Mumbai:
As Hiranandani Group replies to PF default accusation, builders say it is the workers who do not want PF cut from their salary.
The Hiranandani provident fund (PF) controversy may have opened a can of worms for builders in the city. Builders and contractors across the city say that if Hiranandani is at fault, then 99 per cent of their fraternity is also guilty.
From 2003 to 2006, the Hiranandani Group did not pay the PF of sub-contractors, and according to PF Department calculations, the missing amount is Rs 9.36 crore. A statement issued by Hiranandani builders earlier this week said: "It is well known that not a single builder in India has ever paid the provident fund liability of a contractor till 2006 and it is shocking that the PF Department in order to protect its mistake is now making this allegation against Hiranandanis."
The Hiranandanis went on to say that the Nagpur Bench of the Bombay High Court had put a stay on builders and contractors paying the PF of sub-contractors up to March 2006. "The Hiranandani case falls during this period," the group said.
Anand Gupta, secretary, Builders Association of India, a consortium of builders and contractors, said most builders did not cut PF because the workers were against it and the government should recognise this reality. "This is the fault of the government. If Hiranandani is at fault, then 99 per cent of the builders and contractors are at fault. Most labourers are temporary workers; they do not want to suffer a salary cut. They do not believe they will ever get their money back if it is deposited in PF. They do not believe in the government and its machinery," said Gupta. "As soon as labourers come to know that their salary will be cut for the PF, they simply refuse to work and ask us to pay them the money instead of putting it in the PF account."
Sunil Mantri, president, Maharashtra Chamber of Housing Industry (MCHI), said there needs to be clarity on this issue. "We being builders, we hire the contractors, and contractors need to pay PF for the employees hired by them. But if the contractor fails to do his job, then, being the principal employer, we are the ones who are caught," said Mantri. "This is the case with almost every builder in the city. The government should bring clarity on all this before taking any action. And if anyone is ready to pay the fine, the government should accept it instead of prosecuting them."
The CBI raided the offices of Hiranandani Group in March 2008 based on information provided by the Provident Fund Department that there was a PF fraud committed by the Hiranandani Group involving an amount of Rs 168 crore, though later the amount was said to be Rs 9.63 crore. Pravin Salunke, DIG, CBI Anti-Corruption Department, said a case has been registered and it is being investigated.
As Hiranandani Group replies to PF default accusation, builders say it is the workers who do not want PF cut from their salary.
The Hiranandani provident fund (PF) controversy may have opened a can of worms for builders in the city. Builders and contractors across the city say that if Hiranandani is at fault, then 99 per cent of their fraternity is also guilty.
From 2003 to 2006, the Hiranandani Group did not pay the PF of sub-contractors, and according to PF Department calculations, the missing amount is Rs 9.36 crore. A statement issued by Hiranandani builders earlier this week said: "It is well known that not a single builder in India has ever paid the provident fund liability of a contractor till 2006 and it is shocking that the PF Department in order to protect its mistake is now making this allegation against Hiranandanis."
The Hiranandanis went on to say that the Nagpur Bench of the Bombay High Court had put a stay on builders and contractors paying the PF of sub-contractors up to March 2006. "The Hiranandani case falls during this period," the group said.
Anand Gupta, secretary, Builders Association of India, a consortium of builders and contractors, said most builders did not cut PF because the workers were against it and the government should recognise this reality. "This is the fault of the government. If Hiranandani is at fault, then 99 per cent of the builders and contractors are at fault. Most labourers are temporary workers; they do not want to suffer a salary cut. They do not believe they will ever get their money back if it is deposited in PF. They do not believe in the government and its machinery," said Gupta. "As soon as labourers come to know that their salary will be cut for the PF, they simply refuse to work and ask us to pay them the money instead of putting it in the PF account."
Sunil Mantri, president, Maharashtra Chamber of Housing Industry (MCHI), said there needs to be clarity on this issue. "We being builders, we hire the contractors, and contractors need to pay PF for the employees hired by them. But if the contractor fails to do his job, then, being the principal employer, we are the ones who are caught," said Mantri. "This is the case with almost every builder in the city. The government should bring clarity on all this before taking any action. And if anyone is ready to pay the fine, the government should accept it instead of prosecuting them."
The CBI raided the offices of Hiranandani Group in March 2008 based on information provided by the Provident Fund Department that there was a PF fraud committed by the Hiranandani Group involving an amount of Rs 168 crore, though later the amount was said to be Rs 9.63 crore. Pravin Salunke, DIG, CBI Anti-Corruption Department, said a case has been registered and it is being investigated.
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