- (1.) IN this writ petition, petitioner has prayed for quashing the order dated November 30, 1998, passed by respondent No. 3 directing it to, pay the contribution under the Employees' state Insurance Act, 1948 (hereinafter referred to as the Act) for the period July 1, 1987 to march 31, 1989 and interest thereon. The only question involved in this writ petition is whether the employees employed by the other units, doing the job work of the petitioner, were covered under Section 2 (9) of the said Act.
(2.) PETITIONER's case, in short, is as follows: it is a limited Company. It is engaged in manufacturing rainwear, air pillow, rubber canvas foot wear etc. in its smal1 scale industrial unit. It is covered under the provisions of the act. Petitioner off-loads various works on piece-rate basis to other units for stitching button hole fixing, taping, pasting, moulding mixing etc. The charges paid against such job work include the cost of job work and profit of the units who execute such job orders. Such units are independent and they do the job work of the petitioner as well as of others at their own premises. Petitioner has got no connection or control whatsoever on the said units. It has got no supervisory control over day-to-day execution of the work. The said units submit their bills against such work and payments are made by cheque. The said units are also registered units. Respondent No. 3 wrongly proceeded to recover the alleged contribution under the Act for the said period.
(3.) IN the impugned order, it is, inter alia, held that some of the work at intermediate stage of the manufacturing process is assigned to some of other units on job work basis only. Such units are immediate employers under Section 2 (13) of the Act. As the quality control lies in the hands of the petitioner, it implies that it exercises exclusive supervision at all the intermediate stage of manufacturing process which is done by immediate employer and thus the employees employed by these small units are the employees as defined under Section 2 (9)of the Act and petitioner is one of the principal employers and it is required to pay contribution on the amount of wages paid to such employees.;