PETITIONER:
ANDHRA UNIVERSITY ETC.
Vs.
RESPONDENT:
REGIONAL PROVIDENT FUND COMMISSIONER OF ANDHRA PRAfESH AND A
DATE OF JUDGMENT08/10/1985
BENCH:
ERADI, V. BALAKRISHNA (J)
BENCH:
ERADI, V. BALAKRISHNA (J)
REDDY, O. CHINNAPPA (J)
KHALID, V. (J)
CITATION:
1986 AIR 463 1985 SCR Supl. (3) 582
1985 SCC (4) 509 1985 SCALE (2)752
ACT:
Employes' Provident Funds and Miscellaneous Provisions
Act, sections 1(3)(a), 2(1-C), 2(g) and 2(a), scope of -
Whether the establishments namely, the Departments of
Publications and Press of the Andhra and Osmania
Universities are "factories" and their activities fall under
"manufacture" and therefore they are governed by the
provisions of the said Act - Interpretation of the word
"establishment" in section 2-A.
HEADNOTE:
The Employees' Provident Funds and Miscellaneous
Provisions Act applies to every establishment which is a
"factory" engaged in and "industry" specified in Schedule I
and in which 20 or more persons are employed. The
expressions "manufacture" and "factory" are defined in
section 2(1-C) and 2(g) of the Act. The establishments
namely, the Departments of Publications and Press of the two
Universities each employing 100 persons, run printing
presses, where the work of printing of text books, journals
and magazines for the various constituent and affiliated
colleges as well as of various items of stationery such as
admission forms to colleges, hostels and examinations, forms
of memo of parks, hall' tickets, answer books, syllabi for
various colleges and departments, registers, receipt books
for colleges and hostels and letter heads for Universities
carried out. The Regional Provident Fund Commissioner called
upon the two Universities to submit their monthly returns
and remit the amounts of contribution as required by the
provisions of the scheme covered under the Employees'
Provident Funds and Miscellaneous Provisions Act. Two writ
petitions were therefore, filed by the appellants separately
challenging the legality and validity of the notices issued
to them by the Regional Provident Fund Commissioner,
contending (i) that the Universities are purely educational
institutions having a Dumber of departments, the main object
of which is to impart education to the youth of the country
in various branches of Students, and therefore, the
Department of Publications and Press which is intended only
to cater the needs and requirement of the students cannot be
regarded either as a "factory" or as an "industry"
attracting the provisions of the Act; ant (11) that the two
Universities had their own provident
583
fund schemes for their employees and therefore, there was
justification for subjecting them to the provisions of the
Act. A learned Single Judge of the High Court accepting the
said conventions allowed the writ petitions. However, on
appeals filed by the Regional Provident Fund Commissioner,
Andhra Pradesh, the Division Bench by two separate judgments
set aside the judgments of the learned Single Judge and held
that the Department of Publications and Press of each of the
two Universities is an "establishment" which is a factory
engaged in an industry specified in Schedule I, in which
more than 20 persons were employed and hence the provisions
of the Act ant the Scheme were applicable in respect of
these Departments. Hence the appeals by special leave.
Dismissing the appeals, the Court,
^
HELD : 1.1 To attract the provisions of the Employees'
Provident Funds and Miscellaneous Provisions Act, two tests
namely, whether there is an establishment which is a
"factory" engaged in any of the scheduled industries and
whether 20 or more persons are employed in the said
establishment must be fulfilled. [587 F]
1.2 Printing is one of the industries specified in
Schedule I of the Act ant it is admitted that much more than
20 persons are employed in the concerned establishment of
the two Universities [588 A]
1.3 The Departments of Publications ant Press are
"factories" as defined in clause (g) of section 2 of the
Act. Under the definition, "factory" means any premises, in
any part of which a manufacturing process is being carried
on. The Printing of text books, journals, registers, forms
ant various items of stationery clearly constitute
"manufacture" within the meaning of the said expression as
defined in clause (1-C) of section 2 of the Act. [587 G-H;
588 A]
1.4 It is therefore clear that all the requirements of
clause 3(a) of section (l) of the Act are fully satisfied
in the cases and hence the decision of the Division Bench of
the High Court upholding the validity of the notices issued
by the respondent, Regional provident Fund Commissioner, is
perfectly correct ant justified. [588 A-B]
Visva Bharati v. Regional Provident fund Commissioner,
West Bengal, [1983] 1 L.L.J. 332 overruled.
