Offences and Penalties under the Social Security Code
Chapter Thirty-Three
Syllabus topic 2.6, "Offences and Penalties"
Pages 237 to 244 of 597
In one line
Seventeen things an employer can do wrong, graded into four punishment bands, with a mandatory chance to put it right before any prosecution.
In exam wording: section 133 of the Code on Social Security 2020 lists seventeen offences in clauses (a) to (q) and grades their punishment in four bands; section 134 enhances punishment for a repeat offence; section 135 makes officers of a company liable; section 136 governs cognizance; section 137 requires a prior written opportunity to comply; and section 138 permits compounding of a first offence.
Why the law has these at all
Because the duties in the Code are owed to workers who usually cannot enforce them. A contribution not paid is invisible until retirement; a gratuity not paid is owed to somebody who has already left. Civil recovery under sections 129 to 132 gets the money in, but it does not deter, and it does not reach the employer who deducts an employee's own contribution and keeps it.
But the Chapter is not simply punitive, and the two provisions that show this are the most examinable in it.
Section 137 requires the officer, before prosecuting, to give the employer a written direction and a period in which to comply, and if he complies, no prosecution shall be initiated. That is a genuine change from the old law, and it fits the Inspector-cum-Facilitator's advisory role in section 122(5)(a).
Section 138 lets a first offence which is punishable by fine only, or by imprisonment which is not minimum and with fine, be compounded.
Both have a limit, and the limits are where the marks are. Section 137's opportunity is not available if a violation of the same nature is repeated within three years. Section 138 applies only to an offence committed for the first time.
Some words this chapter uses
Cognizance is a court's taking notice of an offence so as to begin proceedings. Sanction is prior official permission to prosecute. Compounding is settling a criminal charge by payment, with the consent of the authority, so that no trial follows. Due diligence means all reasonable care. Connivance is knowing and passive permission. Metropolitan Magistrate and Judicial Magistrate of the first class are the ranks of criminal court named in section 136(3).
Section 133: the offences
The seventeen clauses. A person commits an offence if he:
| Clause | The offence |
|---|---|
| (a) | being an employer, fails to pay any contribution he is liable to pay |
| (b) | deducts or attempts to deduct from the wages of an employee the whole or any part of the employer's contribution |
| (c) | in contravention of the Code, reduces the wages or any privilege or benefit admissible to an employee |
| (d) | in contravention of Chapter IV or Chapter VI, dismisses, discharges, reduces in rank or otherwise penalises a woman employee |
| (e) | fails or refuses to submit any return, report, statement or other information required |
| (f) | obstructs an Inspector-cum-Facilitator or other officer or staff of a Social Security Organisation or a competent authority |
| (g) | fails to pay any amount of gratuity to which an employee is entitled |
| (h) | fails to pay any amount of compensation to which an employee is entitled |
| (i) | fails to provide any maternity benefit to which a woman is entitled |
| (j) | fails to send a statement to a competent authority as required under Chapter VII |
| (k) | fails to produce on demand any register or document in his custody |
| (l) | fails to pay the cess for building workers |
| (m) | any other contravention or non-compliance for which no special penalty is provided |
| (n) | obstructs an executive officer in exercising his functions under Chapter XIII |
| (o) | dishonestly makes a false return, report, statement or information |
| (p) | fails or makes default in complying with a condition of an exemption granted under section 143 |
| (q) | fails to pay administrative or inspection charges under a Chapter III scheme |
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