IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN THURSDAY, THE 21ST OCTOBER 2010 / 29TH ASWINA 1932 Ins.APP.No. 66 of 2008() ------------------------------ IC.50/2003 of E.I.COURT, KOLLAM .................... APPELLANT(S)/RESPONDENT ---------------------------------- THE REGIONAL DIRECTOR, E.S.I. CORPORATION, PANCHADEEP BHAVAN, NORTH SWARAJ ROUND, THRISSUR. BY ADV. SRI.T.V.AJAYAKUMAR RESPONDENT(S)APPLICANT -------------------------------- 1. FATHIMA RAHIM, PROPRIETRIX, JALADARSHINI LAKE SIDE RESORT, THEVALLY, KOLLAM. 2. ASAS RAHIM, MALIKA VEEDU, LAKSHMINADA, KOLLAM. 3. ANSAR RAHIM, PALMGROVE, MADANADA, KOLLAM. 4. LYLA BEEVI, MALIKA VEEDU, LAKSHMINADA, KOLLAM. 5. JAMEELA BEEVI, MALIKA VEEDU, LAKSHMINADA, KOLLAM. 6. SHAMEELA BEEVI, MALIKA VEEDU, LAKSHMINADA, KOLLAM. R2 BY ADVS. SRI.G.SREEKUMAR (CHELUR) SRI.K.RAVI (PARIYARATH) SMT.PREETHY KARUNAKARAN THIS INSURANCE APPEALS HAVING BEEN FINALLY HEARD ON 21/10/2010, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: SVS/ M.N. KRISHNAN, J. ........................................... Ins.A.NO.66 OF 2008 ............................................. Dated this the 21st day of October, 2010. J U D G M E N T This is an appeal preferred against the order of the Employees Insurance Court, Kollam in I.C.No.50/2003. It was an application filed by the establishments challenging coverage of the establishments under the ESI Act. There are two establishments namely A.A. Rahim Memorial Auditorium and another Jaladarshini Lake side Resort. Both the buildings are owned by the applicants. But Jaladarshini Lake side Resort is leased out to one Shajahan from 1993 onwards and it functions as a separate unit. 2. The E.S.I Inspector who visited the property had taken common list of the employees of the restaurant and auditorium and had projected that they are part and parcel of the same organisation, liable to be clubbed and therefore as there are more than 10 employees, it is liable to be covered. It has to be stated that only common factor is the ownership of the buildings. There are two buildings; one is run as an auditorium and the other is run on lease : 2 : Ins.A.NO.66 OF 2008 arrangement by a different person as restaurant. There is no unity of ownership. There is no interconnectivity between the auditorium and the restaurant in relation to the business. There is no interchangeability of the staff. They are separately managed and manned and the wage registers, the pay etc are all done by these two different and distinct establishments. So by no stretch of imagination, the restaurant can be clubbed with the auditorium or vis versa. Unless they are clubbed together, there will not be more than ten members and therefore, ESI Act cannot be made applicable. 3. In Vrindavan Hotels (P) Ltd. v. E.S.I Corporation (2005 (3) KLT 577), a Division Bench of this Court held that when restaurant facility available in hotel and it is being run by lessee, Corporation cannot club employees of restaurant and lodge together for the purpose of coverage. But in this case even that is not available for the reason that one is functioning as a restaurant which has nothing to do with the functioning of auditorium. Therefore the Court below has approached the matter only in the correct perspective : 3 : Ins.A.NO.66 OF 2008 and held that the establishments are not liable to be covered under the Act and had allowed the application. I do not find any merit in the appeal and therefore it is dismissed. M.N. KRISHNAN, JUDGE. cl : 4 : Ins.A.NO.66 OF 2008 M.N. KRISHNAN, J. ........................................... A.S.NO.389 OF 2001 ............................................. 8th day of October, 2010. J U D G M E N T