# THE REGIONAL PROVIDENT FUND COMMISSIONER, BOMBAY v. '

- **Citation:** [1962] Supp. 3 S.C.R. 815
- **Court:** Supreme Court of India
- **Decided:** 1962
- **Bench:** P. B. Gajendragadkar, K. N. WANCHOo
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/the-regional-provident-fund-commissioner-bombay-v-2497
- **Pages:** 17

## Headnote

Construction-Rules
of Grammer-Oontext-Oomposite
factory-Different industries~Whether "factory'' -Determinative
industry, which is-Employees'
Provident Funds Act, 1952
(19 ~' 1952), ss. 1(3)(a), (2)(g), Schedule I.
The respondent· company in the first appeal carried on
the business of manufac.turing brass, copper and 'kasa' circular
sheets for manufacrnring utensils therefrom, milling paddy,
a fiour mill and a saw mill in the same compound, it had a
rolling mill for the first item of its business and bad other mills
for the other for each of which it employed different set
of workmen,
but
there were common clerks and other
employees for the entire business. When the Employees Provi·
dent Funds Act came in to force the company was required
to comply with its terms. It challenged the applicability of
the Act to it successfully by way of a writ petition before the
High Court of Bombay at Nagpur.
The respondent in the second appeal were mills which
manufactured Hydrogenated vegetable oil. They also manu·
factured tin containers for marketing and storing and its
product in a separate establishment in which were employed
0 nly 31 workmen as against 211 employed for the manufac·
ture of oil. The mills were also asked to comply with the Act,
but contested the applicability of the Act to their industry
which was manufacture of oil and not tin containers. They
also successfully challenged the order of the appellant against
them by a writ petition before the High Court of Bombay,
Nagpur Bench.
In both the appeals it was contended that
each of the respondents was a 'factory' within the meaning
ofs.1(3)(a) of the Act and that the High Court was in error
in construing it otherwise.
Held, that the fact that 1he Act was beneficicnt piece
of legislation aimed at p~omoting the welfare of the emp~•
must be borne in miad in construing it and that there was no
warrant in the language or context to read into or imply into
s.1(3)(a) the sense of exclusive engagement in the 3chedule
Ma1ch 14.
·rht u,11iDflol
Procid< nl Fund
Commissio11tf,
~01116'!1'
v.
Shire K,iJJmo MtloJ
MormftUluring Cr.,
lllundora
816 SUPREME COURT REPORTS [1962] SUPP.
industry and that composite factories wrre well within the
1neaning of 'factory' \vhich \Vas comprehensively dtfined by
s.2(g) and later made clearer hy the amrndment by which
"establishn1ents"
\\·ere included
\\·ithin
the meaning of
1factory '.
llcltl, f'11rthrr, that in s.1(3)(a) the qualilication •in which
fifty or rnorc persons arc ernploycd' though lt inunediatcly
followed the words •industry' specified Schedule I, properly
applied to 'factory' which proceeded the latter words and
that the applicability of the ordinary rules of grammer to a
section is to be detennind by the context and by reference to
other relative provisions of the Act.
Hr,ld, further, that the expression
'engaged
in any
industry sptcificd in Sch.I' n1eans priinarily or tnainly engaged
in any industry a.s contrasted ,vith incidentally and in that
~ense minor or sub:)i<liary activities for the purpose of feeding
the main industry would 11ot detenuinc the character of the
industry \vith reference to the Schedule.
\Vhcn t\\·o constructions arc possible each of \vhich leads to some anomolies
that which is on the \Yholc consistent \vith comtnon sense and
the current understanding of the expression used should be
preferred.
·Held, also that the respondent in the fint appeal was
commercially engaged in a Scheduled industry among others
and the Act was applicable to it; further held that the respondent in the second appeal was mainly engaged in an industry
not included in the Schedule but was engaged incidentally and
only for the feeding that industry in manufacturing containers
and hence did not co1nc \vithin the Act.
CIVIL APPELLATE J UUIBDICTIO!'l : Civil Appeals
Nos. 361 and 387 of 1959.
Appeals from the judgment and ordor dated
March 19•i7, of the Bombay High Court at :N'agpur
in Misc. Petn. Nos. 282 and 335 of 1955.
B. Sen and P. D .• 'ltenan.

