B.R.Tuli, J. - (1.) BISHAN Singh and Harbhajan Singh started the business of Drycleaners and Dyers under the name and style 'Tip Top Drycleaners and Dyers' and their establishment was registered with the Shops Inspector on July 23, 1968. On August 17, 1962, two more partners were taken in the firm, namely Kishan Singh and Smt. Harnam Kaur and thenceforward the business of Tip Top Drycleaners and Dyers was continued by the firm consisting of four partners The Regional Provident Fund Commissioner formed the opinion that the firm was liable to contribute to the Employees' Provident Fund in accordance with the Scheme framed under the Employees Provident Funds Act, l952 (hereinafter called the Act) The petitioner -firm disputed this liability to contribute to the Provident fund and the matter was referred to the Central Government which decided it against the petitioner firm and that decision was conveyed to it by letter dated September 29 1967. The present petition is directed against that order to which a written statement has been filed by the respondents.
(2.) THE first point argued by the learned counsel for the petitioner is that there were never 20 or more then 20 employees on the muster roll of the petitioner -firm on regular basis and in order to attract the provisions of the Act, it is necessary that 20 or more than 20 employees on regular basis must be in the employment of the petitioner -firm for a continuous period of one year. In support of this submission reliance is placed on para 26(a) of the Provident Fund Scheme which reads as under: 26. Classes of employees entitled and required to join the Fund. (a) Every employee employed in or in connection with the work of a factory or other establishment to which the scheme applies, other than an excluded employee, shall be entitled and required to become a member of the Fund from the beginning of the month following that in which this paragraph comes inn force in such factory or other establishment if on the date of such coming into force he has completed one year's continuous service of has actually worked for not less than 240 days during a period of twelve months or less in that factory or other establishment or in any other factory or other establishment under the same employer, or partly in one sad partly in the other. As I read this para of the scheme, I am of the view that it does not relate to the applicability of the Act to a particular establishment. The Act becomes applicable to an establishment when 20 or more than 21 persons are employed therein. On the first date on which the number of employees in an establishment reaches the figure 20 or more, the Act automatically becomes applicable. I hereafter the Act will cease to be applicable only if for a whole year less than 15 employees remain employed in the establishment. From the proviso to Sub -section (5) of section I, also no help can be taken to determine the time when the Act becomes applicable. That proviso only provides in what eventuality the Act will cease to become applicable. I am, therefore, of the opinion that the Act became applicable to the petitioner -firm on the first day on which the number of its employees was 20 or more on or after December 31, 1960, provided other conditions for the application of the Act also existed. That date was determined as November 1, 1963. by the Regional Provident Fund Commissioner. It is submitted that 'employees' do not include casual employees for the purposes of the Act. I am not able to agree with this contention. No such distinction is discernible in the Act wherein the word 'employees' only is used. It is only in paragraph 26 (a) of the scheme that the employees entitled to take benefit of the scheme are mentioned and it may be that casual employees are not able to take the advantage of the scheme unless they fulfil the condition prescribed in that para. But this fact does not mean that the casual employees have not to be counted in order to determine the number of employees in an establishment. The regional Provident Fund Commissioner determined the number of employees as 20 or more than 20 on November 1, 1963 on the basis of the statement of one of the partners of the petitioner firm although in the chart filed with the petition, annexure 'A', the number of employees during the months of November and December, 1963, is shown as 17, in January 1964, as 18, and in February ]964, as 21. Even according to this chart, the Act became applicable to the petitioner -firm in February, 1964, when the number of employees reached 21. In the petition it has not been made clear whether in the month of November, the petitioner -firm had any casual employee. The case of the petitioner -firm as stated in the petition is that during the winter months the business is more than in summer months and in winter months some casual labour is employed. According to this statement the petitioner -firm must have employed some casual labour in the month of November, 1963 as that happened to be a winter month. It was for the petitioner to state in the petition the number of regular employees and the casual employees in that month in order to contradict the information given to the Provident Fund Commissioner by a Partner of the firm, It cannot be said that while acting on the statement of a partner of the firm the Regional Provident Fund Commissioner went wrong in determining the number of employees in the employment of the petitioner I, therefore, hold that the Act was rightly made applicable to the petitioner firm with effect from November 1, 1963.
(3.) THE second point argued by the learned counsel for the petitioner is that the petitioner firm, which carried on the business of Tip Top Dry cleaners and Dyers, was constituted with effect from August 27, 1962, and should have been granted five years' exemption under section 16 of the Act. There is no substance in this submission in view of the admission that the business had been started in 1958 and it was registered with the Shops Inspector with effect from July 23, 1958 That very business, which was previously owned by two persons, was continued by a firm of four persons including those two. It was a case of change of ownership of an existing establishment and not a case of new establishment. Their Lordships of the Supreme Court have made this matter clear in a number of judgments namely, R. Ramakrishna Rao v. The State of Kerala, 1968 Lab I.C. 1580 (S.C.), Provident Fund Inspector Trivandrum v. N.S.S. Co -operative Society (by Secretary), Changanacherry : 1969 II L.L.J. 693 (S.C.), Regional Provident Fund Commissioner, Madras v. Vittaldas Jagannathadas, 1969 III L.L.J. 145, State of Punjab v. Satpal and another, A.I.R. 1670 S.C. 556 according to which no doubt is left that the date of the petitioner's establishment is to betaken as July, 19(sic)8, in which month it started business, A similar view was taken by a Division Bench of this Court in Regional Provident Fund Commissioner Punjab and Anr. v. Lakshmi Rattan Engineering Works Ltd, A.I.R. 1882 P&H 507. I therefore, hold that the petitioner firm was not entitled to five years' exemption with effect from August 17, 1962, as claimed by it was entitled to that exemption with effect from July 23, 1958, which was allowed.;