Decided on May 20,1970

M/S. Tara Chand Mohan Lal And Anr. Appellant
Employees State Insurance Corporation And Ors. Respondents


Goswami, C.J. - (1.) THIS appeal under Section 82(2) of the Employees State Insurance Act, 1948, hereinafter called 'the Act', is by a firm of partnership under the name and style "Tara Chand Mohan Lal", owning a factory dealing in production of mustard oil and dhal. Appellant No. 2 is the Managing Partner.
(2.) AN application was made by the Insurance Inspector under Section 75(2) of the Act praying for a decree for Rs. 3497/ - being the employees' contribution in respect of 37 labourers working in the factory during the period 28 -9 -1958 to 31 -12 -1960. The Inspector paid a visit to the factory on 21 -1 -1963 and found "37 persons (employees) employed by the contractor for the purpose of weighing, drying, filling, loading etc., mustard seeds. M. Oil, soldering of tins of mustard oil etc., inside the premises of the factory". He recorded the names of these employees found working at the premises along with their Sardars, Topeswar Tewari and Loton inside the factory. He was in the factory from 12 noon to 2 P.M. and Inspected the khata, attendance register and wage registers produced before him by the employers. According to him, these Sardars are immediate employers and Mohanlal and S. C. Jam are principal employers. The factory had submitted only partial returns but did not include these 37 employees in their - returns and hence this application for realisation of the contribution on their account. The factory denied the claim on various grounds and the only point now that requires consideration is whether these 37 persons were employees of the factory, entitled to claim employees' contribution under the Act. According to the factory, these persons were supplied by two Sardars in their mills for loading and unloading of the goods. They were employed by the Sardars and the payment was made to the Sardars by the factory. The Sardars used to engage different labourers on different dates.
(3.) THE Corporation examined one witness, namely the Manager and the factory examined the Managing Partner Mohanlal and Sardar Loton Barai. Mohanlal admitted that he produced the records and registers before the Inspector at the time of inspection but did not produce them in Court. Certain account books namely Exts. A to E produced before the Court had not been placed before the Inspector. He stated that they made payments to the Sardars according to the amount of work done and used to pay on the basis of loading and unloading of bags. He even cannot remember whether Topeswar or Loton was present on the date of inspection. He stated that they had only 22 permanent labourers on the date' of Inspection, but did not deny that these 37 labourers were working in the factory on that date. He made a very significant concession in the evidence to the following effect: When the labourers work in the factory it is done under the supervision of one of the partners. Anyone of the partners supervises the work, when there is work. All the labourers either permanent or casual supplied by the contractor work under the supervision of the partner. The names of labourers working within the fencing of the factory are kept in a register. I have not submitted the account of the labourers daily working in the mill. I have got such account." He admitted to have paid the contribution of the employers and employees under the E. S. I, scheme for the permanent labourers alone. He, however denied the suggestion put to him that he did not maintain the names of the 37 labourers only to avoid the employees contribution. Loton Sardar stated that he used to work sometime in the mills of Mohanlal and also other mills. He used to receive payments of all the labourers and disbursed the same to them. He stated that "sometime I used to supply 2 (two), sometime 3 (three), sometime 6 (six) and sometime 8 (eight) labourers to D. W. 1 Mohanlal. I used to take the extra labourers from Bazar." He admitted in cross -examination that he supplied labourers to Mohanlal's mill for the last three or four years. He also admitted that Topeswar and Rajdeo Sardar worked in the mill of Mohanlal. He does not remember whether he saw the Inspector at the factory at the time of inspection. He also stated that he did not know if 50/60 persons worked in the factory daily. It appears from his evidence that he did not receive any commission for the supply of labourers in the mills. He, however, keeps no account of the amounts received from the mills. On the above evidence, the learned Court below came to the conclusion that the factory was liable for the claim.;

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