IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN MONDAY, THE 7TH APRIL 2008 / 18TH CHAITHRA 1930 OP.No. 7323 of 1998(V) ------------------------------- PETITIONER: ----------------- M.R.F LTD., POST BOX NO. 2, KOTTAYAM- 686 010, REP. BY ITS SENIOR GENERALMANAGER, GEORGE MATHEW. BY ADV. SRI.M.PATHROSE MATTHAI SRI.SAJI VARGHESE RESPONDENTS: ---------------------- 1. THE DIRECTOR OF FACTORIES & BOILERS, OFFICE OF THE DIRECTOR OF FACTORIES & BOILERS, GOVT. OF KERALA, UPPALAM ROAD, THIRUVANANTHAPURAM. 2. JOINT DIRECTOR OF FACTORIES & BOILERS (MEDICAL), INDUSTRIAL HYGIENE LABORATORY COMPLEX, DEPARTMENT OF FACTORIES & BOILERS, KUMARAPURAM, THIRUVANANTHAPURAM-11. 3. INSPECTOR OF FACTORIES & BOILERS, KOTTAYAM. 4. GOVERNMENT OF KERALA, REP. BY THE SECRETARY, LABOUR AND REHABILITATION DEPARTMENT, THIRUVANANTHAPURAM. BY GOVERNMENT PLEADER SRI. SANDESH RAJA THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 20/02/2008,THE COURT ON 07/04/2008 DELIVERED THE FOLLOWING: ORDER ON CMP NO. 12811/1998 IN OP NO. 7323/1998 V DISMISSED 07/04/2008. SD/- P.N.RAVINDRAN, JUDGE. APPENDIX PETITIONER'S EXHIBITS EXT.P1. COPY OF THE INSPECTION ORDER DT. 3/4/96 BY THE SR. JOINT DIRECTOR OF FACTORIES & BOILERS. EXT.P2. COPY OF THE APPLICATION DT. 22/5/96 BEFORE THE R1. EXT.P3. COPY OF THE LETTER DT. 10/1/97 FROM THE R1 TO THE PETITIONER. EXT.P4. COPY OF THE LETTER DT. 21/1/97 BY THE PETITIONER TO THE R1. EXT.P5. COPY OF THE LETTER DT. 31/3/98 FROM THE R1. RESPONDENT'S EXHIBITS EXT.R1A. COPY OF THE PRIORITY INSPECTION REPORT OF MRF LTD., KOTTAYAM. True copy tga P.N.Ravindran, J. ============== O.P.No.7323 of 1998 ======================== Dated this the 7th day of April, 2008. JUDGMENT The petitioner, a company incorporated under the Companies Act, 1956, is engaged in the manufacture of automotive tyres, tubes and other rubber products. It employs 1254 workers in its factory at Vadavathoor in Kottayam. The main raw material for the manufacture of automotive tyres, tubes and other rubber products is natural rubber. Besides natural rubber, chemicals and other materials are also used in the manufacturing process. 2. After inspecting the petitioner's factory on 22.3.1996, the Senior Joint Director of Factories and Boilers, Thiruvananthapuram issued Ext.P1 order dated 3.4.1996 directing inter alia that an "Ambulance Room" as prescribed, should be provided in the factory. The reference evidently is to Section 45(4) of the Factories Act, 1948, hereinafter referred to OP 7323/98 -: 2 :- as the "Act" for short. On receipt of Ext.P1, the petitioner submitted Ext. P2 letter dated 22.5.1996 to the Director of Factories and Boilers, the first respondent herein, pointing out that as a well equipped ESI hospital is available very close to the factory, it is unnecessary to have an ambulance room in the factory and therefore the petitioner's factory may be exempted from providing an ambulance room invoking Rule 90(5) of the Kerala Factories Rules, 1957, hereinafter referred to as the "Rules" for short. The first respondent considered the petitioner's request in Ext.P2 and sent Ext.P3 letter dated 10.1.1997 in reply, stating that as per Section 45 of the Act, it is mandatory to provide an ambulance room in every factory wherein more than 500 workers are ordinarily employed, that there is no provision in the Act to grant exemption from providing an ambulance room and that Rule 90(5) of the Rules contemplates grant of exemption from the requirements of Rule 90 only and not from the provisions of Section 45 of the Act. The petitioner was also informed that its request for exemption from providing an ambulance room is therefore rejected. The petitioner thereupon sent Ext.P4 letter dated 21.1.1997 to the Director of Factories OP 7323/98 -: 3 :- and Boilers pointing out that Section 45 (4) of the Act has to be read along with Rule 90 of the Rules and that when the conditions prescribed in Rule 90(5) of the Rules are satisfied, exemption can be given from providing an ambulance room as required under Section 45 (4) of the Act. In Ext.P4, the petitioner requested the Director of Factories and Boilers to reconsider his decision and to grant exemption in terms of Rule 90(5) of the Rules. By Ext.P5 letter dated 31.3.1998, the Director of Factories and Boilers called upon the petitioner to provide an Occupational Health Centre in its factory immediately for the reason that it is classified as "hazardous" as per the Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989 and the process is hazardous process as per the first schedule to the Act. The petitioner was also informed that there is no necessity to provide an ambulance room and the question of granting exemption would not arise at all, if there is an Occupational Health Centre with all the requirements, in the factory. This original petition was thereupon filed seeking