Kailash Gambhir, J.
1. By way of this petition filed under Article 226 of the Constitution of India, the petitioner seeks quashing of the order dated 23/10/1998 passed by the respondent No. 1 in appeal against the order dated 23/6/1998 passed by the respondent no 2 under Section 7A of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 and order dated 14.12.1998 on review application passed by respondent No. 1 and demand raised by respondent No. 2 on the basis of impugned order dated 23/6/1998.
2. The brief conspectus of the facts as set out in the petition are as under:
3. The present petitioner M/s Grand Chemical Works, C-21/2, Mayapuri, Ph.II, New Delhi-110064 was covered with effect from 30.04.1996 under scheduled head 'Heavy and fine Chemicals' vide EPF office establishment No. E/DL/17749/Coverage/1281 dated 5.6.1996. The establishment was directed to report compliance with effect from 1.5.96. Instead of reporting compliance, the establishment challenged the applicability of the Employee's Provident Funds and Miscellaneous Provisions Act, 1952, on the ground that they never employed more than 19 persons and their employment strength never exceeded 14 employees at any given time. The establishment made various representations, pleading that in their establishment forcibly they had never employed more than 19 employees. 7A Enquiry was initiated vide summons No. E/DL/17749/Enf-VI/280-81 dated 20.10.97 to decide the issue of applicability to the establishment which was decided vide order dated 23.6.1998 by Regional Provident Fund Commissioner holding that the establishment was rightly covered by the department and liable for the outstanding dues from 05/1996. Thereafter appeal was preferred by the Establishment before EPF Appellate Tribunal which was dismissed vide order dated 23.10.1998.
4. Mr. R.P. Sharma counsel for the petitioner contended that the proprietor of the petitioner firm is an illiterate person and was not aware of the fact that what was being recorded at the dictates of two enforcement officers who had visited the premises of the petitioner on 13.5.96. Counsel for the petitioner submitted that in fact the total number of the employees of the petitioner were never increased from 14 and therefore, the establishment of the petitioner was not covered under the EPF and MP Act on the relevant date.
5. Counsel for the petitioner invited attention of this Court to the copy of the returns filed by the petitioner with the Employees State Insurance Organization which clearly showed that the employees working on the establishment of the petitioner were below 14. Counsel urged that the said returns pertain to the same period during which time the inspection was made by the enforcement officers. Another ground taken by the petitioner to challenge the order of the appellate authority and that of the Provident Fund Commissioner is that even the product of petitioner is not covered under Schedule-I, the same being 'phenyl'. The contention of the counsel for the petitioner is that the Appellate authority has given a wrong finding to cover the product of the petitioner in Schedule-I of the said Act when specifically the said product is not covered. Counsel contended that the product of 'phenyl' cannot be covered either as a chemical or in the category of soaps. Counsel further submitted that adequate opportunity was not granted to the petitioner by the Provident Fund Commissioner to place on record the said returns before the Provident Fund Commissioner and therefore, the matter may be remanded back for fresh determination. Counsel for the petitioner also maintained that in the returns furnished with the ESIC the 'wages'. being paid to the employees were indicated and not the 'salaries'.
