014-SLLR-SLLR-2006-V-1-SPORTSMAN-TEA-PVT-LTD-.-vs.-COMMISSIONER-GENERRAL-OF-LABOUR-AND-OTHERS.pdf
CA
Sportsman Tea (Pvt) Ltd., ys
Commissioner General of Labour and Others (Sriskandarajah, J.)
93
SPORTSMAN TEA (PVT) LTD.,vs
COMMISSIONER GENERAL OF LABOUR AND OTHERS
COURT OF APPEALSRIPAVAN, J. ANDSRI SKANDARAJAH, J.
C. A. 335/2002SEPTEMBER 19. 2004
Employees Provident Fund Act, sections 31 and 32 – Payment of arrears-Inquiry-Opportunity not given to peruse documents-Breach of natural justice-Reasons for decision-ls it necessary ?
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Sri Lanka Law Reports
(2SCB) 1 Sri L R.
The 3rd respondent former Director of the petitioner company, complainedto the 1st respondent that a certain sum being arrears of E. P. F. dues has notbeen paid to him. An inquiry was held by the Assistant Commissioner ofLabour, 2nd respondent and after written submissions were filed, the 2ndrespondent (Assistant Commissioner of Labour) sought certain clarificationsfrom the petitioner company. The company informed the 2nd respondent thatas the inquiry is concluded, order could be made on the material submitted.The 2nd respondent thereafter requested the company to pay a certain sum asE.P.F. dues and the surcharge.
The petitioner company contended that the 2nd respondent has failed togive the petitioner an opportunity to examine the documents on which the 2ndrespondent is said to have made the order, and that he has not given reasonsfor his order.
Held:
The documents that are relied upon by the Commissioner of Labourand the decision of the Board of Directors, at the meeting held on28.02.1995 to arrive at this decision are not new documents ; theoriginals, of these documents are in the possession of the petitioner.
The powers of the Commissioner of Labour under the EPF Act are notonly to determine claims but also to call for documents (Section 31)and to examine any record or documents relating to any provident fundor scheme (section 32). In this instance, the 2nd respondent havingthe material necessary in his possession had called for the originalswhich were in the possession of the petitioner, but the petitioner hadfailed and neglected to produce same.
The 2nd respondent in his affidavit had stated that he has relied on themarked documents, and the reasons are in the departmental file,which was disclosed to court.
In the absence of a statutory requirement to give reasons there is norequirement to give reasons.
However, if the Commissioner fails to give his reasons to courtexercising judicial review, an inference may well be drawn that theimpugned decision is ultra vires and relief granted on this basis.
APPLICATION for a writ of certiorari.
CA
Sportsman Tea (Pvt) Ltd., vs
Commissioner GeneraI of Labour and Others (Sriskandarajah, J.)
95
Cases referred to :Ceylon Printers and another vs. Commissioner of Labour and Others- (1998) 2 Sri LR 29
Kusumawathie & Others vs. Aitken Spence Co. Ltd and Another (1996)2 Sri LR 19
Percy Wickremasekera for petitioner.
M. Fernando, Senior State Counsel for 1 st and 2nd defendants.
Cur.adv.vult.
SRISKANDARAJAH, J.The petitioner is a limited liability company. In this company the 3rdrespondent was functioning as a Director from 1993 to 20th of September1998. The position of the petitioner is that the 3rd respondent resignedfrom the company after the chairman had detected some alterations inbills submitted by the 3rd respondent for reimbursement of money. Duringthis period the 3rd respondent was not paid a salary but he was onlyentitled to a share of profit. 3rd respondent thereafter made a claim throughhis lawyer a sum of Rs. 5,000,000 or 4.3 million plus a vehicle for him tocompletely sever his connection with the company (P1). The petitionercompany arrived at a settlement with the 3rd respondent to pay a totalsum of Rs. 780,870 out of which 225,000 for transfer of his shares in thecompany to the chairman and Rs. 555,870 for his services to the company.The respondent accepted these sums and gave a letter that he has nofurther claims from the company (P4). Thereafter the AssistantCommissioner of Labour Mr. M. R.. Kannangara by his letter of 22nd May2000 called upon the petitioner company to pay a sum of Rs. 245,000being arrears of Employment Provident Fund dues to the 3rd respondentand the surcharge. The petitioner company took up the position that the3rd respondent was never an employee of the company and that therefore,the question of paying him provident fund dues does not arise (P6 & P8).The 2nd respondent summoned the parties for an inquiry and after severaldates of inquiry oral and written submissions were made. Thereafter the2nd respondent by his letter of 05.11.2001 sought certain clarificationsregarding the basis on which monthly payments have been made to the
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Directors, the statement of salaries paid to the other Directors and thedecision made at the board meeting on 28.02.1994 to increase the monthlysalary of Directors. The petitioner company in response to the above letterinformed the 2nd respondent that the inquiry has been already concludedand the decision may be given on the material before him. The 2ndrespondent by his letter of 15.01.2002 conveyed his order to the petitionercompany requesting the company to pay the 3rd respondent Rs. 123,000as Employees Provident Fund dues and the surcharge. The petitionersubmitted that the 2nd respondent has failed to give the petitioner anopportunity to examine the material on which the 2nd respondent wassaid to have made this order and this is a breach of the rules of naturaljustice.