the following reliefs: "i) call for the records and proceedings relating OP 7323/98 -: 4 :- to Exts.P3 and P5 and to quash or set aside the same by the issue of a writ of certiorari or other appropriate writ, order or direction; ii) to issue a writ of mandamus to the 1st respondent directing him to grant exemption to the petitioner under Rule 90(5) of the Kerala Factories Rules from the requirements of Rule 90 from providing ambulance room at the petitioner's factory at Vadavathoor;" 3. The Director of Factories and Boilers, the first respondent herein, has filed a counter affidavit wherein it is stated that an ambulance room as contemplated in Section 45(4) of the Act is mandatory for any factory wherein more than 500 workers are ordinarily employed, that Rule 90 of the Rules stipulates the details regarding the infra structure, facilities, staff, etc. required to be provided in the ambulance room and that Rule 90(5) of the Rules enables the Chief Inspector of Factories to exempt any factory from the requirements of Rule 90 only, subject to such conditions as may be specified, if a hospital, ambulance room or dispensary is maintained at or near the factory and such arrangements are made as to ensure the immediate treatment of all injuries to workers occurring within OP 7323/98 -: 5 :- the factory and for providing rest to the injured workers. It is further contended that the mere fact that a ESI hospital is located near the petitioner's factory does not call for an order of exemption in favour of the petitioner. The counter affidavit proceeds to state that the activity in the petitioner's factory is a hazardous process as defined in Section 2(cb) of the Act and the Manufacture, Storage and Import of Hazardous Chemicals Rules 1989. It is contended that as synthetic rubber is also used as a raw material in the petitioner's factory, Section 2(cb) of the Act will apply and therefore the petitioner's factory falls in entry 13 of the the first schedule to the Act. It is stated that the Inspection Team headed by the Joint Director of Factories and Boilers (Medical), Thiruvananthapuram had after inspecting the petitioner's factory on 28.6.1997 concluded that Rule 81AJ of the Rules will apply to the petitioner's factory and therefore the management was bound to set up an Occupational Health Centre with all facilities. It is also stated that for these reasons, the petitioner's request for exemption was validly rejected, that against Ext.P3, the petitioner ought to have filed an appeal under Section 107 of the Act to the State Government and that instead, OP 7323/98 -: 6 :- the petitioner chose to make repeated requests for exemption. It is also stated that Ext.P5 letter was issued in continuation of the earlier correspondence and that it was sent after the inspection referred to in Ext.R1 report. The stand taken in Ext.P5 is sought to be sustained relying on Rule 81 AJ of the Rules. It is further stated that Ext.P5 was issued to alert the petitioner that its factory comes under the purview of the rules framed under Sections 41B and 41C of the Act, which specify the responsibility of the occupier of a factory wherein the activity is a hazardous process. As regards the plea of the petitioner that a ESI Hospital is located near its factory, the counter affidavit states that the management has not produced any valid agreement with the said hospital, that most of the workers in the petitioner's factory are not eligible for ESI benefits and that the facilities in the ESI Hospital are of a general nature. The inspection report, a copy of which is marked as Ext.R1 states inter alia as follows: "23. Medical facilities: A. The inspection team evaluated the medical facilities provided by the factory management and found to be inadequate. There shall be provided and maintained in good condition an ambulance van OP 7323/98 -: 7 :- manned by a full time driver cum mechanic and a helper trained in First-aid for the purposes of transportation of serious cases of accident or sickness. The ambulance van shall not be used for any purpose other than the purpose stipulated herein and will normally be stationed at or near to the proposed Occupation Health Centre. Factory of this size and coming under the provisions of S.2(cb) requires an Occupational Health Centre to monitor and conduct the health conditions of the workers. Pre-employment and periodic medical examination is required. This Occupational Health Centre should also cover the requirements of Artificial Respiration. B. Till such centre is established, the management shall provide first-aid facilities as prescribed by law in all key sections. C. In addition to these, the management shall make available, a minimum of three qualified first-aiders in every shift." 