Salary & Stipend

I would like a clarification on the major differences between the Salary and Stipend. Up to now, we were paying the Salary to our regular employees on our rolls, and the Stipend to our Trainees.
What are the various deductions to be applied for the stipend.
Regards
Mithil Y. Sardesai
HR Manager & Administrator
Sunlux Technologies Ltd.
Bangalore

Dear Mithil,
Stipend does not have any liability of ESI or PF given its head in your accounts department is proper.
Vijay Vyas
Manager - HR

Hi Sardesai
Salaries are paid to the employees on Rolls, salaries tent amount to deduction of statutory payments, such as PF, ESI, P.TAX
Stipend is paid to trainees who are not employees of the company, they are only under training , they are the learners of specific job, when they are not the employees there is no necessity for deduction of any of the statutory payments.
Mohan Rao
Manager HR

dear sri rao garu,
i heard that there is a supreme court judgement for "trainees" p f need not pay? if it so kindly give me some reference.
further, for contract labour, can we split the wages into basic + other allowance ? if it is so what is the minimum (%) to be fixed for basic for the following category :
a) contract labour
b) security personnel
pl reply.
regards,
dp gunturi