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DELHI HIGH COURT
V. Kameswar Rao, J.
Vir Arjun Newspapers Pvt. Ltd. - Appellant
Versus
Regional Provident Fund Commissioner, Delhi & Anr. - Resopndent
W.P.(C) 3014/2000
Decided On : 05-09-2014
WRIT PETITION - CHALLENGE TO ORDER OF REGIONAL PROVIDENT FUND COMMISSIONER AND EMPLOYEE’S PROVIDENT FUND APPELLATE TRIBUNAL - INFANCY PROTECTION UNDER SECTION 16 OF THE ACT - CONTINUATION OF OLD ESTABLISHMENT - FUNCTIONAL INTEGRITY - UNITY OF OWNERSHIP, MANAGEMENT AND CONTROL.
Fact of the Case:
M/s Vir Arjun Newspaper Pvt. Ltd. (Petitioner) challenged the order of the Regional Provident Fund Commissioner (Respondent No. 1) and the Employee’s Provident Fund Appellate Tribunal (Respondent No. 2) denying infancy protection under Section 16 of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (the Act). The authorities concluded that the Petitioner was not entitled to infancy protection as it was a continuation of the old establishment, M/s Daily Vir Arjun.
Finding of the Court:
The Court found that the Petitioner was not entitled to infancy protection under Section 16(2) of the Act. It held that the Petitioner was a continuation of the old establishment, M/s Daily Vir Arjun, based on the following findings: * The Petitioner was incorporated in 1987, but the registration number for its newspaper, Vir Arjun, was the same as that of M/s Daily Vir Arjun, which had been published by Mr. K. Narendra, the father of Mr. Anil Narendra, the Managing Director of the Petitioner. * Mr. Anil Narendra was the publisher, editor, and printer of both M/s Daily Vir Arjun and Vir Arjun. * There was evidence that M/s Daily Vir Arjun continued to be published between 1982 and 1985, even after Mr. K. Narendra claimed to have closed it down in 1981. * The Petitioner failed to produce any evidence to prove that it was a separate establishment from M/s Daily Vir Arjun.
Issues: 1. Whether the Petitioner was entitled to infancy protection under Section 16(2) of the Act. 2. Whether the Petitioner was a continuation of the old establishment, M/s Daily Vir Arjun.
Ratio Decidendi: The Court applied the following principles in reaching its decision: * The question of whether two units should be considered as one establishment or otherwise is a question of fact. * In determining whether two units form part of the same establishment, courts consider factors such as unity of ownership, management and control, unity of finance and unity of labour, unity of employment and unity of functional “integrality.” * A conclusion whether two units should be considered as one establishment or otherwise is a question of fact.
Final Decision: The Court dismissed the writ petition, upholding the orders of the Regional Provident Fund Commissioner and the Employee’s Provident Fund Appellate Tribunal.
V. Kameswar Rao, J.:--
1. The challenge in this writ petition is to the order dated July 12, 1999 passed by the Respondent No. 1 i.e. The Regional Provident Fund Commissioner, Delhi (Commissioner) and order dated May 09, 2000 passed by the Respondent No. 2 i.e. The Employee’s Provident Fund Appellate Tribunal (‘Tribunal’ in short), whereby the Commissioner has concluded that the petitioner herein i.e. M/s Vir Arjun Newspapers Pvt. Ltd. and M/s Sandhya Vir Arjun are not entitled to infancy protection as envisaged under Section 16 of the Act as these are a continuation of the old establishment M/s Daily Vir Arjun. They were directed to report compliance in respect of the employees of M/s Daily Vir Arjun and M/s Sandhya Vir Arjun with effect from January, 1983 after excluding the amount deposited by the establishment earlier, and the appeal against the order of Commissioner was dismissed by the Tribunal.
2. It was the case of the petitioner that M/s Daily Vir Arjun, the newspaper published by Mr. K. Narendra, as proprietor, was started sometime in the year 1971. It was a proprietary concern which was closed down in the year 1981. It published a newspaper called ‘Daily Vir Arjun’. The establishment was covered under the Act and its code number was DL-111. Mr. K. Narendra was registered with the Registrar of Newspapers for India and the registration number allotted was 511/57. On the closure of ‘Daily Vir Arjun’, all employees employed at that time were removed from service and their full and final payment was made before the Conciliation Officer. These employees had withdrawn their provident fund from the Commissioner’s office. Thereafter the proprietary firm was never restarted by Mr. K. Narendra or any other person.
3. That after closure of ‘Daily Vir Arjun’, en eveninger was started by Mr.Anil Narendra. The newspaper was called and registered as ‘Sandhya Vir Arjun’. Sandhya Vir Arjun was registered with the Registrar of Newspaper for India and was allotted the registration number 47311/88 dated May 25, 1988. Mr. Anil Narendra was the sole proprietor of ‘Sandhya Vir Arjun’. It was the case of the petitioner that the total number of employees had always remained less than 20.
4. It is the petitioner’s case that it was incorporated on December 15, 1987. It started publishing newspaper called ‘Vir Arjun (Hindi Daily)’with effect from April 18, 1988. The newspaper was published by Mr. Anil Narendra and was also registered with the Registrar of Newspapers for India and was allotted registration No. 511/57 vide certificate dated June 16, 1988. After 5 years of the commencement of the business, the petitioner vide its letter dated March 29, 1993 addressed to the Respondent No. 1 requested to allot an Establishment Code Number in order to facilitate the petitioner to deposit the deductions of the employees contribution along with other charges but no communication was received back. The petitioner send numerous reminders to the respondent No. 1 vide its letter dated December 05, 1994, May 25, 1995 and September 05, 1995 to issue Establishment Code Number to the petitioner and also informed the respondent No. 1 vide its letter dated May 25, 1995 that the petitioner, suo motu started depositing Provident Fund in the State Bank of India. However, the petitioner did not receive any reply to the said letters.
5. That it may be necessary to state here that summons dated June 29, 1988 were issued to ‘Daily Vir Arjun’, Pratap Bhawan, 5, Bahadur S hah Zafar Marg, New Delhi. Pursuant thereto the Area Enforcement Officer visited the petitioner’s establishment on August 29, 1988 and found that establishment was not reporting compliance of the provisions of the Act with effect from January. 1983. It is noted that the Area Enforcement Officer has in her report stated as under:-
a. “Two establishments are functioning – i) M/s Daily Vir Arjun Sandhya [Evening Edition]; & ii) M/s Vir Arjun News Paper Pvt. Ltd. [Morning Edition]. Daily Vir Arjun Sand
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