IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN TUESDAY, THE 24TH NOVEMBER 2009 / 3RD AGRAHAYANA 1931 OP.No. 20548 of 1998(U) ---------------------------------- PETITIONER(S): --------------------- 1. MERCY HOSPITAL, REPRESENTED BY ITS MANAGING PARTNER, KONDOTTY, MALAPPURAM DISTRICT-673 638. 2. DR.K.T. VEERANKUTTY, MANAGING PARTNER, MERCY HOSPITAL, KONDOTTY, MALAPPURAM DISTRICT-673 638. BY ADV. MR.C.P.MOHAMMED NIAS RESPONDENT(S): ------------------------ 1. UNION OF INDIA, REPRESENTED BY ITS SECRETARY, DEPARTMENT OF LABOUR, NEW DELHI. 2. EMPLOYEES PROVIDENT FUND ORGANISATION, REPRESENTED BY REGIONAL PROVIDENT FUND COMMISSIONER, II (EMPLOYMENT PROVIDENT FUND) BHAVISHYA NIDHI BHAVAN, ERANHIPALAM, CALICUT-6. 3. EMPLOYEES PROVIDENT FUND APPELLATE TRIBUNAL, 7TH FLOOR, SKYLARK BUILDING, NEHRU PLACE, NEW DELHI-110 019. R2 & R3 BY ADV. MR.THOMAS MATHEW NELLIMOOTTIL,SC, P.F. THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 24/11/2009,THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: O.P. NO. 20548/1998-U APPENDIX PETITIONER'S EXHIBITS: EXT.P1: COPY OF THE ORDER DATED 27/01/1997 ISSUED BY THE 2ND RESPONDENT. EXT.P2: COPY OF THE ORDER DATED 6/08/1998 ISSUED BY THE 3RD RESPONDENT. EXT.P3: COPY OF THE STATEMENT DATED 06/06/1996 FILED ON BEHALF OF THE FIRM BY THE 2ND PETITIONER. EXT.P4: COPY OF THE LIST OF THE PETITIONER'S FIRM DATED 30/01/1996 GIVEN BY SRI.ZUBAIR. EXT.P5: COPY OF THE STATEMENT DATED 22/07/1996 SUBMITTED BEFORE THE 2ND RESPONDENT BY THE ENFORCEMENT OFFICER OF THE INSPECTORATE OF EMPLOYMENT PROVIDENT FUND. EXT.P6: COPY OF THE STATEMENT FILED BY THE PETITIONER'S FIRM BEFORE THE REGIONAL PROVIDENT FUND COMMISSIONER DATED 03/08/1996. EXT.P7: COPY OF THE NOTE OF ARGUMENTS SUBMITTED BEFORE THE REGIONAL PROVIDENT FUND COMMISSIONER DATED 26/11/1996. EXT.P8: COPY OF THE ARGUMENT NOTES SUBMITTED BY THE COUNSEL FOR THE PETITIONER DATED 26/11/1996. EXT.P9: COPY OF THE ADDITIONAL ARGUMENT NOTES SUBMITTED BY THE COUNSEL FOR THE PETITIONER DATED 27TH NOVEMBER 1998. EXT.P10: COPY OF THE ADDITIONAL ARGUMENT NORES SUBMITTED BY THE COUNSEL FOR THE PETITIONER DATED 17/12/1996. EXT.P11: COPY OF THE REPLY TO COMMENTS OF ARGUMENT NOTE SUBMITTED BY INSPECTOR OF PROVIDENT FUND DATED 8TH JANUARY 1997. RESPONDENT'S EXHIBITS: EXT.R2(a): COPY OF THE LETTER DATED 14/03/1996 SENT BY THE MANAGING PARTNER. EXT.R2(b): COPY OF THE LIST OF 24 EMPLOYEES GIVEN BY THE WORKING PARTNER OF THE FIRM. //TRUE COPY// P.S. TO JUDGE rs. S. Siri Jagan, J. =-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-=-= O.P. No. 20548 of 1998 =-=-=-=-=-=-=-=-=--=-=-=-=-=-=-=-=-= Dated this, the 24th November, 2009. J U D G M E N T A hospital, which has been directed to be covered under the Employees Provident Funds and Miscellaneous Provisions Act and its managing partner, have come up with this original petition challenging Ext. P1 order of coverage and Ext. P2 order of the Appellate Tribunal confirming Ext. P1. 2. When notice of proceedings for coverage was received from the 2nd respondent, the managing partner objected to the same on the ground that the hospital does not employ 20 or more persons so as to be liable to be covered under the Act. Therefore, proceedings under Section 7A was initiated, which led to Ext. P1 order. Ext. P1 order is solely based on a list of employees signed by the working partner of the hospital, wherein the names of 22 employees have been shown. In the 7A proceedings , that working partner gave evidence to the effect that the list included the names of employees of a scan center and a telephone booth working in the same premises. According to the working partner, he mistakenly gave the names of the employees of the scan center and the telephone booth also. He submits that he has very serious problems of eye sight and he is almost blind. However, the 2nd respondent did not accept the evidence of the working partner and relied upon the very same list signed by the working partner, which he later retracted from, to pass Ext. P1 order. The appeal filed by the petitioner was rejected by Ext. P2 order again relying on the very same list of employees. The petitioner is challenging Exts.P1 and P2 orders. 