6. Refuting the said submissions made by the counsel for the petitioner, Mr. Chawla, counsel for the respondent submitted that as per the settled legal position this Court will not re- appreciate the findings of fact arrived at by the Provident Fund Commissioner and gone into by the Appellate Authority. Counsel for the respondent submitted that complete details oe the salary, and wages being paid to the employees were given which could not have been within the personal knotledge oe the two enforcement officers who had visited the petitioner on the relevant date. The contention of the counsel of the respondent was that details of the salary/wages were given by the proprietor of petitioner firm himself and even he had disclosed bank account number of the firm, from where the salary/wages were being disbursed. Counsel thus stated that this Court may not re appreciate the said findings of the Provident Fund Commissioner which have already been gone into by the Appellate Authority. Even on the second issue question raised by the counsel for the petitioner that the product of phenyl is not covered by Schedule-I of the Act, counsel states that the said issued was raised by the petitioner for the first time before the Appellate Authority and the Appellate Authority came to the conclusion that the product phenyl is prepared from Soda Castic, Rosin, Caster Oil and Light Caster Oil and it is generally used for cleaning of floors. The Appellate Authority also observed that by notification dated 30.9.1956 'Heavy and Fine Chemicals'. including the pharmaceutical preparations, toilet preparations, soaps along with other chemicals producing industries were brought under the cover of the Act and the said product phenyl which is used for cleaning the floors can be treated as a soap and therefore, is covered in the said schedule. Mr. Chawla also submitted that the Employees Provident Fund is a beneficial piece of legislation and therefore, at the time of bringing the items in the said schedule or even at the time of the amendment every ancillary product could not be perceived to be brought under the cover of the Act but since the phenyl is used for cleaning purposes so no fault can be found with the findings of the tribunal in treating the said product as by-product of soap and toiletry products . As regards filing of returns by the petitioners with the ESIC are concerned, counsel for the respondent stated that the returns were submitted by the petitioner itself and therefore, no analogy can be drawn from such returns to find out as to how many employees were working on the said relevant date. The contention of the counsel for the respondent is that the said employees were found by the officers who visited at the site and to whom the details were given by none else but by the petitioner alone. Counsel for the respondent stated that even the accountant who had noted down the said details was never produced before the Provident Fund Commissioner and therefore, also the petitioner cannot take this plea that some wrong information was collected under the dictates of the said officers.
7. Refuting the said contentions of counsel for the respondent, counsel for the petitioner stated that the proprietor of the petitioner firm was aged 77 years old at the time of said inspection and could only sign in English but could not read or write in English. He further urged that the work of the petitioner firm was such that the workmen kept coming and going after working sometimes for a single day and sometimes a week, or even a month and work on a single day by more workers would not mean that the petitioner employed 20 or more workers/employees on regular basis and thus covered under EPF and MP Act, 1952.
8. I have heard learned Counsel for the parties and perused the record.
9. There is no dispute as regards the legal position that the Regional PF Commissioner and Employee's Provident Fund Appellate Tribunal are the final fact finding authorities and this Court normally would not re-appreciate and reassess the finding on facts. It is equally well known that a writ in the nature of certiorari may be issued only if the order of the inferior tribunal or subordinate court suffers from an error of jurisdiction, or from a breach of the principles of natural justice or is vitiated by a manifest or apparent error of law. In this regard in Harbans Lal v. Jagmohan Saran : (1985) 4 SCC 333, the Hon'ble Apex Court observed as under:
5. We are satisfied that the High Court traveled outside its jurisdiction in embarking upon a reappraisal of the evidence. The Prescribed Authority as well as the learned Second Additional District Judge concurrently found that Madan Lal was sitting in the shop on behalf of the appellant and deputizing for him in carrying on the vegetable selling business. The finding by both authorities rested on evidence, and there was no warrant for disturbing that finding of fact in a writ petition. The limitations on the jurisdiction of the High Court under Article 226 of the Constitution are well settled. The writ petition before the High Court prayed for a writ in the nature of certiorari, and it is well known that a writ in the nature of certiorari may be issued only if the order of the inferior tribunal or subordinate court suffers from an error of jurisdiction, or from a breach of the principles of natural justice or is vitiated by a manifest or apparent error of law. There is no sanction enabling the High Court to reappraise the evidence without sufficient reason in law and reach findings of fact contrary to those rendered by an inferior court or subordinate court. When a High Court proceeds to do so, it acts plainly in excess of its powers. We are informed that a report of the Commissioner in another suit was not considered by the Prescribed Authority and by the learned Second Additional District Judge, and therefore, it is urged, the High Court was justified in taking that report into consideration and entering into an examination of the material on the record. We have examined the report of the Commissioner and we find that an objection had been filed to that report and the trial court had failed to dispose it of. In other words, the report of the Commissioner is not a final document and cannot be taken into consideration as it stands. It must, therefore, be ignored. That being so, the finding of fact rendered by the Prescribed Authority and affirmed by the learned Second Additional District Judge remains undisturbed. The finding is that Madan Lal sat in the shop conducting the vegetable selling business on behalf of the appellant. 10. Further in Calcutta Port Shramik Union v. Calcutta River Transport Assn., : 1988 Supp SCC 768, the Hon'ble Apex Court observed as under:
10. The object of enacting the Industrial Disputes Act, 1947 and of making provision therein to refer disputes to tribunals for settlement is to bring about industrial peace. Whenever a reference is made by a government to an Industrial Tribunal it has to be presumed ordinarily that there is a genuine industrial dispute between the parties which requires to be resolved by adjudication. In all such cases an attempt should be made by courts exercising powers of judicial review to sustain as far as possible the awards made by industrial tribunals instead of picking holes here and there in the awards on trivial points and ultimately frustrating the entire adjudication process before the tribunals by striking down awards on hyper technical grounds. Unfortunately the orders of the Single Judge and of the Division Bench have resulted in such frustration and have made the award fruitless on an untenable basis.
