New Salary component that won't be considered for PF

In caluclating PF basic salary, DA, retaining allowance and food concession, if any is claculated and maximum limit is Rs. 6500/- but if salary of any new incomer is initially fixed more than Rs. 6500/- then no PF liability remains against him and such an employee is an exempted employee.

Now I come to your quarry. special Allowance is not included in computation of wages hence this name can be maintained but you say PF authorities are not in agreement with you on this point so better change its name as performance allowance or Special reward. It cannot be included in wages.

Thank you sir. 

Is there any cap for Basic as part of salary structure for PF purpose. There was a query that basic should be 60% of gross to the maximum of Rs.6500. I don't see any such stuff in Act, but they say it is part of PF Rule - is that correct? or is there any Superme court case in this regard.

The extent of applicability of salary are at variance in computing its variious constutuents. There exist no specific applicability in terms of PF, Pension, Bonus, Income Tax etc., which is the fallacy of  the Indian system of democracy and to the extent of comprehension there is no scope for reviewing the same at any level of governance in the near future of the piquant politics of vote banks.

 If salary of any new incomer is initially fixed more than Rs. 6500/- then no PF liability remains against him and such an employee is an exempted employee. But an employee who has been covered under the Act and even if his salary exeeds 6500/ shall continue under the coverage.