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Robindra Textile Mills Vs. Secretary, Ministry of Labour, Govt. of India, New Delhi and anr. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtPunjab and Haryana High Court
Decided On
Case NumberCivil Writ No. 447 of 1956
Judge
Reported inAIR1958P& H55; (1960)ILLJ650P& H
ActsEmployees' Provident Fund Act, 1952 - Sections 1(3) and 16(1)
AppellantRobindra Textile Mills
RespondentSecretary, Ministry of Labour, Govt. of India, New Delhi and anr.
Appellant Advocate Bhagirath Dass, Adv.
Respondent Advocate L.D. Kaushal, Deputy Adv. General
DispositionPetition dismissed
Excerpt:
- sections 100-a [as inserted by act 22 of 2002], 110 & 104 & letters patent, 1865, clause 10: [dr. b.s. chauhan, cj, l. mohapatra & a.s. naidu, jj] letters patent appeal order of single judge of high court passed while deciding matters filed under order 43, rule1 of c.p.c., - held, after introduction of section 110a in the c.p.c., by 2002 amendment act, no letters patent appeal is maintainable against judgment/order/decree passed by a single judge of a high court. a right of appeal, even though a vested one, can be taken away by law. it is pertinent to note that section 100-a introduced by 2002 amendment of the code starts with a non obstante clause. the purpose of such clause is to give the enacting part of an overriding effect in the case of a conflict with laws mentioned with the..........industry.' section 16(1)(b) of the act reads : '16(1)(b). this act shall not apply to any other factory, established whether before or after the commencement of this act, unless three years have elapsed from its establishment' and the expression 'factory' is defined in section 2(g) as meaning 'any premises, including the precincts thereof, in any part of which a manufacturing process is being carried on or is ordinarily so carried on, whether with the aid of power or without the aid of power.' it is clear from section 1(3) of the act that it is made specifically applicable to factories only and not to the owners thereof other provisions in the act and in the scheme framed under the act also lead to the same conclusion. section 16 exempts factories belonging to government or local.....
Judgment:
ORDER

Bishan Narain, J.

1. Robindra Textile Mills of Amritsar have filed this petition under Article 228 of the Constitution through Robindra Nath Mehra, one of the partners, for an order restraining the Regional Provident Fund Commissioner, Punjab and the Government of India from enforcing the provisions of the Employees' Provident Funds Act, 1952, against the petitioning mills, during the period from 1st November, 1952 to 1st February, 1955.

2. The facts which are not in dispute in this case may be briefly stated. The factory at its present site was started in 1946 under the name of Sindh Textile Mills, Amritsar. The factory worked from 1946 till 15th June. 1951 when' it was closed. Robindra Nath Mehra and others purchased the factory on 31st January, 1952 and formed a partnership firm to carry on the business of manufacturing textiles under the name and style of Robindra Textile Mills. The factory started functioning from 1st February, 1952 with admittedly more than 50 employees. The Employees' Provident Funds Act, 1952, came into force on 4th March, 1952 and the Employees' Provident Funds Scheme was framed by the Central Government under Section 5 of the Act.

The scheme came into force on 2nd September. 1952. The Regional Provident Fund Commissioner required the petitioning mills to deposit contributions under the Act by letter dated 19th December, 1953. The firm in reply claimed that the industry was exempted from contributing toprovident fund for three years with effect from 1st February, 1952 by virtue of Section 16(1)(b) of the Act. This position was not accepted by the Commissioner and he called upon the petitioning mills to comply with the provisions of the Act. The petitioner thereupon filed a writ petition (Civil Writ No. 159 of 1954) which was, however, dismissed on 14th December, 1955 on the ground that he had not availed of the remedy provided in Section 19A of the Act. Thereafter the petitioner applied to the Central Government under that provision of law but that application was dismissed on 2lst August, 1956 Hence this petition.

3. It is common ground between the parties that Robindra Textile Mills come within the definition of 'factory' as defined in the Act inasmuch as they are engaged in an industry specified in schedule I of the Act and employ 50 or more persons. It is not seriously in dispute that the workers employed in the Sindh Textile Mills were 50 or more. In any case it is not the petitioner's case that it was not so. It is also admitted that the factory is now functioning in the same premises as previously, 'although the petitioner has alleged that some of the old machinery has been reconditioned and new power-looms have been added to it.

4. The dispute centres round the fact whether the factory is exempted from the application of the Act under Section 16(1)(b), i.e., whether It can be said to have been established in 1946 when it first went into production or when the present partnership firm started operating it after it had remained closed for about seven months from 15th June, 1951 to 25th January, 1952, If it can be said that the factory was established on 26th January, 1952 then obviously it is entitled to take the advantage of the exemption provided in Section 16(1)(b) of the Act, otherwise not.

