Sree Lakshmi Kuries and Loans P. Ltd. vs Regional Provident Fund Commissioner, Kozhikode and Others

P.R. Ramachandra Menon, J—The declaration as to the coverage in respect of the appellant establishment under the Employees Provident Funds and Miscellaneous Provisions Act, 1952/Scheme and the extent of liability are under challenge in this appeal. The materials on record reveal that the coverage was finalized as per Ext. P1 order passed by the first respondent/Provident Fund Commissioner, which was sought to be challenged by filing appeal availing the statutory remedy before the second respondent. After considering the merit involved, the Tribunal dismissed the Appeal, which hence was subjected to challenge before the learned Single Judge by filing OP. 8004 of 2000. The main contention raised was that the appellant was doing the business in chits/kuries which did not come within the purview of the Act, so as to have coverage.

It was also pointed out that, merely for the reason that the appellant establishment was employing more than 20 persons, the same by itself would not give automatic coverage, in view of Section 1(3)(b) of the Act and hence the finding of the Tribunal was not liable to be sustained.

The matter was examined by the learned Single Judge with reference to the factual position and also the relevant provisions of law. Even though, it was observed that the finding of the Tribunal that there would be automatic coverage under Section 1(3)(b) of the Act if the establishment was a scheduled employment, employing 20 or more persons was not correct, the rest was affirmed on a different footing and reasoning with reference to the merit involved. It was also observed that the version of the appellant/petitioner that it was not doing any money lending activity, but for confining the activity only to the business in chits and Kuries was not correct or sustainable, in view of the fact that no reliable material was produced either before the original authority or before the Tribunal or even in the writ petition, as observed in paragraph ''7'' of the judgment.

The sequence of events with regard to the constitution of the partnership firm, also providing to do ''money lending business'', along with business in chits/kuries, is revealed from the partnership deed, the subsequent renewal and also taking over of the partnership firm by the concerned Company. Reliance sought to be placed by the appellant to the resolution No. 2.4.96, as to confining of the activity only to the business of chits/kuries by the Company, after its formation, has been referred to and observed that the original of the Minutes Book was never produced. So also, the appellant Company did not choose to produce the Books of Accounts or the Articles of Association, Memorandum of understanding etc; to substantiate the contention.

It is also relevant to note from the pleadings and materials on record that the appellant company had deployed sufficient staff/manpower to collect the deposits in connection with the business in this regard. A specific reference was also made to the nature of activity performed by the Company earlier, when it was a partnership firm with the name M/s. Sree Lakshmi Finance and M/s. Sree Lakshmi Bankers and by the re-constituted firm with the name M/s. Sree Lakshmi Kuries and Loans (P) Ltd., and the subsequent turn of events. It is brought to the notice of this Court by the learned Sr. Counsel appearing for the appellant that in the course of time, the appellant Company was sought to be wound up and it has been wound up pursuant to the orders passed by the Company Court in C.P. 10 of 2010. This Court does not find it necessary to examine anything in this regard, as the rights and liberties flowing from the course and events will depend upon the orders of the Company Court, if any proceedings are pending in this regard.

In the said circumstance, this Court finds that the finding and reasoning given by the learned Single Judge does not call for any interference. Fact adjudication has been done at three different levels. This is not a fit case to call for interference by way of appeal and it is dismissed accordingly.