LAKSHMI RESTAURANT Vs. REGIONAL PROVIDENT FUNDS COMMISSIONER

JUDGEMENT

(1.) The petitioners have filed this writ petition against the demand of the respondent, Regional Provident Fund Commissioner, dated 11th May, 1967 (annexure M) by which a sum of Rs. 7990.00besides administrative charges for the period from February, 1962 to November, 1966, have been demanded from the petitioner and are proposed to be recovered as arrears of land revenue. This demand follows an order passed by the respondent Commissioner dated 17th January, 1967 (annexure J), by which he has made the assessment of the aforesaid amount.

(2.) The material facts of the case are that petitioner No. 1 is a pertnership firm of which petitioner No. 2 is a partner, which is carrying on business of running a restaurant, inter alia, at Connaught Circus, New Delhi. Petitioner No. 1 is hereinafter referred to as'the petitioners'. The firm is registered under the Delhi Shops & Establishment Act,1954. T he question arising for determination is whether the petitioners are governed by the provisions of Employees' Provident fund Act (Act No. 19 of 1952) and the Scheme under it, which has been extended to the hotels and restaurants and other non-factory industries in Delhi by a notification with effect from 10th June, 1981. On 3rd August, 1965 inc respondent Commissioner (wno is the contesting respondent, while the second respondent is the District Collection Officer), issued a notice to the petitioners requiring them to furnish material information for purposes of the Act, to which the petitioners sent a reply, inter ilia, asserting that the petitioners were a partnership -firm, which had been working since 1937 and that they had employed 12 to 17 workers for various months since Jane. 1961 up to July, 1965, the details of which were given in the reply, in particular the petitioners emphasised that they had not employed 20 or more persons. It appears that on 14th December, 1965, an Inspector of the respondent paid a visit to the establishment of the petitioners and he examined the records including the establishment and wages accounts for the period from June, 1961 to March 1962. But he felt aggrived since, according to him, the petitioners did not "allow him to turn even a page beyond the said accounts and also did not produce the records from April, 1962 onwards". Consequently, a notice was issued to the petitioners on 4/5th January, 1966 to which a reply was sent by the petitioners on 8th February, 1966. The respondent Commissioner gave another opportunity in January, 1966. In the month of February, 1966, the respondent lent a formal notice staling that the petitioners' establishment fell under the category of restaurant as specified in appendix X to the Act, that it had completed five years on or before 30th June, 1961 and that it had employed 20 or more persons on 31st January, 1962. An advice was given by the respondent to the petitioners to deposit the arrears of cotnribution of the Employers under the Employees Provident Fund Scheme. 1952. The petitioners protested against the said demand and contended by their letter dated 25th February, 1966 that the scheme applied only to persons who employed 20 or more persons while in their establishment there were only 12 persons in employment. On 11th July, 1966 the respondent wrote to the petitioners that it had been observed from the report of the inspector that on his visit to the shop on 14th December, 1965 he had found that in the month of January, 1962 the petitioners had employed more than 19 such persons in the restaurant's wine shop and in addition "you had also made payment to the staff engaged on parties. In the absence of the names made available however, their names could not be included." It was further pointed out that the onus to prove that the establishment did not employ 20 or more persons lay OB the management. The respondent refused to supply list of the 20 employees alleged in the report. This was followed by a notice to hold enquiry in October, 1966, which culminated in an order dated 17th January, 1967, by which the respondent assessed the arrears of provident fund besides penally. The petitioners pretested against the same and after exchange of further correspondence, the recovery proceedings were initiated against the Petitioners on or about 11th May, 1967 as mentioned above. Aggrieved by this action, the petitioners have filed this writ petition on the allegations that the establishment of the petitioners was not covered by the Act or the scheme framed under the Act and that the impugned order and the action for recovery was illegal.

(3.) A counter affidavit has been filed by Mr. R. R. Sahae, Regional Provident Fund Commissioner,in which he has contested the contentions raised on behalf of the petitioners. He has stated in paragraph I that the petitioners' restaurant was estiblished in 1947 and was doing the restaurant business, i.e. etering inside the restaurant and also for outside parties. The assertion of the petitioners was denied that the number of employees with the petitioners was II and at all event never exceeded 17. It was asserted that the petitioners had on 31st January, 1962 employed more than 20 employees. In paragraph 4 of the counter affidavit, the statement made in para 1 appears to have been diluted and it is stated that on verification of the records of the petitioners, it was found that the petitioners had employed more than 19 employees. This is also reiterated in answer to ground No. 8. The case set up by the - respondent is that the petitioners were employing more than 19 persons in their regular employ in addition to catering staff for doing outside work, who were casual workers. With regard to onus of proof, the respondent has in the counter affidavit placed reliance on AIR 1958 Patna 314.