Dear Swastik and Aby,
Thanks for your elucidations.
I would suggest that no company mainatins two accounts for this purpose. It is always better to have one proper account, but professionally nullifying the imapct of subsidy on PF in whatever way it should be done from accounts point of view.
But, it will be quite strange if any PF officer makes much ado about food allowance, though it is explicitly intended to be just an allowance but not concession, and keeps mum over the large amount of subsidy visibly going as food concession, but hidden to the PFO because the accounts are set right to make this subsidy hidden or disappear.
Regards,
Govardhan
From India, Madras
18Thanks for your elucidations.
I would suggest that no company mainatins two accounts for this purpose. It is always better to have one proper account, but professionally nullifying the imapct of subsidy on PF in whatever way it should be done from accounts point of view.
But, it will be quite strange if any PF officer makes much ado about food allowance, though it is explicitly intended to be just an allowance but not concession, and keeps mum over the large amount of subsidy visibly going as food concession, but hidden to the PFO because the accounts are set right to make this subsidy hidden or disappear.
Regards,
Govardhan
From India, Madras
Dear Govardhan,
.
The amount cannot be hidden or made to disappear as it appears in the Audited Balance Sheet of Canteen. If you give subsidy and record it once it remains. What I was saying is that the method of apportionment of the subsidy amount.
For instance, say the Canteen has a subsidy amount of Rs. 50,000/-. Now as you know that PF is made up of both employee and employers contribution, it becomes difficult or impossible administratively to keep track of how many meals a worker had in Canteen, to determine the individual concession amount. The other thing is from practical point of view as we all know that it is not only workers but sometimes guests or outsiders are even allowed, so it is very difficult to apportion it. The other thing is never is it mandatory to have Food from Canteen even if there is subsidy(I have not seen it anywhere). So, for practical sake, the amount is not included. Please donot be of the opinion that the Employer want to evade PF in these cases. Always remember an Employer other than a Food/ Hotel Industry who has subsidsed Canteen will ever try to do something like this as they epitomises Social Commitment.
Regards,
SC
From India, Thane
.
The amount cannot be hidden or made to disappear as it appears in the Audited Balance Sheet of Canteen. If you give subsidy and record it once it remains. What I was saying is that the method of apportionment of the subsidy amount.
For instance, say the Canteen has a subsidy amount of Rs. 50,000/-. Now as you know that PF is made up of both employee and employers contribution, it becomes difficult or impossible administratively to keep track of how many meals a worker had in Canteen, to determine the individual concession amount. The other thing is from practical point of view as we all know that it is not only workers but sometimes guests or outsiders are even allowed, so it is very difficult to apportion it. The other thing is never is it mandatory to have Food from Canteen even if there is subsidy(I have not seen it anywhere). So, for practical sake, the amount is not included. Please donot be of the opinion that the Employer want to evade PF in these cases. Always remember an Employer other than a Food/ Hotel Industry who has subsidsed Canteen will ever try to do something like this as they epitomises Social Commitment.
Regards,
SC
From India, Thane
Dear Swastik,
Thanks for your further writings on the subject.
I never mentioned about intentional evasion on the part of any employer having subsidised canteen. But was only wondering how the actual food concession through subsidy legally escapes from the DA definition, and food allowance - just because the word food is associated with this allowance - becomes disputable.
Regards,
Govardhan
From India, Madras
Thanks for your further writings on the subject.
I never mentioned about intentional evasion on the part of any employer having subsidised canteen. But was only wondering how the actual food concession through subsidy legally escapes from the DA definition, and food allowance - just because the word food is associated with this allowance - becomes disputable.
Regards,
Govardhan
From India, Madras
Dear Govardhan,
Now coming to the real issue why is it like that. Well my friend Politics is raising all the confusions. You may ask what politics have to do with PF/ The answer is everything.
The situation:
PF cannot give you the high interest rate it earlier use to give i.e 12%. The Government wanted to reduce it to 8% but the best would have been at the level of Bank Interest Rate. But the Left has kept up the pressure and have not allowed the Finance Ministry to reduce the rate as per Finance Ministry's recommendation. The loss has been huge. Where will the Govt. give you that High rate when the overall rates are so low, the only option was Stock Market. The left has stalled that move also(You must have read the newspapers or seen News regarding this last year).
