TRANSPORT CORPORATION OF INDIA versus EMPLOYEES STATE INSURANCE CORPORATION AND ANR.

Citation: [1999] SUPP. 4 S.C.R. 393 · Decided: 05-11-1999 · Supreme Court of India · Bench: S.B. MAJMUDAR · Disposal: Dismissed

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Judgment (excerpt)

TRANSPORT CORPORATION OF INDIA 
v. 
EMPLOYEES' STATE INSURANCE CORPORATION AND ANR. 
NOVEMBER 5, 1999 
[S.B. MAJMUDAR, M. JAGANNADHA RAO 
AND M.B. SHAH, JJ.] 
A 
B 
Employees' State Insurance Act, I948-Sections 1(4), 1(5), 1(6), 2(1), 
2(9), 2(12), 2(13), 2(17), 2A, 38, 39, 40, 46, 49, 50, 51, 51 A to D-Notification 
issued by the State of Andhra Pradesh under Section 1 (5) in exercise of its C 
powers as an 'appropriate Govt. ' extending the provisions of the Act to road 
motor transport establishments-Head Office of the appellant Corporation 
being situated in the State of Andhra Pradesh, provisions of the Act applicable 
to the same by virtue of the aforesaid notification-Branch offices of the 
Appellant Corporation in other parts of the country-Applicability of the D 
notification to-Held, once the Appellant Corporation having its registered 
Head Office at Andhra Pradesh is governed by the Act, its branch offices 
would also automatically get covered by the sweep of the Act by the very 
same notification-Express legislative intention of sprea'ding the beneficial 
network of the Act sufficiently wide for covering all employees working for 
the main establishment covered by the Act even though actually stationed at E 
different branches outside the State, wherein the Head Office of the 
establishment is located-Any other technical or narrower construction 
cannot be countenanced as that would frustrate the legislative intent 
underlying the enactment of such a beneficial social security ~cheme­
Employees' State Insurance (General) Regulations, 1950-Regulations 2(g), F 
2(h), 2(i), 10-8, 29, Forms 1&6. 
Principal employer-Employee-Existence of relationship of-The 
appellant concern operating on al/ India level its transport business through 
the active working and co-operation of all the branches and the employees 
working at these branches-Transport business .carried on at the principal G 
office as well as at its branch office being totally interdependent-Thus, 
branches of the appellant spread over different parts of the country are part 
and parcel of the main establishment of the company which remains the 
'employer' and the employees in different branches remain its 'employees'-
There is unity of relationship and a complete integrality of working of the H 
393 
394 
SUPREME COURT REPORTS [1999) SUPP. 4 S.C.R. 
A employees in different branches and those working in the Head Office vis-a-
vis the single and solitary management being the Appellant Corporation-
Each branch being under the direct supervision and control of the parent 
office is an appendage of the main establishment and cannot be considered 
as separate independent entity-Thus, an employee of the establishment 
B whether working within the precincts of the main establishment or outside, 
if carrying on the work of the establishment would be covered by the sweep 
of the Act moment the main establishment is covered by the Act. 
Appropriate Government-Concept of-Held, the 'Appropriate 
Government' is constituted by the Parliament to be its delegate to uniformly 
C apply the provisions of the Act to any other establishment or class of 
establishments as found fit for its applicability-Once the appropriate Govt. 
exercises that power and issues a notification in that respect, such a 
notification covers within its sweep all establishments situated within the 
State and covered by the notification and also automatically covers all the 
branches situated outside the State which are mere appendages and part and 
D parcel of the very same establishment-It co11ld not be said that such a 
notification issued by the State in its power as 'Appropriate Government' has 
any extra territorial operation-In the present case, Head Office of the 
I 
appellant Corporation being situated in Andhra Pradesh, it was only that 
'Appropriate Government' which could apply the provisions of the Act to all 
E its employees whether working at the Head Office or any of its branches in 
any part of the country, being the very limb and interconnected organs of the 
very same establishment of the Appellant-Corporation. 
The appellant Corporation was engaged in the business of road motor 
transport operating from Bombay. It had its registered office at Secunderabad, 
F Andhra Pradesh which operated on all India level through its various regional 
offices spread over the country including the appellant's branch at Bombay. 
A notification was issued by the State of Andhra Pradesh in e

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