Important Point
In the absence of materials, the High Court was not justified in assuming certain factors to fix the liability on FCI without appreci­ating the relevant provisions of Employees’ Provident Fund and Miscel­laneous Provisions Act, 1952.

Order

K. Venkataswami, J.-These two appeals arise out of an order dated 9.12.94 of the Kerala High Court in Writ Appeal No. 664/91 and O.P. No. 7523/89. The questions that arose for consideration before the High Court in Writ Appeal No. 664/91 were (a) whether the Food Corpo­ration of India (for short ‘FCI’), the appellant herein, for the purposes of application of the provisions of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter referred to as the “Act”) would be an ‘establishment’ and (b) whether 31 headload workers (workers in question for short) engaged by the Contractor in loading and unloading operation at Kuttipuram Railway Station would be regarded as ‘employees’ of the FCI within the meaning of Section 2(f) of the Act and consequently liable to remit the contributions required under the Act. The latter question alone was agitated before us.

2. The question for consideration before the Kerala High Court in O.P. No. 7523/89 was whether the Contractor (petitioner in the said O.P.) was entitled to refund of security deposit amounting to Rs. 1,35,000/- with inserted at 12% p.a. from the FCI.

3. In the view we propose to take, we do not intend to deal with the matters elaborately. As the question of refund of security deposit was inter-related with the question relating to the liability or otherwise of the FCI under the Act as referred to above, the High Court decided the two matters by a common judgment and for the same reason we have also dealt with these two appeals by this common order.

4. Initially, the second respondent, Regional Provident Commissioner, fixed the liability on the FCI under the Act on the basis of a Report given by the Provident Fund Inspector prepared behind the back of the appellant. It was challenged before the High Court. A Division Bench of the Kerala High Court in Writ Appeal No. 467/85 dated 13.10.87 set aside the assessment made by the second respondent and remanded the case to the Provident Fund Commissioner with a direction that if he proposes to rely upon the Inspector’s Report, a copy of the same should be furnished to the appellant and an opportunity of showing cause of being heard should also be afforded to the appellant before rendering a final decision. Accordingly, the second respondent after issuing the show-cause notice and supplying a copy of the Inspection Report and after giving an opportunity to the appellant again found that the appellant was the real employer of the said 31 headload workers through the Contractor and as such, liable to pay the contri­butions under the Act. For coming to this conclusion, the second respondent placed reliance on an alleged agreement entered into be­tween the FCI and the Union representing the railway goods shed work­ers. Principally, based on the said agreement, the decision of the second respondent was rendered. We may at once point out that though notice was served on the second respondent, none appeared and assisted the Court when these appeals were heard by this Court. There is noth­ing on record to evidence the said agreement. It is also denied by the appellant that there was any such agreement which will show that the appellant was the real employer of the 31 headload workers through the Contractor.

5. Aggrieved by the order of the second respondent, the appellant filed O.P. No. 10332/88-E before the Kerala High Court. The learned Single Judge, after referring to the role played by the FCI in set­tling the dispute between the workers and the Contractor, reached a conclusion that the workers in question are the employees of the FCI through the Contractor and, therefore, the second respondent was justified in fixing the liability on the appellant. Still aggrieved, the appellant preferred Writ Appeal No. 664/91 before the Division Bench of the same High Court. The Division bench noticed the facts as follows :-

“It is submitted that the workers in the Railway shed do loading and unloading work in respect of wagons