New Delhi, April 28 Staffing services provider TeamLease Services has received a show-cause notice from the Employees' Provident Fund Organisation (EPFO) over an alleged fund management dispute involving about Rs 185 crore, the company said in an exchange filing on Tuesday.
The notice -- dated April 13 and received on April 23 -- flagged certain contraventions related to the administration and management of funds by the Employees’ Provident Fund Trust.
According to the filing, major observations included investment losses, losses on the sale of bonds and debentures, alleged misappropriation of reserves, and certain employee-related amounts reflected as recoverable, for which supporting documentation has been sought.
The total financial implication cited in the notice stood at Rs 184.58 crore, including interest, which the company has disputed.
"The company is currently evaluating the notice and will take appropriate legal action. We remain committed to ensuring full compliance with applicable laws and regulatory requirements," it said.
However, the company noted a delay of five days in disclosing the development due to administrative reasons and the time taken to assess the materiality of the notice.
It added that it had earlier sought clarification from the regional provident fund office, under which employers were allowed to fund only the shortfall reflected in the balance sheet, and the same had been addressed in March 2022.
The company said it is working closely with the authorities to resolve the issue.
Following the development, shares of TeamLease Services fell as much as 3.2 per cent during intraday trade to around Rs 1,210 apiece on NSE. The stock was later trading at Rs 1,233.30, down 1.34 per cent from the previous close.
The stock has declined about 30 per cent over the past six months, 20 per cent so far this year, and around 35 per cent over the past one year. Over the longer term, it has fallen nearly 60 per cent in the last five years.
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