ANDllllA UNIVERSITY ETC,

RF.GIOllAL PROVIDENT PUllD <XHIISSIO!llER OF

AND1111A PRADESll AND AN&.

OCTOBER 8, 1985

[O. CHINNAPPA REDDY, V. BALAKIUSHNA ERADI AND V. KHALID, JJ.]

Employees' Provident Funds and Miscellaneous Provisions Act, sections l(3)(a), 2(1-C), 2(g) and 2(a), scope of - Whether the establishments namely, the Departments of Publications and Press of the Andhra and Osmania Universities are "factories" and their activities fall under "manufacture" and therefore they are governed by the provisions of the said Act - Interpretation of the word "establishment" in section 2-A

The Faployeea' Provident Funda and Miscellaneous Provisions Act appliea to every eatabli1bment which is a "factory• engaged

in and "industry" specified in Schedule I and in which 20 or more persona are employed. The exprealiona "manufacture• and "factory" are defined in section 2(1-C) and 2(g) of the Act.

The establiahments namely, the Departments of Publications and Press of the two Univerlitiea each employing 100 persona, run printing presaea, where the work of printing of text books, journals and magazinea for the various conatituant and affiliated colleges as well as of various items of stationary such as admission forms to colleges, ho1tela and examinations, forms of memo of marks, hell tickets, 8D8118r bookl, ayllabi for various colleges and departments., regiatera, receipt booka for colleges and hostela and letter heed8 for Univeraitiea is carried out. The Regional Provident Fund Collllliaaionar called upon the two Univeraitiea to

submit their monthly returns and remit the amounta of contribution u required by the proviliona of the scheme covered under the Faployeea 1 Provident Funds and Miscellaneous Provisions Act.

Two writ petitions were therefore, filed by the appellants separately challeog1ng the legality and validity of the notices iHued to them by the Regional Provident Fund Coaaisaionar, contending (i) that the Univerlitiea are purely educational institutions having a number of departmenta, the main object of which ia to impart education to the youth of the country in

various bram:hea of atudents, and therefore, the Department of Publications and PrH~ which 1a intended only to cater the needa and requirements of the atudents cannot be regarded either aa a

"factory" or aa an "industry" attracting the provisions of the Act; and (11) that the two Univeraities had their own provident

ANDHRA UNIVERSITY V• P.F. COMMR. 583

fUDd acbemea for their employees and therefore, there was no

juatification for subjecting them to the provisions of the Act. A A leam.d Single Judge of the High Court accepting the said contentioll8 allowed the writ petitions. However, on appeal.a filed by the Bq1onal Providmt Fund Commiasiooer, Andhra Pradesh, the Diviaion lleDch by two aeparate jwlgmellta set aside the jwigm!lnts

of the leaned Single Judge and held that the Department of Publicat1oll8 and Preas of each of the two Uoiveraities ia an B

"establishment" which is a factory eogaged in an industry apec1f1ed in Schedule I, in which more than 20 persOllS were employed and hence the provisiOll8 of the Act and the Scheme were applicable in respect of these Departments. llellce the appeals by

apeci.al leave.

Diami991ng tM app2&l.e, the Court, c

llBU> 1 l.l 'Io attract the provisious of the F.mployees' Provident Funds and Miscellaoeoua Provisions Act, two teats namely, whether there is an establishment which is a "factory"

eogaged iD an.y of the scheduled industries and whether 20 or more 0 persons are employP.d in the B&id eetabliabmeot 1111st be fulfilled. [587 !i')

l.2 Printi113 ia one of the industries specified in Schedule I of the Act. and it is admitted that llllCh more than 20 peraons are employed in the concerned establishment of the two Univer- E sitiea. [588 A]

l.3 The Departments of Publlcatioua and Press are "factories" as defined in clause (g) of section 2 of the Act.

Under thedefinition, "factory" means soy premiaes, in sn.y part of vh1ch a 11181111facturi113 process is be1113 carried on. The printi113 of text booka, journal.a, regiatera, forms and variowi F itema of atationery clearly constitute "manufacture" within the me•nlng of the said expreaaiou aa defined in clause (1-<:) of section 2 of the Act. [587 ~; 588 A]

1.4 It ia therefore clear that all the requirements of clauae 3(a) of aection (l) of the Act are fully aatisfied in G

tbae caaea and hence the decision of the Di vision Bench of the lligb Court uphold1113 the validity of the notices issued by the

rupoudent, llegional Provident Fund Counisaiooer, is perfectly correct and juatifiedo [588 A-BJ

Vina llbuati Vo llegioml l'Eov1deDt Jund ('cawf••1-r, V.t lleDgal, [1983] l L.L.J, 332 overruled. ii

2.1 In construi113 the proviaiOll8 of the Employees' Provident l'llllds and Miscellaneous Provisiona Act, it 11118t be

SUPREME COURT REPORTS [1985] SUPP.3 s.c.R.

