UNION OF INDIA Vs. JAMMU DEVELOPMENT AUTHORITY

JUDGEMENT

(1.) Assistant Regional Director, Employees State Insurance Corporation, Sector-A, Chandigarh between 11th December, 1994 and 30th March, 1995 served three notices on Jammu Development Authority ("Authority" for short) signifying its intention to determine and recover the amount of contribution in respect of employees of the Authority, under section 45-A of the Employees State Insurance Act, 1948 (hereinafter called the Act) read with Employees State Insurance (General) Regulation, 1950. The authority was informed that it was running a hotel at Main Bus Stand, Jammu and in terms of aforesaid Act and regulations, the Authority was required to make contribution for the employees working in the hotel towards Employees Insurance Fund. Notice dated 30.3.1995, called upon the Chief Administrative Officer of the Authority to show cause within fifteen days from the date of issue of the notice, as to why the Authority should not be prosecuted for commission of offence punishable under section 85 of the Act. The Authority aggrieved with the notice dated 30.3.1995 issued by the Assistant Regional Director, filed Writ-Petition being OWP No. 243/95.

(2.) The case set up by the Authority in the writ petition was that facility run by the Authority at Jammu Bus Stand was not a hotel but a night shelter for the passengers who board buses from General Bus Stand, Jammu provided at nominal charges. The authority insisted that no element of profit was involved in running facility and that a few daily wagers were employed to serve the passengers in shifts who avail the facility. It was pleaded that notices issued by the Assistant Original Director, Employees State Insurance Corporation impugned in the petition, were void and illegal for the reasons that the Act was applicable to the factories as defined under Section 2(12) of the Act; 'and premises' to be declared as 'factories' in terms of the Act must have 20 or more employees in case of manufacturing process without aid of power or it must have 10 or more persons if the manufacturing process is undertaken with the aid of power. It was pleaded that as JDA Hotel was not involved in any manufacturing process with or without aid of power and thus it did not fail within the definition of expression 'factory' or premises to be declared as factory within the meaning of the Act. It was further urged that the Authority did not employ 10 or more persons to maintain and run the facility.

(3.) The Authority further pleaded that employees working in JDA Hotel, were provided all facilities, amenities and allowances as admissible in case of State Government employees including contribution 8.33% of their pay towards C.P. Fund with equal contribution from the employees and therefore, the Act was not applicable to JDA, Hotel.