{"id":203224,"date":"2007-03-07T00:00:00","date_gmt":"2007-03-06T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/regional-provident-fund-vs-ms-rajs-continental-exports-p-on-7-march-2007"},"modified":"2015-03-02T17:09:54","modified_gmt":"2015-03-02T11:39:54","slug":"regional-provident-fund-vs-ms-rajs-continental-exports-p-on-7-march-2007","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/regional-provident-fund-vs-ms-rajs-continental-exports-p-on-7-march-2007","title":{"rendered":"Regional Provident Fund &#8230; vs M\/S Raj&#8217;S Continental Exports (P) &#8230; on 7 March, 2007"},"content":{"rendered":"<div class=\"docsource_main\">Supreme Court of India<\/div>\n<div class=\"doc_title\">Regional Provident Fund &#8230; vs M\/S Raj&#8217;S Continental Exports (P) &#8230; on 7 March, 2007<\/div>\n<div class=\"doc_author\">Author: . A Pasayat<\/div>\n<div class=\"doc_bench\">Bench: Dr. Arijit Pasayat, Lokeshwar Singh Panta<\/div>\n<pre>           CASE NO.:\nAppeal (civil)  7345 of 2000\n\nPETITIONER:\nRegional Provident Fund Commissioner\n\nRESPONDENT:\nM\/s Raj's Continental Exports (P) Ltd\n\nDATE OF JUDGMENT: 07\/03\/2007\n\nBENCH:\nDr. ARIJIT PASAYAT &amp; LOKESHWAR SINGH PANTA\n\nJUDGMENT:\n<\/pre>\n<p>J U D G M E N T<\/p>\n<p>Dr. ARIJIT PASAYAT, J.\n<\/p>\n<p>Challenge in this appeal is to the judgment rendered by a<br \/>\nDivision Bench of the Karnataka High Court dismissing the<br \/>\nWrit appeal filed by the appellant.  The learned Single Judge,<br \/>\nwhose order was under challenge before Division Bench had<br \/>\nallowed the writ petition filed by the respondent holding that<br \/>\nthe order passed under Section 7A of the Employees&#8217; Provident<br \/>\nFunds &amp; Miscellaneous Provisions Act, 1952 (in short the &#8216;Act&#8217;)<br \/>\nwas not sustainable.\n<\/p>\n<p>Background facts in a nutshell are as follows:\n<\/p>\n<p>Respondent claimed in-fancy protection under the<br \/>\nprovisions of the Act. It started production in 1984.  The<br \/>\nrespondent was of the view that it was an extension on the<br \/>\nbranch of M\/s Continental Exporters, a proprietorship<br \/>\nconcern of one Sampathraj Jain, who was also  the Managing<br \/>\nDirector of the respondent-company.  Appellants&#8217; view was<br \/>\nthat the respondent was nothing but a department of the<br \/>\naforesaid &#8220;M\/s. Continental Exporters&#8221;.  Assailing the<br \/>\nadjudication, respondent filed a writ petition stating that there<br \/>\nwas no financial integrity.  It was separately registered under<br \/>\nthe Factories Act, Central Sales Act 1956, Income Tax Act,<br \/>\n1961 and the Employees State Insurance Act. The concerns<br \/>\nare separate and distinct.  They have separate Balance Sheets<br \/>\nand audited statements.  The High Court accepted the<br \/>\ncontention and held that there was total independent exercise<br \/>\nof power in the two concerns.  Though the manufacturing of<br \/>\ngoods was in respect of the same article, that by itself was not<br \/>\nsufficient to hold that it was a branch or department of M\/s<br \/>\nContinental Exporters.  The High Court as a matter of fact<br \/>\nfound that there was total independence exercise of the<br \/>\nmanagement and control of the affairs, the employees were<br \/>\nseparately appointed and controlled.  Taking into account<br \/>\nthese factors it was held that that the respondent company<br \/>\nand M\/s Continental Exporters were not one and the same.\n<\/p>\n<p>Challenge was made to the order of learned Single Judge<br \/>\nin the Writ Appeal.  The High Court after analyzing the factual<br \/>\nposition came to hold that there was nothing in common<br \/>\nbetween the two establishments.  Merely because the<br \/>\nproprietor of the one concern was the Managing Director of the<br \/>\nother that by itself is not sufficient to establish that one was<br \/>\nbranch of the other.  Accordingly the Writ Appeal was<br \/>\ndismissed.