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CASE NO.: Appeal (civil) 5827  of  1998

PETITIONER: M/S LAKSHMANI STONE PRODUCTS & ORS.

       Vs.

RESPONDENT: UNION OF INDIA & ORS.

DATE OF JUDGMENT:       30/01/2001

BENCH: S. Rajendra Babu & S.N. Variava.

JUDGMENT:

RAJENDRA BABU, J. : L...I...T.......T.......T.......T.......T.......T.......T..J

   A  notification  was issued on February 12,  1977  under Section  1(3)(b)  of  the  Employees  Provident  Funds  and Miscellaneous  Provisions Act, 1952 (hereinafter referred to as  the  Act]  specifying   that  certain   establishments mentioned  in  the Schedule thereto would be covered by  the Act  and,  inter alia, stating that the Act would  apply  to stone  quarries  producing stone chips, stone  set,  stone boulders  and ballasts.  On February 19, 1977 a notification was  issued  under  Section  7(1) of the Act  to  amend  the scheme, namely, the Employees Provident Fund Scheme, 1952 by inserting  identical provisions.  A contention was raised by the appellant in a writ petition filed before the High Court that  no notification has been issued under Section 4 of the Act  including stone quarries in the Schedule to the  Act. In  the absence of a notification issued under Section 4  of the  act, it is contented that the Act has no application to stone  quarry  industry.   However, that writ  petition  was dismissed.   This appeal has been filed by leave granted  by this Court.

   The  High  Court  took the view that the  appellant  was carrying  on the business of quarrying stone under a  mining lease  and it was carried on by blasting stones at quarry by explosives  which  are thereafter sized either  manually  by chipping or by using a mechanical crusher resulting in stone chips.   The High Court held that the operations carried  on by  the  appellant  are  not  disassociated  activities  but integrally  connected  with  each other and form part  of  a continuous process and the claim of the appellant that it is running  a factory was not accepted.  The High Court noticed that  the  appellant runs the establishment of stone  quarry which  has  been brought within the purview of the Act,  and inasmuch  as  the operation of reducing stones into  smaller size  is subsidiary and incidental operation to the  primary activity,  that  is, running a stone quarry, the High  Court took  the view that it is an establishment which has  been brought within the ambit of the Act by issuing notifications on February 12, 1977 and February 19, 1977.

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   On  the facts of the case, admittedly the appellants are lessee  under  the State Government under the provisions  of Mines and Minerals (Regulation and Development) Act, 1952 to quarry  and to crush stones.  Therefore, the appellants  are engaged in a manufacturing process as is rightly held by the High  Court.   It  is clear that dominant  activity  of  the appellant  is  to quarry the stones and cut or chip them  to appropriate  size before marketing the same either by manual or  mechanical process which is a subsidiary and  incidental activity  to the primary activity of running a stone quarry. In  that  view of the matter, we find no substance  in  this appeal and the same stands dismissed.  No costs.