Horticulture Experiment Station Gonikopal, Coorg Vs Regional Provident Fund Organisation
Forum-Supreme Court of India
Date-23rd February 2022
Sub-Whether element of Mens rea (guilty mind) is essential for violation of civil laws.

The Supreme Court in this case was called upon to decide that once an employer violated the law relating to deposit of PF, whether damages u/s 14B of the EPF Act 1952 was mandatory or mens rea could be claimed by the employer.

The Apex court examined the law in this regard right from the decision of two- Judge Bench judgment in Chairman, SEBI v. Shriram Mutual Fund and Another which has been relied upon by a three-Judge Bench judgment in Union of India and Others v. Dharmendra Textile Processors and others. The court refused to follow the case of Dilip N Shroff cited by the appellant and also the decision in the case of Employees State Insurance Corporation v. HMT Ltd on the pretext that the Dilip Shroff case has been overruled by the Dharmendra Textile Processors and the ESI case was decided sans the decided binding judicial precedent. Finally the appeal was dismissed and the levy of damages was held to be proper.

This judgement will again open pandora box in all civil matters including Income-tax, GST and others and the department will cite this judgement in all cases. The decision in the case of Union of India Versus M/s Rajasthan Spinning & Weaving Mills which had distinguished the decision in the case of Dharmendra Textile was neither cited nor argued.

Ramesh Patodia
24-02-2022