## Text

-'
3 S.C.R.
SUPREME COURT REPORTS
THE REGIONAL PROVIDENT FUND
COMMISSIONER, BOMBAY
v.
'
815
SHREE KRISHNA METAL MANUFACTORING
CO., BHANDARA
(P. B. GAJENDRAGADKAR and K. N. WANCHOo,JJ.)
Construction-Rules
of Grammer-Oontext-Oomposite
factory-Different industries~Whether "factory'' -Determinative
industry, which is-Employees'
Provident Funds Act, 1952
(19 ~' 1952), ss. 1(3)(a), (2)(g), Schedule I.
The respondent· company in the first appeal carried on
the business of manufac.turing brass, copper and 'kasa' circular
sheets for manufacrnring utensils therefrom, milling paddy,
a fiour mill and a saw mill in the same compound, it had a
rolling mill for the first item of its business and bad other mills
for the other for each of which it employed different set
of workmen,
but
there were common clerks and other
employees for the entire business. When the Employees Provi·
dent Funds Act came in to force the company was required
to comply with its terms. It challenged the applicability of
the Act to it successfully by way of a writ petition before the
High Court of Bombay at Nagpur.
The respondent in the second appeal were mills which
manufactured Hydrogenated vegetable oil. They also manu·
factured tin containers for marketing and storing and its
product in a separate establishment in which were employed
0 nly 31 workmen as against 211 employed for the manufac·
ture of oil. The mills were also asked to comply with the Act,
but contested the applicability of the Act to their industry
which was manufacture of oil and not tin containers. They
also successfully challenged the order of the appellant against
them by a writ petition before the High Court of Bombay,
Nagpur Bench.
In both the appeals it was contended that
each of the respondents was a 'factory' within the meaning
ofs.1(3)(a) of the Act and that the High Court was in error
in construing it otherwise.
Held, that the fact that 1he Act was beneficicnt piece
of legislation aimed at p~omoting the welfare of the emp~•
must be borne in miad in construing it and that there was no
warrant in the language or context to read into or imply into
s.1(3)(a) the sense of exclusive engagement in the 3chedule
Ma1ch 14.
·rht u,11iDflol
Procid< nl Fund
Commissio11tf,
~01116'!1'
v.
Shire K,iJJmo MtloJ
MormftUluring Cr.,
lllundora
816 SUPREME COURT REPORTS [1962] SUPP.
industry and that composite factories wrre well within the
1neaning of 'factory' \vhich \Vas comprehensively dtfined by
s.2(g) and later made clearer hy the amrndment by which
"establishn1ents"
\\·ere included
\\·ithin
the meaning of
1factory '.
llcltl, f'11rthrr, that in s.1(3)(a) the qualilication •in which
fifty or rnorc persons arc ernploycd' though lt inunediatcly
followed the words •industry' specified Schedule I, properly
applied to 'factory' which proceeded the latter words and
that the applicability of the ordinary rules of grammer to a
section is to be detennind by the context and by reference to
other relative provisions of the Act.
Hr,ld, further, that the expression
'engaged
in any
industry sptcificd in Sch.I' n1eans priinarily or tnainly engaged
in any industry a.s contrasted ,vith incidentally and in that
~ense minor or sub:)i<liary activities for the purpose of feeding
the main industry would 11ot detenuinc the character of the
industry \vith reference to the Schedule.
\Vhcn t\\·o constructions arc possible each of \vhich leads to some anomolies
that which is on the \Yholc consistent \vith comtnon sense and
the current understanding of the expression used should be
preferred.
·Held, also that the respondent in the fint appeal was
commercially engaged in a Scheduled industry among others
and the Act was applicable to it; further held that the respondent in the second appeal was mainly engaged in an industry
not included in the Schedule but was engaged incidentally and
only for the feeding that industry in manufacturing containers
and hence did not co1nc \vithin the Act.
CIVIL APPELLATE J UUIBDICTIO!'l : Civil Appeals
Nos. 361 and 387 of 1959.
Appeals from the judgment and ordor dated
March 19•i7, of the Bombay High Court at :N'agpur
in Misc. Petn. Nos. 282 and 335 of 1955.
B. Sen and P. D .• 'ltenan. for tho appellants.
I. N. Shroff, for
the respondent (in C. A.
No. 361/59).
A. V. V i8wanatlu1 Sa11tri and V. J. 111 erchuut,
for respondent (in C. A. No: 387 of 195\l).
3 s.c.tt.
SUPREME COURT REPORTS 811
1962. March 14. The Judgment of the Court
was delivered by
GAJENDRAGADKAR, J.-These two appeals
have been heard together ·because they raise a
common question of construction of section 1(3)(a)
of the Employee's Provident Funds Act, 1952 (No.19
ofl952) (hereinafter called the Act). The Regional
Provident Fund Commissioner, Bombay, is the
appellant in both the appeals, whereas Shree
