Jharkhand High Court
Hotel Yamuna Villa, A Partner Ship Firm, ... vs Regional Provident Fund Commissioner ... on 29 December, 2005
Equivalent citations: [2006(1)JCR268(JHR)], (2006)IILLJ965JHAR
Author: R.K. Merathia
Bench: R.K. Merathia
JUDGMENT R.K. Merathia, J.
1. The only question involved in this case is as to whether Rang Mahal Restaurant (hereinafter referred to as Restaurant) was a department or branch of the petitioner-Hotel Yamuna Villa, (hereinafter referred to as Hotel).
2. Petitioner filed a writ petition earlier being CWJC No. 1420 of 1994 (R) challenging the order dated 16.3.1994, passed by respondent No. 2 holding that the establishment of the petitioner Hotel Yamuna Villa was governed by the Employees Provident Funds and Miscellaneous Provisions Act, 1952 (hereinafter referred to as the Act), as the Rang Mahal Restaurant was a department/branch of the Hotel. By order dated 23.11.1994 passed in the writ petition, the matter was remanded for a fresh consideration.
3. By the impugned order dated 19.6.1995 (Annexure 12) again it was held that the hotel and the restaurant were part of one establishment and taking into consideration the total number of employees engaged by the Hotel and the Restaurant the Hotel was governed under the Act.
4. As would appear from the impugned order, the following position is admitted. The hotel is owned by a partner ship Firm. The restaurant is a proprietary concern in the name of wife of one of the partners of the said Firm. The hotel and the restaurant were registered independently under the Bihar Shops and Establishment Act, Bihar Sales Tax Act and Central Sales Tax Act and they maintained their own books of accounts and balance-sheet as independent assesses with Income tax Department. The restaurant was being run under an agreement with the hotel.
5. The impugned order was passed on the following grounds. The hotel was asked to produce attendance cum wage register, ledger, cashbook etc. to prove that it is independent establishment but only attendance cum wage register for the period January, 1991 to June, 1993, electric bills and a closure intimation of the restaurant in June, 1993 were produced. The advocate of the hotel and the restaurant was common and he filed joint petitions on behalf of hotel and restaurant. The documents of the restaurant were not produced for counter checking the wages paid to the employee and therefore it was difficult to rely on the documents/information submitted by learned advocate. Adverse inference was drawn for not producing all the basic documents such as Cash Book, ledger etc. which were required to be maintained as per the Income Tax Act, their turnover being more than Rs. 5 lacks per year. The restaurant was working solely for the clients of the hotel and therefore both were interdependent. In the letter heads of the hotel and restaurant the telephone numbers were common. The inquiry report of the Enforcement Officer showing the total strength of 29 employees of the hotel and restaurant was signed by one of the partners of the hotel, who was also the husband of the proprietor of the restaurant. On these premises, petitioner-hotel was directed to comply with the various provisions of the Act with effect from July, 1991 and pay the clues in respect of all the eligible employees as already assessed by the Assessing Authority in his order dated 16.3.1994.
6. Mr. Shivnath, appearing for the petitioner, submitted that in the counter affidavit, the respondents have inter alia, tried to introduce a new case of Hindu Undivided Family and therefore such stand taken in the counter affidavit cannot be considered.
Then relied on three judgments rendered by the learned Single Judges of Bombay High Court. In Allana Sons Private Ltd. v. R.M. Gandhi 1991 (63) FLR 120, Allana Sons Private Ltd. was a commercial and trading establishment of Allana Lines which was a shipping concern. Staffs were different; the accounts were different. It was held that Allana Sons Private Ltd. was not a department/branch of Allana Lines in terms of Section 2-A of the Act as there was no functional integrity between them.
In Sunder Transport v. The Regional P.F. Commissioner reported in 1993 (66) FLR 528, some partners in the Firms were common all the four establishments were situated in one premises; they used common telegraphic address and post box number; maintained accounts by a common accountant etc. It was held that these circumstances were not sufficient to hold that they were one establishment. In the case of Ebrahim Currim v. Regional P.F. Commissioner 1994 (1) LLJ 369, it was held that petitioner which was trading in umbrellas, subsequently set up a factory for manufacturing umbrella. Although the establishments were owned by same owner, it was said that on the test of functional integrity between the two units as per Section 2-A of the Act, it cannot be held that the factory was a branch/department of the Trading Firm.
7. In the light of the provisions of Section 2-A of the Act, read with the law laid down by the Hon'ble Supreme Court in the case of Noor Niwas Nursery Public School v. Regional P.F. Commissioner , I find force in the submissions of learned counsel for the petitioner. Admittedly the hotel and the restaurant were independently registered under different enactments such as Shops and Establishment Act, Bihar Sales Tax Act and they maintained their own books of accounts and balance-sheet, for the purpose of Income tax assessment. There was an agreement between two. Only because, the husband of the proprietor of the restaurant was one of the partners of the Firm owning the hotel or as common telephone numbers were shown in their letter heads or a common advocate appeared for them, it cannot be held that the restaurant was a branch/ department of the hotel. The closure of the restaurant in June, 1993 shows that the hotel could run without the restaurant. Adverse inference should not have been drawn for not producing cash book ledger and vouchers etc. as the wages register and the balance-sheet were produced. In my opinion there was no functional integrity between the hotel and restaurant. One unit could exist conveniently and reasonably without the other; and in the matters of finance and employment, the two units were kept distinct.
The request of Mr. P.P.N. Roy, for remand of the case, is not accepted, as after closure of the restaurant in 1993, remanding this matter will be beating the bush only.
8. In the result, this writ petition is allowed and the impugned order, dated 19.6.1995, passed by respondent No. 2 and the notice dated 3.7.1995 issued pursuant thereto i.e. annexurc-13 are quashed. No costs.