5. Section 1(3) of the Act reads :

'1(3), Subject to the provisions contained in Section 16, it applies in the first instance to all fac-fories engaged in any industry specified in Schedule I in which fifty or more persons are employed, but the Central Government may, after giving not less than two months' notice of its intention so to do, by notification in the Official Gazette apply the provisions of this Act to all factories employing such number of persons less than fifty as may be specified in the notification and engaged in any such industry.'

Section 16(1)(b) of the Act reads :

'16(1)(b). This Act shall not apply to any other factory, established whether before or after the commencement of this Act, unless three years have elapsed from its establishment'

and the expression 'factory' is defined in Section 2(g) as meaning

'any premises, including the precincts thereof, in any part of which a manufacturing process is being carried on or is ordinarily so carried on, whether with the aid of power or without the aid of power.'

It is clear from Section 1(3) of the Act that it is made specifically applicable to factories only and not to the owners thereof Other provisions in the Act and in the scheme framed under the Act also lead to the same conclusion. Section 16 exempts factories belonging to Government or local authorities, and any class of factories for reasons specified in Sub-section (2) of this section is granted exemption by the Central Government by notification in the Official Gazette. It also exempts all factories from the operation of the Act which have not been established for three years and it is with this exemption that we are concerned inthe present case. Neither the Act nor the scheme provides tests for determining when a factory can be said to have been established and it is therefore necessary to examine the provisions of the Act and the scheme to find out the intention of the legislature,

6. The 'factory' is defined in the Act as 'premises where manufacturing process is being carried on or is ordinarily so carried on.' The explanation to Section 16(1)(b), however, expressly lays down that when the premises or a factory are changed, then such a change shall not change the date of the establishment of the factory. In the present case, however, there has been no change in the location of the manufacturing process and it would therefore appear that the date of the establishment would be the date when that process was started in 1946. A change of ownership obviously in this context cannot start a fresh date of establishment of a factory. This has been so held in an unreported case of the Bombay High Court, Chhaganlal Textile Mills Private Ltd. v. p. A. Bhaskar, Misc. Appln. No. 289 of 1956 (Bom) (A), in which Tendolkar J. has discussed the matter at some length.

The fact that subsequently the original power-looms were reconditioned and additional 38 power-looms were installed by the partnership firm cannot possibly affect the date of establishment of the factory. Additions to or subtractions from a factory, however large cannot change its date of establishment. It is however, argued that, during the period the factory stopped functioning and was closed, it cannot be said that in these premises 'manufacturing process is being carried on or is ordinarily so carried on' and It is urged that 'ordinarily' in this context means 'regularly.' The contention is that the factory under this Act dies or ceases to exist when the manufacturing process is stopped and is reborn or is freshly established when the manufacturing process starts again.

There is no force in this contention. Obviously if a mill works only one shift of eight hours in twenty-four hours, then it cannot be said to be established afresh when it starts working next day. When a mill is stopped for repairs or because of some accident, then it does not cease to exist. Similarly even if a mill is closed temporarily for trade reasons or for reasons peculiar to the owner of the mill, then the factory cannot be said to die. Temporary cessation of the manufacturing process for whatever reasons cannot lead to the result of the factory ceasing to be established.

It is argued that when a mill or factory remains closed for about seven months then it should not be held that it was only temporarily closed but that it should be held that it was permanently closed. This is incorrect. In the present case it is not suggested that the factory during these seven months was not in working order and could not start production if the owners so desired. The stoppage therefore cannot be said to be anything but temporary.

7. This conclusion is also in accordance with the object and policy of the Act. By this Act the provident fund is instituted for benefit of employees to which the employer and the employee contribute equally. Once an employee is a member of the fund, he does not cease to be a member the leaves that factory. This is laid down in the scheme framed under the Act. Therefore the emphasis in the scheme is on the factory which carries on manufacturing process and on the employee who benefits under the Act.

In these circumstances there is no reason whythe exemption laid down in Section 16(1)(b) shouldbe applied to an owner who has purchased afactory which had carried on manufacturing pro-cess from 1946 till 15th June, 1951 simply becausethe partnership firm has purchased it after thelapse of about seven months and has restartedIts manufacturing process. All that has happenedin substance is that the factory already established has been restarted by the petitioning millsafter adding some power-looms to it. The Government under Section 19A has also come to the same conclusion. The result is that this petition fails and isdismissed with costs. Counsel's fee Rs. 100/-.


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