Kerala High Court
Abdul Gaddafi vs State Of Kerala on 11 February, 2004
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE K.HARILAL
FRIDAY, THE 15TH DAY OF JANUARY 2016/25TH POUSHA, 1937
WP(C).NO. 15225 OF 2011 (C)
----------------------------
PETITIONER:
-----------
ABDUL GADDAFI, PROPRIETOR,
MRA BACKERY, CHOKLI P.O., THALASSERRI
KANNUR DISTRICT.
BY ADVS.SRI.K.LAKSHMINARAYANAN
SMT.SATHYA SHREEPRIYA
RESPONDENTS:
-------------
1. STATE OF KERALA, MINISTRY OF LABOUR & EMPLOYMENT,
SECRETARIAT, THIRUVANANTHAPURAM-695001
(REPRESENTED BY ITS SECRETARY).
2. EMPLOYEES PROVIDENT FUND ORGANISATION,
SUB REGIONAL OFFICE, FORT ROAD, KANNUR
PIN 670001. (REPRESENTED BY ITS COMMISSIONER).
3. EMPLOYMENT OFFICER,
EMPLOYEES PROVIDENT FUND ORGANISATION,
SUB REGIONAL OFFICE, FORT ROAD, KANNUR- 670001.
R1 BY ADV. GOVERNMENT PLEADER, SRI. G. GOPAKUMAR
R2 & R3 BY ADV. DR.ABRAHAM P.MEACHINKARA, SC, EPF ORG.
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON
15-01-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
WP(C).NO. 15225 OF 2011 (C)
----------------------------
APPENDIX
----------
PETITIONER'S EXHIBITS:
---------------------
EXT.P1 : A TRUE COPY OF THE PROCEEDINGS NO.
KR/KNR/18235/ENF.1(6) COVERAGE/2004/3556 DATED
11.02.2004 ON THE FILE OF THE EMPLOYEES PROVIDENT
FUND COMMISSIONER ALONG WITH LIST OF NAMES OF 33
PERSONS.
EXT.P12 : TRUE COPY OF THE STATEMENT FILED BY THE PETITIONER
BEFORE THE 2ND RESPONDENT.
EXT.P3 : TRUE COPY OF THE STATEMENT FILED BY THE PETITIONER
BEFORE THE 2ND RESPONDENT.
EXT.P4 : A TRUE COPY OF THE SAID ORDER IS DATED 12.09.05
ISSUED BY THE 2ND RESPONDENT.
EXT.P5 : A TRUE COPY OF THE ORDER DATED 18.01.2011 ISSUED
BY THE EMPLOYEES PROVIDENT FUND APPELLATE TRIBUNAL.
RESPONDENTS' EXHIBITS:
----------------------
EXT.RA(A) : TRUE COPY OF THE ESI RETURNS FOR THE PERIOD
1.4.2003 TO 30.9.2003.
//TRUE COPY//
P.A. TO JUDGE
DST
"CR"
K. HARILAL, J.
= = = = = = = = = = = = = = = = = =
W.P. (C) No.15225 of 2011
- - - - - - - - - -- - - - - - - - - - -
Dated this the 15th day of January, 2016
J U D G M E N T
This writ petition is filed challenging Ext.P5 order, passed by the Employees' Provident Fund Appellate Tribunal, under Section 7(i) of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952, ('the Act', for short). The petitioner is running a bakery by name "MRA Bakery"
and he is having business mainly on bakery items like bread, biscuits, cakes, etc. According to him, there were only 8 employees in his shop and he has been maintaining all records under different Statutes, with respect to those employees. While so, on 20.1.2004, the squad led by the Enforcement W.P.(C) No.15225 of 2011 -: 2 :- Officer, the 3rd respondent herein, conducted an inspection in his shop and, on the basis of the report prepared in that inspection, initiated proceedings against the petitioner, on an allegation that, in the inspection, the petitioner was found employed 33 employees, contrary to the records maintained by him, and shown to the 3rd respondent, during the course of inspection. On the basis of the said report, the 3rd respondent conducted an enquiry under Section 7A of the Act for the determination of the amount due from the petitioner as "employer" defined under Section 2(e) of the Act.
