The main legal point established in the judgment is the broad definition of 'employee' under the EPF Act, which includes both direct and indirect employees, and the legislative intent to protect employees from employers attempting to avoid regulatory expenses.

JUDGMENT :

SATISH CHANDRA SHARMA, J.

1. The Employees’ Provident Funds And Miscellaneous Provisions Act, 1952 (Hereinafter referred as “the EPF Act” or “the Act”) provides for the institution of certain funds to be maintained through contributions by employers employing equal to or more than 20 persons in their establishments. The competent authority under the EPF Act declared the appellant’s establishment to be an employer under the Act and held it to be governed by the provisions of the Act. Whether the appellant is governed by the provisions of the EPF Act, and thus liable to meet certain obligations meant for employers under the Act, is the sole question that falls for our consideration.

2. On 01.10.2012, the appellant received a communication whereby his establishment Shri Krishna Automobiles was brought under the purview of the EPF Act. Aggrieved thereby, the appellant preferred a review petition dated 06.11.2012 before the Assistant Provident Fund Commissioner (Hereinafter referred as “APFC”), Agartala, which came to be dismissed. Thereafter, on 27.02.2013, the appellant filed an application under Section- 7A of the Act before APFC, Agartala for determining whether his establishment was covered by the Act or not. The Commissioner conducted a quasi-judicial enquiry in this regard. Upon culmination thereof, an order was passed by the Commissioner declaring the establishment to be covered by the Act. During the course of this proceeding, the appellant submitted that the establishment was employing 17 employees and 3 security personnel who were only employed for a temporary period and on need basis. It was further submitted that the three security personnel were engaged through a contractor namely New Brave Security Pvt. Ltd. on outsourcing basis and thus, they cannot be regarded as the employees of his establishment. The appellant was given opportunity to produce the relevant records to show the employees engaged by the establishment. The appellant, before the Commissioner, also took the stand that the wages of the said security personnel were not being paid from the accounts of the establishment and thus, they cannot be regarded as the employees of the establishment. However, the Enforcement Officer furnished the profit and loss account of the establishment along with the balance sheet for the concerned period of time, which revealed that the wages of the security personnel were paid from the account of the establishment. On this basis, the application under Section-7A came to be decided against the appellant vide order dated 01.07.2013 passed by the APFC, Agartala.

3. The aforesaid order came to be challenged before the Employees Provident Fund Appellate Tribunal (Hereinafter referred as “the Tribunal”) which upheld the order passed by the Commissioner and noted that the appellant employed 20 persons, including the three security personnel. Challenging the Tribunal’s order, the appellant has approached this Court by way of a writ petition. Ld. Single Judge traversed through the history of this case at length and found the impugned orders to be on the right side of the law. Ld. Single Judge noted that the appellant’s own documents reflected that the three security personnel were being paid from the account of establishment and thus, they were employed with the establishment. The Court further noted that the Tribunal correctly relied upon the definition of “employee” within the meaning of the Act as it included both direct as well as indirect employees hired through a contractor. The operative part of the impugned order reads thus:

“29. On a consideration of the averments made in the petition, the response of the respondent, written submissions made on behalf of either side and oral submission addressed on behalf of either side by their learned counsel, it is apparent that the impugned order dated 09.05.2017 of the learned Employee Provident Fund Appellate Tribunal, New Delhi i.e. EPFAT in ATA No.480(2)/2013 is based on the pro