Clarity on PF Registration

Dear Sir,

You cannot continue with the same PF registration if:

You have incorporated two separate legal entities (with separate CINs, PANs, GST, etc.).

The employees are transferred from one company to another.

Each entity maintains separate books of accounts and conducts business independently.

In such cases, each must obtain its own PF code, and employees’ PF accounts can be transferred seamlessly through the UAN (Universal Account Number) mechanism.

Dear Client,
The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 applies to every establishment which is a factory engaged in any industry specified in Schedule I and in which 20 or more persons are employed and to any other establishment employing 20 or more persons. Section 2A of the Act provides that the establishment is to include all department and branches. Where an establishment consists of different departments or has branches, whether situate in the same place or in difference places, all such departments or branches shall be treated as parts of the same establishments. There are a number of controversies in the interpretation of Section 2A of the Act. Recently, in the case of M/s Torino Laboratories Pvt. Ltd. v. Union of India & Ors. (Neutral Citation: 2025 INSC 849), the Hon’ble Supreme Court held that Torino Laboratories and Vindas Chemical Industries constituted a single establishment under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act), thereby justifying their clubbing for compliance purposes. The Court rejected Torino’s arguments regarding separate legal identities, distinct registrations and employee interchange, emphasizing that functional integrality, unity of ownership, common management, and shared infrastructure were decisive factors. The Court emphasized that separate legal registration under the Companies Act or other statutes does not automatically preclude clubbing if other factors demonstrate functional integrality. So, two separate companies with different legal entities can be registered under the EPF Act, but the Employees' Provident Fund Organisation (EPFO) may still club them if they demonstrate functional unity/integrality.