- (1.) The question arises in these three civil misc. appeals is whether the employer M/s Rajasthan Patrika Private Limited is required to cover its certain employees / services for the purposes of the Employees' State Insurance Act, 1948. The demand raised by the ESI on certain issues has been refuted by the appellant. The demands raised in pursuance of the communications dated 05.10.1984 and 03.12.1985 reads as follows :- "(i) and (ii): Rs.7,317/- and Rs.9,000/-: Payment to the Employees of Goliat Detectives. The security guards who are already employees of Goliat detective, the company charge remuneration for providing guard for security of the office of the Patrika. They are employees of Goliat Detective and their salaries are paid by Goliat Detectives and not by the appellant. (iii) Rs.475/- : Labour charges paid for white washing etc. This amount is paid to labour who are engaged for white washing in which costs of material like - kali, Chuna, colour and Brush etc. are included for doing white-washing in the building. (iv) Rs.8455/-: For building repairs. This amount is spent on building extensio and reparis inclusive costs of material, like Chuna, Kali, Bazari, Cement, Stone etc. and also the labour charges. The labour provided are not the employees of company but they are engaged for construction purposes whose names are not even known because they are engaged by the Thekedar from the road side every now and then. (v) Rs.4304/- : Paid to Fitter. This amount is paid for fitting of sanitary including the costs of sanitary articles whichis got fitted which consists major amount of costs of articles and petty amount for labour. (vi) Rs.2901.25 P : Paid for composing and Proof reading. Whenever necessity arises, some time proof reading and composing job had to be got done from the market and the amount is paid for this work. (vii) Rs. 15,888.87 P : Maintenance of machinery and shifting etc. For maintaining of machinery, this amount is spent for consumable articles for replacing of certain instruments in the machine. For such head of items ESI has wrongly levelled."
(2.) The demand raised in pursuance of the communication dated 06.07.1981 reads as follows :- "(i) to (vii) were pointed out :- (I) Rs.2250/- paid to the persons employed for general reparis. No regular labour is employed. It is the amount spent on routine repair contingently inclusive the price of material used in repairs. (ii) Rs.1300/- : Paid to the persons employed for carriage and forwarding: This amount is spent for taking bundles to Railway station and Bus station and for loading it in rail and bus, paid to coolies engaged n the spot from time to time. (iii) Rs.6485.30 P paid to persons employed for building repairs. This expenditure includes labour charges engaged or a day or two for petty repairs through the agency of Thekedars. It includes material-Kali, Chuna and cement etc. (iv) Rs.115/- paid to the persons employed for delivery. This pertains to Auto Rikshah charges for taking News- papers and for taking dak charges etc. (v) Rs.1379.60 P. paid to persons employed for graining works. The amount is spent for cutting and cleaning of Aluminium and Iron plates pertaining to the Blocks for printing. (vi) Rs.6712.50 P paid to persons employed for packing work. This amount is paid for the packing of news-paper on the basis of bundles to the contractors. (vii) Rs.17767.32 P. paid to persons employed for composing proof reading work on contract basis. Whenever it is needed this job work is arranged from the market shops. "
(3.) Learned counsel for the appellant has drawn the attention of this Court to certain precedent law, a gist of which reads as follows :- "C.E.S.C Limited Etc. Vs. Subhash Chandra Bose reported in AIR 1992 Supreme Court 573; Employee - Who is - Employment through immediate employer - Establishment of employer-employee relationship between principal employer and employees appointed by immediate employer - Determination - Criteria - Supervision by principal employer or his agent, of work of employees appointed by immediate employer - Essential. ESI Corporation Vs. Bethall Engineering Company reported in 2007 LLR 1054; Section 2 (9) 'Employee' - Clarification and interpretation of - For the purposes of coverage under the Act - Where an employer entrusts the work to a third party-contractor and latter engages independent workers to carry on the work as entrusted - The employees of such contractor will not be treated as employees of the employer entrusting the work since the principal employer could not exercise any supervision as envisaged in sub-clause (9) of section (2) of the Act. Right of principal employer to reject or accept work done by contractor through his employees, by itself not to be construed as effective 'supervision' under Section 2(9). Indian Oil corporation Ltd. Vs. Employees' State Insurance Corporation reported in 2008 LLR 1070; Dispute pertaining to employment of certain casual workers engaged through independent contractors to execute works relating to cutting grass, repair of the boundary wall of the two LPG bottling plants of the appellant - Definitions of the terms "Employee", "Principal employer" and "Immediate employer" discussed. Held : A person engaged casually