijules Life Sciences Ltd was registered. Faiz Zakir Vali (Nagpur) was made head of the company. As per record, company’s board of directors comprised Faiz Zakir Vali (Nagpur), Vinayak Gopala (Mumbai), Nitish V Shastri (Nashik), Mohammad Vali (Nagpur), Shehare Bano Vali (Nagpur), Rajiv K Jiddewar (Mumbai) and Shamishtha Khobragade (Mumbai). It also alleged against the company that it retrenches its employees after 6 months, rather than regularizing them.