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CMA Intermediate · Business Laws and Ethics · Employees Provident Fund and Miscellaneous Provisions Act, 1952

Schedule II to the EPF Act, 1952 allows a Scheme to provide for the time and manner of contributions to the Fund. Which statement about those contributions is correct?

A Scheme may provide for the time and manner of contributions by employers and by, or on behalf of, employees, including employees engaged directly or through a contractor. It is not confined to employer-only or employee-only contributions, nor to directly employed staff.

  1. AThe Scheme may provide for contributions by employers and by, or on behalf of, employees, whether employed directly or through a contractorCorrect
  2. BThe Scheme may provide only for employer contributions, since employees cannot contribute
  3. CThe Scheme may provide for contributions only for employees employed directly by the employer, not through a contractor
  4. DThe Scheme may provide for contributions by employees only, with the employer paying nothing

Explanation

Item 2 of Schedule II covers the time and manner in which contributions are made by employers and by, or on behalf of, employees, whether employed by the employer directly or by or through a contractor. Hence options limiting contributions to one party or to direct employees are wrong.

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