11. The Employee's Provident Funds and Miscellaneous Provisions Act provides for the compulsory institution of contributory provident funds, pension funds and deposit linked insurance funds for employees. The act aims to ensure grant of retiral benefits to secure the future of the employee after retirement. The Employees' Provident Funds and Miscellaneous Provisions Act extend to whole of India except State of Jammu and Kashmir. The Act applies to industries specified in Schedule I employing 20 or more persons and any other class of establishments employing 20 or more persons notified by the Government. The Government may apply the Act to establishments employing less than 20 people. Employees covered under the Act include contract labour but exclude apprentices, trainees, directors, working partners, domestic servants and contractors. Establishments can seek exemption from any or all the provisions of the act.
Section 2(f) of EPF & MP Act defines employee and Section 2(ff) defines exempted employee as under:
(f) 'employee' means any person who is employed for wages in any kind of work manual or otherwise in or in connection with the work of an establishment and who gets his wages directly or indirectly from the employer and includes any person
(i) employed by or through a contractor in or in connection with the work of the establishment;
(ii) engaged as an apprentice not being an apprentice engaged under the Apprentices Act 1961 or under the standing orders of the establishment;
(ff) 'exempted employee' means an employee to whom a Scheme or the Insurance Scheme as the case may be would but for the exemption granted under Section 17 have applied;
12. From the above definition it is manifest that a person is an employee if he is
(a) Employed for wages;
(b) in any kind of work, manual or otherwise;
(c) in or in connection with the work of an establishment;
(d) He must get his wages directly or indirectly from the employer.
The term employee includes any person:
(i) employed by or through a contractor in or in connection with the work of the establishment;
(ii) engaged as an apprentice not being an apprentice engaged under the Apprentices Act 1961 or under the standing orders of the establishment;
13. Para 26 of the Employees. Provident Funds Scheme, 1952, refers to the classes of employees who may claim benefit under the scheme and para 29 talks about contribution, the said paras are as under:
Classes of employees entitled and required to join the fund.
26. (1) (a) Every employee employed in or in connection with the work of a factory or other establishment to which this Scheme applies, other than an excluded employee, shall be entitled and required to become a member of the Fund from the day this paragraph comes into force in such factory or other establishment.
(b) Every employee employed in or in connection with the work of a factory or other establishment to which this scheme applies, other than an excluded employee, shall also be entitled and required to become a member of the fund from the day this paragraph comes into force in such factory or other establishment if on the date of such coming into force, such employee is a subscriber to a provident fund maintained in respect of the factory or other establishment or in respect of any other factory or establishment (to which the Act applies) under the same employer:
Provided that where the Scheme applies to a factory or other establishment on the expiry or cancellation of an order of exemption under Section 17 of the Act, every employee who but for the exemption would have become and continued as a member of the fund, shall become a member of the fund forthwith.(2) After this paragraph comes into force in a factory or other establishment, every employee employed in or in connection with the work or that factory or establishment, other than an excluded employee, who has not become a member already shall also be entitled and required to become a member of the fund from the date of joining the factory or establishment.
(3) An excluded employee employed in or in connection with the work of a factory or other establishment to which this Scheme applies shall, on ceasing to be such an employee, be entitled and required to become a member of the fund from the date he ceased to be such employee.
