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CASE NO.: Appeal (civil) 3320 1997

PETITIONER: NOOR NIWAS NURSERY PUBLIC SCHOOL

       Vs.

RESPONDENT: REGIONAL PROVIDENT FUND COMMR.  & ORS.

DATE OF JUDGMENT:       08/12/2000

BENCH: S.R.Babu, S.N.Vaariava

JUDGMENT:

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     J U D G M E N T

     RAJENDRA BABU, J.  :

     The  appellant is aggrieved by the application of  the Employees Provident Funds and Miscellaneous Provisions Act, 1952   [hereinafter   referred  to  as  the   Act].    The appellant-institution is run by Baptist Union North India, a registered  Society under the Registration of Societies Act, 1860.   The said Society runs two schools at 17, Darya Ganj, Delhi,  namely, Francis Girls Higher Secondary School  which was  established in 1916 and the appellant-school which runs nursery  classes.   The appellant-school was started in  the year  1971.   The  claim  of the  appellant-school  is  that Francis    Girls   Higher    Secondary    School   and   the appellant-school,  Noor Niwas Nursery Public School, are two different  institutions  having   separate  and  independent accounts   and  are  managed  by  two   different   Managing Committees.   The  appellant has four employees,  namely,  1 Head  Mistress, 1 Teacher, 1 Peon and 1 Aaya and it being  a separate  establishment is not covered by the provisions  of the  Act.   Therefore,  it is contended that  Francis  Girls Higher  Secondary School and the appellant-school cannot  be treated as one establishment for the purpose of the Act.

     The  respondents  contention is that an Inspector  of the Department visited Francis Girls Higher Secondary School when  Mrs.   P.  Wadhavan, the Head Clerk in  Francis  Girls Higher  Secondary School gave particulars not only in regard to  Francis Girls Higher Secondary School but also in regard to the appellant-school.  The said Inspector was examined as a  witness  before the Provident Fund Commissioner.  He  was thoroughly cross-examined suggesting that the letter seeking

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for  a common number for depositing the contribution to  the provident fund was obtained under duress.  But while denying the  same  he clearly stated that this information had  been furnished  by Mrs.  P.  Wadhavan on 21.04.1982  voluntarily. The  Provident Fund Commissioner on this material held  that the   two   institutions  constitute   one  and   the   same establishment  and, therefore, is covered by the Act.   This order  of the Provident Fund Commissioner was unsuccessfully challenged before the High Court.  Hence this appeal.

     Whether  two units are one or distinct will have to be considered  in the light of the provisions of Section 2-A of the  Act which declares that where an establishment consists of  different departments or has branches whether situate in the  same place or in different places, all such departments or   branches  shall  be  treated  as  parts  of  the   same establishment.  In such cases, the court has to consider how far  there is functional integrality between the two  units, whether  one  unit cannot exist conveniently and  reasonably without  the other, and on the further question, in  matters of  finance  and employment, the employer has actually  kept the  two units distinct or integrated.  In fact, this  Court set  out  certain tests in Management of Pratap  Press,  New Delhi  v.  Secretary, Delhi Press Workers Union, Delhi, AIR 1960  SC  1213.   However, we may point out that  each  case would  depend  upon  its own peculiar facts and  has  to  be decided accordingly.

     In  the  present  case,  when two  units  are  located adjacent to one another and there are only two Teachers with an Aaya, a Clerk and a Peon, it is difficult to believe that the  Society  which  runs 30 schools would  run  a  separate school  consisting of such a small number of staff.  If  the unit  of  the appellant-school was not part of the  unit  of Francis  Girls Higher Secondary School, the Head Clerk, Mrs. Wadhavan   could  not  have  been   in  possession  of   the particulars  of  the  appellant-school and  could  not  have furnished  such particulars to the Inspector when he visited the  school  in connection with the grant of a code  number. Undisputably,  the two units are run by the same Society and they  are  located  in  one and  the  same  address  thereby establishing  geographical proximity and nothing  worthwhile has been elicited in the cross- examination of the Inspector in  regard to inquiries made by him from Mrs.  P.  Wadhavan. Mrs.   P.   Wadhavan was not examined before  the  Provident Fund Commissioner.  All these facts clearly point out to one factor   that   the   two   units  constitute   one   single establishment.  After all appellant-school caters to nursery classes,  while  the higher classes are provided in  Francis Girls  Higher Secondary School.  Thus, the link between  the two  cannot be ruled out.  In the facts and circumstances of the  case, we hold that the view taken by the Provident Fund Commissioner as affirmed by the High Court in this regard is correct.

     However,  the  learned counsel for the appellant  drew our  attention  to the letter sent to Francis  Girls  Higher Secondary  School wherein the said school has been  excluded from  the  purview of the Act in view of the fact  that  the provident fund in respect of all the employees is subscribed under another scheme.  The learned counsel submitted that if the  two units were put together as a single  establishment, the  Act would be applicable and otherwise not, inasmuch  as it falls short of the number of minimum of employees for the applicability  of the Act under Section 1(3)(b) of the  Act.

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We   are  not  impressed  with   this  argument.   The   two establishments have more than 20 employees and the exemption granted  under  Section  17  of the Act is  subject  to  the condition  that  such  exclusion  will   not  apply  to  the appellants unit because the same would not be covered under another  scheme for subscribing to the provident fund.  When the entire establishment is covered by the Act, only part of the  establishment  is excluded and condition  of  exclusion being applicable only to a part, we fail to understand as to how  the  appellant can rely upon the said letter  to  claim non-  applicability  of the Act on the ground that it  falls short of the number of employees.

     We  do not find any good reason to interfere with  the order made by the High Court affirming the view taken by the Provident  Fund  Commissioner.  This appeal  is,  therefore, dismissed.