The 2nd respondent submitted that an inquiry commenced with thecomplaint (P11) and the reply (P12). Written submissions of both partieswere tendered and they made oral submissions on two days. He furthersubmitted that as certain matters needed further clarifications, hedispatched (P15) requesting the petitioner to tender further documents.As the petitioner refused to tender further documents he considered theavailable documents and having been satisfied that the 3rd respondenthad been remunerated monthly and also been satisfied that theEmployment Provident Fund contribution with regard to the 3rd respondenthas not been forwarded to the department of Labour by the petitionermade order to pay the Employees Provident Fund dues and the surcharge.Under these circumstances the petitioner cannot complain that he wasnot given a fair hearing. The Senior State Counsel who appeard on behalfof the 1 st and 2nd Respondents produced the Department file in court andsubmitted that the copy of the minutes of the Board of Directors meetingheld on 28th February 1994 containing the decision that the monthly salaryof the Directors had been increased is filed of record.
The powers of the Commissioner of Labour under the EmployeesProvident Fund Act is not only to determine claims but also to call fordocuments (Section 31) and to examine any records or documents relatingto any provident fund or pension scheme (Section 32). In this instant casethe 2nd respondent having the materials necessary in his possession hadcalled for the originals which were in the possession of the petitioner butthe petitioner failed and neglected to produce the same.
CA
Sportsman Tea (Pvt) Ltd., i/s
Commissioner General of Labour and Others (Sriskanda/ajah, J.)
97
The Petitioner complained that he was not given an opportunity to perusethe documents on which the 2nd respondent relied upon to arrive at hisdecision. He relied on the judgment in Ceylon Printers LtdandAnothervWeerakoon, Commissioner of Labour and others1'' where Gunasekara Jheld;
“In view of the failure by the Commissioner to give the appellants anopportunity of challenging the new material on which he acted, theCommissioner is under a duty to give reasons for his decision, particularlyin view of the fact that it was not he who held the inquiry and recordedthe evidence. In the result, the order of the Commissioner was in breachof the principles of natural justice”.
This judgment is not applicable in this instant case as the documentsthat are relied upon by the Commissioner of Labour namely P13a, P13band the decision of the Board of Directors at the meeting held on 28.02.1995to arrive at his decision are not new documents. The originals of thesedocuments are in the possession of the petitioner.
The Petitioner further submitted that the 1 st respondent has not givenreasons for his decision that was communicated to him by letter markedP17. In Kusumawathe and others vAitken Spence & Co. Ltd* and anotherthe court held;
“that in the absence of a statutory requirement to give reasons fordecisions or a statutory appeal from a decision, there is no requirementof Common Law or the principles of natural justices that a Tribunal oran Administrative Authority should give reasons for its decision, even ifsuch decision has been made in the exercise of a statutory discretionand may adversely affect the interest of the legitimate or reasonableexpectations of other persons.
Per Silva, J
“the finding that there is no requirement in law to give reasons shouldnot be construed as a gateway to arbitrary decisions and orders. If adecision that is challenged is not a speaking order, when notice isissued by a Court exercising judicial review, reasons to support it have
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to be disclosed. Rule 52 of the SC Rules 1978 – is intended to afford anopportunity to the respondents for this purpose ; the reasons thusdisclosed form part of the record and are in themselves subject to review.Thus if the Commissioner fails to disclose his reasons to Court exercisingjudicial review, an inference may well be drawn that the impugned decisionis ultra vires and relief granted on this basis."
The 2nd respondent in his affidavit has stated that he has relied on thedocuments marked P13a, P13b (the audit reports which give the monthlyremunerations of the Directors) and having been satisfied that the 3rdrespondent had been remunerated monthly and also been satisfied thatthe Employee’s Provident Fund contribution with regard to the 3rdrespondent had not been forwarded to the Department of Labour he madethe order marked as P17. The reasons for the decision are also in thedepartment file of the 2nd respondent which was disclosed to court by thelearned Senior State Counsel. Therefore the petitioner cannot complainthat there is a violation of the rules of natural justice. The decision of theCommissioner is based on the documents, the originals of which were inthe possession of the petitioner and the petitioner had not made any attemptto controvert the facts contained in these documents other than statingthat the copies of the documents which were submitted to the Commissionerare not duly signed or authenticated by any person. Therefore thesubmissions of the petitioner that the decision of the Commissioner is inexcess of his jurisdiction and without any material has no merit. Underthese circumstances the petitioner is not entitled for the relief claimed for.I dismiss this application without costs.
SRIPAVAN, J. -1 agree.
Application dismissed.