3. The contention of the petitioners is that the hospital never employed 20 or more persons at any time and therefore is not liable to be covered under the Act. They submit that apart from the retracted list signed by the working partner, who was almost blind, there was O.P.. No. 20548/1998 -: 2 :- absolutely no evidence whatsoever available to the 2nd respondent to come to the conclusion that the hospital employed 20 or more persons at any time. The petitioners would submit that the orders based on such totally inadequate material cannot be sustained. 4. With the help of a counter affidavit, the 2nd respondent opposes the prayers in the original petition. According to him, the working partner was subjected to cross examination while giving evidence and serious discrepancies were noted in his evidence and therefore he was disbelieved. He would submit that insofar as the working partner himself gave l names of 22 persons as employees of the hospital, there is absolutely no reason why the same should not be adopted as the basis for covering the establishment under the Act. He would therefore argue for sustaining the impugned orders. 5. I have considered the rival contentions in detail. 6. I am surprised that no serious attempt was made by the 2nd respondent to bring in sufficient evidence to prove their case when the managing partner, who gave the list, which is the sole basis of the decision, retracted from the same. The enforcement officer who visited the hospital could very well have interviewed the employees whose names were given by the working partner and ascertained directly from them as to whether they are employees of the hospital. Not even an attempt was made by the 2nd respondent to ascertain and place before this Court as to the size of the hospital. Not even the number of the beds in the hospital has been brought on record. The facilities in the hospital have not been attempted to be brought on record. They are solely relying on a list prepared on the instruction of a working partner, who admittedly had very serious eye sight problems. The 2nd respondent cannot even tell me in whose hand writing Ext. P4 has been prepared. He has not been able to tell me whether it was in the handwriting of the working partner. The 2nd O.P.. No. 20548/1998 -: 3 :- respondent has not made any attempt to ascertain who owns the scan center and the telephone booth working in the same premises. When the petitioner claimed that the scan center and the telephone booth are unconnected with the hospital and Ext. P4 contains the names of employees of the scan center and the telephone booth also, the 2nd respondent had a duty to verify the correctness of that statement and bring on record sufficient evidence in support of the conclusion that the establishment employed 20 or more persons instead of simply relying on a list prepared at the instance of a blind man, which was retracted by him on oath before the 2nd respondent while giving evidence. The 2nd respondent has no case that there is any indication in the records of the hospital to the effect that the number of employees in the hospital is 20 and above. Therefore, I am of opinion that on such flimsy evidence, the 2nd respondent could not have come to the conclusion that the establishment employed 20 or more persons. In view of the above findings, Exts.P1 and P2 are unsustainable. Accordingly, they are quashed. However, it would be open to the 2nd respondent to re-consider the matter and pass fresh orders, after bringing in sufficient evidence to show that the establishment had actually employed 20 or more persons at the relevant time. The original petition is disposed of as above. Sd/- S. Siri Jagan, Judge. Tds/