(1)
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
WRIT PETITION NO. 4185 OF 1996
Shri Nandkishore Laxminarayan Agarwal .. Petitioner
Aged 33 years, R/o. Plot No. EG-1,
Suraj Apartment, Mustgad, Jalna,
through Power of Attorney
Ghanshyam Dhanraj Gupta, Aged. 39 years,
R/o. As Above.
ig Versus
1. The Union of India, .. Respondents
through the Standing Counsel,
High Court of Judicature of Bombay,
At Aurangabad.
2. The Asst. Regional Provident Fund
Commissioner, N-1, Cidco, Aurangabad.
3. The Jalna People Co-operative Bank Ltd.,
Kavi Ramkrishna Shola Chowk, Sadar Bazar,
Jalna - 431 203, through the
Special Recovery Officer, Class-I.
4. M/s. Mahendra Re-rolls Industries,
through : the Partner Shri Badri Vishal
Pitty, Pitty Complex, Nehru Road,
Saraf, Jalna.
[Res. Nos. 3 & 4 deleted as per order
dated 11.10.1996]
Shri Yugant Marlapalle h/f. Shri T.K. Prabhakaran, Advocate
for the petitioner.
Shri K.B. Choudhari, Advocate for respondent No.2.
::: Downloaded on - 09/06/2013 15:08:27 :::
(2)
CORAM : P.R. BORKAR,J.
DATED : 30.09.2009
ORAL JUDGMENT :-
1. This is a writ petition which challenges the order
of attachment passed by the Assistant Commissioner and
Recovery Officer, Employees Provident Fund Organization,
Maharashtra and Goa. By its order dated 14.08.1996, it
attached the property of respondent No.4 that was purchased
by present petitioner in the auction sale held by respondent
No.3 Bank on 23.07.1996. The petitioner paid amount of Rs.
31,35,000/-. As per the attachment order the attachment was
for a sum of Rs. 3,63,230/-. Said amount is said to be
deposited under protest on 20.08.1996. According to the
petitioner, issuance of recovery certificate and attachment
by the order dated 14.08.1996 is illegal and needs to be
quashed and set aside.
2. Heard learned advocate Shri Marlapalle for the
petitioner. He has argued that, what were purchased were
dead assets. The factory was closed long back and therefore
::: Downloaded on – 09/06/2013 15:08:27 :::
(3)
it is not an establishment and Section 17-B of the Employees
of the Provident Fund and Miscellaneous Provisions Act, 1952,
(for short “E.P.F. Act”), is not applicable. Section 17-B of
the E.P.F. Act is as follows :-
“17-B. Liability in case of transfer of
establishment. – Where an employer, in relation toan establishment, transfers that establishment in
whole or in part, by sale, gift, lease or licenceor in any other manner whatsoever, the employer and
the person to whom the establishment is so
transferred shall jointly and severally be liable
to pay the contribution and other sums due from theemployer under any provision of this Act or the
Scheme or the Pension Scheme or the Insurance
Scheme, as the case may be, in respect of the
period up to the date of such transfer:
Provided that the liability of the
transferee shall be limited to the value of theassets obtained by him by such transfer.”
3. The words used is not ’employer’ so far as
transferee is concerned, but the word ‘person’ is used with
reference to transferee. The transfer can be of whole of the
establishment or part and the liability of transferor and
transferee of establishment is said to be joint and several.
Admittedly, amount of Rs. 3,63,230/- was due towards
contribution of employees of respondent No.4.
::: Downloaded on – 09/06/2013 15:08:27 :::
(4)
4. The learned advocate for the petitioner argued that
‘industrial establishment’ is defined under Section 25-L of
the Industrial Disputes Act, but as the definition of
‘industrial establishment’ under Section 25-L of the
Industrial Disputes Act states that ‘industrial
establishment’ means a factory as defined in clause (m) of
Section 2 of the Factories Act, 1948. Under the Factories
Act, ‘factory’ is defined under clause (m) of Section 2 as
any premises including precincts thereof where 10 or more
workers are working, or were working at any day of the
preceding twelve months, and in any part of which a
manufacturing process is being carried on with the aid of
power, or is ordinarily so carried on, or whereon twenty or
more workers are working, or were working on any day of the
preceding twelve months, and in any part of which a
manufacturing process is being carried on without the aid of
power, or is ordinarily so carried on.
5. So, it is argued that manufacturing process should
be carried on. When the factory assets were purchased it
were junk assets/dead assets. No manufacturing activity was
going on. If, we consider provisions of the E.P.F. Act,
::: Downloaded on – 09/06/2013 15:08:27 :::
(5)
particularly Section 1 (3), idea is not only applying the Act
to a factory, but also to other establishments employing ten
or more persons. As preamble discloses, the Act is enacted
to provide for the institution of Provident Funds, Pension
Fund and deposit-linked insurance fund for employees in
factories and other establishments. In the statement of
objects and reasons, the situation in which the Act came into
force are discussed. One thing is clear that under the
E.P.F. Act, employer is also liable to contribute to the
Provident Fund along with employees or workmen and the funds
so collected by the employer are to be remitted to the
Provident Fund authorities as per Section 38 of the Act.
Section 17-B of the E.P.F. Act is made for protecting the
interest of employees.
6. In the facts and circumstances of the case, it does
not appear from reading provisions of the E.P.F. Act that a
factory should be running when attachment or other steps for
recovery of contribution payable under the E.P.F. Act are
contemplated by the authorities. There is no express
provision in the Act, which lays down as pre-condition that
the factory must be running before the Provident Fund
::: Downloaded on – 09/06/2013 15:08:27 :::
(6)
Authorities would resort to attachment of property.
7. In the facts and circumstances of the case, in my
opinion, this is not a case where any interference in the
extra-ordinary jurisdiction, under Articles 226 and 227 of
the Constitution of India, is called for. However, it is
made clear that if the amount of Rs. 3,63,230/- is already
deposited under protest, present petitioner will be entitled
to reimbursement from previous employer of respondent No.2.
8. With these observations, this writ petition is
dismissed. Rule discharged.
[P.R. BORKAR,J.]
snk/2009/SEP09/wp4185.96
::: Downloaded on – 09/06/2013 15:08:27 :::