IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN THURSDAY, THE 10TH JULY 2008 / 19TH ASHADHA 1930 Ins.APP.No. 44 of 2004(A) ------------------------- IC.75/2002 of ESI COURT, PALAKKAD .................... : APPELLANT/OPPOSITE PARTY. ------------------------------------------ THE REGIONAL DIRECTOR, E.S.I.CORPORATION, THRISSUR. BY ADV. SRI.T.V.AJAYAKUMAR RESPONDENTS: APPLICANT. ----------------------- ASHLYN CHEMUNGOOR ELECTROCNICS PVT.LTD., PALAKKAD ANGADI, THRISSUR. BY ADV. THUSHARA JAMES SRI.E.K.NANDAKUMAR FOR R1 SRI.K.JOHN MATHAI FOR R1 THIS INSURANCE APPEALS HAVING BEEN FINALLY HEARD ON 10/07/2008, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: M.N.KRISHNAN, J ===================== Ins.A. No.44 OF 2004 ===================== Dated this the 10th day of July 2008 JUDGMENT This appeal is preferred against the order of the Employees' Insurance Court, Palakkad in I.C.No.75 of 2002. It is the case of the Employees' State Insurance Corporation(for short ' Insurance Corporation') that the applicant company before the court below is covered by the provisions of the Employees' State Insurance Act(for short 'the Insurance Act') and therefore they have initiated proceedings. On the contrary, the applicant would contend that it has never employed more than 13 persons and it does not have any manufacturing process and that it has never used any power for the purpose of manufacture. 2. The question whether it will come under the ambit of the Insurance Act depends upon the finding whether they will satisfy the condition under Section 2(12 )(a) of the Insurance Act. Section 2(12) of the Act defines “factory” means any premises including the precincts thereof--(a) whereon ten or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing Ins.A.44/2004 -:2:- process is being carried on with the aid or power or is ordinarily so carried on. Learned counsel for the Insurance Corporation would contend that the manufacturing process contemplated under Section 2(12)(a) takes in repairing also and when the repairing is effected with the help of a soldering iron using the power, then squarely there is satisfaction of what is contemplated under Section 2(12)(a) of the Insurance Act and therefore there will be coverage under the Insurance Act. Or in other words, the extension of the term repairing amounts to manufacturing process only by virtue of the inclusive definition used under Section 2(k) of the Factories Act. Learned counsel for the Corporation has cited before me the decision of the Calcutta High Court reported in Limton(P)Ltd. v. E.S.I.C.(1961 (II) LLJ 361) and also the decisions in Christian Medical College v. ESIC (2001) 1 SCC 256 and ESIC v. Ambika Appliances(P) Ltd.(2007(3) KLT SN 64(C.No.82) Karnt). In all these cases it has been held that if repairing is effected with the help of power then the ingredients are satisfied and there can be applicability of the Insurance Act. But the entire thing depends upon the factual foundation. It is contended by the applicant before the Insurance Court that it only conducts sales and servicing of electronic weighing instruments and electronic taxi meters. It is supplied to them by different manufacturers and their duty is to sell it and the service engineers visit the Ins.A.44/2004 -:3:- premises for the purpose of installation and they do not have the power under the contract with the supplier to open it and further. For the purpose of installation the equipment used is only a screw driver and not a soldering iron. It has to be further stated that the insurance court was not satisfied with the materials available there to show that the soldering iron was used for the purpose of carrying repairs and sales in the premises of the applicant before the said court. Therefore on facts it found that it is not proved. Learned counsel for the appellant very strongly contends before me that when a soldering iron is an imperative requisite for issuance of a license for the purpose of sales and services it may not be correct to presume that the said equipment is installed there and is lying idle without being used for the purpose. It all depends upon the work that is being processed and whether the necessity of soldering iron arises in the ordinary course of business or services conducted by the applicant. Therefore I feel the matter requires reconsideration and an opportunity has to be given to the Insurance Corporation for eliciting materials both documentary and oral to satisfy the conscience of the court that soldering iron is used for the activities which the applicant firm is doing. Needless to say that the respondent herein also would be entitled to adduce rebuttal evidence to establish that it is not using that soldering iron Ins.A.44/2004 -:4:- so as to attract the provisions under the Insurance Act. Therefore the order under challenge is set aside and the matter is remitted back to the Employees' Insurance Court for the purpose of considering these materials in accordance with law. The court shall issue notice to the parties for appearance. It is also to be specifically stated that Sri.Manu Govind, who has helped the court to address the matter on the question of law had taken great pains and his help is appreciated. M.N.KRISHNAN, JUDGE Cdp/-