LexKIRLOSKAR BROTHERS LTD. versus EMPLOYEES STATE INSURANCE CORPN.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A KIRLOSKAR BROTHERS LTD. v. EMPLOYEES' STATE INSURANCE CORPN. JANUARY 24, 1996 B [K. RAMASWAMY, S. SAGHIR AHMAD AND G.B. PATTANAIK, JJ.] Employees State Insurance Act, 1948 : c Sections 2(g)2(9 ), 2(15 ), 2( 17), 3(g) 75-Registered Office in one place-Fact01ies situated in different States-Benefit to employees of the factories under the Act-TTUe test is control by the principal employer over the employe~Test of predominant business activity of two remote connec- lion-Not relevant-When there is connection ·between the factory and the D finished products sold or distributed in the regional offices or establishment and principal employer has control over employee the Act is applicabl~on- tribution payable accordingly. Hyderabad Asbestos Cement Products Ltd. v. The Employee Insurance Cowt&Anr., [1978] 2 SCR345; C.E.S.C. Limitedv.Subhash Chandra Bose, E [1992] 1 SCC 441 and Consumer Education & Research Centre & Ors. v. Union of India & Ors., [1995] 3 SCC 42, referred to. CIVIL APPELLATE JURISDICTION : Civil Appeal No. 177 of 1984 Etc. F From the Judgment and Order dated 24.8.83 of the Karnataka High Court in M.F.A. No. 1128 of 1979. R.F. Nariman, P.H. Parekh and Arivind Kumar Sharma for the ·Appellant. G V.C. Mahajan, T.C. Sharma for Mrs. Anil Katiyar for the Respon- dent. The following Order of the Court was delivered : In these appeals short question that arises for consideration is: H whether the Employees' State Insurance Act, 1948 (for short, 'the Act') 884 ~ .. ,I ., KIRLOSKAR BROS. LTD. v. E.S.l. CORPN. 885 would apply to the regional offices of the appellant at Secunderabad· in A Andhra Pradesh and Bangalore in Karnataka State. The Appellant had established its registered office at Poona for sale and distribution of its products from three factories - one situated at Kirloskarvadi, second at Karad in State of Maharashtra and the third one at Deewas in the State of Madhya Pradesh. Admittedly factories situated in Maharashtra are not covered under the Act. They set up regional offices at several places. The Governments of Andhra Pradesh and Karnataka have applied the provisions of Section 2(g) of the Act to the aforesaid regional offices situated at Secunderabad and Bangalore and the respondent had issued notice under Section 3(g) of the Act calling upon them to contribute their c B share of the health insurance of the workmen working in the respective regional offices. Disputing the liability, the appellant filed application before Insurance Court under Section 75 of the Act. The Court had held that the appellant's regional offices are covered under the Act and accord- ingly it directed them to pay their contribution. The High Courts of Andhra Pradesh and Karnataka have upheld the said orders. Hence these appeals D by special leave. In point of time, the judgment of the Andhra Pradesh High Court is the earliest rendered in C.M.A No. 593 of 1976. It had· followed the decision of this Court in Hyderabad Asbestos Cement Products Ltd. vs. 17ze E Employees Insurance Court & Anr. [(1978) 2 SCR 345] and held that the regional offices are established for sale or distribution of the appellant's products, which have their connection to its factory at Deewas and as such the appellant is liable to pay contribution. When similar question had arisen in the Orissa High Court, in Misc. Appeal No. 187 of 1982, by an order dated March 5, 1987, the learned single Judge had held that since F the percentage of sale of products form Dewas at Bhubaneswar regional office is not predominantly higher but is only incidental, it is not covered under the Act. Therefore, the appellant is not liable to contribute to the insurance of the workmen. S.L.P. No. 7372 of 1987 against the said judg- ment was dismissed by a Bench of two Judges of this Court on January 28, G 1988 holding that having regard to the peculiar facts of the case, no interference under Article 136 of the Constitution was called for. When the appeals came for hearing before a Bench of two Judges, by an order dated January 17, 1990, the appeals were referred to this Bench for decision. Thus these appeals have come before us. H 886 SUPREME COURT REPORTS [199611 S.C.R. A Shri R.F. Nariman, learned senior counsel for the appellant, raised two-fold contentions. It is contended that as per material on record, the regional offices at Secunderabad and Bangalore are transacting business of the products
Excerpt shown. Read the full judgment & AI analysis in Lexace.