LexREGIONAL PROVIDENT FUND COMMISSIONER versus SANATAN DHARAM GIRLS SECONDARY SCHOOL AND ORS.
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REGIONAL PROVIDENT FUND COMMISSIONER
A
v.
SANA TAN DHARAM GIRLS SECONDARY SCHOOL AND ORS
OCTOBER 30, 2006
[DR. AR. LAKSHMANAN AND AND TARUN CHATTERJEE, JJ.]
B
Employees Provident Funds and Miscellaneous Provisions Act, 1952-
Section 16(l)(b)-Exemptionfrom operation of Act-Establishments belonging
to or under control of Government whose employees are entitled to benefits C
of contributory provident fund under scheme framed by Government-Non-
Governmental Educational Institution covered under Rajasthan Non-
Government Educational Institutions Act, 1989 and availing benefit of
provident fund scheme formulated therein-Held: Under the Act
of 1989 the State Government exercised substantive control over educational
institutions even though they were not "owned" by it, and also had authority D
to direct, restrict or regulate their working-Hence those institutions were
exempted from operation of Act of 1952 -Also, as the State Act of I989 was
enacted subsequent to the '(Jpplicability of Act of 1952, the former eclipsed
the latter by application of Art. 254(2) Constitution of India, 1950.
Words and phrases-Belonging to or control of Government-Meaning E
of in context of Section 16(l)(b) of Employees Provident Funds and
Miscellaneous. Provisions Act, 1952.
Respondent is a Non-Governmental Educational Institution. In the year
1989, an amendment to Section 16{1){b) of Employees Provident Fund and
Miscellaneous. Provisions Act, 1952 exempted certain 'establishments from
the operation of that Act, which inter alia included establishment belonging
to or under the control of the Central Government or a State Government and
whose employees are entitled to the benefits of contributory provident fond or
F
old age person in accordance with any scheme or rule framed by the Central
Government or the State Government governing such benefits'. After this, G
the State passed Rajasthan Non-Government Educational Institutions Act,
1989 and formulated a provident scheme under it. Respondents were paying
their provident find dues according to that scheme. However, later on, the State
Government ordered implementation of the Act of 1952 with respect to the
849
H
850
SUPREME COURT REPORTS [2006] SUPP. 7 S.C.R.
A respondents, and thereupon not only transferred their existing Provident Fund
amount from the State treasury to the office of appellant, a Regional Provident
Fund Commissioner, but also further directed them to deposit their
contributions with the appellant. High Court allowed the writ petitions of
respondents challenging this order. Hence the present appeals.
B
Respondents contended that (i) they were covered under the exception
c
D
E
F
G
H
enumerated in the amended section 16(1)(b) of the Act of 1952 (ii) as per
Article 254(2) of the Constitution of India, 1950, the State Act of 1989 eclipsed
the Central Act of 1952.
Dismissing the appeals, the Court
HELD: 1.1. The two words used in the said Section 16(1)(b) have
different connotations. The words "belonging to" signify ownership i.e. the
Government owned institutions would be covered under the said part and the
words "under the control of' signify control other than ownership since
ownership ·has already been covered under the words "belonging to". It must
be also noted that the two words are separated by the word "OR" and therefore
these two words refer to two mutually exclusive categories of institutions.
While the institutions "belonging" to the Central or the State Government
would imply the control of the State the privately owned institutions can be
"under" the control of" the Government in various ways, 1862-C-EJ
Shamrao Vithal Coop. Bank Ltd. v. Kasargode Panduranga Maliya,
[1972) 4 SCC 600 and State of Mysore v. Allum Karibasappa, (1974) 2 SCC
498, relied on
1.2. The State Act is a complete code in itself with regard to the
educational institutions and the State Government exercises substantive
control over the institutions even though the institutions are not "owned" by
it. (863-G-HJ
1.3. The State Government has the power of Superintendent or the
authority to direct, restrict or regulate the working of the educational
institutions. 1864-C-D I
2.1. Benefit of Art. 254(2) is available. Admittedly the State Act has
been enacted and has received the assent of the president subsequent to the
applicability of the EPF Act, 1952 on the educational institutions.
(864-H; 865-AJ
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