4. I heard Sri.M.Pathrose Mathai, the learned Senior Counsel appearing for the petitioner and Sri.K.Sandesh Raja, the learned Government Pleader appearing for the respondents. Assailing Ext.P3, the learned Senior Counsel appearing for the petitioner submitted that the reasoning therein that Rule 90(5) of OP 7323/98 -: 8 :- the Rules does not empower the Chief Inspector of Factories to exempt the petitioner's factory from providing an ambulance room as stipulated in Section 45 of the Act is faulty and untenable. The learned Senior Counsel submitted that Section 45 (4) of the Act cannot operate on its own, that it is dependent on Rule 90 of the Rules and therefore, the Chief Inspector of Factories is competent to exempt the petitioner's factory from providing an ambulance room if the conditions stipulated therein for the grant of exemption are satisfied. The learned Senior Counsel submitted with reference to the decision of the Apex Court in Punjab Sikh Regular Motor Service, Moudhapara, Raipur v. Regional Transport Authority, Raipur & another - A.I.R. 1966 S.C. 1318, that the provisions in 90(5) of the Rules supercede Section 45(4) of the Act and that once the conditions stipulated therein for the grant of exemption exist, the Chief Inspector of Factories has the power coupled with a duty to grant exemption. The learned Senior Counsel contended that even though Section 45(4) of the Act stipulates that in every factory wherein more than 500 workers are ordinarily employed, an ambulance room of the prescribed size containing the prescribed OP 7323/98 -: 9 :- equipment and in charge of such medical and nursing staff as may be prescribed shall be provided, it is made subject to Rule 90 of the Rules framed by the State Government under Section 112 of the Act and that the provision in Rule 90(5) empowering the Chief Inspector of Factories to grant exemption, supersedes the direction in Section 45(4) of the Act that there shall be provided and maintained an ambulance room in every factory wherein more than 500 workers are ordinarily employed. The learned Senior Counsel contended that the Director of Factories and Boilers has proceeded on the erroneous assumption that Section 45 of the Act does not contemplate the grant of exemption, that Rule 90(5) of the Rules contemplates only exemption from the stipulations in Rule 90 and that the said provision does not empower him to exempt the petitioner's factory from providing an ambulance room. As regards the contention of the respondents that the petitioner's factory falls in the list of industries involving hazardous process and that entry 13 in the first schedule to the Act takes in the petitioner's factory as well, it was submitted that only factories which are engaged in the manufacture of synthetic rubber fall within the said entry. OP 7323/98 -: 10 :- The learned Senior Counsel contended that if synthetic rubber is used as a raw material in a factory, that by itself cannot result in the industry being classified as an industry wherein hazardous process is involved. It was submitted that that the term "hazardous process" has been defined in Section 2(cb) of the Act to mean any process or activity in relation to an industry specified in the first schedule to the Act where, unless special care is taken, the raw materials used therein or the intermediate or finished products, bye-products, wastes or effluents thereof would cause material impairment to the health of the persons engaged in or connected therewith or result in the pollution of the general environment. The learned Senior Counsel for the petitioner contended that in the light of the definition of the term "hazardous process", a factory engaged in the manufacture of automotive tyres, tubes and other rubber goods wherein synthetic rubber is also used as a raw material cannot be said to be an industry specified in the first schedule to the Act. The learned Senior Counsel also referred to and relied on the provisions of the Industries (Development and Regulation) Act, 1951, to contend that industries engaged in the manufacture of OP 7323/98 -: 11 :- synthetic rubber and industries engaged in the manufacture of rubber goods are different and distinct. It was submitted that an industry engaged in the manufacture or production of synthetic rubber falls under entry 19(6), while an industry engaged in the manufacture or production of rubber goods including tyres and tubes falls under entry 30 of the first schedule to the Industries (Development and Regulation) Act, 1951. The learned Senior Counsel contended that the test to ascertain whether the petitioner's industry falls within the list of industries enumerated in the first schedule to the Act is not the user test but the end product test and that to fall within entry 13 of the first schedule to the Act, the industry should be one engaged in the manufacture or production of synthetic rubber and not one in which synthetic rubber is also used as a raw material. 