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1955 Supreme(Mad) 19

IN THE HIGH COURT OF JUDICATURE AT MADRAS
Mr. Justice Rajagopalan, J.
Amnamalai Mudaliar and Bros., by managing Partner A. Mariappa Mudaliar
Versus
Regional Provident Fund Commissioner
W.P.No. 445 of 1954.
Decided On : 20 January 1955

Advocates:
M.K.Nambiar for Petitioner.
The Special Government Pleader (V.V.Raghavan) on behalf of Respondents.

What constitutes employment.

Headnote:Employees Provident Fund Act, 1954-Scope and applicability-Jurisdiction of Commissioner in the matter of deciding applicability of the Act.

Order.-The petitioner is the managing partner of a firm which owns a factory at Karur where bedsheets and towels are manufactured on handlooms. The real question that arises for determination in this application, filed under Article 226 of the Constitution for the issue of an appropriate writ to the respondents, to restrain them from enforcing the provisions of the Employees Provident Fund Act (XIX of 1952) and the scheme framed thereunder against the petitioner firm, was whether it “employed” 50 persons or more in the factory within the meaning of section 1(3) of that Act.

The position was to some extent clarified after the first respondent filed a supplementary counter affidavit. The seven persons enumerated in paragraphs 2 of that affidavits belonged to the office staff of the petitioner’s factory, and they were paid wages on a monthly rate. It was only with reference to these seven persons that contributions were claimed by the first respondent under the provisions of the scheme framed under Act XIX of 1952. But even that claim could be justified only if the Act applied to the petitioner’s factory, that is, only if it could be found that 50 or more persons were “employed” in that factory.

The conditions under which the labourers worked on the handlooms in the petitioner’s factory on its manufacturing side were set out in paragraph 3 of the affidavit filed by the petitioner.

“Weavers from the neighbourhood undertake to weave bedsheets and towels by the yarn supplied by us within our premises and payment is made not as wages for work done for any particular time but only according to the stipulated rates for the particular fabric that are woven and turned out by each individual weaver. The weavers who are so engaged on a contract basis do not turn up or leave the premises at any stipulated time but work in the premises at any time convenient to them in order to suit their agricultural operations during the same period or to attend to similar work that they usually undertake with similar establishments situated in Karur. There are no fixed employees for the business of weaving bedsheets and towels in the firm. No weaver is permanently attached to a particular weaving firm. They are only casual workers who come and go at such times and days as are convenient to them and paid according to the piece work turned out by them.”

These facts were not controverted in either of the affidavits filed by the first respondent. The number of labourers exceeded 50 was not denied by the petitioner at any time.

The main contention of the petitioner was that these workers were not employees as defined in section 2(f) of the Act and what was payable to them for the work done by them was not wages. That was what was urged also in paragraph 15(a) of the petitioner’s affidavit.

The question in the form in which it was finally raised before me was not decided by the first respondent at any time. Despite the correspondence between the petitioner and the first respondent, in which this aspect of the conditions of labour was adverted to by the petitioner, adjudication of the issue on the narrowed basis now represented to me was apparently not sought by the petitioner. In any case, there was no decision beyond that implied in the claim by the first respondent that the provisions of the Act applied, which was the basis for the demand notices he issued to the petitioner to pay up the contributions claimed to be due, and also the further steps taken by the first respondent and the second respondent to recover the sums demanded as arrears of land revenue under the provisions of section 8 of the Act.

It should, however, be noted that neither the Act nor the scheme vests any power in the first respondent to adjudge a dispute should one arise, whether the factory is one to which the Act applied, that is, whether it is a factory within the scope of section 1(3) of the Act. Section 19-A specifically provides:

“If any difficulty arises in giving effect to the provisions




































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