JUDGMENT - S.C. PRATAP, J.:---Short question for determination in this petition is whether the petitioner-company is entitled to the benefit of the infancy period under section 16 of the Provident Funds and Miscellaneous Provisions Act, 1952 (for short 'the Act') already availed of by the original Company M/s. Saraiya Industrial and Containers Company Private Limited.

2. M/s. Saraiya Industrial and Containers Company Private Limited (hereinafter 'the original company') manufactures of composite containers started manufacturing activity in October, 1963 at the Wagle Industrial Estate, Thane, but closed down the same in July 1972. In November, 1972 pursuant to lease agreement, the petitioner Industrial Factors Limited (for short 'the petitioner company') took on lease from the original Company its imported plant machinery and equipments. It also took over from the original Company its twenty-four employees as also its raw materials and stocks. Later, the petitioner company was converted into a subsidiary of Mr. Poysha Industrial Company Limited (for short 'Poysha') and it started manufacturing operations on the mezzanine floor of Poysha's premises (at Sewree, Bombay) taken on leave and licence.

3. Upon enquiry under section 7-A of the Act, the Regional Provident Funde Commissioner held that there was unity of management and ownership of the two units- Industrial Factors Limited and Poysha Industrial Company Limited, that the original Company Mr. Saraiya Industrial and Containers Company Private Limited was already covered under the Act and its business along with machinery having been taken over by the petitioner company, this latter will also, therefore, remain covered under the Act and that change in management would not affect the date of its coverage. The establishment in question was consequently held to be rightly covered with affect from 31st December, 1972. Dues for the period 1st January, 1973 to 31st December, 1975 were then assessed provisionally at Rs. 70,326/- under the Provident Fund Account No. I and Rs. 1620/- under the Provident Fund Account No. II. The petitioner's representation under section 19-A of the Act was dismissed by the Central Government. Hence this petition.

4. Mr. Bhatkal, learned Counsel for the petitioner, contended that the petitioner Company was entitled to the benefit of the infancy period under section 16 of the Act and that the decision to the contrary of the authorities below was not correct. We are unable to agree. The benefit of the infancy period under section 16 of the Act once availed by the original Company cannot be extended afresh and again to the petitioner Company. To do so militates against the prime purpose of the Act. Accepting the petitioner's claim would lead to strange and unintended results defeating the object of the Act and the interests of the workers. A prosperous establishment of 'A' (which has already availed of the benefit of the infancy period) is taken over by 'B' and 'B' thereafter claims benefit of the infancy period, though carrying on the same business albeit under different name and ownership and which benefits were already availed of by the original owner 'A'. Later, the same establishment is taken over by 'C' and 'C' also then claims to the benefit of the infancy period. And so on ad infinitum. Such surely is not the object of section 16 of the Act. But such could well be the result if the petitioner's claim for the benefit once again of the infancy period already availed of the original company, is accepted. Repeated grant of the benefit of the infancy period to different successive entities qua an establishment already previously set up and which had already availed of the infancy period, would defeat and render infructuous the beneficial provisions of the Act. It has been found by the authorities that the original company was a viable unit and it was a viable unit that was taken over. What is more, machinery was not sold by the o

Click Here to Read the rest of this document