2. In the enquiry, the petitioner has maintained his stand that he has employed eight persons only and has maintained all the statutory records, in conformity with the persons actually employed by him. But, after enquiry, the 3rd respondent rejected his application and passed W.P.(C) No.15225 of 2011 -: 3 :- Ext.P4 order with the finding that the petitioner has employed 33 workers in his shop and thereby, the establishment owned by the petitioner is an establishment covered by Section 1(3)(b) of the Act and the Schemes framed thereunder, with effect from 20.1.2004 and further directed to remit the dues and submit returns, as per the provisions within 15 days on receipt of the proceedings. Aggrieved by Ext.P4, the petitioner filed statutory appeal under Section 7(i) before the Appellate Authority. The Appellate Authority also affirmed the findings of the 2nd respondent and rejected the the appeal. The legality and propriety of the concurrent findings, in Exts.P4 and Ext.P5 are under challenge in this writ petition.
3. Heard the learned counsel for the petitioner and the learned standing counsel appearing for the respondents 2 and 3. W.P.(C) No.15225 of 2011 -: 4 :-
4. The sum and substance of the arguments advanced by the learned counsel is that there is no reliable document to show that the petitioner had employed 33 employees, as contended by the 3rd respondent. According to the petitioner, the full details of the persons, who were allegedly found employed, at the time of inspection on 20.01.2004, are not disclosed in the records prepared by the 3rd respondent, at the time of inspection. Unless, the identity of those persons are proved beyond doubt, no liability can be fastened on the petitioner under the Act, with respect to those employees. According to the learned counsel, the petitioner had engaged eight workers only and all the records, under different Statutes, were maintained in conformity with the persons, who were actually engaged for his work. But, the statutory authorities, under the said Act, miserably failed to appreciate the lack of W.P.(C) No.15225 of 2011 -: 5 :- material evidence in its correct perspective.
5. Per contra, the learned standing counsel appearing for respondents 2 and 3 advanced arguments, to justify the findings in Exts.P4 and P5. According to the learned standing counsel appearing for the respondents 2 and 3, there is no reason to disbelieve the evidence collected during the course of sudden surprise inspection, conducted by the Enforcement Officer, under Section 13 of the Act. The Enforcement Officer/3rd respondent had prepared a mahazar, containing the name of 33 employees found engaged in working under the petitioner in the Bakery, at the time of inspection and their statements were also taken with their signatures. Thus, according to the learned counsel appearing for the respondents 2 and 3, the evidence collected, during the course of inspection itself, is sufficient enough, to arrive at a conclusion that W.P.(C) No.15225 of 2011 -: 6 :- the petitioner was maintaining false records under different statues, so as to evade from the liability under the various Acts.
6. The scope and extent of consideration, in a Writ petition, challenging an order passed by the Appellate Authority under Section 7(i) of the Act, is very limited and confined to the legality, propriety, arbitrariness and the denial of natural justice only. This Court is not sitting in appeal to re-appreciate the factual findings concurrently arrived at by the statutory Original Authority, as well as the Appellate Authority under the Statute.
7. Going by the writ petition and the submissions made at the Bar, the petitioner has no case that Ext.P4 was passed in violation of the principles of natural justice. The entire arguments are advanced against the factual findings on the basis of the surprise inspection conducted by the W.P.(C) No.15225 of 2011 -: 7 :- Enforcement Officer, under Section 13 of the Act. Under Section 13 of the Act, indisputably, the Enforcement Officer has statutory right to conduct a sudden surprise inspection, without notice to the employer, in an establishment, to ascertain, whether the establishment has employed more than 20 persons or not. According to Section 13(2)(k) of the Act, the Inspector has the power to conduct such a surprise inspection to enquire into, whether any of the provisions of the Act or the Scheme had been violated in the conduct of an establishment to which the Scheme applies and the provisions of the Code of Criminal Procedure is made applicable to such an inspection. There is no dispute to the question, whether the nature of business conducted by the petitioner would come under the provisions of Act. The matter in dispute is, whether he has employed more than 20 workers in his establishment. Going by W.P.(C) No.15225 of 2011 -: 8 :- Ext.P4, it is seen that sufficient opportunities were given to the petitioner to adduce evidence in the enquiry and the petitioner also has co-operated with the enquiry. He has filed written statements also, denying the allegations.
