VELLIPALAYAM CO OPERATIVE MILK SUPPLY SOCIETY Vs. REGIONAL DIRECTOR EMPLOYEES STATE INSURANCE CORPORATION

JUDGEMENT

(1.) The petitioner before the Employees State Insurance Court, Nagapattinam, in E.S.I.O.P.No.33/1998 filed the above appeal, having aggrieved by the judgment of the learned single Judge in C.M.A.No.273/1993, dated 8.6.2000, confirming the order passed in E.S.I.O.P.No.33/1988.

(2.) The appellant is a Co-operative Society registered under the the provisions of the Co-operative Societies Act. The Society has been purchasing milk from the cattle owners and after selling the milk, if there was any excess, they used to store it in a cooler for storage and it will be sold to the customers later. The Employees State Insurance Corporation issued a show cause notice on 28.9.1988 to determine and recover damages under Sec.85(B)(1) of the Employees State Insurance Act, hereinafter called 'the E.S.I.Act'. It is also stated that from December 1982, the Society has been paying the contribution to the Employees State Insurance Corporation regularly. An order was passed asking the appellant to pay contribution of a sum of Rs.21,385/for the period from 14.5.1978 to 30.11.1982 stating that the cold storage was installed only in the year 1984 and so the Society cannot be construed as a factory as defined under Sec.2(12) of the E.S.I. Act as no manufacturing process was being carried on. Challenging the same, the Society filed a petition before the E.S.I. Court .

(3.) The same was contested by the Employees State Insurance Corporation stating that the Society has been involved in the manufacturing process within the meaning of Sec.2(12) of the E.S.I. Act and the meaning assigned to the expression "manufacturing process" under the Factories Act, 1948. By an amendment to the Factories Act, 1948, the process of storing any article in cold storage deep freezer etc., had been brought under the definition of "manufacturing process" under Sec.2(k) of the Factories Act with effect from 26.10.1976. On that basis a sum of Rs.21,384.38 was calculated as contribution.