JUDGMENT

K.JAGANNATHA SHETTY, J.

(1) THESE appeals by special leave are directed against the judgment of the Karnataka High court rejecting the claim of the appellant-corporation for covering the factories of the respondents under the provisions of the Employees State Insurance Act, 1948 (the Act).

(2) S. 1(4 excludes "seasonal factory" from the scope of the Act. The "seasonal factory" is defined under S. 2(12 of the Act which is extracted hereunder:

"2. (12 * *

SEASONAL factory means a factory which is exclusively engaged in one or more of the following manufacturing processes, namely, cotton ginning, cotton or jute pressing, decortication of groundnuts, the manufacture of coffee, indigo, lac, rubber, sugar (including gur) or tea or any manufacturing process which is incidental to or connected with any of the aforesaid processes."

(3) THE factories of the respondents were excluded from the operation of the Act since they were declared to be the seasonal factories within the meaning of the above-stated definition. There is no dispute on this aspect.

(4) BY Amending Act 44 of 1966 which came into force with effect from 28/01/1968, the definition of "seasonal factory" has been amended. The definition as amended reads:

"2. (12 * * *

SEASONAL factory means a factory which is exclusively engaged in one or more of the following manufacturing processes, namely, cotton ginning, cotton or jute pressing, decortication of groundnuts, the manufacture of coffee, indigo, lac, rubber, sugar (including gur) or tea or any manufacturing process which is incidental to or con nected with any of the aforesaid processes and includes a factory which is engaged for a period not exceeding seven months in a year-

(A) in any process of blending, packing or re-packing of tea or coffee; or

(B) in such other manufacturing process as the central Government may, by notification in the official Gazette, specify;

THE expressions manufacturing process and power shall have the meaning respectively assigned to them in the Factories Act, 1948";

(5) AFTER the said amendment, the Employees State Insurance Corporation called upon the respondents to pay the contributions payable under the Act and threatened to take coercive steps to recover the arrears under the Revenue Recovery Act and prosecute them. Challenging the validity of the demand made, the respondents approached the Employees Insurance court, inter alia, contending that the amendment to the definition of the expression "seasonal factory" brought out by the Amending Act 44 of 1966 has not altered the position of the seasonal factory as obtained prior to the amendment and S. 1(4 of the Act would still continue to exclude such factory from the operation of the Act. The Employees Insurance court accepted the respondents plea. The Karnataka High court has also agreed with the view taken by the Employees Insurance court. The Corporation has now appealed to this court.

(6) THE sole question for consideration is whether the respondents factories in view of the amendment to the definition of seasonal factory have lost the benefit of exclusion from the Act. The High court on this aspect has observed that the purpose of the amendment was to enlarge and not to restrict the statutory concept of "seasonal factory" and the position of respondents establishments as seasonal factories under and for the purpose of the Act remained unaltered even after the amendment.

(7) THE view taken by the High court seems to be justified. The Statement of Objects and Reasons of the Bill which later became the Act 44 of 1966 indicates that the proposed amendment was to bring within the scope of the definition of "seasonal factory", a factory which works for a period of not exceeding seven months in a year -(a) in any process of blending, packing or re-packing of tea or coffee; or (b) in such other manufacturing process as the central government may, by no