Rule 65: Eligibility conditions for grant of exemption

Finin2min analysis — operative rule mechanics

Full notified text — Rule 65

65. Eligibility conditions for grant of exemption.– (1) An establishment, to be eligible to seek
exemption under section 143 shall be required to fulfil the following conditions, prior to grant of
exemption, namely: -

(a) the employees of such establishment are in receipt of benefits substantially similar or superior to
the benefits granted in the schemes framed under Chapter III or the benefits available under Chapter
IV, as the case may be, of the Code;

(b) the establishment seeking exemption shall make an application electronically or otherwise;

(c) the establishment has been complying with the provisions of Chapter III of the Code or the
Employees‘ Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952); or, the provisions
of Chapter IV of the Code or the Employees‘ State Insurance Act, 1948 (34 of 1948), as the case may
be, for a continuous period of three years immediately before making the application and has not
defaulted in payment of contribution payable under the respective Chapters during such period;

(d) the establishment seeking exemption under section 143 shall have minimum five hundred
contributory members for the purposes of Chapter III of the Code or minimum five hundred
employees for the purposes of Chapter IV of the Code, as the case may be, on the date of such
application;

(e) the establishment seeking exemption from the provisions of the Provident Fund Scheme or the
Pension Scheme framed under section 15 shall have a cumulative balance in members account of
rupees fifty crore or more in respect of the Scheme from which exemption is sought;

(f) for the purposes of the Chapter III, the establishment shall furnish consent of majority of the
employees for seeking exemption under section 143;

(g) the establishment seeking exemption should have a positive net worth during each of the last three
years before the date of application;

(h) the establishment must have seeded the Aadhaar number of each member in the respective
member‘s account for the purposes of Chapter III or that of each of insured person and his or her
family members for the purposes of Chapter IV, as the case may be, of the Code in the respective
database; and

(i) for the purposes of Chapter III of the Code, the establishment shall provide facilities for online
claim settlement and has an online portal for grievance resolution to provide linkages with that of
Employees‘ Provident Fund Organisation within ninety days of grant of exemption.

(2) The notification granting exemption under section 143 shall be issued so as to take effect from the
date of the notification and shall contain the other terms and conditions to be complied with by the
establishment and /or the employer, as the case may be.

(3) (a) The application for extension of exemption under section 143 shall be made on specified
portal, at least six months before expiry of exemption.

(b) The exemption granted to an establishment from the provisions of Chapter IV shall be extendable
by the appropriate Government for a period of five years at a time, subject to the condition that the
establishment continues to fulfil the relevant conditions in specified sub-rule (1) of rule 65 except that
in clause (d) of sub-rule (1).

(c) No exemption under the provisions of Chapter IV shall be extended without prior consultation of
the Corporation.

(d) The Corporation shall submit its views to the appropriate Government within three months of
receipt of application failing which the appropriate Government shall decide on the extension of
exemption, as it may deem fit.

(e) The exemption granted in respect of the Provident Fund Scheme or the Pension Scheme or the
Insurance Scheme, as the case may be, may be extended for such period and on such terms and
conditions as may be specified in the respective Schemes.

Application and evidence

1. Primary statutory test — (1) An establishment, to be eligible to seek exemption under section 143 shall be required to fulfil the following conditions, prior to grant of exemption, namely: - (a) the employees of such establishment are in receipt of benefits substantially similar or superior to the benefits granted in the schemes framed under Chapter III or the benefits available under Chapter IV, as the case may be, of the Code;
2. Additional operative limb — (b) the establishment seeking exemption shall make an application electronically or otherwise;
3. Numerical or timing control — (c) the establishment has been complying with the provisions of Chapter III of the Code or the Employees‘ Provident Funds and Miscellaneous Provisions Act, 1952 (19 of 1952); or, the provisions of Chapter IV of the Code or the Employees‘ State Insurance Act, 1948 (34 of 1948), as the case may be, for a continuous period of three years immediately before…
4. Code Section mapping — 143. Read the mapped provision together with this text rather than treating the concordance as a substitute for it.
5. Evidence file — retain facts and records proving the role/status of: Employer, Employee / worker, Appropriate Government, Corporation / EPFO / Board.

Cross-references & prescribed forms

Worked example

Q&A — Rule 65

Primary sources