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2014 Supreme(Ker) 360

High Court of Kerala
B. KEMAL PASHA, J.
Kailasanatha Vidya Nikethan, represented by its Executive Director, Mallika Purushothaman
Versus
Employees State Insurance Corporation, rep. by its Regional Director & Others
Ins. Appeal Nos. 37, 38, 39, 40, 60, 79, 89, 90 & 99 of 2012 & 30, 31, 35, 36, 38 & 40 of 2014
Decided on : 02-07-2014

Advocates appeared:
For the Appellant:N.N. Sugunapalan, Sr. Advocate, M.B. Prajith, K.K. Premalal, Advocates.
For the Respondents:R1 & R2, P. Sankarankutty Nair, SC, ESI Corpn, Sandesh Raja, T.V. Ajayakumar, Advocates.

Headnote:A. Employees State Insurance Act, 1948 Section 1(5) The term "or otherwise" - If Governments intention is to include establishment similar to industrial, commercial or agricultural alone as establishments, definitely, legislature would have worded it as "such other establishments of similar nature",Plea that term `or otherwise' does not give a blank cheque to the Government to bring any establishment totally aliened to an industry, commercial and agricultural establishment within the sweep of the Act is not tenable.

        B. Employees State Insurance Act, 1948 Sections 2(9) and 1(5) Term "employee" - Teachers employed by CBSE Schools being run by organisations are also employees within in the meaning of section 2(9) r/w 1(5) of the Act - Terms "employee" contained in section 2(9) of the ESI act has a wider amplitude than that of a `workman' as contained in section 2(s) of Industrial Disputes Act and `employee' as contained section 2(i) of the Minimum Wages Act.

       C. Employees State Insurance Act, 1948 Sections 2(9) and 1(5) Notification - Government is free to bring any establishments of their choice within the sweep of section 1(5) of the ESI Act and there cannot be any restriction to it - CBSE School can be an establishment within the meaning of "or otherwise" as contained in section 1(5) of the ESI Act, or `or establishment to which this Act applies' in various provision of the Act.

       D. Civil Procedure Code, 1908 Sections 11 Explanation (ii) - Employees State Insurance Act, 1948 Section 1(5) and 2(1) Res judicata - Appropriate Government - Government of Kerala issuing notification bringing CBSE Schools within the purview of the Act -Government of Kerala is an appropriate Government within the meaning of section 2(1) r/w section 1(5) of the Act as the CBSE schools are under the control of Central Government.

       

Judgment :

(i) Can CBSE schools in the State of Kerala being run by individuals, trustees, societies or other organisations be brought within the category of 'educational institutions' mentioned in the impugned notification?

(ii) Whether the Government of Kerala is the 'appropriate Government' within the meaning of Section 2(1) read with Section 1(5) of the ESI Act empowered to issue the impugned notification?

(iii) Whether the decision in C.B.S.E. School Management's Association Vs. State of Kerala [2009 (3) KLT 421] acts as res judicata to contend that the Government of Kerala is not empowered to issue the impugned notification?

(iv) Whether the teachers of CBSE Schools being run by such organisations be 'employees' within the meaning of Section 2(9) of the ESI Act?

(iv) Whether the impugned notification can be extended in the case of such teachers?

These are the common questions of law arise in all these appeals.

2. These are appeals of similar nature filed by various CBSE schools being run by different individuals, trustees, societies or other organisations in the State of Kerala, challenging notification G.O. (P) No.135/2007/LBR dated 08.10.2007 issued by the Government of Kerala ('the impugned notification', for short), extending the provisions of the Employees' State Insurance Act, 1948 ('the ESI Act', for short) to educational institutions run by individuals, trustees, societies or other organisations, wherein 20 or more persons are employed or were employed on any day of the preceding twelve months. Challenging C11 and C18 notices issued by the Employees State Insurance Corporation ('the ESI Corporation', for short), the said various schools have approached the Employees' Insurance Court through the insurance cases. Their cases stand dismissed through the impugned judgments.

3. Heard the learned Senior Counsel Sri.N.Sugunapalan and the learned Counsel Sri. K.K. Premalal for the appellants, and Sri.Sandesh Raja K. and Sri. T.V. Ajayakumar for the ESI Corporation.

4. The learned Senior Counsel for the appellants has taken this Court through various provisions of the ESI Act, Industrial Disputes Act, Minimum Wages Act, Kerala Education Act and Rules and the Affiliation byelaws of the Central Board of Secondary Education, and strenuously argued that such CBSE Schools being run by the individuals, trustees, societies or other organisations in the State of Kerala are also establishments 'under the control of the Central Government' and therefore, the Government of Kerala, not being the 'appropriate Government' within the meaning of Section 2(1) read with Section 1(5) of the ESI Act, is not empowered to issue the impugned notification. It is also argued that teachers are practising a 'profession' and not an 'occupation' and, therefore, it cannot be said that teachers are workers or workmen. The learned counsel Sri.Premalal has further argued that the decision in C.B.S.E. School Management's Association (supra) does not lay down the correct law on the subject, as the decision is per incuriam of the other decisions of the Apex court in the matter. It is also argued that teachers of CBSE Schools can never be categorised as 'employees' within the meaning of Section 2(9) of the ESI Act.

5. Per contra, the learned Standing Counsel for the ESI Corporation Sri. Sandesh Raja K. and Sri. T.V. Ajayakumar argued that the ESI Act as such is a self contained Code, which is capable of giving a wider amplitude to the definition of 'employee' so as to take in the teachers of CBSE Schools also within its sweep. It is also argued that the CBSE Schools, which are merely affiliated to the CBSE Board, cannot be categorised as institutions 'under the control of the Central Government'. It has also been argued that the Government of Kerala is the 'appropriate Government', who can issue the impugned notification as decided by the C.B.S.E. School Management's Association (supra) and also State of Kerala Vs. Mythri Vidya Bhavan E.M. School [2013 (



































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