MESSRS. P.M. PATEL & SONS AND OTHERS, ETC. versus UNION OF INDIA AND OTHERS, ETC.

Citation: [1985] SUPP. 3 S.C.R. 55 · Decided: 25-09-1985 · Supreme Court of India · Bench: V.D. TULZAPURKAR · Disposal: Dismissed

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Judgment (excerpt)

55 
MESSRS. P.M. PATEL & SONS AND OTHERS, ETC. 
v. 
UNION OF INDIA AND OTHERS, ETC. 
SEPTEMBER 25, 1985 
[V·D· TULZAPURKAR, R.S. PATHAK AND AMARENDRA NATH SEN, JJ.] 
Employees' Provident Funds and Miscellaneous Provisions Act 
1952 
Section 2(f) 
-
Workers 
employed at their homes 
in 
manufacture of beedis - Whether entitled to benefit of the Act. 
Relationship of Master and servant - Element of personal 
service - Of little significance when test of control and 
supervision enables a right of rejection. 
The labour employed in the manufacture of beedis consists 
of different categories. At the factory, which constitutes the 
formal establishment, there are administrative and cleriCal 
staff, accountants, packers, checkers and bhattimen, The work of 
rolling the beedis itself is done by one or the other of 
different categories of workers. The first category is where the 
'iiork may be entrusted by the manufacturers directly to workers 
who prepare the beedis at home after obtaining a supply of the · 
raw material consisting of tobacco, beedi leaves and thread from 
the lllllllUfacturers. The 
second category consists of workers 
employed 
by 
the manufacturers 
through contractors and the 
manufacturers pass on the raw material to such workers for 
rolling the beedis in their dwelling houses and then supplying 
beedis. 
There is thus 
a 
direct relationship 
between 
the 
manufacturers and workers. The third category of home workers are 
those to whom the work is entrusted by independent contractors 
who treat the workers aa their own employees and get the work 
cloDe by them either at their own premises or in the dwelling 
'-a of the workers in order to fulfil and complete contracts 
entered into with the manufacturers for the supply of the 
fillished 
product 
from 
the 
raw. material 
supplied. .bY 
the 
manufacturers to the contractors. 
The home workers attend the factories within specified 
hours everyday and collect the raw material for taking to their 
homes for rolling beedis, In the case of home workers who hold a 
direct relationship with the manufacturers, the rolled beedis are 
brought by the home workers to the factory and the beedis which 
A 
B 
c 
D 
E 
F 
G 
H 
A 
56 
SUPREME COURT REPORTS 
[1985] SUPP.3 s.c.R. 
conform to the standards envisaged by the manufacturers are 
accepted while those which do not are rejected. The staff at the 
factory maintains registers in which regular entries are made of 
the raw material supplied to home workers, and of the rolled 
beedis which are delivered by them at the factory. The payment of 
B wages to such home workers may be made directly or distributed 
through the contractors engaged by the manufacturers. In the case 
of 
contracts 
between 
the 
manufacturers 
and 
independent 
contractors, 
the manufactured product is collected by the 
contractors from their home workers and delivered to the 
manufacturer. The manufacturer is concerned only with the payment 
under the contract to the contractors, and the payment of wages 
C to the home workers is a matter between the contractors and the 
home workers. 
The Employees' Provident Funds and Miscellaneous Provisions 
Act, 1952 provides for the institution of provident funds for 
employees in factories and other establishments. Originally, it 
did not extend to the beedi industry. For the first time, by a 
D Notification dated May 17, 1977 made by Government of India the 
beedi industry was added to Schedule I of the Act with effect 
from May 31, 1977. This was followed by another Notification 
dated May 23, 1977 issued by the Central Government amending 
clause (b) of sub-paragraph 3 of paragraph I of the Employees' 
Provident Funds Scheme, 1952 in order to bring the beedi industry 
E within the province of that scheme with effect from May 31, 1977. 
The Central Government Provident Funds Conmissioner thereupon 
wrote to all the Regional Provident Funds Comnissioners for the 
enforcement of the scheme in the beedi industry. 
The petitioners in the Writ Petitions who were engaged in 
F the manufacture and sale of beedis, challenged the constitutional 
validity of the Notifications dated May 17, 1977 and May 23, 
1977, and the enforcement of the Scheme in so far as it related 
to home workers and sought a declaration that the Employees' 
Deposit-Linked Insurance Scheme and the F.mployees' Family Pension 
Scheme framed under the Employees' Provident Funds Act are 
G unenforceable in respect of the beedi industry, 

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