Clarifies on News Item

• Security Code: 532719
• Company: BLKASHYAP

With reference to news item appearing on leading financial daily tilted "In a Season of Scams, the Biggest PF Fraud Surfaces", B. L. Kashyap and Sons Ltd has submitted to BSE a copy of Clarification in this regard.

Announcement:

"We have all along been complying with all the statutory requirements under the various Acts applicable to us including the Provident Funds Act. We have always been complying with all the legitimate and legal directives and/or demands being raised by the department from time to time.

The order passed by the RPFC is totally erroneous, misconceived and perverse on various grounds, including that those ‘employees’ who are construed to be ‘excluded employees’ under the EPF Act, have also been included. This is contrary to the fact and records.

No employee has complained against us. Moreover, no benefiary(ies) for whom the alleged recovery is being made, have been identified.

It can be verified that we are making more EPF contributions than any of the other construction companies though their turn over is more than us.

The PF authorities have mechanical and without application of mind just picked up the Head ‘Wages and benefits’ appearing in the yearly balance sheets and imposed PF on the same. In fact this head includes payments to skilled workers, payments to un skilled workers, payments to sub-contractors with materials, payments to sub-contractor without material, welfare benefits and expenses and PF contribution on un-skilled labour wages and other miscellaneous expenditures. The Sub Confractors are complying with their PF obligations and have their independent code numbers. Most of the Skilled workers are drawing salary above Rs. 6500/- and are hence excluded employees and not covered under the EPF Act. Even the PF contributions deposited with respect to the unskilled workmen amounting to crores of Rupees are included under this head. There cannot be any question of imposing PF on PF contributions itself. These categories constitute substantial of the head ‘wages and benefits' which could not have been taken into account at all, Further, they did not summon the contractors who have independent code numbers and were duly complying with the provisions under the Act with respect to the employees, Further; the order has been passed in haste and without any proper opportunities the matter and present our case.

PF Authorities have not passed the order on the basis of any evidence or material regarding non compliance or any grievance of any beneficiary but on the basis of mere conjectures, assumptions
and surmises. It may be pertinent to note that due to the aforesaid erroneous assumptions the demand raised is in fact more than the net profit that the Company has earned since its inception until now.

The Order is not based on facts. Merely because they have found some alleged discrepancies they have assumed that the entire work force for several years whether covered under the Act or not, whether the compliance is being made by the sub contractors or not is liable and covered under the PP scheme, which is erroneous and not as per law.

We are in the process of examining the order and shall take appropriate legal recourse/remedies available to us at the earliest."