A. N. Varma, J. - (1.) THE petitioner is a public limited company incorporated under the Companies Act, 1973. THE petitioner owns and runs a factory called the Cawnpore Woollen Mills, Kanpur. THE petitioner is aggrieved by an action of the Chief Inspector of Factories, U. P. refusing to recognize Shri J. S. Bindra as the Occupier of the petitioner factory within the meaning of section 2 (n) of the Factories Act.
(2.) BY a resolution dated 26th August, 1972 the Board of Directors of the petitioner company nominated Shri J. S. Bindra, the General Manager of the aforesaid factory as the Occupier of the factory for the purposes of the Factories Act. A copy of this resolution was forwarded to the Chief Inspector of factories in Form No. 4 under Rule 14 of the rules framed under the Factories Act. The Chief Inspector of Factories refused to recognise Shri Bindra as the Occupier of the said factory solely on the ground that Shri Bindra was not one of the Directors of the Company, hence he could not be recognised as Occupier within the meaning of section 2 (n) of the Factories Act. This was communicated by the Chief Inspector of Factories to the petitioner by his letter dated 5-2-1973. The petitioner company also passed a similar resolution on 5-12-1975, whereby the company made the position still more explicit by passing a specific resolution, that Shri J. S. Bindra was invested with the ultimate control of the affairs of the Cawnpore Woollen Mills until the Board decides otherwise. The Chief Inspector of Factories, has, however, been refusing to recognise Shri Bindra as the Occupier and has been refusing to renew the licence of the aforesaid factory on the same ground, namely, not being a Director of the company, Shri Bindra could not legally have been appointed as the Occupier. The petitioner contends that the Chief Inspector of Factories is not right in taking the view that only a Director of the company could be nominated as Occupier within the meaning of section 2 (n) of the Factories Act. Having heard the learned counsel for the parties, we are of the opinion that the above contention of the learned counsel for the petitioner is well founded. Section 2 (n) of the Factories Act reads as follows :- " "Occupier" of a factory means the person who has ultimate control over the affairs of the factory, and where the said affairs are entrusted to a managing agent, such agent shall be deemed to be the occupier of the factory ;" In our opinion the Chief Inspector of Factories is confusing the two things, the Company and the Factory, referred to above. In the present case there are specific resolutions of the company vesting the ultimate control over the affairs of the factory in Shri Bindra. We are not concerned here with the affairs of the company generally. The Factories Act is concerned with the question as to which person exercises control over the affairs of the factory. As Shri Bindra had been specifically invested with the ultimate control of the factory, which fact has not been denied in the counter-affidavit, we are clearly of the opinion that the Chief Inspector of Factories was wrong in talcing the view that a person other than Director of a company could not be a Occupier within the meaning of section 2 (n) of the Factories Act.
(3.) LEARNED Standing Counsel appearing for the respondents placed reliance on a decision reported in 1962 page 1351 John Denald Mackenzie v. The Chief Inspector of Factories, Bihar Ranchi. That decision does not in our view support in the slightest degree the stand taken by the Chief inspector of Factories in the instant case. All that has been laid down in the above decision is that the ultimate control over the factory is ordinarily with the owner unless the owner has completely transferred that control to another person. In the present case, as noticed above, the company has specifically transferred the ultimate control over the factory to Shri Bindra, the General Manager of the factory. Under these circumstances, the said decision not only does not support the contention raised by the learned Standing Counsel, but it fully supports the contention of the petitioner's counsel. In the result, the petition succeeds and is allowed. The Chief Inspector of Factories, U. P. is directed to accept the nomination made by the petitioner company in favour of Shri J. S. Bindra as the Occupier of the aforesaid factory with effect from 26th August, 1972, till the petitioner company withdraws that nomination and nominates some other person as the Occupier of the said factory in accordance with law. The Chief Inspector of Factories is further directed not to refuse renewal of the licence in favour of the petitioner company on the ground that Shri J. S. Bindra (or any other person, who may be subsequently nominated as the Occupier in accordance with law) is not the Director of the petitioner company. The petitioner is entitled to its costs from the respondents, Petition allowed.;