(4) On re-election of an employee or a class of employees exempted under paragraph 27 or paragraph 27A to join the fund or on the expiry or cancellation of an order under that paragraph, every employee shall forthwith become a member thereof.
(5) Every employee who is a member of a private provident fund maintained in respect of an exempted factory or other establishment and who but for exemption would have become and continued as a member of the fund shall, on joining a factory or other establishment to which this Scheme applies, become a member of the fund forthwith.
(6) Notwithstanding anything contained in this paragraph, an officer not below the rank of an Assistant Provident Fund Commissioner may, on the joint request in writing of any employee of a factory or other establishment to which this Scheme applies and his employer, enroll such employee as a member or allow him to contribute more than rupees 18a[six thousand and five hundred] of his pay per month if he is already a member of the fund and thereupon such employee shall be entitled to the benefits and shall be subject to the conditions of the fund, provided that the employer gives an undertaking in writing that he shall pay the administrative charges payable and shall comply with all statutory provisions in respect of such employee.]
Contribution.
29. (1) The contributions payable by the employer under the Scheme shall be at the rate of 46[ten per cent] of the 47[basic wages, dearness allowance (including the cash value of any food concession) and retaining allowance (if any)] payable to each employee to whom the Scheme applies:
48[Provided that the above rate of contribution shall be
49[twelve] per cent in respect of any establishment or class of establishments which the Central Government may specify in the Official Gazette from time to time under the first proviso to Sub-section (1) of Section 6 of the Act.]
(2) The contribution payable by the employee under the Scheme shall be equal to the contribution payable by the employer in respect of such employee:
50[Provided that in respect of any employee to whom the Scheme applies, the contribution payable by him may, if he so desires, be an amount exceeding 50a[ten per cent] or 49[twelve] per cent, as the case may be, of his basic wages, dearness allowance and retaining allowance (if any) subject to the condition that the employer shall not be under an obligation to pay any contribution over and above his contribution payable under the Act.]
(3) The contributions shall be calculated on the basis of 51[basic wages, dearness allowance (including the cash value of any food concession) and retaining allowance (if any)] actually drawn during the whole month whether paid on daily, weekly, fortnightly or monthly basis.]
52[(4) Each contribution shall be calculated to 53[the nearest rupee, 50 paise or more to be counted as the next higher rupee and fraction of a rupee less than 50 paise to be ignored].]
14. In Sayaji Mills Ltd. v. R.P.F.C., : 1984 Supp SCC 610 the Hon'ble Apex Court explained the object and purpose of the EPF & MP Act in following terms:
5. At the outset it has to be stated that the Act has been brought into force in order to provide for the institution of provident funds for the benefit of the employees in factories and establishments. Article 43 of the Constitution requires the State to endeavor to secure by suitable legislation or economic organization or in any other way to all workers, agricultural, industrial or otherwise among others conditions of work ensuring a decent standard of life and full enjoyment of leisure. The provision of the provident fund scheme is intended to encourage the habit of thrift amongst the employees and to make available to them either at the tune of their retirement or earlier, if necessary, substantial amounts for their use from out of the provident fund amount standing to their credit which is made up of the contributions made by the employers as well as the employees concerned. Therefore, the Act should be construed so as to advance the object with which it is passed. Any construction which would facilitate evasion of the provisions of the Act should as far as possible be avoided.
15 . In Balbir Kaur v. Steel Authority of India Ltd. : (2000) 6 SCC 493, the Hon'ble Apex Court explained the aim of the EPF & MP Act in following terms:
14. It is significant to note that the Employees' Provident Fund & Miscellaneous Provisions Act of 1952 is a beneficial piece of legislation and can amply be described as a social security statute, the object of which is to ensure better future of the employee concerned on his retirement and for the benefit of the dependants in case of his earlier death.
16. Adverting to the provident fund, be it noted that the same is payable to an employee under the provisions of a statute and this statutory obligation cannot possibly be deferred in the event of an untimely death of a worker or an employee. As noticed above, the family needs the money in lump sum and availability of this amount is the only insulating factor to such a grief-stricken family. The amount is payable in one lump-sum and as a matter of fact it acts as a buffer to the retirement of or on the death of an employee. Situations are not difficult to conceive when the family needs some lump-sum amount but in the event of deposit of the same with the employer, the heirs of the deceased employee could be put into the same problems of realities of life, even though, if this money would have been made available to them the situation could have been otherwise.
