Judgment

SINHA, C.J.I. : This petition under Art. 32 of the Constitution challenges the vires of certain provisions of the Employees Provident Funds Act (XIX of 1952) (which hereinafter will be referred to as the Act), and the scheme framed thereunder. The respondents to this petition are the Union of India and the Regional Provident Fund Commissioner.

2. The petition is found on the following allegations. The petitioners, 5 in number, are citizens of India and are carrying on business of running a restaurant and general stores under the name and style of "Messers George Restaurant and Stores" at 20, Appollo Street, Fort. Bombay-1, since September 1958. They are running this business as a partnership firm, registered under the Indian Partnership Act. The firm employs 43 persons, including cooks, waiters, tea makers, bill clerks and two store clerks. Besides paying salary to their employees, the petitioners give them free food and other personal allowances, which it is not necessary to set out in detail. In exercise of the powers conferred by S. 1(3) (b) of the Act, the Central Government issued the notification No. G.S.R. 704, dated May 16, 1961, in the following terms :

"G.S.R. 704 - In exercise of the powers conferred by clause (b) of sub-sec. (3) of S. I. of the Employees Provident Funds Act 1953 (19 of 1952) the Central Government hereby directs that with effect from the 30th June, 1961, the said Act shall apply to the following classes of establishments, in each of which twenty or more persons are employed, namely;

i. Hotels.

ii. Restaurants."

As a result of the notification aforesaid, the operation of the Act has been extended to hotels and restaurants, including the one run by the petitioners. Subsequently, the Central Government issued a notification under S. 5, read with S. 7(1) of the Act, the relevant portions of which are in these terms :

"G.S.R. 783- In exercise of the powers conferred by S. 5 read with sub-sec. (1) of S. 7, of the Employees Provident Funds Act, 1952 (19 of 1952), the Central Government hereby makes the following Scheme further to amend the Employee s Provident Fund Scheme, 1952, namely :

1. This Scheme may be called the Employees Provident Funds (Third Amendment) Scheme, 1961.

2. In the Employee s Provident Fund Scheme, 1952. In cl. (b) of sub-paragraph (3) of paragraph 1, sub-clause (xvii) shall be renumbered as sub-clause (xix) thereof and the following shall be inserted as sub-clauses (xvii) and (xviii), namely : "(xvii) as respects hotels and restaurants covered by the notification of the Government of India in the Ministry of Labour and Employment No. G.S.R. 704 dated the 16th May, 1961 come into force on the 30th day of June, 1961 :"

3. The said notification introduced the scheme known as the Employees Provident Funds (Third Amendment) Scheme, 1961. The petitioners challenge the constitutionality of the scheme aforesaid, and the section of the Act in pursuance of which it was brought into existence. The petitioners pray for a writ or order or direction quashing the said notifications and for issue of a mandamus to the respondents not to apply the said scheme to the petitioners establishment.

4. Before dealing with the specific grounds of attack raised in support of the petition, it is necessary to set out briefly the relevant provisions of the Act. The Act applies to every establishment which is a factory engaged in any industry specified in Schedule 1 and in which 20 or more persons are employed, and to any other establishment employing 20 or more persons or class of such establishments which the Central Government may, by notification in the Official Gazette, specify in this behalf. Employee has been defined in S. 2(f) as follows :

" employee means any person who is employed for wages in any kind of work, manual or otherwise, in or in connection with the work of an establishment, and who gets his wages directly or indirectly from the employer, and includes any person employed by or through a