\n<\/p>\n<p>In support of the appeal, learned counsel for the<br \/>\nappellant submitted that factual scenario clearly establish that<br \/>\nthe respondent was a branch of M\/s. Continental Exporters.<br \/>\nLearned counsel for the respondent on the other hand<br \/>\nsubmitted that in view of the findings recorded by both the<br \/>\nlearned Single Judge and the Division Bench of the High<br \/>\nCourt, there is no scope for any interference.\n<\/p>\n<p>At this juncture it would be appropriate to take note of<br \/>\nSection 2A of the Act. The same reads as follows:-\n<\/p>\n<p>&#8220;For the removal of doubts, it is hereby<br \/>\ndeclared the where an establishment consists<br \/>\nof different departments or has branches,<br \/>\nwhether situate in the same place or in<br \/>\ndifferent places, all such departments or<br \/>\nbranches shall be treated as parts of the same<br \/>\nestablishment.&#8221;\n<\/p>\n<p>In Pratap Press, etc. v. Their Workmen (1960 (1) LLJ 497)<br \/>\nit was inter-alia held as follows :\n<\/p>\n<p>&#8220;The question whether the two activities in<br \/>\nwhich the single owner is engaged are one<br \/>\nindustrial unit or two distinct industrial units<br \/>\nis not always easy of solution.  No hard and<br \/>\nfast rule can be laid down for the decision of<br \/>\nthe question and each case has to be decided<br \/>\non its own peculiar facts.  In some cases the<br \/>\ntwo activities each of which by itself comes<br \/>\nwithin the definition of &#8220;industry&#8221; are so<br \/>\nclosely linked together that no reasonable man<br \/>\nwould consider them as independent<br \/>\nindustries.  There may be other cases where<br \/>\nthe connection between the two activities is<br \/>\nnot by itself sufficient to justify an answer one<br \/>\nway or the other, but the employer&#8217;s own<br \/>\nconduct in mixing up or not mixing up the<br \/>\ncapital, staff and management may often<br \/>\nprovide a certain answer.&#8221;\n<\/p>\n<p><a href=\"\/doc\/935364\/\">In Regional Provident Fund Commissioner and Anr. v.<br \/>\nDharamsi Morarji Chemical Co. Ltd.<\/a> (1998 (2) SCC 446), it was<br \/>\nheld that unless there is clear evidence to show that there was<br \/>\nany supervisory financial or managerial control, it cannot be<br \/>\nsaid that one is the branch of the other.  As noted by learned<br \/>\nSingle Judge, the respondent was separately registered under<br \/>\nthe Factories Act.  It was separately registered under the<br \/>\nCentral Sales Tax Act and the Employees State Insurance Act.<br \/>\nIt has also been found by learned Single Judge that there was<br \/>\ntotal independence of the two units. The learned Single Judge<br \/>\nand the Division Bench were right in their conclusion that the<br \/>\nrespondent is not a branch of M\/s. Continental Exporters.\n<\/p>\n<p>The appeal is sans merit, deserves dismissal, which we<br \/>\ndirect.  There will  be no order as to costs.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Supreme Court of India Regional Provident Fund &#8230; vs M\/S Raj&#8217;S Continental Exports (P) &#8230; on 7 March, 2007 Author: . A Pasayat Bench: Dr. Arijit Pasayat, Lokeshwar Singh Panta CASE NO.: Appeal (civil) 7345 of 2000 PETITIONER: Regional Provident Fund Commissioner RESPONDENT: M\/s Raj&#8217;s Continental Exports (P) Ltd DATE OF JUDGMENT: 07\/03\/2007 BENCH: Dr. [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-203224","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Regional Provident Fund ... vs M\/S Raj&#039;S Continental Exports (P) ... on 7 March, 2007 - Free Judgements of Supreme Court &amp; High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/regional-provident-fund-vs-ms-rajs-continental-exports-p-on-7-march-2007\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Regional Provident Fund ... vs M\/S Raj&#039;S Continental Exports (P) ... on 7 March, 2007 - Free Judgements of Supreme Court &amp; 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