16. The Employees' Provident Fund & MP Act, 1952 is an important piece of Labour Welfare legislation enacted by the Parliament to provide social security benefits to the workers. The Employees. Provident Funds and Miscellaneous Provisions Act, 1952 is applicable to Factories and Establishments engaged in 180 specified industries/classes of establishments. Earlier the Act was applicable to establishments on completion of three years of existence and employing 20 or more persons. This provision was later amended with effect from 22.09.1997 and as such any factory falling in the category of the notified industry/class of establishments employing 20 or more persons from the very date of its set-up is coverable under the Act. At present, the Act and the Schemes framed there under provides for three types of benefits-Contributory Provident Fund, Pensionary benefits to the employees/ family members and the insurance cover to the members of the Provident Fund. The object of the Act in 1952 was the institution of the compulsory contributory Provident Fund to the employees to which both the employee and the employer would contribute. The Employees' Provident Fund Scheme was accordingly framed under the Act and it came into effect from 1-11-1952. Initially, the title of the Act was, 'The Provident Fund Act 1952'.
17. From perusal of the above provisions and decisions, it is manifest that a person employed for some days as a daily wager or as a casual or a temporary worker or otherwise will not be covered under the term 'employee' to gain benefits under the provisions of Employee's Provident Fund and Miscellaneous Provisions Act. In this regard the following observations of the Apex Court in Regional Provident Fund Commr. v. T.S. Hariharan : (1971) 2 SCC 68, are reproduced as under:
9. To accede to the appellant's argument would lead to some startling consequences. By way of illustration, if for the purpose of extinguishing accidental fire an establishment is compelled to employ a few persons for about a couple of hours, even then, however weak and unstable its general financial capacity, the establishment would be covered by the Act and would have to contribute towards the provident fund for the benefit of its regular employees, of course, excluding those whose services were utilised for a short while for extinguishing the fire. In this illustration we are assuming that the employees would have no objection to being governed by the Act. This, in our opinion, could never have been the intention of the Legislature. Similarly, we find it difficult to impute to the Legislature an intention to exclude from the application of the Act an establishment which regularly employs for its general business the required number of persons for a major part of the year, say, for 360 days every year, merely because the employment of the required number does not extend to full one year. Both the extreme views, the one canvassed on behalf of the appellant and the other postulated in the observation of the High Court that the required number of persons must continuously work in the establishment for one year, do not conform to the scheme and object of the Act and are, therefore, unacceptable.
10. Considering the language of Section 1(3)(b) in the light of the foregoing discussion it appears to us that employment of a few persons on account of some emergency or for a very short period necessitated by some abnormal contingency which is not a regular feature of the business of the establishment and which does not reflect its business prosperity or its financial capacity and stability from which it can reasonably be concluded that the establishment can in the normal way bear the burden of contribution towards the provident fund under the Act would not be covered by this definition. The word 'employment' must, therefore, be construed as employment in the regular course of business of the establishment; such employment obviously would not include employment of a few persons for short period on account of some passing necessity or some temporary emergency beyond the control of the company. This must necessarily require determination of the question in each case on its own peculiar facts. The approach pointed out by us must be kept in view when determining the question of employment in a given case.
18. From the above decision, it is clear and coherent that employment of a few persons on account of some emergency or for a very short period necessitated by some abnormal contingency which is not a regular feature of the business of the establishment and which does not reflect its business prosperity or its financial capacity and stability from which it can reasonably be concluded that the establishment can in the normal way bear the burden of contribution towards the provident fund under the Act would not be covered by the definition of employment under the Act.
