EMPLOYEE’S PROVIDENT

FUND AND MISCELLANEOUS

PROVISION ACT, 1952

PRESENTED BY :
KHUSHBOO RAWAT
ANCHAL PUNDIR
ADITI GUPTA
OBJECTIVE
• The aim of the act is to provide for the institution of provident fund and
deposit-linked insurance fund employees in factories and other
establishments.
• The scheme of provident funds, as a social security measures, are meant
to induce employees to save a portion from their present earnings for a
rainy day.
 FEATURES

• The act is applicable to whole of India except the state of Jammu and
Kashmir.
• It has 20 sections and 4 schedules.
• Schedule 1: is related with the matter of industry engaged in
manufacturing.
• Schedule 2: matters for which provisions may be made in the
scheme.
• Schedule 3: matters for which provisions may be made in the pension
scheme.
• Schedule 4: matters to be provided for employees deposit linked
insurance scheme
SCHEMES

• Schemes been framed under the act by the central government:

The Employees ‘Provident Scheme 1952
The Employees’ Pension Scheme 1985
The Employees’ Deposit Linked Insurance Scheme 1976
DEFINITIONS

• APPROPRIATE GOVERNMENT: It means the central government in

relation to an establishment belonging to, or under the control of, the
central government or in relation to an establishment connected with a
railway company, a major port, mine or an oilfield or a controlled
industry, or in relation to an establishment having departments or
branches in more than one state. In relation to any other establishment,
the appropriate government means the state.
• AUTHORISED OFFICER: it means the Central provident Fund
Commission, Additional Central provident Fund Commissioner, Deputy
Provident Fund Commissioner, Regional provident Fund Commissioner or
such other officer as may be authoried by the central government,by
notification in the official Gazette.
CONTINUED…..

• BASIC WAGES: Means all emoluments which are earned by an employee

while on duty or on leave or on holidays with wages in either
• case in accordance with the terms of the contract of employment and
which are paid or payable in cash to him, but does not include-
(i) the cash value of any food concession;
(ii) any dearness allowance that is to say, all cash payments by whatever
name called paid to an employee on account of a rise in the cost of living,
house-rent allowance, overtime allowance, bonus, commission or any other
similar allowance payable to the employee in respect of his employment or
of work done in such employment;
(iii) any presents made by the employer
CONTINUED….
• CONTRIBUTION: It means a contribution payable in respect of a member,
under the Employees’ Provident Fund Scheme or the contribution payable
in respect of an employee to whom the Employees’ Deposit-linked
Insurance Scheme applies.
• EMPLOYER: in relation to an establishment which is a factory, the owner
or occupier of the factory, including the agent of such owner or occupier,
the legal representative of a deceased owner or occupier and, where a
person has been named as a manager of the factory under clause f of sub-
section 1 of section 7 of the Factories Act, 1948 (63 of 1948), the person so
named; and
• in relation to any other establishment, the person who, or the authority
which, has the ultimate control over the affairs of the establishment, and
where the said affairs are entrusted to a manager, managing director or
managing agent, such manager, managing director or managing agent;
EMPLOYEES COVERED UNDER THE
SCHEME
• Person who is employed for wages in any kind of work manual or
otherwise in or in connection with the work of the establishment
and who gets its wages directly or indirectly from the employer.
• Includes a person employed by or through a contractor in or in
connection with work of establishment.
• Person engaged in apprentice, not being apprentice under
( Apprentice act 1961 or under the Standing orders of the
establishment).
APPLICABILITY
• the act applies to every establishment which is a factory, which is
engaged in industry, specified in schedule 1 of the act in which 20 or
more workers are employed.
• Any other establishment or class of establishment employing 20 or more
persons which may be specified by central government.

NOTE: Once the act is applied it continues to apply even if the number
workers goes below 20.
NOT APPLICABLE
• Co-operative society employing less than 50 person working without the
aid of power.
• A newly setup establishment for an period of 5 years.
• Any central or state government establishment having its own scheme of
provident fund.
EMPLOYEE CONTRIBUTION
• An employee eligible for the membership of employee provident fund
whose getting salary upto Rs 6500 p.m. Now it is amendented to
Rs.15000 p.m.
• 12% of the wages is to be contributed
ADMINISTERING BODY

The board’s duties are administering the funds vested in it by means of

contributions and maintain proper accounts of its income and expenditure
in central government’s prescribed way.
Central government constitute Executive Committee to assist the central
board in the performance of its function
• Chairman, he is appointed from amongst members of central board
• 2 persons from central amongst central board
• 3 persons representing employers and 3 persons representing employees
Government CPF commissioner is to serve as CEO of Central Board, a
Financial advisor and Chief Accounts Officer to assist central provident fund
commissioner in the discharge of his duties.
The Central government also constitutes Employee Provident Fund
Appellate tribunal and it consists of only one person who is
Presiding officer. Eligibility for the presiding officer is that a person must be
the judge of high court or district court.
EMPLOYER CONTRIBUTION

• Employer is also required to contribute towards provident fund; the

deduction rate is same as employee’s contribution i.e. 12% of the
wages.
• Of this 12%, 3.67% goes to Provident Fund and the balance of
8.33% goes to Pension Fund.
VOLUNTARY CONTRIBUTION

• An employee can contribute voluntarily over and above the stipulated

rate of PF contribution by opting for Voluntary PF scheme at any rate
as he / she desires i.e up to 100% of Wages.
• However, the contribution to VPF should be a certain % of wages and not
a fixed amount.
• But the employer is not bound to contribute at the enhanced rate.
• It is suggested that the enhancement can be done at the beginning of the
financial year for comfort level of calculation.
ADVANCE PROVIDENT FUND

• A person is eligible to withdraw money in advance from their PF Account

for purposes like marriage, education, medical treatment etc, subject to
the prescribed conditions. Note that the said advance is totally tax-free
and interest-free.
 WITHDRAWAL OF PROVIDENT FUND
AND PENSION FUND
• A member is eligible to apply for withdrawing his provident fund and
pension fund only after 2 months from the date of resignation,
provided that he / she is not employed during the said 2 months.
• The member should submit Form 19 to withdraw his provident fund
dues on leaving service/retirement/termination.
• To claim pension, the member is required to submit Form 10 C.
• The member needs to fill in Forms 19 and 10c and get it signed from the
previous employer and submit it to the provident fund office (in many
cases, the employer will themselves help by submitting the forms).
• Normally, it takes about 40 days to have the monies credited to the bank
account of the member after submission of the relevant forms.
TAXABILITY
• The withdrawals are exempt from tax if the concerned employee has
rendered continuous service of more than 5 years. Otherwise, it would be
taxable at the applicable slab rates.
THE ACT PROVIDES FOR

• Grant of exemption from the operation of the schemes framed under the
Act to an establishment, to a class of employees and to an individual
employee, on certain conditions.
• Penalties to employers/trustees of exempted Provident Fund who
contravene the provision of the Act and the Scheme.
• Appointment of inspector to secure compliance under the Act and the
Schemes framed there under.
• Mode of recovery of moneys due from employers.
THANK YOU