2.1 In construing the provisions of the Employees'
Provident funds ant Miscellaneous Provisions Act, it must be
584
borne in mint that it is a beneficent piece of Social
Welfare legislation aimed at promoting and securing the well
being of the employees ant the Court will not adopt a narrow
interpretation which will have the effect of defeating the
very object ant purpose of the Act. [587 A-B]
2.2 Section 2-A of the Act was inserted merely for the
purposes of clarifying the position that the Act applies to
composite factories. It is not the intentment of the section
to lay down even by remotest implication that an
establishment, which is a factory engaged in an industry
specified in Schedule I will not liable for coverage under
the Act merely because it is part of a larger organisation
carrying on some Of the activties also which may not fall
within the scope of the Act. [586 G-H; 587 A]
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 126 of
1973.
From the Judgment and Order dated 21.12.70 of the
Andhra Pradesh High Court in Writ Appeal No. 396 of 1971.
AND
Civil Appeal No. 204 of 1973.
From the Judgment and Order dated 25.2.1972 of the
Andhra Pradesh High Court in Writ Appeal No. 392 of 1971.
B.R.L. Iyengar, G.N. Rao, T.C. Gupta and Attar Singh
for the Appellant.
M.S. Gujral, C.V. Subba Rao, R.N. Poddar and T.C.
Sharma for the Respondents.
The Judgment of the Court was delivered by
BALAKRISHNA ERADI, J. These two appeals are directed
against two judgments of the Andhra Pradesh High Court
dismissing two Writ Petitions filed by the appellants herein
namely, the Andhra University ant the Osmania University
challenging the legality and validity of the notices issued
to the two Universities by the Regional Provident Fund
Commissioner of Andhra Pradesh intimating them that the
Departments of Publications and Press wherein printing
presses were being run by the two Universities, were liable
for coverage under the Employees’ Provident
585
Funds and Miscellaneous Provisions Act (hereinafter called
the ‘Act and Scheme’) and calling upon the two Universities
to submit their monthly returns and remit the amounts of
contribution as required by the provisions of the Scheme. me
appeals have been filed on the basis of certificates of
fitness granted by the High Court under Article 133 (l)(c)
of the Constitution.
The common contention taken by the appellants herein in
the two Writ Petitions was that the Universities are purely
educational institutions having a number of departments, the
main object of which is to impart education to the youth of
the country in various branches of studies, that the
Department of Publications and Press which is intended only
to cater the needs and requirements of the students cannot
be regarded either as a ‘factory’ or as an ‘industry’ and
the provisions of the Act are not therefore, attracted in
respect of the said department. It was also submitted in the
Writ Petitions that the two Universities had their own
provident fund schemes for their employees and hence there
was no justification for subjecting them to the provisions
of the Act. A learned Single Judge of the High Court
accepted the contention of the two Universities that the
Department of Publications and Press could not be regarded
as an ‘industry’ and accordingly held that the provisions of
the Act were not attracted. However, on appeals filed by the
Regional Provident Fund Commissioner, Andhra Pradesh before
a Division Bench of the High Court, the Division Bench by
two separate judgments set aside the judgments of the
learned Single Judge and held that the Department of
Publications and Press of each of the two Universities is an
establishment’ which is a factory engaged in an industry
specified in Schedule I, in which more than 20 persons were
employed and hence the provisions of the Act and the Scheme
were applicable in respect of these Departments. In these
appeals, the appellants namely, the two Universities, have
challenged the correctness of the aforesaid conclusion
recorded by the Division Bench of the High Court.
It is common ground that the Department of Publications
and Press of the two Universities (appellants) runs printing
presses, where the work of printing of text books, journals
and magazines for the various constituent and affiliated
colleges as well as of various items of stationery such as
admission forms to colleges, hostels and examinations, forms
of memo of marks, hall tickets, answer books, syllabi for
various colleges and departments, registers, receipt books
for colleges and hostels and letter heads for Universities
is carried out. About 100 persons are employed in connection
with the said activity in the Department of Publications and
Press of each University.
