BHASJARAN C N Vs. CENTRAL PROVIDENT FUND COMMISSIONER

JUDGEMENT

(1.) BY this writ petition under Article 226 of Constitution, the petitioner, employee of respondent No. 7 Company, inter alia, prays for a writ of mandamus directing the Provident fund Commissioner to initiate proceedings on the basis of the complaint filed by some of the employees of the Company under Section 7 of Employees' Provident Funds and Miscellaneous provisions Act, 1952.

(2.) ACCORDING to the said employee, the Company has resorted to discriminatory coverage in the matter of Provident Funds and Family Pension Funds and the failure of Respondent Nos. 1 to 6 to enforce uniform coverage has resulted in his making various complaints to the Regional provident Fund Commissioner (RPFC ). The petitioner has also filed this petition in his capacity as a Trustee of Gannon Dunkerlay and Co. Ltd. Employees' Provident Fund Trust and as a general Secretary of the Gannon Dunkerlay Employees' Union. According to the petitioner, the said company has diversified business. The said company is engaged in manufacturing water purification plants and converger belt systems, mechanical fabrication and erection, civil engineering contracts and trading and marketing variety of products. The Head Office of the company is at Bombay and Branch Offices are at Calcutta, Ahmedabad Coimbatore, Hyderabad and New Delhi. These offices are in addition to several engineering and construction sites all over the company. The complaint is also that the mechanical fabrication, erection installation of materials handling systems as well as civil engineering and construction work constitute the main activity of the company as of date. The company has established a Trust to manage the provident Fund accumulation of its employees and this Trust is exempted under Section 17 of the Act. In 1962, the said Trust was established to administer Provident Fund accumulations. The said Trust was subsequently exempted under Section 17 of the Act. It was further provided that if the members of the Trust receive lesser benefit than those under the Act and the Scheme, then the exemption shall be revoked. The definition of the word 'employee' in the Rules makes it clear that it shall apply to any kind of work or in connection with the Company's work covered by the Rules. The complaint of the petitioner in the present petition is that Respondent No. 7 company has consistently adopted means denying equivalent benefits to all its employees. According to the petitioner, even the Rules of the Trust as framed in 1971, discrimination is inbuilt in the Rules to deprive the employees of the benefits lawfully due to them. Various instances of such discrimination have been mentioned in the writ petition. It is further alleged that the company has unlawfully framed exclusion clauses in the Rules by which entire class of employees working for several years in the company have been denied benefits under the Act. The company has excluded temporary or casual employees. The company has excluded employees in the Civil Engineering Department for more than 10 to 15 years by calling the employees as temporary. According to the petitioners, on October 31, 1964, the Government issued a Notification extending all benefits under Section 13-B of the Act to Engineers and engineering Contractors under being exclusively engaged in building and construction industries. It is alleged that since mechanical fabrication, erection and construction were being done by the Company's Mechanical and Civil Engineering Departments and in addition manufacturing, trading, import and export, clearing and forwarding and various other business were being carried on by the company, the Notification dated October 31, 1964 was clearly applicable and the employees were liable to be covered under the Act. According to the petitioners, upto October 30, 1980 several hundreds of Civil Engineering Department employees were not given Provident Fund benefits at all on the ground that the said Notification did not apply. At the same time on November 19, 1965, the Mechanical Engineering Department at mahul was covered under the Act and was allotted specified code number as mentioned in para 10 of the petition. In that connection, it is also alleged that the said code number was only for workers working for Mechanical and Engineering Department and the staff working for the said department at Mahul. It is further alleged that right from the inception, the company has discriminated in the matter of coverage as far as civil engineering employees are concerned. Some of the employees were given the coverage while the others were denied. It is further alleged that the construction industry was not covered of specious plea of the company that the provident Fund Act was not applicable till October 31, 1980. The discrimination is alleged even with regard to the rates for calculating the provident fund contribution. The petitioners alleged that sometime in 1987, Section 7-A proceedings were initiated by the RPFC, Bombay but the same was only in respect of one company. The petitioner has addressed a letter on February 1, 1978 to the RPFC, pointing out the above grievances and several other grievances which are not required to be reproduced. The said letter was followed up by a letter dated April 19, 1979 to the rpfc (Exhibits C and D to the petition ). The letters dated January 8, 1980 and January 23, 1980 also referred to various clarifications sought by the petitioner. The petitioner has also written letters in respect of the Central Provident Fund coverage and also in respect of non-coverage in respect of certain category of employees. However, no steps whatsoever was taken by the RPFC till today. The petitioner seeks a direction against the RPFC to initiate proceedings under Section 7-A of the Act by the above letters but it appears that RPFC has refused to do so. This position emerges from the letter addressed by the petitioner to the RPFC dated April 24, 1990, which indicates that sometime in 1987 proceedings under Section 7-A of the Act was held by the company for non-coverage of the various employees. The said letter also indicates that the petitioner was called for the said proceeding and he had expressed his desire to participate therein. However, the RPFC closed the case. Consequently, by letter dated April 24, 1990, the petitioner has sought a direction from the RPFC to reopen the case. It is in these circumstances that the petitioners have sought large number of prayers in the writ petition seeking the uniform coverage of employees and also of the employees who have not been covered so far and so also the demarcation of the implementation of the section. The petitioners have also sought prayers with regard to the Trust Rules. However, the petitioner at this stage has made it very clear that the main grievance of the petitioner is that inspite of the above irregularities, the RPFC has not initiated proceedings under Section 7-A of the Act and aggrieved thereby have filed the present writ petition.

(3.) BY their affidavit dated July 16, 1990, the company has denied the above allegations. It is averred in the affidavit that the company undertakes execution of a very big project of construction of factory buildings, thermal power stations and other projects of civil engineering nature, in addition to the other activities such as trading, exports etc. However, it is stated that the main activity is of civil engineering carried out by the five independent divisions. It is further stated that the civil engineering division is engaged in construction activity. It is, therefore, submitted that the provisions of the Act are not applicable and in any event uniform coverage could not have been granted as the divisions are quite distinct and separate and no arbitrariness has resulted as alleged in the various complaints made by the petitioners.