5. Per contra, Sri.K.Sandesh Raja, the learned Government Pleader appearing for the respondents contended that Section 45 (4) of the Act is mandatory and that in every factory wherein more than 500 workers are ordinarily employed, an ambulance room has to be provided and maintained. The learned Government Pleader submitted that the petitioner's factory falls OP 7323/98 -: 12 :- within entry 13 of the first schedule to the Act, since the manufacturing process involves the use of synthetic rubber also as a raw material. The learned Government Pleader further contended that Rule 90 of the Rules prescribes the size of the ambulance room, the equipment, the number of medical and nursing staff to be deployed therein and such other details and that the exemption contemplated in Rule 90(5) of the Rules can only be from the requirements of Rule 90 and not from the very obligation to provide and maintain an ambulance room as required under Section 45(4) of the Act. It was further contended that such an exemption could be given only if a hospital, ambulance room or dispensary is maintained at or near the factory and such arrangements are made as to ensure the immediate treatment of all injuries to workers occurring within the factory and for providing rest to the injured workers. The learned Government Pleader also contended that the principles laid down by the Apex Court in A.I.R. 1966 S.C. 1318 (supra) do not apply at all to the case on hand. It was submitted that the Act is a welfare legislation, enacted to ensure the safety of factory workers and therefore an interpretation in favour of the OP 7323/98 -: 13 :- workers should be placed on Rule 90 of the Rules. The learned Government Pleader submitted that as Section 45 of the Act does not contemplate the grant of exemption, Rule 90(5) of the Rules cannot be invoked to claim or grant exemption from providing an ambulance room in any factory. 6. I shall first consider the question whether the petitioner's factory, which is engaged in the manufacture of automotive tyres, tubes and other rubber goods, is a factory in which hazardous process is involved in the manufacturing process. The Industries (Development and Regulation) Act, 1951 provides for the development and regulation of the industries described in the schedule thereto. I shall for easy reference extract entry 19 and entry 30 of the first schedule to the Industries (Development and Regulation) Act, 1951, hereinafter referred to as the "Regulation Act" for short. "19. CHEMICALS (OTHER THAN FERTILISERS): (1) Inorganic heavy chemicals. (2) Organic heavy chemicals. (3) Fine chemicals including photographic chemicals. (4) Synthetic resins and plastics. (5) Paints, varnishes and enamels. (6) Synthetic rubbers. (7) Man-made fibres including regenerated cellulose-rayon, OP 7323/98 -: 14 :- nylon and the like. (8) Coke oven by-products. (9) Coal-tar distillation products like naphthalene, anthracene and the like. (10) Explosives including gunpowder and safety fuses. (11) Insecticides, fungicides, weedicides and the like. (12) Textile auxiliaries. (13) Sizing materials including starch. (14) Miscellaneous chemicals." "30. RUBBER GOODS: (1) Tyres and and tubes. (2) Surgical and medicinal products including prophylactics. (3) Footwear. (4) Other rubber goods. 7. Entry 19 in the first schedule to the Regulation Act relates to chemical industries. Factories engaged in the manufacture and production of synthetic rubber fall in item 6 of entry 19 thereof. Factories engaged in the manufacture of rubber goods fall in entry 30 thereof. Under the Regulation Act, a factory manufacturing synthetic rubber is classified as a factory engaged in the manufacture of chemicals while a factory engaged in the manufacture of tyres and tubes, surgical and medicinal products including prophylactics, footwear and other rubber goods is classified as a factory manufacturing rubber goods. A Full Bench of this Court in Elizabeth v. State of Kerala - 1991 OP 7323/98 -: 15 :- (1) K.L.T. 475, interpreting the provisions of the Regulation Act held that industries comprised in the first schedule to that Act are those engaged in the manufacture of the articles mentioned under each of the headings or sub headings therein and that industries, engaged in the production of raw materials necessary for a scheduled industry are not engaged in the production of the articles mentioned in the schedule. The Full Bench repelled the contention that as China clay is a raw material used by industries engaged in the manufacture and production of China ware and pottery, which is item 6 in entry 34 of the first schedule to the Regulation Act, the entry must be deemed to comprehend within it, an industry engaged in the manufacture of China clay as well. It is therefore evident that a factory engaged in the manufacture of rubber goods which include (1) tyres and tubes (2) surgical and medicinal products including prophylactics, (3) footwear and (4) other rubber goods cannot be said to be a factory engaged in the production of synthetic rubber for the reason that synthetic rubber is also used in the manufacturing process of the said goods. An industry engaged in the manufacture of synthetic rubber which falls in item 6 of entry 19 in the first schedule to the OP 7323/98 -: 16 :- Regulation Act, cannot therefore be held to be an industry engaged in the production of rubber goods which falls within entry 30 thereof. 