JUDGMENT
H.H. Kantharia, J.
1. Petitioner No. I-M/s. Haroon & Company is a partnership firm carrying on business, inter alia, as Commission Agents in fresh fish and other marine products having their office at 9, Saboo Sidik Road, off Palton Road, Bombay-400 001. It consists of five partners. Petitioner No. 2-Haroon Sea Food Private Limited is a Company incorporated on 9th May, 1979 under the Companies Act, 1956. They carry on business as processors and export meat and marine products and processed Food products, having their registered office at Central Ice and Cold Storage Building, 9, Saboo Sidik Road, off Palton Road, Bombay-400001.
2. It is the case of petitioners No. 1 and 2 that petitioner No. 1 is an establishment within the meaning and under the provisions of the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter referred to as “the Act”), and the provisions of the said Act are applicable to them and a Code Number bearing No. MH/14039 has been given to it by respondent No. 1, the Regional Provident Fund Commissioner for Manarashtra and Goa, having his office at Bhavishya Nidhi Bhavan, 341, Bandra (East), Bombay-400 051. Petitioner No. 1 has been paying contributions under the provisions or the Act and has been filing returns as required under the said Act in respect of the employees employed by them. It is their “further case that petitioner No. 2 are a separate legal entity and they had commenced their business sometime in September, 1979. Their business is independent of the business carried on by petitioner No. 1. Their workers have nothing to do with establishment of petitioner No. 1. It is also their case that the premises of the petitioner Nos. 1 and 2 are different. Thus, according to both the petitioners, there is nothing in common between them and the two units have no functional integrality for any purpose whatsoever except that some of the partners of petitioner No. 1 were the subscribers of the Memorandum of Association of petitioner No. 2 and that some of the partners of petitioner No. 1 are the Directors of petitioner No. 2. In the submission of petitioners Nos. 1 and 2, therefore, they cannot be termed or clubbed as sister concerns.
3. The petitioners further contended that petitioner No. 2 having been incorporated on 9th May, 1979, the provisions of the Act became applicable to them only after 31st May, 1982 because they are entitled to exemption during the infancy period of three years. However, respondent No. 1 issued a notice to petitioner No. 2 on 19th March, 1981, stating that petitioner No. 2 was a sister concern of petitioner No. 1 and Petitioner No. 1 was already covered under the provisions of the Act but, for the sake of convenience, a separate Code Number MH/20184 was allotted to the establishment of petitioner No. 2 with effect from 9th May, 1979. It was further stated in the said notice that for all purposes, under the Act, the establishment of petitioner No. 2 would be treated as one along with petitioner No. 2’s so-called main establishment. On 26th March, 1981, petitioner No. 2 addressed a letter to the first respondent contending that they were not the sister concern of petitioner No. 1 and asked for a copy of the investigation report of the Inspector on which the first respondent had acted and also requested for a personal hearing. Accordingly, a personal hearing was granted to petitioner No. 2 when various documents and relevant papers were produced before the first respondent who, after taking into consideration all the documents, passed on order on 30th October, 1981 that the establishment of petitioner No. 2 was a separate legal entity and, therefore, they could not be clubbed together with Petitioner No. 1. It was further stated in the said order that the establishment of petitioner No. 2 would come under the purview of the Act only after the completion of three years infancy period. By the said order, the Code Number MH/20184 allotted to petitioner No. 2, pursuant to the order dated 19th March, 1981 was also cancelled.
4. Thereafter, on completion of the infancy period of three years on 31st May, 1982, petitioner No. 2 addressed a letter on 24th June, 1982 to the first respondent to issue a separate Code Number to them as the provisions of the Act were applicable to the said establishment effective from 31st May, 1982. Along with this letter, petitioner No. 2 also forwarded the answers contained in a questionnaire in the form prescribed by the office of the first respondent. A query was raised by the first respondent as to the number of the employees of petitioner No. 2. Petitioner No. 2 answered the said query on 2nd September, 1982. However, there was no response from the office of the first respondent and, therefore, petitioner No. 2 addressed a letter on 7th February, 1983 to the office of the first respondent stating that although no separate Code number was given to them and as the provisions of the Act had become applicable to them, they were depositing contributions collected after June, 1982 in the State Bank of India. They made grievances that in the absence of the allotment of a code number to them they were not in a position to submit returns and requested the first respondent to allot a code number to them immediately so that they could implement the provisions of the scheme under the Act. They were informed by a letter dated 7th March, 1981 that the matter was under investigation. Petitioner No. 2 again sent a reminder on 21st March, 1983. And thereafter on 16th April, 1983 they pointed out that despite reminders, no code number was allotted to them and they were depositing the provident fund dues in the State Bank of India in the name of their establishment without mentioning the code number in the challan. They also pointed out that as no code number was allotted to them, the settlement of the claims and transfer of provident funds could not be made and their workers were facing hardships and difficulties and once again requested the first respondent to issue a code number immediately. A stereotyped reply was issued by the first respondent that the matter was under investigation. The second respondent also by their letter dated 25th June, 1983 informed petitioner No. 2 that the matter was being examined in consultation with the first respondent. Thereafter, a couple of reminders were issued by petitioner No. 2 but with no result.
