Central Government has power to decide about applicability of the Act.

1. The batch of writ petitions can be dealt with under a common judgment. It is enough if the facts in Writ Petition No. 1800 of 1978 alone are noted. The petitioner-establishment carried on business of manufacturing Jamakalams (carpets) otherwise know as Thari Carpets, which are manufactured by using 22 looms and 2 permanent employees. As such, according to it the Employees' Provident Funds Act, 1952 (hereinafter referred to as the Act) would not apply to the petitioner. Under the Act, the establishment should have at least 20 employees employed therein. This being so, the second respondent, viz., the Regional Provident Fund Commissioner, Madras-14, issued a memo to the petitioner calling upon it to submit a return in Form 9 prescribed under the Employees' Provident Fund Schemes, 1952 and also a return in Form 3(FPF) prescribed under paragraph 15 of the Employees' Family Pension Scheme, 1971. Since the petitioner was contending that the Act itself would not apply in view of the fact that there being two permanent employees, all the others were merely independent contractors, and as such they are not employees, a petition was filed on 11th February, 1977, before the Central Government under S. 19A of the Act. In that application it was prayed that Central Government might decide whether the Act would apply to the petitioner-establishment. This was duly informed to the second respondent. The first respondent, before whom this application was filed, passed the following order on 5th May, 1978 :

"No. S-35011/13(1-A)/78-PPC

Government of India,

Ministry of Labour,

New Delhi, the 5th May, 1978.

To

M/s. A.K.N. Textiles,

Bhavani P.O.,

Tamil Nadu,

Sub :- Coverage of carpet manufacturers in Tamil Nadu under the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 - Representation under S. 19A of the said Act.

Dear Sir,

With reference to your representation dated 11th February, 1977 on the above subject, I am to say that it is now settled law that completion of the proceedings under S. 7A of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 by the Provident Fund Authorities concerned are mandatory before a party can approach the Central Government under S. 19A of the said Act. The following passage from the judgment of Delhi High Court in Raj Narayan Aggarwal v. Regional Fund Commissioner, (1976) Lab. I.C. 131, is relevant in this context, namely :

"The primary enquiry under S. 7A cannot be got over by resorting to S. 19A even where the employer applies under S. 19A. The matters to be decided by the Government under S. 19A may be decided after necessary facts are gathered and after an enquiry postulated by S. 7A is made, if the facts are in dispute. If the procedure under S. 7A is adopted there will be full, fair and effective opportunity for a dialogue between an employer and the officer concerned; this will not be feasible at least to the same extent and measure under S. 19A. Order passed by the Government under S. 19A without primary enquiry under S. 7A is not valid.

The Gujarat High Court in a recent judgment in Textile Allied Industries Research Organisation (TAIRO) Board v. R.R. Sahee Regional Provident Fund Commissioner, Gujarat, (1977) 18 G.L.R. 540, has also reiterated the same view.

(2) It is seen from the facts narrated in your representation that the Regional Provident Fund Commissioner has not yet instituted the inquiry under S. 7A of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 and his findings on the question whether the Act and the Scheme are applicable to your establishment have not been recorded. In view of judgments of Delhi High Court and Gujarat High Court referred to in para. I above, your representation under S. 19A of the aforesaid Act is premature and cannot be entertained as it has been submitted to the Central Government before the completion of proceedings under S. 7A by the Regional Provident Fund Commissioner and passing of the order thereunder.

(3) The case is a