YEMMIGANUR WEAVERS CO OPERATIVE PRODUCTION AND SALE SOCIETY LTD Vs. REGIONAL DIRECTOR EMPLOYEES STATE INSURANCE CORPORATION HYDERABAD

JUDGEMENT

(1.) The question for consideration in this appeal preferred under Section 82 (2) of the Employees State Insurance Act, 1948 (hereinafter referred to as 'the Act') is whether the appellant the Yemmiganur Weavers' Co-operative Production & Sale Society Ltd., is a 'factory' within the meaning of Section 2 (12) of the Act.

(2.) The appellant made an application under section 75 of the Act challenging the levy of contribution from the appellant by the respondent viz., the Employees State Insurance Corporation. The Appellant purchases yarn from mills and weaves handloom cloth like bed-sheets towels etc. Though the looms used are only handlooms and not power looms, the yarn is dyed by means of machine called "Hydre-extractor" which is run by an electric motor. The appellant has also installed a plaat called "Hank Mercerising Plant" for the purpose of mercerising the yarn. This is also run with the aid of power. Only one worker operates the Hydre-extractor and ten workers are employed in Hank Mercerising Plant. After the yarn is mercerised, it is dyed in another part called "Dye-house" wherein more than 90 persons are employed. After the yarn is dyed, it is woven into cloth by handlooms. The Employees State Insurance Corporation considered, in these circumstances, that the appellant was a 'factory' within the meaning of the Act and was bound to pay the contribution under Sec.40 of the Act. In its application before the Employees Insurance Court, the appellant contended that as less than 20 workmen were employed in that part of the manufacturing process wherein power was used, the appellant was not a 'factory' within the meaning of the Act and in considering the question whether the appellant was a factory or not, the number of workmen employed in the Dyehouse or in the handlooms wherein power was not used should not be taken into consideration This contention was negatived by the Employees' Insurance Court which held that the coverage of the workmen was valid and dismissed the petition, The appellant has preferred this appeal against the said order.

(3.) The facts found, which cannot be questioned in this appeal before us under Section 82(2) of the Act are that the manufacturing process consists of extracting the water from the yarn by means of the Hydro-extractor, the mercerising of the yarn in the Hank Mercerising Plant, the dyeing of the yarn in the Dye-house and the weaving of the yarn into cloth in the handlooms. In the first two parts of the process power is used whereas in the second iwo parts, there is no use of any power. The total number of workmen in the first two parts of the manufacturing process is 11, whereas the number of workmmen employed in the other two parts far exceeds 20. In those circumstances, the question is whether the appellant can be considered to be a 'factory' within the meaning of the Act and all the employees are employees who are required to be covered by the provisions of the Act.