in connection with processes which are not integral parts of or incidental to or preliminary to or connected with the operations of the establishment, though such engagement may be for long period, such deployment would not make the workman an employee as defined under section 2(9). The issue could not have adjudicated without considering the work contracts awarded by the appellant to independent contractors and the supervisory control of the appellant. The matter calls for a remand - Appeals allowed. National India Rubber Works Ltd. through its Factory Manager, Katni Vs. Employees' State Insurance Corporation, through its Regional Director, Indore and Anr. reported in 2007 LLR 993; Work of cutting and polishing of rubber items done on contract basis - The Company had no control or supervision over such work carried on through the contractor - Evidence of company unrebutted - Employees of contractor, would not come within sweep of section 2(9) of E.S.I. Act - The appellant-company was therefore held not be come within the ambit of 'immediate employer' as envisaged by section 2(3) of the Act. Employees' State Insurance Corporation Vs. RK Furnaces and Anr. reported in 2007 LLR 14; The workmen of casual contactors like plumbers, electricity repairers, air conditioner repairers, computer repairers, T.V. repairers, etc. who are engaged for temporary repair work - Would not be covered by the provisions of the said Act. Employees' State Insurance Corporation Vs. Prakash Paper Mart reported in 2003 LLR 1126; Respondent firm carrying on business in the manufacture and sale of students' note books and registers etc. - Entrusting the binding work to book binders for binding in books - payment being made to various binders on piece rate basis - Binders binding books with workers of their choice and returning bound books to the employer - No evidence to establish workers employed by binders work in premises of principal employer - No proof that principal employer has any control over binders or their employees - Employer firm not the principal employer for employees of binders for purposes of Act - Demand pertaining to conversion charges of workers doing work of binding books liable to be set aside. E.I.D. Parry (India) Ltd. Vijayawada Vs. Employees' State Insurance Corporation and Anr. reported in 2002 LLR 753; Hamalies engaged only for loading, unloading and storing of goods in godown - They are not employees of the Company - These workers are also available for such type of work to others also - No evidence to show that they are engaged exclusively by the appellant for their work - No contribution to be paid for hamalies. Employees State Insurance Corporation Vs. J.M.d. Fashions, passed by Karnataka Court in MFA No.1089/2001; The appellant claimed contribution on conversion charges and job work entrusted to the outside establishments for stitching for the period from 1992-1994. Outside establishments are not immediate employers under section 2(13) of the Act. In view of this, in my considered view, there is no merit in this appeal and hence it is liable to be dismissed. Abu Marble Mining Pvt. Ltd. Vs. Regional Directors, ESI Corp. Mumbai reported in 2005 LLR 184; Section 2(9) - 'Employee' - Work of marble fixation done outside the factory premises - Carried upon by the contractor - ESI Authorities demanded contribution on the payment made to the contractor for such work. - Merely because the material is supplied at the site and that is laid by the contractor i.e., immediate employer, it cannot be said that, that would be work which is incidental to the work of the factory or for the purpose of the factory. There was nothing to show that the employees engaged by the immediate employer fell within the extended definition of 'employee' within the meaning of section 2(9) of the ESIC Act. National India Rubber works Ltd. Vs. Employees' State Insurance Corporation through its Regional Director, M.P. and Anr. reported in 2007 LLR 838; So far as the carrying out necessary repair of building is concerned, I am placing reliance on the decision of Patel Printing Press (supra) in which it has been held that the wages paid to employees of contractor for construction of building, since construction activity was not in connection with the work of establishment, therefor, the demand of contribution was not legal. Sinch the appellant is not supervising the work of the employees of the contractors, therefore, I am of the view that the appellant company would not come under the ambit and sweep of "immediate employer" as envisaged under S.2(13) of the said Act, nor those employees of the contractors would come under the ambit and sweep of "employee" as defined under S.2(9) of the Act. Employees' State Insurance Corporation Vs. R.K. Furnaces and Anr. reported in 2007 LLR 14. Four workers engaged in respondent's establishment - For changing the electrical wiring - Coverage intimation was sent to respondent by ESIC - Held that this position is well settled in law - The workmen of causal contractors like plumbers, electricity repairers, air conditioner repairers, computer repairers, T.V. repairers, etc. who are engaged for temporary repair work would not be covered by the provisions of the said Act.";