An establishment employing more than 20 workers is covered under the Employees' Provident Fund Act, and failure to provide sufficient evidence to dispute its applicability leads to dismissal of certification challenges.

JUDGMENT

Mr. Harsh Bunger, J. (Oral)

Petitioner (M/s Hotel Vikrant) has filed the instant writ petition under Articles 226/227 of the Constitution of India, seeking a writ in the nature of certiorari for quashing the order dated 17.06.2005 (Annexure P-5) passed by the Assistant Provident Fund Commissioner (in short 'the APFC') under Section 7(a) of the Employees' Provident Fund and Miscellaneous Provision Act, 1952 (in short 'the 1952 Act').

Petitioner further seeks quashing of order dated 06.01.2011 (Annexure P-7) passed by the Employees' Provident Fund Appellate Tribunal (in short 'the Appellate Tribunal'); whereby the appeal filed by the petitioner against order dated 17.06.2005 (Annexure P-5) was dismissed.

2. Briefly, the Area Enforcement Officer from the Office of Regional Provident Fund Commissioner, Karnal visited the premises of the petitioner on 20.01.1999 and he found that 20 employees were working in the petitioner-establishment. Accordingly, the Area Enforcement Officer made a list of the employees, who were found working at the spot in the petitioner's premises and the said list was got signed from the Manager of the petitioner-establishment. Thereupon, the Area Enforcement Officer recommended that the petitioner-establishment be covered under the 1952 Act as 20 workers were found working at the time of inspection of the petitioner's premises. In this regard, the petitioner-establishment was informed vide letter dated 27.05.1999 and the proceedings under Section 7(a) of the 1952 Act were initiated.

3. The petitioner submitted a reply (Annexure P-2) to the notice under Section 7(a) of the 1952 Act, wherein a stand was taken that from the date of inception of the petitioner-establishment, they had never employed 20 or more than 20 employees and therefore, the petitioner-establishment was not covered under the 1952 Act. It was further stated that the petitioner-establishment came into existence and started its business w.e.f. 01.01.1999 and in terms of Section 16(1)(d) of the 1952 Act, the application of the provisions of the Act are exempted for a period of three years, from the date when the such establishment is or has been set up.

4. As per the petitioner, Hotel-Vikrant (petitioner-establishment) is situated in Village Rally, which is now Sector 12-A, Panchkula and the said hotel is constructed on a plot of 100 sq. yards and it is not possible to employ 20 persons in such a small place; more so, the hotel was catering only to local people. Petitioner claims that it was never supplied with the list of employees during the proceedings under Section 7(a) of the 1952 Act. It is submitted that an order to arrive at a conclusion that the petitioner-establishment is covered under the 1952 Act, it was incumbent upon the authorities to collect relevant material by examining the books of accounts and/or other records of the establishment and then base its finding on the evidence/relevant material. Petitioner maintains that during the proceedings under Section 7(a) of the 1952 Act, it had supplied copies of balance sheets for the year 1998-99 upto 2003-04 and in case, the total salary/wages paid by the establishment during these years is divided by minimum wages, then the strength of establishment would not go beyond 5-6 employees.

5. The learned APFC, upon considering the material available on the record, passed an order dated 17.06.2005 (Annexure P-5) holding that the 1952 Act is applicable to the petitioner-establishment w.e.f. 20.01.1999 and the petitioner was directed to report compliance under the various provisions of the 1952 Act as well as the schemes framed thereunder