8. A factory engaged in the manufacture of automotive tyres, tubes and other rubber goods and a factory engaged in the manufacture of synthetic rubber belong to two different categories. In the petitioner's factory, the raw materials used are natural rubber and chemicals including synthetic rubber as well. In my opinion, as rightly contended by the learned Senior Counsel for the petitioner, the test to ascertain whether the petitioner's factory falls within any of the entries in the first schedule to the Act is not the user test, but the end product test. Applying that test, only an industry engaged in the manufacture of synthetic rubber will fall within entry 13 of the first schedule to the Act. If the contention of the learned Government Pleader is accepted, any industry which uses iron and steel or cement as a raw material in its factory, would also be an industry involving hazardous process. For example, a factory manufacturing cement blocks using portland cement cannot be said to be an industry involving hazardous process. What is included in the list OP 7323/98 -: 17 :- of industries involving hazardous process is only an industry engaged in the manufacture of cement (vide entry 8 of the first schedule to the Act). Likewise an industry engaged in the manufacture of synthetic rubber alone will fall within entry 13 of the first schedule to the Act. Therefore, the contention of the respondents that the petitioner's factory falls within entry 13 of the first schedule to the Act, is plainly untenable and I overrule the said contention. 9. In the view that I have taken, the stand taken by the respondents in Ext.P5, Ext.R1 and in the counter affidavit that the manufacturing process in the petitioner's factory is a hazardous process as defined in Section 2(cb) of the Act, thereby attracting Rules 81 A1 to 81 AO of the Rules framed and issued under Section 41B and Section 41C of the Act is misconceived. In my opinion, the manufacturing process in the petitioner's factory cannot be termed a hazardous process, since the process or activity in the petitioner's factory is not in relation to an industry specified in the first schedule to the Act. As stated earlier, the petitioner's factory is not a factory, which is engaged in the manufacture or production of synthetic rubber. Though it OP 7323/98 -: 18 :- was contended by the learned Government Pleader that entry 13 in the first schedule to the Act reads as Rubber (Synthetic Industries) on verification, it was noticed that entry 13 really reads as Rubber (Synthetic) Industries. Since entry 13 of the first schedule to the Act takes in only industries engaged in the manufacture of synthetic rubber and not a factory engaged in the manufacture of rubber goods, which uses synthetic rubber also as a raw material, the stand taken by the respondents in Ext.P5, Ext.R1 and in the counter affidavit that the petitioner has to provide an Occupational Health Centre in its factory as required by and in terms of Rule 81 AJ of the Rules is unsustainable in law. Ext.P5, in so far as it directs the petitioner to provide an Occupational Health Centre in its factory in terms of Rule 81 AJ of the Rules, is therefore liable to be quashed. 10. I shall now consider whether Rule 90(5) of the Rules enables the Chief Inspector of Factories to exempt the petitioner's factory from providing an ambulance room as stipulated in Section 45(4) of the Act. Section 45(4) of the Act reads as follows: "(4) In every factory wherein more than five OP 7323/98 -: 19 :- hundred workers are ordinarily employed there shall be provided and maintained an ambulance room of the prescribed size, containing the prescribed equipment and in the charge of such medical and nursing staff as may be prescribed and those facilities shall always be made readily available during the working hours of the factory." (Emphasis supplied) It is evident from a reading of Section 45(4) of the Act that an ambulance room has to be provided and maintained in every factory wherein more than 500 workers are ordinarily employed. In the petitioner's factory, 1254 workers are admittedly employed and therefore Section 45(4) of the Act applies with full force. Section 45(4)