19. On perusal of the Cross-examination of Mr. Sabharwal, proprietor of the petitioner firm, it has come up that he admitted the fact that a list of employees duly signed by him was supplied to the enforcement officers who visited the establishment on 13.5.1996 & also admitted that statement for the period from 1991 to 1996 was signed by him. He also admitted that casual daily workers were not shown in attendance register. The respondent department examined Sh. Sant Lal, Enforcement Officer, who visited the premises of the firm for physical verification and he deposed that he found 20 employees working in the premises of establishment but on perusal of the attendance register only 11 employees were shown and 9 employees were being paid vide wages on vouchers. In his cross-examination Sh. Sant Lal confirmed that the employer got the letter written through their accountant and then signed it in Urdu. Furthermore, it has come on record that Sh. Brij Bhan and Sh. I.D. Sharma, EO's were deputed to verify the record of the establishment and in their report dated 24.4.1998 they reported that on going through the attendance register maintained by the employer for the period from 1993-94 to 1996-97, it is seen that employer showed names of regular employees in the attendance register whereas employer employed some casual/emporary employees who were paid on vouchers. They also reported that the employer never showed more than 17 persons on record during the period from 1993-94 to 1996-97.
20 . On perusal of the list prepared by the accountant upon instructions from the employer, it is manifest that the names and the bank account numbers mentioned therein could not have been figured out by the Enforcement Officers, unless the employer himself disclosed it. The fact that the accountant who prepared the said list was not examined by the employer has been also admitted. Also, it is a undeniable fact that daily wages were being paid on vouchers and regularly daily wagers were being appointed by the employer and it was not that the work from the daily wagers was being taken intermittently. Considering all these factors specially, the fact that the accountant who was a material witness was not examined clearly shows that the employer petitioner was trying to evade liabilities under the EPF & M.P. Act. The cock and bull story of the proprietor of the firm that he had no knowledge of English language is not a good excuse, as if a person signs a document, then a knowledge is imputed to him, that the signature was put after properly knowing the contents of the document. Also, the very fact that the employer himself dictated the list to the accountant, clearly shows that he was aware of the entire situation. Furthermore, the accountant was not examined who could have helped the employer on this issue, thus adverse inference has to be drawn against him.
21 . The entire case spells out the fact that the proprietor of the firm had knowledge of his liabilities under the EPF & MP Act but has made all efforts to escape his liability after the self admission made by him.
22. The observation of the appellate authority that since the salary shows decreasing trend and wages show an increasing trend and salaries were paid to about 14-17 employees every month and if somewhat similar amount is shown to be paid to the daily wagers then the number of employees each month would be more than 20 and took total of daily wagers and salaried persons to be beyond 20 in number in each month and thus, held petitioner guilty of violation of provisions of EPF & MP Act is quite appropriate. No fresh documents can be looked into at this stage, when were not placed by the petitioner before the respondents, to upset the findings of the adjudicatory authority duly affirmed by the appellate authority.
23. In the light of the above discussion, I do not find any illegality, perversity of irrationality in the impugned orders passed by the respondent Nos. 1 and 2. The issue whether the petitioner has deployed 20 workmen in his factory or less than that is a pure question of fact and I do not find any fault can be found in the approach of the respondents in finding the petitioner fully covered under EPF and MP Act having deployed the requisite workmen.
24 . The decision in T.S. Hariharan's Case (Supra) is of no assistance to the petitioner, since in that case the employees were engaged due to some exigency but herein the employees were being engaged as daily wagers in order to avoid liabilities under EPF & MP Act and to dupe the authorities under the Act.
25 . As regards the issue of 'phenyl' being covered under the category of 'Heavy & Fine Chemicals. it is a well known fact that Phenyl is a disinfectant and is used in toilets. The category 'Heavy & Fine Chemcials' includes; (i) Pharmaceuticals preparations; (ii) Toilet preparations; (iii) Soaps alongwith other Chemicals producing industries. Soap is a clearing agent and phenyl is a disinfectant. Both are used for cleaning and getting rid of dirt and germs. Thus, righly the appellate authority took 'phenyl' to belong to the category of 'Soaps'.
26. In view of the foregoing discussion, the present petition is dismissed and order dated 23/10/1998 passed by the respondent No. 1 in appeal against the order dated 23/6/1998 passed by the respondent no 2 under Section 7A of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 and order on review application 14/12/1998 passed by respondent No. 1 and demand raised by respondent No. 2 on the basis of impugned order dated 23/6/1998 are upheld and not interfered with.