A borne in llliDd that it is a beneficient piece of Social Welfare legislation aimed at promoting and securing the well being of the employees and the Court will not adopt a narrow interpretation which will have the effect of defeating the very object and purpose of the Act. [587 A-B]

B 2.2 Section 2-A of the Act was inserted .., rely for the purposes of clarifying the position that the Act applies to cCDpOaite factories. It is not the intent...nt of the section to lay down even by remotest implication that an establis1-nt, which ia a factory engaged in an industry specified in Schedule I will not be liable for coverage under the Act ...rely because it is part of a larger organisation carrying on SOllM! of the activi- C ties alao which may not fall within the scope of the Act. ( 586 G-il; 587 A]

CIVIL APPELLATE JURISDICTION Civil Appeal No. 126 of 1973.

From the Judgment and Order dated 21.12. 70 of the Andhra D Pradesh High Court in Writ Appeal No. 396 of 1971.

AND

Civil Appeal No. 204 of 1973.

E From the Judgment and Order dated 25. 2.1972 of the Andhra Pradesh High Court in Writ Appeal No. 392 of 1971.

B.R.L. Iyengar, G.N. Rao, T.C. Gupta and Attar Singh for the Appellant.

F ij.S. Gujral, c.v. Subba Rao, R.N. Poddar and T.c. Sharma for the Respondents.

The Judgment of the Court was delivered by

BAIA!QU'l!INA ERADI, J.

These two appeals . are directed G against two judgments of the Andhra Pradesh High Court dismissing two Writ Petitions filed by the appellants herein namely, the Andhra University and the Osmania Uoiversity challenging the legality and V(llidity of the notices issued to the two Universities by the Regional Provident Fund Commissioner of Andhra Pradesh intimating them that the Departments of Publications an.d H Press wherein printing presses were being run by the two Universities, were liable for coverage under the 12nployees' Provident

ANDHRA UNIVERSITY v. P.F. COOMR. [llALAKRISHNA ERADI, J.] 585 .

Funds and Miscellaneous Provisions Act (hereinafter called the 'Act and Scheme') and calling upon the two Universities to submit their monthly returns and remit the amounts of contribution as required by the provisions of the Scheme. The appeals have been filed on the basis of certificates of fitness granted by the High Court under Article 133 (l)(c) of the Constitution.

The collllllOn contention taken by the appellants herein in the two Writ Petitions was that the Universities are purely educational institutions having a number of departments, the main object of which is to impart education to the youth of the country in various branches of studies, that the Department of Publications and Press which is intended only to ca:ter the needs and requirements of the students cannot be regarded either as a 'factory' or as an 'industry' and the provisions of the Act are not therefore, attracted in respect of the said department, It was also submitted in the Writ Petitions that the two Universities had their own provident fund schemes for their employees and hence there was no justification for subjecting them to.the provisions of the Act. A learned Single Judge of the High Court accepted the contention of the two Universities that the Department of Publications and Press could not be regarded as an 'industry' and accordingly held that the provisions of the Act were not attracted. However, on appeals filed by the Regional Provident Fund Conmissioner, Andhra Pradesh before a Division Bench of the High Court, the Division Bench by two separate

judgments set aside the judgments of the learned Single Judge and held that the Department of Publications and Press of each of the two Universities is an 'establishment' which is a factory engaged in an industry specified in Schedule I, in which more than 20 persons were employed and hence the provisions of the Act and the Scheme were applicable in respect of these Departments. In these appeals, the appellants namely, the two Universities, have challenged the correctness of the aforesaid conclusion recorded by the Division Bench of the High Court.

It is common ground that the Department of Publications and Press of the two Universities (appellants) runs printing presses, where the work of printing of text books, journals and magazines for the various constituent and affiliated colleges as well as of various items of stationery such as admission forms to colleges, hostels and examinations, forms of memo of marks, hall tickets, answer books, syllabi for various colleges and departments, registers, receipt books for colleges and hostels and letter heads for Universities is carried out. About 100 persons are employed in connection with the said activity in the Department of Publiations and Press of each University.