586
Section 1(3)(a) of the Act lays down that subject to
the provisions contained in Section 16 (those provisions are
admittedly not applicable to the cases before us), the Act
applies to every establishment which is a ‘factory’ engaged
in any ‘industry’ specified in Schedule I and in which 20 or
more persons are employed. The expression “factory” has been
defined in Section 2(g) as meaning “any premises, including
the precincts thereof, in any part of which a manufacturing
process is being carried on or is ordinarily so carried on,
whether with the aid of power or without the aid of power.”
Section 2(1-c) defines “manufacture” or ‘manufacturing
process’ as meaning ‘any process for making, altering,
repairing, ornamenting, finishing, packing, oiling, washing,
cleaning, breaking up, demolishing or otherwise treating or
adapting any article or substance with a view to its use,
sale, transport, delivery or disposal.”
It was not disputed before the High Court that the
Department of Publications and Press of the two Universities
were ‘establishments’ and the only contention urged was that
the said Departments were not ‘factories’ and the activity
carried on therein did not constitute an ‘industry’.
However, before this Court a new point was urged on behalf
of the appellants that for the purposes of determining the
applicability of the Act the entire University must be
treated as an establishment and if the University cannot be
said to be a factory engaged in an industry, there cannot be
any question of coverage under the Act and the Scheme. For
sustaining this contention support was sought to be derived
from Section 2-A of the Act, which is in the following terms
:-
“2-A Establishment to include all departments and
branches –
For the removal of doubts, it is hereby declared
that where an establishment consists of different
departments or has branches, whether situate in
the same place or in different places, all such
departments or branches shall be treated as part
of the same establishment.”
We are unable to see how this provision is of any
assistance to the appellants. Section 2-A was inserted in
the Act merely for the purposes of clarifying the position
that the Act applies to composite factories. It is not
intentment of the section to lay
587
down even by remotest implication that an establishment,
which is a factory engaged in an industry specified in
Schedule I will not be liable for coverage under the Act
merely because it is part of a larger organisation carrying
on some other activities also which may not fall within the
scope of the Act. In construing the provisions of the Act,
we have to bear in mind that it is a beneficient piece of
Social Welfare legislation aimed at promoting and securing
the well being of the employees and the Court will not adopt
a narrow interpretation which will have the effect of
defeating the very object and purpose of the Act. Once it is
found that there is an establishment which is a ‘factory’
engaged in an ‘industry’ specified in Schedule I and
employing 20 or more persons, the provisions of the Act will
get attracted to the case and it makes no difference to this
legal position that the establishment is run by a larger
organisation which may be carrying on other additional
activities falling outside the Act.
Our attention was drawn to a decision of a learned
Single Judge of the Calcutta High Court in Visva Bharati v.
Regional Provident Fund Commissioner, West Bengal, [1983] 1
L.L.J. 332 wherein it was held that the provisions of the
Act were inapplicable in respect of a “Silpa Sadan”,
Agricultural Farm and a Hospital run by the Visva-Bharati
University. The learned Judge was of the view that “if the
University as an establishment does not come under the
provisions and or the purview of the Act, the different
branches or departments of the University which the
University empowered and or entitled to maintain under the
provision of the Visva Bharati Act cannot be brought within
the mischief of the Act.” We have no hesitation to hold that
the aforesaid view expressed by the learned Judge is not
correct or sound and that the said decision does not lay
down correct law.
As already indicated, the true tests to be applied is
whether there is an establishment which is a ‘factory’
engaged tn any of the scheduled industries and whether 20 or
more persons are employed in the said establishment. If the
answer is in the affirmative, the provisions of the Act are
clearly attracted.
In the cases before us there cannot be any doubt that
the establishments namely, the Departments of Publications
and Press are ‘factories’ as defined in clause (g) of
Section 2 of the Act. Under the said definition factory
means any premises in any part of which any manufacturing
process is being carried on. me printing of text books,
journals, registers, forms and various items of stationery
clearly constitute ‘manufacture’ within the
588
meaning of the said expression as defined in clause (1-c) of
Section 2 of the Act. That printing is one of the industries
specified in the Schedule is not in dispute. It is also not
disputed that much more than 20 persons are employed in the
concerned establishments of the two Universities. Thus all
the requirements of clause (3) (a) of Section 1 of the Act
are fully satisfied in these cases and hence the conclusion
recorded by the High Court that the establishments in
question are liable for coverage under the Act is perfectly
correct and justified.
It follows that these appeals are totally devoid of
merits. They will accordingly stand dismissed with costs.
S.R. Appeals dismissed.
589