Important Point
If there is unity in management, supervision and control, geographical proximity, financial unity, general unity of purpose and functional integrality between the different units; then all of them can be treated as one establishment.

Judgment

Dr. Arijit Pasayat, J. —

1.Leave granted in SLP (C) No.17173 of 2008.

2.Challenge in these appeals is to the Judgment of a Division Bench of the Kerala High Court dealing with three Misc. First Appeal Nos. MFA No. 884/95, MFA No. 886 of 1995 and 964 of 1995. By the impugned Judgment all the three Misc. First Appeals were dismissed. The applicants in I.A. Nos.21, 44 and 69 before the Employees’ Insurance Court, Alleppey (in short the ‘E.I. Court’) were the appellant before the High Court. Before the E.I. Court the Order of the Regional Director of the Employees State Insurance Corporation (in short the ‘Corporation’) Trichur clubbing the applicant with other establishments for the purpose of coverage under the Employees State Insurance Scheme (in short the ‘ESI Scheme’) framed under the Employees State Insurance Act, 1948 (in short the ‘Act’) were challenged. All the applications were dismissed by the E.I. Court by common Order dated 30.3.1995. Aggrieved by the said Order applicants filed the Misc. First Appeal before the High Court.

3.The Corporation clubbed Jos Textiles and Jos Cut Piece Centre, two proprietary concerns of two brothers both functioning in the same building at Broadway, Ernakulam, for the purpose of ESI coverage and issued notice as there were 20 or more employees at a time when the inspection was conducted. Notice was issued clubbing the above establishments. The Order was challenged, as noted above, before the E.I. Court.

4.The Corporation also clubbed M/s. Rose Fabrics, Jos Brothers Silk and Sarees and M/s. Jos Associates and issued notice claiming coverage. All these three establishments were functioning in Jos Annex Building, Ernakulam. M/s. Jos Associates was functioning on the 5th floor of the same building whereas the other two establishments were functioning in the same premises. The inspection conducted in November 1990 revealed that there were 12 employees working in M/s. Rose Fabrics, 13 employees in Jos Brothers Silk and Sarees and 9 employees in M/s. Jos Associates. The above Order clubbing the three establishments were challenged by M/s. Rose Fabrics in I.C.44/91 before the E.I. Court, Alleppey.

5.The applicant in I.C.69/91 was M/s. Sumangali. It was clubbed with four other establishments viz. M/s. Jos Silk and Sarees, M/s. Gents Fabrics, M/s. Jacobs and M/s. Jos Brothers Trades and Investments. The clubbing of the above establishments was on the basis of an inspection conducted on 14.11.90. The inspection revealed that there were more than 30 employees in the month of April, 1990. The notice of clubbing of the establishments was challenged by M/s. Sumangali in I.C.69/91. All the above three applications were heard and dismissed by the common Judgment passed by the E.I. Court, Alleppey.

6.Jos Textiles and Jos Cut Piece Centre, two proprietory concerns were owned by two brothers, namely K.A.Sebastian and K.A.Joshy. Jos Textiles was engaged in the business of textile goods and was carrying on the business in a rented building. Jos Cut Piece Centre was functioning in a portion of the first floor of the same building and Jos Textiles was functioning in the remaining portion of the same floor as well as in the second floor of the same building. There was temporary wooden partition separating the above two establishments. The Inspector of the ESI Corporation conducted inspection on 6.1.1988 and 11.1.1988 and reported that the total employment strength in both the units together was 20 (12+8) in April 1984 and from June 1985 onwards. Again the Inspector inspected on 9.8.1990. The building was taken on rent by Sri K.J. Abraham, the father of Sri K.A. Sebastian and Sri K.A. Joshy. The father permitted his son Sri K.A. Sebastian and his daughter Dorothy Edeth Louiz initially to run the business and Sri K.A. Joshy obtained a transfer of the business from his sitar. The father Sri K.J. Abraham was paying the rent to the landlord and Sri Sebastian was paying the entire rent to his father though he was coll