Judgment of Rajasthan High Court: Sarda Gum & Chemicals vs. Union of India & Ors.
The petitioner industrial unit was aggrieved by the order passed by the Regional Provident Fund Commissioner-II, Jodhpur, and the appellate order passed by the Employees Provident Fund Appellate Tribunal in New Delhi. They held that the petitioner unit is covered by the EPF Act, 1952, since the number of employees found at the time in the industrial unit was more than 20. The Commissioner and the Tribunal had held that the petitioner was covered by the provisions of the said Act and was liable to pay provident fund contributions in respect of those 20 workmen.
It was found that out of the 21 individuals said to be employed in the petitioner's factory, 8 persons were temporary laborers employed for the purpose of carrying out repairs on the factory building. The Court observed that it cannot be held that they were employed for the normal business of the establishment. The Court further observed that it naturally depends on the facts of each case whether the so-called temporary workers are regularly employed in connection with the normal and usual course of the business or if they are engaged in work unrelated to the establishment's normal business.
Even if casual or temporary workers are engaged occasionally or intermittently to meet temporary or casual work, such workers cannot be considered employees for the purpose of section 1(3)(a) of the Act. The High Court held that unless temporary or casual workers are found to be regular employees of an industrial unit, they cannot be included to make up the 20 workmen of an industrial unit for the purpose of determining whether the establishment is covered under the definition in section 1(3)(a) of the Act.
The full bench decision of the court found the impugned order of the Appellate Tribunal and the Regional Provident Fund Commissioner to be non-speaking orders and deserving of being quashed. The court set aside the orders.
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Keshav Korgaonkar
Shantadurgaent.com - Insurance Advisors, Corporate Advisors, Legal Advice, Wage and Salary, Labour Compliance Audit, SSI Registration, NOC from
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2584The petitioner industrial unit was aggrieved by the order passed by the Regional Provident Fund Commissioner-II, Jodhpur, and the appellate order passed by the Employees Provident Fund Appellate Tribunal in New Delhi. They held that the petitioner unit is covered by the EPF Act, 1952, since the number of employees found at the time in the industrial unit was more than 20. The Commissioner and the Tribunal had held that the petitioner was covered by the provisions of the said Act and was liable to pay provident fund contributions in respect of those 20 workmen.
It was found that out of the 21 individuals said to be employed in the petitioner's factory, 8 persons were temporary laborers employed for the purpose of carrying out repairs on the factory building. The Court observed that it cannot be held that they were employed for the normal business of the establishment. The Court further observed that it naturally depends on the facts of each case whether the so-called temporary workers are regularly employed in connection with the normal and usual course of the business or if they are engaged in work unrelated to the establishment's normal business.
Even if casual or temporary workers are engaged occasionally or intermittently to meet temporary or casual work, such workers cannot be considered employees for the purpose of section 1(3)(a) of the Act. The High Court held that unless temporary or casual workers are found to be regular employees of an industrial unit, they cannot be included to make up the 20 workmen of an industrial unit for the purpose of determining whether the establishment is covered under the definition in section 1(3)(a) of the Act.
The full bench decision of the court found the impugned order of the Appellate Tribunal and the Regional Provident Fund Commissioner to be non-speaking orders and deserving of being quashed. The court set aside the orders.
Thanks and regards.
Keshav Korgaonkar
Shantadurgaent.com - Insurance Advisors, Corporate Advisors, Legal Advice, Wage and Salary, Labour Compliance Audit, SSI Registration, NOC from
From India, Mumbai
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Provident Fund Act.ppt
EMPLOYEES' PROVIDENT FUND & MISC PROVISIONS ACT '1952 [Compatibility Mode].pdf