8. It is seen that the 3rd respondent also has filed a counter statement, disclosing the evidence, which he collected during the course of inspection. On 20.01.2004, at the time of his inspection, he prepared a list of employees, who are seen working in the premises of the establishment. The 3rd respondent has obtained a statement signed by the employees working in the establishment. The squad of the Enforcement Officer further reported the details of the actual number of persons employed there. According to the Enforcement Officer/3rd respondent, all the 33 persons found engaged in work in the premises of the establishment have agreed, W.P.(C) No.15225 of 2011 -: 9 :- before the officers, with their employment in the petitioner's establishment and put their signatures in the statement and the same proved that the petitioner had not maintained the records in conformity with the actual employees employed by him in his establishment. The report consists of the list of employees, who are seen working in the premises of the establishment. Since the 33 workers themselves have agreed that they do work under the petitioner, in his establishment, I do not find any reason to disbelieve the report. If the evidence collected by the 3rd respondent is taken at its face value, it can be held that those records were maintained in such a way to escape from the statutory liability under different labour laws. The proper maintenance of records of the employees working under an establishment is the duty of the employer. In my view, sudden surprise inspection is W.P.(C) No.15225 of 2011 -: 10 :- provided in the statute with an intent to catch law breaking employers under the guise of records. Section 13 of the Act is incorporated in the Statue with the object of finding out the exclusion of employees actually employed in the establishment from the records maintained by him. The said inspection conducted under the power granted by the Statute and Enforcement Officer is clothed with the provisions of the Criminal Procedure Code with respect to the seizure, etc. I do not find any reason to disbelieve the report prepared by the 3rd respondent, under Section 13 of the Act.
9. Going by the counter, it is seen that the petitioner has denied the presence of 33 persons in his establishment, at the time of inspection. But, at the same time, it is pertinent to note that no kind of mala fides are attributed against the Enforcement Officer/3rd respondent, for preparing W.P.(C) No.15225 of 2011 -: 11 :- such a report against him. Therefore, I do not find any reason to interfere with the evidence collected by the 3rd respondent, during the course of enquiry and the findings made by the 3rd and 4th respondents thereon.
10. The learned counsel for the petitioner, further submits that there should be a nexus between the employer and the employees, so as to fall under Sections 2(e) and (f) of the Act. On an analysis of the definition, I am also of the view that being a beneficial legislation, enacted as a measure of social justice, a wider definition, so as to cover the employees employed temporarily, also is given under Section 2(e) of the Act. The expression "in connection with the work of the establishment" in the definition means that there must be a nexus between the establishment and the work of the employer, which would be relevant for the purpose of W.P.(C) No.15225 of 2011 -: 12 :- establishment; but it is a loose connection only as stated in Basf India Ltd. v. Gurusamy[2004(2) LLJ 500], on which the Appellate Authority relied on. I am of the further opinion that in a case, where the presence of those persons, who were found working, during the course of inspection was admitted by the employer, the burden is heavy on the employer to prove that, even though, they were found working, there was no "employer-employee" relationship with them, as defined in the Act. But, in the instant case, the presence of 33 persons, at the time of inspection, was not denied by the petitioner; but the case of the petitioner is that he never employed more than eight persons and he has neither any connection nor acquaintance with the persons found in the premises. If that be so, what circumstance made their presence in the establishment, when the Enforcement Officer inspected the premises. The W.P.(C) No.15225 of 2011 -: 13 :- petitioner has no explanation, as to the presence of 33 employees, who were found working during the course of inspection. I do not find any reason, to disbelieve the report filed by the Enforcement Officer, in discharge of his official duty. There is no illegality or impropriety in any of the findings, whereby the petitioner was found liable to remit dues, under the Act.
In the result, this writ petition will stand dismissed accordingly.
Sd/-
K. HARILAL, JUDGE DST //True copy// P.A. To Judge