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1985 Supreme(Guj) 24

Gujarat High Court
Judgename :I.C.BHATT, P.S.POTI
D.S.VASAVADA - Appellant
Versus
REGIONAL P.F.COMMISSIONER, GUJARAT - Respondent
S.CRI.A. 5663 of 1984
Decided On : 01/29/1985

Advocates Appeared: D.S.VASAVADA, S.K.SHAH

Headnote:

Second Criminal Appeal – Employees Provident Funds and Miscellaneous Provisions Act, 1952 – Sections 5a, 6c – Industrial Disputes Act, 1947 – Section 25fff (1) – Extending welfare measures to the working class – Employees Deposit-linked Insurance Scheme – Retrenchment – 129 workmen represented by the Textile Labour Association of Ahmedabad were admittedly employees in mills closed down during the period from 8/03/1982 to 14/06/1984 – The Parliament has amended the Employees Provident Funds and Miscellaneous Provisions Act 1952 in the year 1976 by introducing a welfare plea of legislation in the form of Employees Deposit-linked Insurance Scheme. Sec. 6c of the Employees Provident Funds and Miscellaneous Provisions Act 1952 empowers the framing of such scheme – Contribution is payable by an employer as well as by Central Government calculated on the basis of the basic wages dearness allowance and retaining allowance of the employee – No employees contribution is to be deducted from the wages – The amount received as the employers contribution as also the Central Government contribution to the Insurance Fund is credited to the Deposit-linked Insurance Fund Account – The Fund was intended for payment of benefits in accordance with the provisions of the scheme – On the death of an employee who is a member of the Fund the persons entitled to receive the Provident Fund accumulations of the deceased are entitled in addition to such accumulations during the preceding three years or during a period of his membership to receive an amount not exceeding Rs. 10 0 So the maximum limit of insurance payable in respect of a workman who is a member of the Fund is the amount of Rs. 10 0 – The case of the petitioner is that there has been no Termination of services of any of the 129 employees on the date of their death and the mere closure of the mills cannot be taken to amount to termination of their service – Held, As this court have said mere closure without notice or closure simultaneously with putting up a notice would not satisfy the requirement of Sec. 25ffa. Closure specifically keeping employees in service would negative the very concept of termination of service – Even the closure in regard to one of the Mills viz. No. 6 would not operate to terminate their services for Sec. 25 FFF requires notice and compensation as if in a retrenchment – For the reasons stated above the 129 persons whose cases are sponsored by the Textile Labour Association are to be found to have been members of the Fund on the date of their death which would mean that they are entitled to the insurance benefit claimed – Respondent is directed to pay the insurance benefits within two months from today – The amount of insurance should be paid with interest at 12% per annum for the period after three months of the date of death in the respective cases – Petition allowed.

P. S. POTI, J.

( 1 ) THERE are many enactments in this country intended to serve the purpose of extending welfare measures to the working class. Merely enacting laws would not be an adequate protection or extension of a necessary benefit. Such laws have to be implemented with a sense of commitment. That largely depends on who apply the law and how they handle it. That also depends quite often on the degree of efficiency of the persons administering the law and the capacity to take decisions one way or the other expeditiously. Time is of the essence and delay will destroy the advantage conceived by extention of the benefits of such welfare measures.

( 2 ) WE are tempted to preface this judgment with these remarks because of the stand taken by the Regional Provident Fund Commissioner of the Gujarat State in regard to meeting the claims of the dependents of 129 deceased workmen who were working in the textile mills at Ahmedabad. Whatever might have been the stand taken by the respondent earlier at least after issue of notice a different stand if taken could have been appreciated but the respondent has chosen to contest the petition.

( 3 ) THE point for our determination is quite simple. These 129 workmen represented by the Textile Labour Association of Ahmedabad were admittedly employees in mills closed down during the period from 8/03/1982 to 14/06/1984. The Parliament has amended the Employees Provident Funds and Miscellaneous Provisions Act 1952 in the year 1976 by introducing a welfare plea of legislation in the form of Employees Deposit-linked Insurance Scheme. Sec. 6c of the Employees Provident Funds and Miscellaneous Provisions Act 1952 empowers the framing of such scheme. The scheme is to be administered by the Central Board constituted under sec. 5a of the Act. The power of the Central Board could be delegated to the Commissioner. Contribution is payable by an employer as well as by Central Government calculated on the basis of the basic wages dearness allowance and retaining allowance of the employee. No employees contribution is to be deducted from the wages. The amount received as the employers contribution as also the Central Government contribution to the Insurance Fund is credited to the Deposit-linked Insurance Fund Account. The Fund is intended for payment of benefits in accordance with the provisions of the scheme. On the death of an employee who is a member of the Fund the persons entitled to receive the Provident Fund accumulations of the deceased are entitled in addition to such accumulations during the preceding three years or during a period of his membership to receive an amount not exceeding Rs. 10 0 So the maximum limit of insurance payable in respect of a workman who is a member of the Fund is the amount of Rs. 10 0

( 4 ) THE 129 persons mentioned in Annexure A were admittedly members of the Fund they being employees of various mills covered by the Employees Provident funds and Miscellaneous Provisions Act 1952 This is not disputed. That they died is also not disputed. But it is said that since on the respective dates of their deaths the mills had been under closure their service must have been taken as terminated and therefore on the date of their death they were not members of the Fund. If so their legal representatives would not be entitled to the benefit of the insurance. This in short is the stand by the respondent.

( 5 ) THERE is no dispute that all the 14 mills have factually closed. In fact many more mills have been closed in Ahmedabad in this period of crisis for the textile industry in the State. Some of them have closed expressly declaring that they would re-open in due course and keeping the employees in service in the meanwhile. Others have closed without expressing whether they are closing temporarily or permanently. The case of the petitioner is that there has been no Termination of services of any of the 129 employees on the date of their death and the mere closure of the mills cannot be











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