THE HON'BLE MR JUSTICE GHULAM MOHAMMED and THE HON'BLE MR JUSTICE P. SWAROOP REDDY C.M.A.No.774 of 2008 Judgment: (Per Sri Justice Ghulam Mohammed) This civil miscellaneous appeal is directed against the order, dated 09.01.2007, passed in E.S.I.Case No.1 of 2000 by the Presiding Officer, Labour Court, Guntur. 2. Respondent herein is the Managing Partner of M/s. Kollipara Rajeswararao Mill, Guntur. He filed E.S.I.Case No.1 of 2000 under Section 75 of the Employees’ State Insurance Act, 1948 (for short ‘the Act’), against the appellant seeking to declare that his factory as a seasonal factory and the notice, dated 30.12.1999, issued by the appellant as illegal and invalid. The respondent states that as the activity of his factory is cotton ginning and pressing, it is not governed by the provisions of the Act, whereas the appellant states that as the activity of respondent’s factory is cotton ginning, cotton pressing, sale of cotton lint and seeds with the aid of power through out the year, it comes under the provisions of the Act, and as such, it is liable to pay the contributions demanded by him. By the order impugned, the Court below allowed the said case declaring that the respondent’s factory is a seasonal factory and the notice, dated 30.12.1999, as illegal and invalid. Challenging the same, the appellant filed the present appeal. 3. Heard the learned counsel for the appellant and the learned counsel for the respondent. 4. Learned counsel for the appellant contended that on the date of inspection i.e., 04.11.1998, twenty number of employees were working in the respondent’s factory with the activity of purchase of cotton, ginning, pressing and resale with the aid of power through out the year and that the Court below erred in noticing the words ‘purchase of cotton and resale’ which do not come under the definition of ‘seasonal factory’ under Section 2(19A) of the Act. He further contended that the registration form submitted by the respondent also shows the engagement of twenty persons and as such, his factory is governed under the provisions of the Act. 5. Learned counsel for the respondent contended that as the activity of the respondent’s factory is cotton ginning and pressing, it does not come under the purview of the Act. He further contended that the number of its employees is less than twenty excluding mutta coolies. 6. We have perused the material on record. As per Col.No.5 of the Employee’s Registration Form, Regulation 10-B, the exact nature of work/business carried on by the respondent’s factory is to purchase cotton and ginning, pressing and resale of it. Section 2(19A) of the Act reads as under: “’seasonal factory’ means a factory which is exclusively engaged in one or more of the following manufacturing processes, namely, cotton ginning, cotton or jute pressing, decortication of groundnuts, the manufacture of coffee, indigo, lac, rubber, sugar (including gur) or tea or any manufacturing process which is incidental to or connected with any of the aforesaid processes and includes a factory which is engaged for a period not exceeding seven months in a year- (a) in any process of blending, packing or repacking of tea or coffee; or (b) in such other manufacturing process as the Central Government may, by notification in the Official Gazette, specify; 7. The nature of work of cotton ginning and pressing comes under the definition of ‘seasonal factory’ under Section 2(19A) of the Act, but the nature of work of purchase of cotton and resale does not come under the said definition, as it is a commercial activity. As such, the respondent’s factory does not come under the definition of ‘seasonal factory’. The Court below without noticing these two types of nature of work declared that the respondent’s factory is a seasonal factory. As the nature of work of purchase of cotton and resale does not come under the definition of ‘seasonal factory’, we are of the view that the respondent’s factory is not a seasonal factory within the meaning of Section 2(19A) of the Act and therefore, the order impugned is liable to be set aside. 8. In view of the above, the Civil Miscellaneous Appeal is allowed and the order impugned is set aside. No order as to costs. _____________________ GHULAM MOHAMMED, J _____________________ P. SWAROOP REDDY, J Date:20.10.2010. SJ