Now the question comes where is PF going to get this extra amount to compensate the loss. It has come up with some measures:
1) Strict inspection for compliance to get maximise collection
2) One day PF (Even if you work for a day PF must be deposited. Tell me who takes the trouble to get this amount from PF?)
The result is what you are facing. Not only you but almost everyone is facing. You will find even in this site post relating to PF always have large hits, which indicate the problems Organisations are facing.
In future the new PF Ammendment will remove the minimum number of workers and remove the Rs. 6500 basic ceiling. This will bring more people into PF.
Govardhan, EPFO is going to hit you hard and always trouble us as long as the Left continues to put pressure in making them pay more interest then they are capable of paying as per the Economic Situation.
Regards,
SC
From India, Thane
Now coming to the real issue why is it like that. Well my friend Politics is raising all the confusions. You may ask what politics have to do with PF/ The answer is everything.
The situation:
PF cannot give you the high interest rate it earlier use to give i.e 12%. The Government wanted to reduce it to 8% but the best would have been at the level of Bank Interest Rate. But the Left has kept up the pressure and have not allowed the Finance Ministry to reduce the rate as per Finance Ministry's recommendation. The loss has been huge. Where will the Govt. give you that High rate when the overall rates are so low, the only option was Stock Market. The left has stalled that move also(You must have read the newspapers or seen News regarding this last year).
Now the question comes where is PF going to get this extra amount to compensate the loss. It has come up with some measures:
1) Strict inspection for compliance to get maximise collection
2) One day PF (Even if you work for a day PF must be deposited. Tell me who takes the trouble to get this amount from PF?)
The result is what you are facing. Not only you but almost everyone is facing. You will find even in this site post relating to PF always have large hits, which indicate the problems Organisations are facing.
In future the new PF Ammendment will remove the minimum number of workers and remove the Rs. 6500 basic ceiling. This will bring more people into PF.
Govardhan, EPFO is going to hit you hard and always trouble us as long as the Left continues to put pressure in making them pay more interest then they are capable of paying as per the Economic Situation.
Regards,
SC
From India, Thane
Dear SC
PF department is one of the highest revenue earners for the Government after the Tax Department.
The thing is congress is changing its policy.
For Fifty years they strived to remove Poverty, but to no avail
AND now its time to remove the Poor.
No Poor No Poverty.
The percentage losses on oil prices reflected are actually reduced profit margins in petroleum industry. Say if previous financial year profit was around 50,000 crores and this year its 42,000 crores, Loss of 8,000 crores is highlighted whereas profit is nowhere represented.
Poor shall be eradicated by the policy of dominance and materialism which is initiated by the US.
PF department is one of the highest revenue earners for the Government after the Tax Department.
The thing is congress is changing its policy.
For Fifty years they strived to remove Poverty, but to no avail
AND now its time to remove the Poor.
No Poor No Poverty.
The percentage losses on oil prices reflected are actually reduced profit margins in petroleum industry. Say if previous financial year profit was around 50,000 crores and this year its 42,000 crores, Loss of 8,000 crores is highlighted whereas profit is nowhere represented.
Poor shall be eradicated by the policy of dominance and materialism which is initiated by the US.
This critical thing is to convince the PF Authority that PF is not applicable on Food Allowance.Interpretation can be debatable but if supported by any legal evidence and then it cannot be challenged till any change in law for the same.
Pls advise if any case laws are there to support that PF is not applicable on Food Allowance.
SJ
Pls advise if any case laws are there to support that PF is not applicable on Food Allowance.
SJ
in TATA Power Company Limited & Others Vs Regional Provident Fund Commissioner, Maharashtra & Goa & Others reported in 2008-III-LLJ-992(Bom) Hon'ble Mumbai High Court, while interpreting Explanation 1 of Section 6 of EPF & MP Act, 1952, has held that payment of food allowance, without any supply of any food item, cannot be treated as "cash value of food concession" included in Dearness Allowance by virtue of Explanation 1 of Section 6 of the EPF & MP Act. Judgment is available in my file.
From India, Ernakulam
From India, Ernakulam
Some employees of a Government company are being paid advance salary from April 2008 onwards pending finalisation of wage agreement between the Union and the Government. Company is not remitting any contribution towards EPF on this advance salary. Is it contrary to the statutory provisions? Any reported case in the matter?
From India, Ernakulam
From India, Ernakulam
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Maharashtra Special allowance Notification July 14 to Dec 14.pdf
Food .doc