Writ Petition No. 206 of 2012

8th March, 2013

Petitioner Counsel: Shri G.K. Sardessai,Shri V. Palekar
Respondent Counsel: Shri P.P. Singh

Cases Cited:
Employees State Insurance Corporation & Anr. Vs. Tata Engineering & Co. Locomotive Co. Ltd., & Anr., AIR 1976 SC 66 [Para 3]
RPFC, Mangalore Vs. Central Arecanut and Coco Marketing & Processing, 2006(1) CLR 861 [Para 3]

JUDGMENT

JUDGMENT :- Heard Shri G. Sardessai, learned counsel appearing for the petitioner and Shri P. P. Singh, learned counsel appearing for the respondent.

2. The above petition inter-alia seeks to quash and set aside the order passed by the Appellant Tribunal dated 24.08.2011 while disposing of appeal preferred by the petitioner challenging the order dated 03.11.2009 passed by the Regional Provident Fund Commissioner.

3. During the course of the hearing of the above petition, Shri Sardesai, learned counsel appearing for the petitioner apart from raising contentions on merits of the dispute has pointed out that the Appellate Authority while disposing of the appeal preferred by the petitioner has not independently scrutinized the material on record to come to the conclusion that the trainees employed by the petitioner are to be treated as employees within the meaning of the Employees Provident Fund Act. The learned counsel has taken me through the impugned order and pointed out that apart from transcribing the definition of the words "employee" and "wages" the Authority has summarily deciding whether the payment received by such trainees come within the ambit of the definition of wages under the said Act and has proceeded to dismiss the appeal preferred by the petitioner. The learned counsel further pointed out that the petitioner during the course of the hearing of the appeal before the Appellate Authority had besides disputing the correctness of the findings by the Provident Fund Commissioner has also relied upon, in support of his submission, the judgment of the Apex Court which inter-alia establishes that the trainees cannot be treated as employees within the meaning of the said Act. The learned counsel has taken me through the impugned order and pointed out that there is no reference to the said judgment nor consideration to the ratio laid down therein while passing the impugned order. The learned counsel further submitted that the petitioner has relied upon the judgment of the Apex Court reported in AIR 1976 SCC 66 in the case of Employees State Insurance Corporation & Anr. V/s Tata Engineering & Co. Locomotive Co. Ltd., & Anr. and judgment reported in 2006(1) CLR 861 in the case of RPFC, Mangalore V/s Central Arecanut and Coco Marketing & Processing. The learned counsel further pointed out that the attitude of the Appellate Authority in summarily deciding such appeal came for consideration before this Court in an order dated 29.08.2011 passed in Writ Petition No. 3116 of 2011 whereby this Court has in fact deprecated such attitude by the Appellate Authority. The learned counsel as such submits that the petitioner would not mind that without going into the merits of the dispute that the matter be remanded to the Appellate to decide the appeal preferred by the petitioner afresh in accordance with law.

4. On the other hand, Shri P. P. Singh, learned counsel appearing for the respondent has supported the impugned order. The learned counsel pointed out that the Appellate Authority has found that number of trainees employed by the petitioner are disproportionate to the number of actual employees employed by the petitioner. The learned counsel further submitted that in fact the record reveals that the petitioner has engaged 118 trainees when on the contrary the number of regular employees are 52. The learned counsel further pointed out that this disproportion itself raised a doubt to the contention of the petitioner that the said persons employed can be termed as trainees. The learned counsel further pointed out that the salary register examined by the inspector further establishes that the emolument and other amount received by such trainees are in fact the amount which are otherwise paid to regular employees. The learned counsel has taken me through the impugned order passed by the Appellate Authority and pointed out that the Appellate Authority was seized of the definition of the word "employee" in the said Act and has come to the conclusion that the said persons cannot be considered to be trainees for the purpose of consideration. The learned counsel has also pointed out that there is enough material produced on record to suggest that the duties and functions of the said trainees are similar to those of regular employees. The learned counsel as such submits that no interference is called for in the impugned order.

5. I have considered the submissions of the learned counsel and I have also gone through the records. Considering the view proposed to be taken by me, I shall not deal with the rival contentions raised by the learned counsel on merits of the dispute. This Court by order dated 29.08.2011 while disposing of Writ Petition No. 3116 of 2011 has observed at para 7 thus :-

"7. Reading of paragraph 6 of the order, would make it clear that this paragraph is common to all orders that are made by this Presiding Officer. This is a stereo type recording of findings and conclusions. Even in the matters under section 14B of the EPF Act, this paragraph is invariably found in the orders of the Appellate Tribunal and particularly delivered by this Presiding Officer. It has been repeatedly pointed out by me that being an appellate authority, he has definite duties to perform in law. It is not to merely put a stamp of approval without application of mind, that the Appellate Tribunal has been set up. The appellate authority has to consider the matter independently and it has very wide powers in law. In these circumstances, passing of such orders as a matter of routine and in a casual manner, defeats the very purpose of the enactment. It is not the Assessee who has to challenge the order in a higher court, but it is ultimately the workmen who suffer because of delay. All remittances to the workmen depend upon outcome of the proceedings. If the proceedings do not reach a finality in expeditiously, then, the concerned beneficiaries have to await the disbursement of the contribution that is made by the workmen and their employer. Sometimes for no fault of the beneficiary and assessee, the penalties are being levied."

6. In fact, on going through the observations therein, it has been clearly observed that the Appellate Tribunal has to independently scrutinize the material and contentions of the parties to form an independent opinion with regard to the contentions raised by the parties. In the present case, on plain reading of the impugned order passed by the Appellate Tribunal, I find that the Appellate Tribunal besides taking into consideration the definition of the word 'employee' under the said Act has not scrutinized the material to ascertain whether the trainees who are employed by the petitioner would come within the definition of word 'employee' considering the nature and functions performed by them or the amount received by them on account of such services. Having failed to scrutinize the material in the manner acceptable by law, I find that in such circumstances the impugned order passed by the Appellate Tribunal cannot be sustained and deserves to be quashed and set aside. Apart from that, the Appellate Tribunal has not even considered the relevance or otherwise of the judgments relied upon by the learned counsel appearing for the petitioner while passing the impugned order. Whenever the judgments of the Apex Court or a Superior Court are produced before such authority, it is expected that such authority would take note of the said judgments and consider the applicability or otherwise of such judgments. In the present case, having failed to consider the judgments relied upon by the petitioner, I find that the impugned order passed by the Appellate Tribunal stands vitiated and as such deserves to be quashed and set aside.

7. In the facts and circumstances of the case and for the reasons stated herein above, I find it appropriate and in the interest of justice to set aside the impugned order passed by the Appellate Tribunal dated 24.08.2011 and the Appellate Tribunal be directed to decide the appeal filed by the petitioner a fresh after hearing the parties in accordance with law.

8. In view of the above, I pass the following :

ORDER

(i) The impugned order dated 24.08.2011 passed in A. T. A. No.60(20)2010 stands quashed and set aside. The A. T. A. No.60(20)2010 is restored to the file of the Appellate Tribunal.

(ii) The Appellate Tribunal is directed to decide the said appeal filed by the petitioner afresh in the light of the observations made herein above in accordance with law.

(iii) Rule is made absolute in above terms.

(iv) All contentions on merits of the parties are left open.

(v) The petition stands disposed of accordingly.

Ordered accordingly.