Bombay High Court
Kasturba Health Society vs Regional Provident Fund ... on 16 June, 2016
Bench: Z.A. Haq
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH AT NAGPUR
WRIT PETITION NO.433/1998
Kasturba Health Society,
through its Secretary, Sewagram,
Tah. and Distt. Wardha. ..Petitioner.
..Versus..
1. Regional Provident Fund Commissioner,
Sub-Regional Office, 132/A, Ridge Road,
Tukdoji Maharaj Chowk, Raghuji Nagar,
Nagpur, Tah. and Distt. Nagpur.
2. The State of Maharashtra,
through its Secretary,
Public Health Department,
Mantralaya, Mumbai 400 032.
3. Union of India,
through Ministry of Health,
New Delhi. ..Respondents.
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Shri A.S. Manohar, Advocate for the petitioner.
Dr. R.S. Sundaram, Advocate for respondent No.1.
Shri H.R. Dhumale, A.G.P. for respondent No.2.
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CORAM : Z.A. HAQ, J.
DATE : 16.6.2016
ORAL JUDGMENT
1. Heard Shri A.S. Manohar, Advocate for the petitioner, Dr. R.S. Sundaram,
Advocate for the respondent No.1 and Shri H.R. Dhumale, A.G.P. for the
respondent No.2. None appears for the respondent No.3.
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2. In 1969, the Central Government framed scheme to check and control the
population in the country and various hospitals were selected for implementing
Post-Partum Programme (for short "PPP"). As per the Scheme, the employees
required to work for implementation of the Scheme were paid by the Central
Government. The petitioner - Society is administering a hospital where PPP was
undertaken at the behest of Central Government.
The dispute in this petition is about the entitlement of such employees to
receive the benefits under the Employees' Provident Funds and Miscellaneous
Provisions Act, 1952 (for short "Act of 1952") and the Scheme framed thereunder.
The Regional Provident Fund Commissioner, by the impugned order, has concluded
that the employees working under the PPP are entitled for the benefits under the Act
of 1952 from the date of the applicability of the Act. The Regional Provident Fund
Commissioner directed the petitioner - Society to comply with the provisions of the
Act and the Scheme framed under it and to remit dues and submit returns. The
petitioner being aggrieved by the order and directions of the Regional Provident
Fund Commissioner, has filed this petition.
3. The employees working in the institution of petitioner - Society under the
PPP were terminated on 2nd June, 1997. The employees had filed Writ Petition
No.1568/1997 before this Court challenging the termination order. Writ Petition
No.1568/1997 was pending before this Court when the present writ petition (W.P.
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No.433/1998) was filed by the petitioner - Society. Therefore, while issuing Rule by
the order dated 10 th February, 1998, this Court recorded that the present petition will
have to be decided after the decision of Writ Petition No.1568/1997. The Writ
Petition No.1568/1997 is decided on 1 st April, 2016. The Division Bench of this
Court, relying on the judgment given by the Single Judge of this Court in the case of
Ramakant Laxman Sarmalkar V/s. Nowrojee Wadia Maternity Hospital & Ors.
reported in 2002(3) ALL MR 322 has concluded that the employees who were
working in the institution administered by the petitioner Society under the PPP were
not the employees of petitioner Society. The Division Bench has recorded that the
compensation payable to the employees will have to be paid equally by the State
Government and Ministry of Health, Family Welfare, New Delhi.
4. Relying on the judgment given in the case of Ramakant Laxman Sarmalkar
V/s. Nowrojee Wadia Maternity Hospital & Ors. (cited supra) and the judgment given
by the Division Bench in Writ Petition No.1568/1997, the learned Advocate for the
petitioner has argued that the petitioner cannot be held liable to deposit/pay the
amount of provident fund payable to the employees working under the PPP as those
employees were not the employees of the petitioner - Society. Referring to the
considerations in paragraph Nos.11, 12 and 13 of the judgment given in the case of
Ramakant Laxman Sarmalkar V/s. Nowrojee Wadia Maternity Hospital & Ors. (cited
supra) it is argued that under the PPP there was no provision for deposit/payment of
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provident fund and gratuity to the employees working under the PPP of the
institution. The learned Advocate for the petitioner has submitted that the order
passed by the Regional Provident Fund Commissioner is unsustainable in view of
the judgment given in the Writ Petition No.1568/1997 in which it is held that the
employees in question were not the employees of petitioner - Society. It is prayed
that the impugned oder be set aside.
5.
Dr. R.S. Sundaram, learned Advocate for the respondent No.1 has referred
to Section 2(e) of the Act of 1952 i.e. definition of "employer" and has submitted that
the petitioner being the agent for implementing the PPP and as the employees were
working in the institution administered by the petitioner - Society, it is liable to
deposit/pay the contributions as per paragraph No.30 of the Employees Provident
Fund Scheme of 1952. The learned Advocate has supported the impugned order.
