Polo Amusement Park Ltd. vs Epf Applt. Tribunal And Anr.
2007 Latest Caselaw 2282 Del

ORDER

1. The present appeal is directed against the order dated 25th July, 2000 passed by the learned Single Judge in W.P. (C) No. 3998/2000 dismissing the writ petition filed by the appellant and upholding the order dated 31st March, 2000 passed by the Employees' Provident Fund Appellate Tribunal that the establishment of the appellant was covered under the provisions of the Employees' Provident Fund & Miscellaneous Provisions Act, 1952 (hereinafter referred to as the act, for short).

2. The appellant is a public limited company running an amusement park on Delhi-Gurgaon road. The Provident Fund Commissioner initiated proceedings against the appellant under Section 7A of the Act after receiving a report from Enforcement Officer, who had visited the establishment in 1995. The Enforcement Officer in his report has pointed out that establishment had exceeded 19 employees from April, 1995 and was classified under the Scheduled Head theater bearing other form of entertainment. On the basis of the said report, the Regional Office of the Provident Fund Commissioner issued notice and asked the appellant to produce records which it is claimed, were not submitted but an intimation was sent by the appellant asking the respondent to inspect the records in the office of the appellant. The appellant also objected to and claimed that it is not covered under the Act.

3. The Regional Provident Fund Commissioner, however, rejected these contentions and vide order dated 12th October, 1999 declared that the establishment of the appellant was covered under the Act and Head "companies, societies, associations, clubs or troupes which give any exhibition of acrobatic in any arena circular or otherwise or perform or permit any other form of entertainment in any place, other than a theater, and require payment for admission into such exhibition or entertainment as spectators or audience".

4. Being aggrieved, the appellant filed an appeal before the Appellate Tribunal. The said appeal was disposed of vide order dated 31st March, 2000. We have perused the said order passed by the Appellate Authority. In paragraph 6 of the said order, learned Tribunal noticed in brief the issues and questions that arose for consideration in the following manner:

In the present case the only controversy is whether the activity of the appellant's establishment falls under any schedule head of notified establishments or not and whether appellant's establishment is giving entry to any spectator after charging admission fees for providing entertaining. The appellant has insisted that controversy is whether the establishment of the appellant falls under the schedule head of the establishment as held by the 7A authority or not.

5. In paragraph 7 of the said order, learned Tribunal recorded that several High Courts have held that the Act applies on its own force and no notice or declaration is required for its application and it is for the establishment to show that it does not fall within the provisions of the Act or under any scheduled heads of establishment or industries. In paragraph 8, learned Tribunal further recorded that Section 1(3)(a) of the Act applies to factories only and, therefore, is not applicable in the case of the appellant. Thereafter, the learned Tribunal proceeded to examine Section 1(3)(b) of the Act, which reads as under:

Any other establishment employing 20 or more persons or class of such establishments which the Central Govt. may by notification in the Official Gazette specify in this behalf.

6. Learned Tribunal interpreted Section 1(3)(b) and held that it will apply to any establishment, which employs 20 or more persons and it is not mandatory that the said establishment should be one covered by any specific notification issued by the Central Government in the Official Gazette. He held that notification by the Central Government is required only in cases where establishment employs less than 20 persons. Thus, where establishment employs 20 or more persons, it will be automatically covered under the Act, whether or not there is any notification in respect of the said establishment. In the subsequent paragraphs, learned Tribunal recorded that Section 1(3)(b) of the Act was applicable as the appellant herein had employed 20 or more persons and it did not matter whether or not the establishment was covered by any of the notifications issued by the Central Government.

7. Learned counsel for the parties admit that the above interpretation of Section 1(3)(b) of the Act by the Appellate Tribunal is incorrect and it is settled law that for being covered under Section 1(3)(b), an establishment must employ 20 or more persons and the class of such establishment must also be covered by a notification issued by the Central Government in the Official Gazette. Only if both the requirements are satisfied, then an establishment will be covered by Section 1(3)(b) of the Act.

8. Mr. R.C. Chawla, Advocate, however, submitted before us that the appellant is covered by notification issued in form of Head 34 and also by Notification No. 346 dated 7th March, 1962, which reads as under:

Trading and Commercial Establishment engaged in the purchase, sale or storage of any goods.

9. We have examined the order passed by the learned Tribunal and find that there is no effective determination and decision as to whether or not the appellant is covered by Head 34 or under Notification No. 346 dated 7th March, 1962. The Appellate Tribunal did not examine this aspect in view of the interpretation given by the Tribunal to Section 1(3)(b) of the Act, which is already stated above, is contrary to law and cannot be sustained.

10. Mr. R.C. Chawla, Advocate also submitted that the records were not produced by the appellant before the primary authority as well as the Appellate Tribunal and, therefore, a definite and conclusive decision on this aspect has not been given by the Appellate Tribunal. He also referred to paragraph 12 of the order passed by the Appellate Tribunal and submitted that the said observations are sufficient to hold that the appellant was covered under the Head 34.

11. We have examined paragraph 12 of the order dated 31st March, 2000 but are unable to agree with the submissions made by the learned counsel for the respondent. Paragraph 12 only records the facilities available in the establishment of the appellant but does not specifically deal with the contentions and issues that arise for consideration with reference to Head 34 or any other head under which the appellant may be covered. The observations made in paragraph 12 are not descriptive but rather cryptic. No reasons and grounds have been given for making the final observations. Findings by a quasi-judicial authority must be based upon reasons and grounds in support thereof. The conclusions arrived at must be supported by cogent logical examination of facts and the provisions of law. A decision should also take note of the contentions raised by the parties and deal with them. Unfortunately, we find that whatever is recorded in paragraph 12 of the order is completely unsupported by reasons and grounds for reaching the conclusions. The conclusions have been arrived at abruptly without even dealing with the grounds and contentions raised.

12. Learned Single Judge in the impugned judgment has upheld the order passed by the Appellate Tribunal by virtually quoting various paragraphs of the order passed by the Appellate Tribunal. Perhaps learned Single Judge was of the opinion that the interpretation to Section 1(3)(b) of the Act given by the Appellate Tribunal was correct and the appellant establishment would be covered even without any notification.

13. In these circumstances, we have no option but to set aside the order passed by the learned Single Judge as well as the order passed by the Appellate Tribunal dated 31st March, 2000 and remand the matter back to the Appellate Tribunal to consider the entire dispute and questions afresh. While reconsidering the matter, the Appellate Tribunal shall consider the records, which shall be produced by the appellant, immediately when an order for production for the same is made. In case, relevant records are not produced, it will be open to the Tribunal to draw adverse inference as per law. We make it clear that the Tribunal will examine whether or not the appellant establishment is covered by any notification issued in terms of the Act. It will be open to the respondent to rely upon notifications including Notification No. 346 dated 7th March, 1962.

14. We direct the parties to appear before the Appellate Tribunal on 11th February, 2008. This long date is being given as it is stated by the learned counsel for the respondent that the Appellate Tribunal is presently not fully operational as there was fire in it's office. The Appellate Tribunal shall proceed to hear the matter as expeditiously as possible, preferably within a period of three months.

In terms of the aforesaid order, the appeal stands disposed of No costs.