In such a situation, EPFO will collect interest money from the employer or company and initiate recovery proceedings against him. According to the EPF Act, there is also a provision of fine for not depositing money in the PF account.
Your Provident Fund (PF) money is deducted in the company in which you work or the employer under which you work. Then this money is deposited in your PF account. This work is done every month. Every month the PF money is deducted and every month that money is deposited in the PF account. The rules of EPFO say that every month 12-12 percent of basic salary and DA will be deposited in the PF account on behalf of the employer and employee. Of the employer’s 12 per cent stake, 8.33 per cent is deposited in the Employee Pension Scheme (EPS) and the remaining 3.67 per cent goes to the PF account.
EPFO informs its subscribers every month about the money to be deposited in the PF account through SMS alerts. If an employee wants, every month by logging on to the EPFO portal, he can also know the balance of his PF account. This will let you know whether the money is getting deposited in the account or not. The company is required to deposit money in the PF account within 15 days of the release of the salary of the previous month. However, many employers are unable to deposit money in the employee’s PF account on time. In such a situation, there are many ways with the help of which employees can deposit money in PF account.
1- Make a complaint in EPFO
First of all, the employee has to file a complaint with EPFO that the employer deducts his PF money, but does not deposit it in the account. After this EPFO will inquire about that employer. If it becomes clear in the inquiry that the company deducted the money, but did not deposit it in the PF account, then EPFO will take legal action.
2- Case will be registered against the company
In such a situation, EPFO will collect interest money from the employer or company and initiate recovery proceedings against him. According to the EPF Act, there is also a provision of fine for not depositing money in the PF account. EPFO will file a case against the company under sections 406 and 409 of IPC for violation of rules.
3- This is how recovery happens
EPFO has got the right under Section 14-B under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 to recover the penalty from the company. This section is imposed when the company deducts the PF money, but does not deposit it in the employee’s account.
4- First notice, then action
Before taking legal action against the employer, the EPFO asks for the reason for not depositing the money by giving a notice. Action is initiated if the answer is not found correct. If the employer does not deposit the money in the employee’s PF account on time, then he is not given the benefit of tax exemption.