Even Factories Not Associated With Schedule 1 Industries May Be Subject To The EPF Act: Supreme Court Turns Down Umbrella Manufacturing Unit’s Appeal

Title: Thankamma Baby v. The Regional Provident Fund Commissioner

Decided on: 07 November, 2023

+ Civil Appeal No. 4619 of 2010

CORAM: Hon’ble Justice Abhay S. Oka


Recently, the Supreme Court ruled that the Central Government may issue a notification to factories operating in any industry not listed in Schedule I under clause (b) of sub-Section (3) of Section 1 of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952. The Top Court was debating whether the EPF Act may apply to a factory that isn’t included in Schedule 1 of the Act.

Facts of the Case

The Apex Court was considering an appeal in which the appellant was involved in the production, distribution, and manufacturing of umbrellas. In 1997, the Appellant received a notice from the Regional Provident Fund Commissioner (the Respondent before the Apex Court), claiming that the Act applied to them. The Respondent contended that the establishment qualified as a commercial enterprise because the Appellant was in the business of assembling umbrellas and selling them in her own store. The appellant was accused of operating a business that qualified as a “trading and commercial establishment” according to a 1962 notification from the Central Government, which was made in accordance with clause (b) of sub-Section (3) of Section 1 of the 1952 Act. The High Court affirmed the PF authority’s conclusions. The Appellant contested this at the Apex Court.

Courts analysis and decision

The Appellant’s establishment was primarily engaged in commercial activity, according to the Apex Court’s observation. In light of this, the Top Court determined that the Appellant’s company would be classified as a “trading and commercial establishment,” as defined by the Center’s 1962 notification. The Court stated that as a result, the aforementioned notification would regulate the appellant’s case. In light of this, the Court denied the appeal.

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Written by- Hargunn Kaur Makhija

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