ORAL JUDGMENT

1. This first appeal under section 82(2) of the Employees’ State Insurance Act, 1948 (for short “ the Act, 1948) is at the instance of the original applicant before the ESI Court and is directed against the judgment and order dated 01.02.2017 passed by the ESI Court in the ESI Application No.26 of 2009 filed by the appellant herein.

2. The facts giving rise to this first appeal may be summarized as under;

2.1 On 01.11.2008, one officer of the respondent- Corporation visited the premises of the appellant. Upon verification of the muster roll, the officer noticed that 24 employees were in the employment of the Company. The officer also noticed that out of 24 employees, 17 employees were working in the establishment/premises of the employer, whereas 7 employees were working on the field at Paguthan/Changodar. It was also found that all the employees were drawing salary less than Rs.10,000/- per month, which is eligible for them to get register with the ESI Corporation.

2.2 On 03.02.2009, the appellant-Company was heard in this regard. After giving opportunity of hearing, the Corporation passed an order directing the appellant herein to comply with the provisions of the Act and to register all its employees with the ESI Corporation so that the employees can avail of the benefits under the Act.

2.3 The appellant, instead of complying with the provisions of the ESI Act, thought fit to challenge the applicability of the Act before the ESI Court by filing the ESI Application No.26/2009 substantially on two grounds; first, the appellant would not fall within the ambit of the term “factory” as defined under section 2(12) of the ESI Act and second, as seven employees were working outside the premises of the establishment, the provisions of the ESI Act would not be applicable to the appellant.

2.4 According to the appellant, Paguthan is not covered under the sweep of benevolent legislation and, therefore, the employees working at Paguthan cannot be taken into consideration for the purpose of making the provisions of the Act applicable.

2.5 It appears that during the pendency of the aforesaid ESI Application filed by the appellant herein, the appellant started complying with the provision of the Act, 1948 and registered all its employees with the ESI Corporation and also started depositing the contribution under section 39 of the Act, 1948. The ESI Court vide the impugned judgment and order dated 01.02.2017, held the appellant as an establishment and declared that the Act, 1948 would be applicable from 01.11.2008 and not from 01.06.2011. The ESI, in taking such a view, relied on a decision of the Supreme Court in the case of Royal Western India Turf Club Ltd.vs. E.S.I. Corporation, 2016(4) SCC 521.

2.6 Being dissatisfied with the judgment and order passed by the ESI Court, the appellant is here before this Court with the present first appeal, formulating the following questions as the substantial questions of law in the memorandum of the first appeal.

“(a) In view of findings recorded by the learned ESI Court that the appellant cannot be considered as factory within the meaning of Section 2(12) of the ESI Act, whether learned ESI Court could have sustained the order dated 03.02.2009 making the Act applicable to the appellant?

(b) When only 17 employees were found to be working in the premises of the appellant and admittedly other seven employees were working on the field outside the area covered under the Notification of ESI (the area in which ESI Act is not applicable), whether the said employee could have been clubbed with other 17 employees working in the premises making the Act applicable to the appellant?”

3. Mr. Dave, the learned counsel appearing for the appellant vehemently submitted that the ESI Court committed a serious error in passing the impugned order. According to Mr. Dave, the impugned order is erroneous in law.

4. Mr. Dave would submit that the ESI Court, once having taken the view that the appellant does not fall wit