Bhargava, J. - (1.) These twelve connected appeals arose out of twelve Prosecutions instituted by the appellant, Provident Fund Inspector, Trivandrum, against the respondent, Secretary, N.S.S. Co-operative Society, Changanacherry, for offences punishable under the Employees' Provident Funds Act, 1952 (hereinafter referred to as "the Act") on the ground of contravention of the provisions of the Employees' Provident Funds Scheme, 1952 (hereinafter referred to as "the Scheme") . The specific charges related to the failure of the respondent (1) to pay to the Employees' Provident Fund the employees' and the employer's share of contribution together with administrative charges for the twelve quarters comprised between May 1961 and February, 1964; (2) to submit the returns in Forms 5 and 10 for the same twelve quarters; (3) to send statements of recoveries of contributions in Form 12 for the same 12 quarters; and (4) to send the initial return in Form 9 showing the particulars as on 30th April, 1961 along with Form 2 in the manner specified in the Scheme. The payment of the employer's and employees' contribution to the Provident Fund, and the question of sending the various statements arose in respect of a Press which was purchased by the N.S.S. Co-operative Society on the 21st March, 1961 from the Travancore-Cochin Central Printing and Publishing Co-operative Society Limited. According to the appellant, this establishment of the Printing Press had been set up in the year 1946 and it continued in existence even subsequently when, in March, 1961, the Press was purchased by the N.S.S. Co-operative Society. Until the purchase by the N.S.S. Co-operative Society, the establishment was employing only 9 workmen; but, after the N.S.S. Co-operative Society started working the Press, the number of workmen increased beyond 20, so that the Act became applicable to this establishment. The case was that, since the Act became applicable w.e.f. April, 1961, it was the duty of the respondent to comply with the requirements of the Act and pay the contribution and send the various returns which the respondent failed to do. On trial, the Magistrate recorded the finding that the establishment as run by the N.S.S. Co-operative Society after 1961 could not be held to be an old establishment set up in the year 1946, had emerged as a new establishment in l961, and, consequently, for a period of three years from April, 1961, the provisions of the Act would not apply to this establishment because of the provision contained in Section 16 (1) (b) of the Act. On this view, the Magistrate acquitted the respondent in all the cases. The respondent appealed to the High Court of Kerala. The High Court disagreed with the Magistrate and held that even though there was change of management, change of workers and change of machinery when the N.S.S. Co-operative Society purchased the Press in 1961, the business that was carried on was the same as it was at the time of purchase, so that it could not be held that a new establishment had come into existence different from the one which existed before the purchase. The High Court, however, took the view in law that under Section 16 (1) (b) of the Act, an establishment is given exemption for a period of 3 years from the date on which it came within the purview of the Act, treating the establishment as an infant establishment standing in need of protection. The High Court, therefore, held that this establishment was protected from the applicability of the Act for a period of 3 years from 21st March, 1961 which would cover the period in respect of which prosecutions were launched by the appellant. On this ground, the High Court upheld the orders of acquittal passed by the Magistrate. The appellant has now come up in these appeals against this decision of the High Court by special leave granted by this Court.
(2.) It is quite clear that, on the question of law decided by the High Court in favour of the respondent, that decision cannot be upheld in view of the decision of this Court in R. Ramakrishna Rao v. State of Kerala, (1968) 2 SCR 819 where it was held that, under Sec. 16 (1) (b) , in the case of a new establishment, the period of five years (laid down by subsequent amendment) is counted forward from the date the establishment is set up, but, in the case of an existing establishment, from the date the establishment "has been" set up. In the present case, since the establishment was first set up in the year 1946, the period of exemption for purposes of applying Sec. 16 (1) (b) of the Act would run from the date on which the establishment had been set up and could not be counted from April, 1961 when the Act became applicable to this establishment. In view of that decision of this Court, the acquittal of the respondent on the ground given by the High Court cannot be maintained.
(3.) However, on behalf of the respondent, it was argued that, on the evidence in this case, the High Court was not justified in recording the finding that this establishment as set up in the year 1946 continued to exist as it was before, even after the purchase by the N.S.S. Co-operative Society in 1961. It was urged that, on facts, the correct finding that should have been recorded was that the old establishment ceased to exist and an entirely new one was set up in the year 1961. In support of this plea, we were taken by learned counsel for the parties through the evidence which was tendered during the trial before the Magistrate and' after going through it, we are inclined to accept the submission made on behalf of the respondent.;