Sections 134 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 134 raises the punishment when a person already convicted under the Code commits the same offence again. Section 135 says who is answerable when the offender is a company: the company itself and the people running its business.
After one conviction, a repeat offence under the Code carries imprisonment up to two years and a fine of two lakh rupees (s.134). For a repeat failure to pay a contribution, charge, cess, maternity benefit, gratuity or compensation, the term is three years, not less than two years, with a fine of three lakh rupees. When a company offends, every person directly in charge of the business, and the company, are deemed guilty unless the person proves lack of knowledge or due diligence (s.135(1)). Directors, secretaries and officers are also liable where the offence was with their consent or connivance or due to their neglect (s.135(2)).
Why it matters
Section 133 lists the first-time offences and penalties (see our note on section 133). Sections 134 and 135 decide what happens next: a second lapse costs far more, and the exposure is personal for those who run a company. Finance heads, HR heads and directors should treat PF, ESI, gratuity and maternity benefit payments as matters that can reach them directly. If you are unsure how your payroll and payment practices stand, a review with our legal dispute resolution team can show the gaps before an Inspector-cum-Facilitator does.
Section 134: enhanced punishment for a repeat offence
Section 134 applies to "whoever, having been convicted by a court of an offence punishable under this Code, commits the same offence" again, for the second or every later offence.
| Situation | Punishment under s.134 |
|---|---|
| Second or later conviction for the same offence (general rule) | Imprisonment up to two years and fine of two lakh rupees |
| Second or later offence of failing to pay contribution, charges, cess, maternity benefit, gratuity or compensation (proviso) | Imprisonment up to three years, but not less than two years, and fine of three lakh rupees |
Three points are worth noting:
- It needs a prior conviction. The trigger is a conviction by a court, not a notice, an inspection finding or a compounded offence. Compounding is covered separately in section 138.
- "Same offence". The section speaks of the same offence, so a conviction for one kind of default does not by itself enhance the punishment for a different kind.
- The fine is fixed. The general rule says "fine of two lakh rupees" and the proviso "fine of three lakh rupees". The text uses no "may extend" wording for the fine.
The text does not say anything further about suspension of sentence or the court's discretion on the minimum term in the proviso; do not assume the relief in the proviso to s.133(i) applies here.
Section 135: offences by companies
Section 135(1): persons in charge
Where an offence under Chapter XII has been committed by a company, the following are deemed guilty and can be proceeded against and punished:
- every person who, at the time of the offence, was directly in charge of, and responsible to, the company for the conduct of its business; and
- the company.
The proviso gives a defence. Such a person is not liable to punishment if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent it. The burden is on the person to prove this.
Section 135(2): consent, connivance or neglect
Despite sub-section (1), where an offence by a company is proved to have been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, secretary or other officer, that person is also deemed guilty and liable to be proceeded against and punished.
Meaning of "company" and "Director"
The Explanation gives wide meanings:
- "company" means any body corporate and includes a firm or other association of individuals;
- "Director", for a firm, means a partner in the firm.
So partnerships and associations are caught, and partners are treated as directors.
A worked example
A private limited company deducts the employee's share of PF from salaries for several months but does not deposit it. The company is prosecuted and convicted under s.133. Later it again fails to deposit contributions. Under the s.134 proviso the punishment for the repeat offence is imprisonment of not less than two years and up to three years, with a fine of three lakh rupees.
In both cases, s.135 lets the authorities proceed against the company and the finance director who was in charge of remittances. The director can escape only by proving the default happened without his knowledge or that he took all due diligence to stop it, for example by showing documented payment approvals that were overridden without his knowledge. (Illustrative.)
Practical steps for employers
- Keep a payment calendar and proof for each contribution, gratuity and compensation payment.
- Record who is responsible for each statutory task, because s.135(1) looks at who is directly in charge.
- Escalate missed payments in writing to show diligence and lack of consent.
- Comply with any written direction from the Inspector-cum-Facilitator within the stated time; section 137 gives a first-time opportunity but none for a repeat within three years.
Where the Code refers to criminal courts, procedure follows the general criminal law. From 1 July 2024 the Code of Criminal Procedure, 1973 and the Indian Penal Code were replaced by the BNSS and BNS. Offences here are tried by courts as s.136 provides.
Need help with offence exposure?
If a notice, default or prosecution risk is worrying your management, our legal dispute resolution team can help you examine the charge, the role of each officer and the steps available. Early action on a first default is the surest way to avoid the repeat-offence provisions.
Key takeaways
- Repeat offence after a court conviction: up to two years and two lakh rupees fine.
- Repeat payment default (contribution, charges, cess, maternity benefit, gratuity, compensation): two to three years and three lakh rupees.
- Company offences make the company and those directly in charge deemed guilty.
- Directors, secretaries and officers are liable for consent, connivance or neglect.
- "Company" includes a firm; a partner is a "Director".
- Defence: offence without knowledge or with all due diligence.
Read next
- Section 133: Penalties for offences
- Sections 136 to 138: Cognizance, prior notice and compounding
- Prosecution under the EPF Act, Section 14
- Common EPF violations employers should avoid
Disclaimer: Based on the Code on Social Security, 2020 (as enacted) and, where noted, the Code on Social Security (Central) Rules, 2026 (G.S.R. 344(E), 8 May 2026), as on 30 September 2026. The Code is in force from 21 November 2025; some provisions may be notified later, and State Governments make their own rules for establishments where the State is the appropriate Government. Verify the current position before acting.