5. And ultimately on 24th October,1983 the first respondent passed an order against petitioner No. 1 that they were having a sister concern in the name of petitioner No. 2 and that the provisions of the Act were applicable to both the establishments jointly with effect from 9th May, 1979. Petitioner No. 1 was accordingly directed to extend the provident fund benefits to the employees of petitioner No. 2 with effect from 9th May, 1979 under the same code number viz. MH-14039. Along with the said order, two notices under Section 7A of the Act, one addressed to Haroon Haji Osman, a partner of petitioner No. 1, and the other addressed to the Manager of petitioner No. 1, calling upon the petitioner No. 1 to attend an enquiry fixed on 14th November, 1983 to determine the amounts due. Petitioners No. 1 and 2 have challenged in this writ petition under Article 226 of the Constitution of India the said order dated 24th October, 1983 and the notices issued under Section 7A of the Act.
6. Mr. Tulzapurkar, learned counsel appearing on behalf of the petitioners No. 1 and 2, urged that there is absolutely no evidence to show that petitioners No. 1 and 2 are the sister concerns except that some of the partners of petitioner No. 1 are the Directors of Petitioner No. 2 and some of them were subscribers to the Memorandum of Association of petitioner No. 2, Mr. Tulzapurkar also submitted that it was originally held by the first respondent that petitioner No. 1 and petitioner No. 2 are two separate legal entities and thereafter for no reasons whatsoever the code number granted to petitioner No. 2 was cancelled by an order dated 30th October, 1981. Mr. Tulzapurkar also made a grievance that the first respondent held that petitioners No. 1 and 2 are sister concerns on an alleged report of investigation by an Inspector, a copy of which was not furnished to the petitioners. In the submission of Mr. Tulzapurkar, there was no reason whatsoever for the first respondent to have come to a different conclusion than the one which was arrived at after hearing the parties and on perusal of the documents that petitioners No. 1 and 2 were separate legal entities. On behalf of the respondents, an affidavit has been filed by Anant Laxman Tanksale, Enforcement Officer in the office of the first respondent, on 12th October, 1987 and a perusal of the same shows that it is totally vague. At the hearing Mr. Master, learned counsel appearing on behalf of the respondents, urged that some of the partners of the first petitioner are the Directors of the second petitioner and they carry on business at one and the same place and as such both the petitioners are not only sister concerns but they also carry on a family business.
7. Now, it is important to note that except pointing out that some of the partners of the first petitioner are the Directors of the second petitioner, there is absolutely no evidence that there is anything common between the first and the second petitioner. It is also pertinent to note that both the petitioners carry on different kind of business and one is a partnership firm and the other is a Company incorporated under the Companies Act. It may be that some of the partners of the first petitioner are the Directors of the second petitioner but that by itself would not be enough to draw a conclusion that both are sister concerns. As a matter of fact after affording a reasonable opportunity of being heard and on perusal of all the relevant documents, the first respondent had initially come to the conclusion that petitioner No. 1 and petitioner No. 2 are separate legal entities. Thereafter no enquiry worth the name appears to have been made in the matter, and if it was made it has not been pointed out to this Court, and the respondents unilaterally came to the conclusion by the impugned order that petitioner No. 1 and petitioner No. 2 are the sister concerns and are one and the same establishment. It may be noted here that this matter had appeared on the Board of this Court for final hearing on a number of occasions’ right from the months of September, 1987 and was adjourned on many occasions but the respondents did not produce any evidence in this Court, despite directions in that behalf, to show as to how petitioner No. 1 and petitioner No. 2 are the sister concerns. The only reasonable inference that can be drawn from such conduct on the part of the officers of the respondents is that they are not possessed of any evidence worth the name to come to a conclusion that petitioner No. 1 and petitioner No. 2 are sister concerns. Had the respondents been in possession of such evidence, nothing prevented them to file all the documents in this Court during the period of last four months that the matter has been appearing on the Board of this Court for final hearing. Even Mr. Master, at the hearing, could not make further submission except stating that both petitioner No. 1 and petitioner No. 2 carried on business at one and the same place and some of the partners of the first petitioner are the Directors of the second petitioner. On being asked whether he can produce some more evidence except these admitted facts, Mr. Master fairly submitted that respondents were not in possession of any more evidence and/or documents. One can understand if the respondents were to show to this Court that besides the same location where both the petitioners carried on business they had no separate factory or municipal licences. The respondents could also adduce evidence that the first and the second petitioners had common stores or warehouses. Documentary evidence with regard to the books of accounts and balance sheet could also have been adduced by calling upon the petitioners to produce the same here with a view to show that both establishments were a sister concern. No evidence is brought on the record by the respondents that the workmen of both the units were the same or interchangeable and have the same muster roll. In the absence of any such evidence, it is difficult to conclude that the two establishments had functional integrality and were for all purposes one establishment.
8. In this view of the matter, the petition succeeds and the same is allowed. Rule is accordingly made absolute in terms of prayer clauses (a), (b) and (c) with no order as to costs. It is further clarified that by an order dated 10th January, 1984, this Court (S.K. Desai,J.) had passed interim orders in terms of prayer Clauses (f), (g) and (h)and respondents were directed to issue a separate code number in respect of the establishment of petitioner No. 2, without prejudice to the respective rights and contentions. It was further directed that separate code number was to be issued by the appropriate authority on or before 29th February, 1984, and at that time counsel for the second petitioner had stated that payments have already been made both in respect of the employee s contributions as well as in respect of the employers. Therefore, it was further directed that after the code number was issued, payments already made would stand transferred to the said code number and after 1st March, 1984, the payments in respect of petitioner No. 2’s employees to be made in the new account only. The respondents were directed to take necessary steps to effect transfer in respect of the payments made on behalf of the employees of petitioner No. 2 for the period 1st June, 1982 and 29th February, 1984 after separate code number was issued. I am told at the Bar that the directions given by this Court by the said interim orders are carried out. Hence, it would be only fair and proper and in the interest of all the parties that the said interim orders are confirmed and they are hereby confirmed.