The main legal point established is that the apprentices appointed under Certified Standing Orders of a factory are exempted from the purview of the Employees'' State Insurance Act, 1948.

JUDGMENT

(Common Prayer: Civil Miscellaneous Appeals filed under Section 82(2) of the Employees'' State Insurance Act 1948, to set aside the order dated 19.09.2017 passed by the ESI court (Labour Court), Madurai in E.S.I.O.P.Nos.18 and 17 of 2009 and allow the ESIOPs filed by the appellants.)

Common Judgment:

Both these appeals have been filed by the Management challenging the order passed by the E.S.I.Court, Madurai in ESIOP.Nos.17 and 18 of 2009 wherein the order the E.S.I.Corporation under Section 45-A of the E.S.I.Act demanding contribution for the apprentices appointed under the Certified Standing Orders of the factory have been confirmed.

2. Factual Background:

(i).In CMA(MD).No.921 of 2018, the appellant is admittedly a factory and they are covered under E.S.I.Act. An inspection was conducted on 13.03.2008 and a show cause notice was issued on 26.06.2008 why the contribution should not be recovered from the employer towards apprentice wages and trainee wages.

(ii). A Form C-18 notice was issued on 26.06.2008 in which a sum of Rs.48,901/- was demanded as contribution towards apprentice wages and trainee wages. After affording opportunity to the management, an order under Section 45-A of the Act was passed on 26.12.2008 confirming the contribution of Rs.48,901/-. Challenging the same, the management had filed ESIOP.No.18 of 2009

(iii). In CMA(MD).No.953 of 2018, admittedly the appellant management is a factory and it was covered under the E.S.I.Act. An inspection was conducted on 28.11.2005 and a Form C-18 notice was issued on 25.09.2008 demanding a sum of Rs.1,60,019/- for the period between April 2004 to March 2007 towards the omitted wages of stipend paid to the apprentices. After affording opportunity to the management, the provisional order was confirmed by way of an order under Section 45-A of the Act on 24.12.2008. This order was challenged by the management in ESIOP.No.17 of 2009.

3. The primary contention of the management before the ESI Court was that the definition of employee under Section 2(9) of the E.S.I.Act does not include an apprentice or a trainee. Therefore, the stipend or  wages paid to the trainees could never be considered to be wages under Section 2(22) of E.S.I.Act. The Hon''ble Supreme Court in a judgment reported in (1975) 2 SCC P 835 (The Employees'' State Insurance Corporation and another Vs. The Tata Engineering & LOCO Motive Co.Ltd., and another) has held that there is no provision to cover the apprentices under E.S.I.Act. However, it pointed out that the parliament has got power to amend the E.S.I.Act and to incorporate necessary provisions to cover apprentices and trainees. Subsequent to the said judgment, the E.S.I.Act was amended with effect from 20.10.1989 under Central Act 29 of 1989. Under the Amended Act, Section 2(9) of the Employees'' State Insurance Act, 1948 was amended to cover the apprentices except those who were appointed under Apprentices Act, 1961 or appointed under the Standing Orders of an establishment.

4. It was further argued on the side of the management that the term ''establishment'' would also include a factory and therefore, any apprentice appointed under the Certified Standing Order of a factory is also exempted after the Central Amendment Act 29 of 1989. The orders under Section 45-A of the E.S.I.Act have been passed with regard to both the factories only relating to the period prior to 01.06.2010. Because with effect from 01.06.2010, Section 2(9) of the E.S.I.Act was further amended granting exemption only to the apprentices engaged under Apprentices Act 1961. The Apprentices appointed under the Certified Standing Order of an establishment are not exempted. Therefore between 20.10.1989 and 31.05.2010, the apprentices appointed under Certified Standing Order of a factory are also exempted. It was further contended that the term ''establishment'' would include the meaning of a factory. Therefore, merely because the ter