Section 131: Other modes of recovery

Finin2min analysis — what the section actually does

Full statutory text — Section 131

131. other modes of recovery.— (1) Notwithstanding the issue of a certificate to the Recovery Officer
under section 129, the Central Provident Fund Commissioner or the Director General of the Corporation,
as the case may be, or any other officer of such Social Security Organisation so authorised by it in this
behalf, may, recover the amount by any one or more of the modes provided in this section.
     (2) If any amount is due from any person to any employer who is in arrears, the Central Provident Fund
Commissioner or the Director General of the Corporation, as the case may be, or any other officer of such
Social Security Organisation authorised by it in this behalf, may, require such person to deduct from the
said amount the arrears so due, and such person shall comply with any such requisition and shall pay the
sum so deducted to the credit of the Central Provident Fund Commissioner or the Director General of the
Corporation, as the case may be, or any other officer of such Social Security Organisation so authorised by
it in this behalf:

    Provided that nothing in this sub-section shall apply to any part of the amount exempt from attachment
in execution of a decree of a civil court under section 60 of the Code of Civil Procedure, 1908 (5 of 1908).
     (3) (a) The Central Provident Fund Commissioner or the Director General of the Corporation, as the
case may be, or any other officer of such Social Security Organisation authorised by it in this behalf may,
at any time or from time to time, by notice in writing, require any person from whom money is due or may
become due to the employer or, as the case may be, the establishment or any person who holds or may
subsequently hold money for or on account of the employer or, as the case may be, the establishment, to
pay to the Central Provident Fund Commissioner or the Director General of the Corporation, as the case
may be, or any other officer authorised by it in this behalf either forthwith upon the money becoming due
or being held at or within the time specified in the notice (not being before the money becomes due or is
held) so much of the money as is sufficient to pay the amount due from the employer in respect of arrears
or the whole of the money when it is equal to or less than that amount.
    (b) A notice under this sub-section may be issued to any person who holds or may subsequently hold
any money for or on account of the employer jointly with any other person and for the purposes of this sub-
section, the shares of the joint holders in such account shall be presumed, until the contrary is proved, to be
equal.
     (c) A copy of the notice shall be forwarded to the employer at his last address known to the Central
Provident Fund Commissioner or the Director General of the Corporation, as the case may be, or any other
officer of such Social Security Organisation authorised by it in this behalf and in the case of a joint account
to all the joint holders at their last addresses so known.
    (d) Save as otherwise provided in this sub-section, every person to whom a notice is issued under this
sub-section shall be bound to comply with such notice, and, in particular, where any such notice is issued
to a post office, bank or an insurer, it shall not be necessary for any pass book, deposit receipt, policy or
any other document to be produced for the purpose of any entry, endorsement or the like being made before
payment is made notwithstanding any rule, practice or requirement to the contrary.
    (e) Any claim respecting any property in relation to which a notice under this sub-section has been
issued arising after the date of the notice shall be void as against any demand contained in the notice.
     (f) Where a person to whom a notice under this sub-section is sent objects to it by statement on oath
that the sum demanded or any part thereof is not due to the employer or that he does not hold any money
for or on account of the employer, then, nothing contained in this sub-section shall be deemed to require
such person to pay any such sum or part thereof, as the case may be, but if it is discovered that such
statement was false in any material particular, such person shall be personally liable to the Central Provident
Fund Commissioner or the Director General of the Corporation, as the case may be, or any other officer of
such Social Security Organisation authorised by it in this behalf, to the extent of his own liability to the
employer on the date of the notice, or to the extent of the employer's liability for any sum due under this
Code, whichever is less.
    (g) The Central Provident Fund Commissioner or the Director General of the Corporation, as the case
may be, or any other officer of such Social Security Organisation authorised by it in this behalf, may, at
any time or from time to time, amend or revoke any notice issued under this sub-section or extend the time
for making any payment in pursuance of such notice.
    (h) The Central Provident Fund Commissioner or the Director General of the Corporation, as the case
may be, or any other officer of such Social Security Organisation authorised by it in this behalf, shall grant
a receipt for any amount paid in compliance with a notice issued under this sub-section, and the person so
paying shall be fully discharged from his liability to the employer to the extent of the amount so paid.
     (i) Any person discharging any liability to the employer after the receipt of a notice under this
sub-section shall be personally liable to the Central Provident Fund Commissioner or the Director General
of the Corporation, as the case may be, or any other officer of such Social Security Organisation authorised
by it in this behalf, to the extent of his own liability to the employer so discharged or to the extent of the
employer's liability for any sum due under this Code, whichever is less.

    (j) If the person to whom a notice under this sub-section is sent fails to make payment in pursuance
thereof to the Central Provident Fund Commissioner or the Director General of the Corporation, as the case
may be, or any other officer of such Social Security Organisation authorised by it in this behalf, he shall be
deemed to be an employer in default in respect of the amount specified in the notice and further proceeding
may be moved against him for the realisation of the amount as if it were an arrear due from him, in the
manner provided in sections 129 to 132 and the notice shall have the same effect as an attachment of amount
in arrears by the Recovery Officer in exercise of his powers under section 129.
     (4) The Central Provident Fund Commissioner or the Director General of the Corporation, as the case
may be, or any other officer of such Social Security Organisation authorised by it in this behalf may apply
to the court in whose custody there is money belonging to the employer for payment to him of the entire
amount of such money, or if it is more than the amount due, an amount sufficient to discharge the amount
due.
    (5) The Central Provident Fund Commissioner or the Director General of the Corporation, as the case
may be, or any other officer of such Social Security Organisation authorised by it in this behalf, if so
authorised by the Central Government by general or special order, recover any arrears of amount due from
an employer or, as the case may be, from the establishment by distraint and sale of his or its movable
property in the manner laid down in the Third Schedule to the Income-tax Act, 1961 (43 of 1961).

How to apply this provision

1. Primary statutory test — (1) Notwithstanding the issue of a certificate to the Recovery Officer under section 129, the Central Provident Fund Commissioner or the Director General of the Corporation, as the case may be, or any other officer of such Social Security Organisation so authorised by it in this behalf, may, recover the amount by any one or more of the modes provided in this section.
2. Additional operative limb — (2) If any amount is due from any person to any employer who is in arrears, the Central Provident Fund Commissioner or the Director General of the Corporation, as the case may be, or any other officer of such Social Security Organisation authorised by it in this behalf, may, require such person to deduct from the said amount the arrears so due, and such person shall comply with any such requisition and shall pay…
3. Qualification / exception to test — Provided that nothing in this sub-section shall apply to any part of the amount exempt from attachment in execution of a decree of a civil court under section 60 of the Code of Civil Procedure, 1908 (5 of 1908).
4. Evidence file — retain facts and records proving the role/status of: Employer, Central Government, Corporation / EPFO / Board.

Rules, forms and cross-references

A direct concordance is not exhaustive. Central/State jurisdiction, schemes, authority appointments, saved instruments and later notifications may change the practical route without changing the section wording.

Worked example

Q&A — Section 131

Source & verification trail