586 SUPKJ::Mll COURT WlPORTS [1985] SUPP.3 s.c.R.

Section 1(3)(a) of the Act lays down that subject to the provisions contained in Section lb (those provisions are admittedly not applicable to the cases before us), the Act applies to every establishment which is a 'factory' engaged in any 'industry 1 specified in Schedule I and in which 20 or more B persons are employed. The expression "factory" has been defined in Section 2(g) as meaning "any premises, including the precincts thereof, in any part of which a manufacturing process is being carried on or is ordinarily so carried on, whether with the aid of power or without the aid of power."

Section 2(1-c) defines "manufacture" or 'manufacturing C process 1 as meaning "any process for making, altering, repairing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up, demolishing or otherwise treating or adapting any article or substance with a view to its use, sale, transport, delivery or disposal,"

It was not disputed before the High Court that the D Department of Publications and Press of the two Universities were 'establishments' and the only contention urged was that the said Departments were not 'factories' and the activity carried on therein did not constitute an 'industry'. However, before this Court a new point was urged on behalf of the appellants that for the purposes of determining the applicability of the Act the E entire University must be treated as an establishment and if the University cannot be said to be a factory engaged in an industry, there cannot be any. question of coverage under the Act and the Scheme. For sustaining this contention support was sought to be derived from Section 2-A of the Act, which is in the following terms :- F

"2-A Establishment to include all departments and branches -

For the removal of doubts, it is hereby declared that where an establishment consists of different depart- G mehts or has branches, whether situate in the same place or in different places, all such departments or branches shall be treated as part of the same establishment."

We are unable to see how this provision is of any assistance H to the appellants. Section 2-A was inserted in the Act merely for the purposes of clarifying the position that the Act applies to composite factories. It is not intentment of the section to lay

ANUHRA UNIVERSITY v. P.F. COMMR. [BA!AKRISHNA ERADI, J,] 587

down even by remotest implication that an establishment, which is a factory engaged in an industry specified in Schedule I will not be liable for coverage under the Act merely because it is part of a larger organisation carrying on some other activities also which may not fall within the scope of the Act. In construing the provisions of the Act, we have to bear in mind that it is a bene- Eicient piece of Social Welfare legislation aimed at promoting and securing the well being of the employees and the Court will not adopt a narrow interpretation which will have the effect of defeating the very object and purpose of the Act. Once it is

found that there is an establishment which is a 'factory' engaged in an 'industry' specified in Schedule I and employing 20 or more persons, the provisions of the Act will get attracted to the case and it makes no difference to this legal position that the establishment is run by a larger organisation which may be carrying on other additional activities falling outside the Act.

Our attention was drawn to a decision of a learned Single Judge of the Calcutta High Court in Visva Bbarati v. Regional Provident Fund Commissioner, West Bengal, [1983] l L.L.J. 332 wherein it was held that the provisions of the Act were inapplicable in respect of a "Silpa Sadan", Agricultural Farm and a Hospital run by the Visva-Bharati University. The learned Judge was of the view that "if the University as an establishment does not come under the provisions and or the purview of the Act, the different branches or depatments of the University which the University empowered and or entitled to maintain under the provision of the Visva Bharati Act cannot be brought within the mischief of the Act." We have no hesitation to hold that the aforesaid view expressed by the learned Judge is not correct or sound and that the said decision does not lay down correct law.

As already indicated, the true tests to be applied is whether there is an establishment which is a 'factory' engaged in any of the scheduled industries and whether 20 or more persons are employed in the said establishment. If the an•wer is in the affirmative, the provisions of the Act are clearly attracted.

In the cases before us there cannot be' any doubt that the establishments namely, the Departments of Publications and Press are 'factories' as defined in clause (g) of Section 2 of the Act.

Under the said definition factory means any premises in any part of which any manufacturing process is being carried on. The printing of text books, journals, registers, forms and various items of stationery clearly/constitute 'manufacture' within the

588 SUPl(Elli; COURT liliPOl:lTS (1985] SUPP.3 s.c.R.

meaning of the said expression as defined in clause ( 1-c) of A Section 2 of the Act. That printing is one of the industries specified in the Schedule is not in dispute. It is also not disputed that much more . than 20 persons are employed in the concerned establishments of the two Universities. Thus all the requirements of clause (3) (a) of Section 1 of the Act are fully B satisfied in these cases and hence the conculsion recorded by the High Court that the establishments in question are liable for coverage under the Act is perfectly correct and justified.

It follows that these appeals are totally devoid of merits.

C They will accordingly stand dismissed with costs.

s .)i.

APpeals dismissed.