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2025 Supreme(Online)(KER) 7338
HIGH COURT OF KERALA
AMIT RAWAL, K. V. Jayakumar, JJ
THE WELFARE FUND INSPECTOR – Appellant
Versus
C.K. SASIDHARAN – Respondent
WA 2096/2024
G.SANTHOSH KUMAR (P), SRI M G KARTHIKEYAN SR GP, SRI T K VIPINDAS
The court ruled that liability for welfare fund contributions lies solely with the primary employer, not intermediary parties, emphasizing the need for evidence of employment.
Headnote:(A) Kerala Toddy Workers Welfare Fund Act, 1969 - Sections 2(c) and 2(d) - Liability of employers for welfare fund contributions - The Single Bench's ruling that the appellant was not liable for contributions was challenged, asserting that the liability is joint and several - The court found that the appellant did not prove to be the employer of the workers, and the primary employer was liable for contributions. (Paras 1, 6, 7)
(B) Legal Interpretation - The court emphasized that employment must be proven with evidence, and the interpretation of the Act should align with its purpose and public policy. (Paras 6, 7)
Facts of the case:
The appellant, a Welfare Fund Inspector, contested a ruling that held him responsible for contributions under the Kerala Toddy Workers Welfare Fund Act, while the actual employers were found to be defaulters. (Paras 1, 2)
Findings of Court:
The court ruled that the appellant was not the employer of the workers and upheld the liability of the actual employer for contributions. (Paras 7)
Issues: The main issues included whether the appellant could be held liable for contributions and the interpretation of employer responsibilities under the Act. (Paras 1, 7)
Ratio Decidendi: The court concluded that without evidence of employment, the appellant could not be deemed an employer, and the interpretation of the Act must serve its intended purpose. (Paras 6, 7)
Result: Appeal allowed, judgment set aside.
| Table of Content |
|---|
| 1. appellant challenges liability ruling (Para 1) |
| 2. appellant argues for joint liability (Para 2 , 4) |
| 3. respondent counters with supreme court judgment (Para 3) |
| 4. court reviews definitions in the act (Para 5 , 6) |
| 5. supreme court's interpretation of employer (Para 7) |
| 6. judgment set aside, primary employer liable (Para 8) |
JUDGMENT
Amit Rawal, J.
1. Appellant – Welfare Fund Inspector has challenged the judgment of the Single Bench allowing the writ petition filed by the 1st respondent/petitioner who has unnecessarily been held responsible for not depositing the contribution of the employees working under the Kerala Toddy Workers’ Welfare Fund Act. Concededly, respondent Nos.2 and 3 were the successful bidders for running the Toddy shop Nos. 135 to 138 of Kuttanadu excise range. As per the Kerala Toddy Workers Welfare Fund Act, 1969 (hereinafter called ‘Act of 1969’) the employer is required to pay welfare funds for toddy shops in respect of the employees working therein. The petitioner, Sri.C.K.Sasidharan, a senior citizen was working as manager of respondent Nos.2 and 3 ie., Binesh and Bijesh. Both respondent Nos.2 and 3 were wilful defaulters in making the contribution resulted into determination order under Section 8 of the ‘Act of 1969’ against all the three. Respondent Nos.2 and 3 did not assail the aforementioned order, but was assailed by the 1st respondent/petitioner resulted into an order dated 31.03.2005 whereby the matter was remanded to the Welfare Fund Inspector for redetermination. On remand, vide order dated 11.12.2007, liability was fastened on Toddy shop No.135 against all the three. Thereafter also appeal was filed only by the 1st respondent/petitioner and not by the licensees. The ground of challenge before the single Bench was by taking the aid of provisions of Section 2 (c) of the Act as well as the judgment of Supreme Court in Joseph Joseph v. State of Kerala [2002 KHC 171] . Learned Single Judge by rejecting the argument put forward by the appellant that the liability is coextensive, i.e., jointly and severally, allowed the writ petition.
2. Sri.Santhosh Kumar.G, learned counsel appearing on behalf of the appellant submitted that two Division Benches of this Court, in the judgments inSasi V. v. State of Kerala [2016 KHC 694] and Ashokan V.K. v. Kerala Toddy Workers Welfare Fund Board and another [2012 (3) KLT 723] , rendered the findings in favour of the revenue, fastening the liability towards the non-contribution of the employers on the immediate employer and by holding it to be joint and several and therefore, impugned judgment is liable to be set aside.
3. On the other hand, Sri.M.G.Karthikeyan, learned counsel appearing on behalf of the respondent No.1 – the writ petitioner submitted that the aforementioned two judgments have not been taken into consideration in the judgment of the Supreme Court, therefore, cannot be held to be binding on this Court.
4. We have heard the learned counsel for the parties and appraised the paper book.
5. Sections 2 (c) and 2(d) of the Act reads as under:
2(c) “employer” means any person who employs, whether directly or through another person, or whether on behalf of himself or any other person, one or more employees and includes any person who has a licence for the manufacture, distribution, storage or sale of toddy under the Abkari Act for the time being in force.”
2(d) "employee" means any person who is employed for wages in connection with the tapping, manufacture, transport, storage or sale of toddy and who gets his wages directly or indirectly from the employer and includes any person employed by or through a contractor or through an agent in or in connection with the tapping, manufacture, transport, storage or sale of toddy;”
6. ‘Employer’ would mean any person who employs whether directly or through any other person or whether on behalf of himself or any other person one or more employees including any person who has a license for manufacturing, distributi
