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Title: THANKAMMA BABY vs. THE REGIONAL PROVIDENT FUND COMMISSIONER, KOCHI, KERALA

Citation: CIVIL APPEAL NO. 4619 OF 2010

Coram:  ABHAY S. OKA, J.

Introduction:

The case revolves around whether the appellant’s establishment, engaged in manufacturing, assembling, and selling umbrellas, falls under the category of ‘trading and commercial establishments’ as per the 1962 notification issued under the 1952 Act. The appellant argues that it does not, based on the interpretation of the relevant clauses and legislative intent, while the respondent argues.

Facts:

In the case presented, the main issue revolves around the interpretation of clause (b) of sub-Section (3) of Section 1 of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 (the 1952 Act). The appellant, engaged in manufacturing, assembling, and selling umbrellas, received a notice from the Regional Provident Fund Commissioner, alleging that the 1952 Act applied to the appellant. The notice claimed that the appellant’s business fell under the category of ‘trading and commercial establishments’ as notified by the Central Government in 1962.

A Section 7A inquiry was conducted by the respondent, who concluded that the 1962 notification covered the appellant’s case. The appellant filed a Review Petition, which was rejected, and an appeal to the Appellate Authority was also dismissed. Subsequently, a Writ Petition was filed, but the learned Single Judge dismissed it. The Division Bench of the Kerala High Court, in a Writ Appeal filed by the respondent, confirmed the order of the Single Judge.

The appellant’s counsel argued that establishments covered by clause (a) of sub-Section (3) of Section 1 pertain to factories engaged in industries specified in Schedule I of the 1952 Act. Therefore, according to the appellant’s submission, clause (a) is applicable only to factories engaged in Schedule I industries, and factories not specified in Schedule I cannot be covered by clause (b) of sub-Section (3). The counsel asserted that clause (b) of sub-Section (3) does not refer to factories and, based on legislative intent, ‘any other establishment’ in clause (b) should not include a factory. The counsel also referred to a decision of the Apex Court in the case of Regional Provident Fund Commissioner v. Shibn Metal Works in support of the argument. On the other hand, the counsel for the respondent contended that all levels of authority, including the respondent, appellate authority, Single Judge, and Division Bench, have unanimously ruled against the appellant. The argument was based on the assertion that the appellant’s business involves manufacturing and assembling umbrellas and selling them. Therefore, the respondent’s counsel argued that the appellant falls under the category of trading and commercial establishments specified in the 1962 notification.

Court analysis & Judgement:

In the judgment, it appears that the court, likely the Supreme Court or a relevant higher court, considered and rejected the appellant’s argument regarding the interpretation of clause (b) of sub-Section (3) of Section 1 of the Employees’ Provident Fund and Miscellaneous Provisions Act, 1952 (the 1952 Act). The Constitution Bench, after considering clause (a) of sub-Section (3) of Section 1, held that the Central Government has the power to specify establishments or classes of establishments not covered by the industries listed in Schedule I of the 1952 Act.                                The court rejected the argument that a notification under clause (b) could only be issued in respect of factories engaged in industries not covered by Schedule I. The judgment emphasized the social welfare nature of the legislation, describing it as a measure of social justice. In interpreting the legislation, the court adopted a purposive approach to give effect to the legislature’s intention. The court concluded that the notification under clause (b) could be issued for factories engaged in any industry not specified in Schedule I. Therefore, the contention that factories not covered by industries in Schedule I are exempt from the coverage of clause (b) was rejected. The judgment affirmed the views of the learned Single Judge and Division Bench of the Kerala High Court.

As a result, the appeals were dismissed, and no costs were awarded. The judgment also mentioned that if the appellant had incurred any monetary liability based on the orders of the respondent confirmed by the High Court, the appellant was granted three months to pay the necessary amount. This suggests that the appellant might have financial obligations resulting from the legal proceedings, and the court allowed a grace period for payment.

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Written By: Gauri Joshi

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