The applicant in I.C.37/96 on the file of the Employees Insurance Court, Palakkad is the appellant in this M.F.A. The appellant is the proprietor of a hotel under the name and style ‘Indian Hotel’ at Nilambur. According to the appellant, he took the building on lease (in which the hotel is situated) from Kannanari Moideenkutty as per an agreement dated 30-6-91 and started the business from 2-7-1991 after obtaining necessary licence from Nilambur Panchayat. It was averred that in that building Sri K. Muhammed Basheer was running a hotel. He closed the establishment on 15-3-1999 after terminating the services of the workers. The workers were given all the benefits admissible to them. It was averred that the business started by the appellant is neither a continuing one nor a transferred one. It was also averred that the appellant had not engaged more than the minimum number of employees so as to bring the same within the meaning of factory or establishment. It was averred that on 5-9-91 and 6-7-92 the Insurance Inspector, Ferroke had inspected the establishment and was satisfied that the establishment was not liable to be covered. It was alleged that after the lapse of 5 years, the appellant was served with a notice stating that his establishment was covered under the provisions of the Employees State Insurance Act, 1948 (for short, ‘the Act’) and he was directed to comply with the provisions of the Act and to pay contribution from 2-7-91. The appellant filed reply on 13-5-96 denying his liability. The competent authority rejected the contention of the appellant and directed to pay the contribution. The appellant filed I.C.37/96 before the Insurance Court challenging the order of the Regional Director. The Employees Insurance Court, Palghat, found that the establishment run by the petitioner is a contribution of another establishment which was already covered by the Act. It was held that in view of the provisions contained Section 1(6) of the Act, the appellant’s establishment is also liable to be covered. Challenging that decision, this M.F.A. is filed.

2. Advocate Sri Ajayakumar appearing for the respondent raised a preliminary objection that the M.F.A. itself is not maintainable. It is argued that in view of the provisions contained in Section 82 of the Employees State Insurance Act, an appeal can be admitted and heard only on a substantial question of law. It is argued that no substantial question of law arises in this M.F.A. and no such question was also framed in this M.F.A. It is argued that whether the present establishment is a continuation of the old establishment is essentially a question of fact and no question of law arises in such a case. The learned counsel for the respondent relied on a decision reported in The Regional Provident Fund Commissioner v. C.K.M. Saw Mills (1981 (1) ILR 293). In C.K.M. Saw Mill’s case, the decision was rendered under Section 19A of the Employees Provident Fund Act, 1998. The question arose for consideration in that case was also whether the establishment was in fact the continuation of the old establishment. A Division Bench of this Court after considering the law on the point held that whether the old establishment was extinguished and a new establishment came into being is essentially a question of fact. In C.K.M. Saw Mill’s case the Division Bench followed the principles laid down by the Supreme Court in S.L.P. (Civil) No.4583 of 197 in which it was held as follows:

“The sole question that arises in such a situation is as to whether a new establishment has been set up or whether there is a continuation of the old establishment. This is essentially a question of fact depending on many variables”.

The learned Counsel appearing for the appellant relied on a decision reported in T.A. Zainulabdeen v. Regional P.F. Commissioner, Kerala (1975 Lab I.C. 412). It was held as follows:

“An establishment need not in all circumstances continue to be the same establishment: a disruption of