Benefits for Interns - paying them of RS. 10000/- as stipend, are they falling under PF and ESI bracket?

We have few candidates who joined as an Intern after completion of their Graduation. We are paying them of RS. 10000/- as stipend, are they falling under PF and ESI bracket? please clarify. We will convert them as permanent employee in 2 to 6 months depending on their performance.

Hi,
If Students are joining for internship while they are doing their course/degree supported with a authorization letter from College then there is no statutory requirement either PF or ESI. There is no question of employment But as per your statement they have joined your organization after the completion of their Degree, which means you have hired them as Trainees/Fresher. They will work as per your office hours. In that case they should be covered under the purview of PF/ESI.
Statutory authorities will perceive your 'internship' as act of evasion of statutory liability.
So better bring them under the purview of PF/ESI.