6. After going through the judgment given in the case of Ramakant Laxman
Sarmalkar V/s. Nowrojee Wadia Maternity Hospital & Ors. (cited supra), I find that
the employee in that case had filed complaint under Section 28 read with Items 5, 6,
9 and 10 of Schedule IV and Item 1(a)(b) and 4(a) of Schedule II of the Maharashtra
Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971
praying for the benefits and privileges of permanency from the hospital where they
were employed under the PPP. The complaint was dismissed by the Industrial
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Court and the order passed by the Industrial Court came to be challenged. While
dealing with the challenges raised by the employee claiming benefits and privileges
of permanency, the learned Single Judge made some observations regarding the
payment of provident fund and gratuity. While deciding the case of Ramakant
Laxman Sarmalkar V/s. Nowrojee Wadia Maternity Hospital & Ors. (cited supra) the
Court was not required to deal with the entitlement of the employee for the provident
fund. There was no occasion for the Court to consider the provisions of Act of 1952.
It cannot be said that while deciding the case of Ramakant Laxman Sarmalkar V/s.
Nowrojee Wadia Maternity Hospital & Ors. (cited supra) this Court has decided that
the employees working under the PPP are not covered by the Act of 1952 and are
not entitled for the benefits under it.
Similarly, in Writ Petition No.1568/1997 the Division Bench of this Court
considered the challenge to the termination orders issued to the employees working
under the PPP in the hospital administered by the petitioner - Society. The relevant
provisions of the Maharashtra Recognition of Trade Unions and Prevention of Unfair
Labour Practices Act, 1971 are considered by the Division Bench of this Court and
there was no occasion to deal with the provisions of the Act of 1952.
7. Section 2(e) of the Act of 1952 defines the "employer" as follows:
"employer" means -
(i) in relation to an establishment which is a factory, the
owner or occupier of the factory, including the agent of such
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owner or occupier, the legal representative of a deceased owner
or occupier and, where a person has been named as a manager
of the factory under clause (f) of sub-section (1) of section 7 of
the Factories Act, 1948 (63 of 1948), the person so named; and
(ii) in relation to any other establishment, the person who, or
the authority which has the ultimate control over the affairs of the
establishment, and where the said affairs are entrusted to a
manager, managing director or managing agent, such manager,
managing director or managing agent;
Para 30 of the Employees' Provident Funds Scheme, 1952 reads as follows :
30. Payment of Contributions - (1) The employer shall, in the
first instance, pay both the contribution payable by himself (in
this Scheme referred to as the employer's contribution) and
also, on behalf of the member employed by him directly or by or
through a contractor, the contribution payable by such member
(in this Scheme referred to as the member's contribution).
(2) In respect of employees employed by or through a
contractor, the contractor shall recover the contribution payable
by such employee (in this Scheme referred to as the member's
contribution) and shall pay to the principal employer the amount
of member's contribution so deducted together with an equal
amount of contribution (in this Scheme referred to as the
employer's contribution) and also administrative charges.
(3) It shall be the responsibility of the principal employer to
pay both the contribution payable by himself in respect of the
employees directly employed by him and also in respect of the
employees employed by or through a contractor and also
administrative charges.
[Explanation - For the purposes of this paragraph the
expression "administrative charges" means such percentage of
the pay (basic wages, dearness allowance, retaining allowance,
if any, and cash value of food concessions admissible thereon)
for the time being payable to the employees other than an
excluded employee, and in respect of which provident fund
contributions are payable, as the Central Government may, in
consultation with the Central Board and having regard to the
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resources, of the Fund for meeting its normal administrative
expenses, fix.]
It is undisputed that the employees in respect of whom the Regional
Provident Fund Commissioner has passed the impugned order were working in the
institution administered by the petitioner - Society, though the petitioner - Society
claims that they were working under the PPP and for all purposes the Central
Government, Ministry of Health, Family Welfare, New Delhi was their employer. In
the judgment given in the case of Ramakant Laxman Sarmalkar V/s. Nowrojee
Wadia Maternity Hospital & Ors. (cited supra) in paragraph No.12, the learned
Single Judge has recorded that the employees working under the PPP were not
regular employees of the hospital even though they received their wages through
the hospital and the hospital was only an agent of the Central Government.
Considering the admitted fact that the petitioner - Society was working as an agent
to implement the Scheme of Central Government, the petitioner - Society will fall in
the category of "employer" as defined in Section 2(e) of the Act of 1952. It cannot
be said that the impugned order upholding the petitioner - Society liable for
implementation of the provisions of the Act of 1952 and the Scheme framed under it
is improper or unsustainable.
In view of the above, I do not see any reason to interfere with the impugned
order. The petition is dismissed. In the circumstances, the parties to bear their
own costs.
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8. It is undisputed even on behalf of the respondent No.1 that the liability of
payment is to be assessed. It need not be stated that while determining the liability
of payment, the Regional Provident Fund Commissioner shall consider the judgment
given by the Division Bench of this Court in Writ Petition No.1568/1997 and also the
effect of judgment given in the case of Ramakant Laxman Sarmalkar V/s. Nowrojee
Wadia Maternity Hospital & Ors. (cited supra). Considering the conclusions of
Division Bench recorded in the judgment given in Writ Petition No.1568/1997 in
paragraph No.31, the Regional Provident Fund Commissioner shall issue notice and
hear the Ministry of Health, Family Welfare, New Delhi and State of Maharashtra,
through its Secretary, Public Health Department along with the petitioner.
JUDGE
Tambaskar.