Krishna Metal Manufacturing Co., and Oudh Sugar
Mills Ltd. are the respondents respectively. Shree
Krishna Metal Mfg. Co. is a partnership firm
which is registered under the Indian Partnership
Act.
Its business consists of (I) manufacturing
brass, copper and 'kasa' circular sheets and the
preparation of utensils therefrom;
(2) milling
paddy, (3) a flour mill and (4) a saw mill. The
aforesaid four works are situated in the same
compound. For the manufacture of metal circular sheets, the company has a rolling ma.chine.
In order to carry on other works, a separate rice
mill, flour mill and saw mill have been installed
by the Co.
The Company's case is that it employs different workers in each section of its .activities and these workmen are engaged either
on a permanent or on a temporary basis. Some
workers, such as clerks and watchmen are common
to the four sections of the Co.'s works. After
the· Act came into force, the Co. was required to
comply with its provisions. The Co. protested
and urged that it was not a factory under s. 1(3)(a)
of the Act and so, it could not be called upon to
comply with its provisions.
The Regional Provident Fund Commr., however, took a contrary
view. He held that the Co. fell within the meaning of the word ''factory" as defined under s.1(3)(a)
and so, be threatened to use coercive processes
to compel the Co. to comply with its requisitions
issued under the relevant provisions 'of the act.
1961
The &gisnal
Provident FUnd
·Bombay
...
Shree Kr;sh'na Melot
ManuJacluriat Co,,
Bhandor•
Gajendragadk.or J •
1961
7-,., Rtti~nal
rrovitltnJ J•'und
CcmmisJiorier,
Bomba.~
v.
Shrte Kn"sMa fllttal
Jfanufocbdiflg Co.,
J;handara
818 SUPREME COURT REPORTS [1962] SUPP.
At that stage, thc> Co. moved the High Court of
Bombay at Nagpur by a writ petition under
Art. 2'1li of the Constitution and it prayed that an
appropriate writ should bu isAued re8training tho
Commissioner
from enforcing the relevant provisions of the Act against it.. This writ petition
has been allowed and an appropriatt! writ has been
issue.d as prayed
for by the Co.
It. is against
this order that the Regional Commissioner has
comll to this Court with '·a cc>rtificate granted by
tho High Court. For convenience, the Regional
Provident Fund Commissioner would hereafter
be referred a.~ the appellant and the i:-hreo Krishna
l\Ictal Manufacturing Co.
would be called the
Company.
The Oudh Sugar lllilb Ltd. which is respondent in C.A. No. 387 of i\Jii\l, is a public limited
company registered under the Indian Companies
Act. It carries on the business of manufacturing
hydrogenated vegetable oil named "Vanasada"
and its by-products, such as soap, ·oil.cakes, etc.
This business is carried on at Akola. under the
name and style of 'Berar Oil Industries'. The
Mills commenced manufacturing its products on the
11th October,
19~8. It also manufactures and
.Markets vegetable oil after completing all the processes at Akola. The oil is then tinned in tin
containers of certain sizes.
The said tin containers
a.re fabricated by the mills in its own precincts
of the oil factory. These tin containers a.re used
only for the purpose of packing vegetable oil and
for no other. They are not sold in the market nor
aro tho customers of oil chargerl ·separate prico
for the tins. The \\ ork of fabricating these tiaH
began on the 13th October, HHS. In this section
of the Works only 31 workmen are engaged, while
in the Mills 1·roper 211 workers \\ere working on
tLc ma11ufac1u1;e of vii a.1.d ita l .1 ·f,J c LUds c,J, tJ,c
Jst of November, 1952.
·
\
3 S.C.R.
st:J:PREME COURT REPORTS
8Hl
The Central Government framed a scheme
under 5 of the Act and this scheme came into force
partly on 2.9.1952 and partly on 6.10.1952. Under
this scheme, an employer is required to contribute
6-1/4% of the total wage bill every year as his contribution towards the Fund and 3% as the administrative charges on the total contribution of the
employer and his employees.
On the 8th of August, 1955, the Regional
Commissioner called upon the Mills to deposit its
contribution and incidental charges as required by
the scheme.
The amount thus required to be
deposited was of the order of Rs. 34,000/-.
This
deposit is required on the basis that the whole of
the factory run by the Mills is a factory under
s. 1(3)(a). The Mills declined to make the deposit
on the ground that it was not a factory to which
the Act applied. The Regional Commr.
then
threatened to take· proceedings against the Mills
for the recovery of the said amount under section
8 of the Act.
At that stage, the Mill moved the
High Court of Bombay at Nagpur by a writ petition and its writ petition has been allowed by the
High Court. In the result, a direction has been
issued restraining the Regional Commissioner from
enforcing the provisions of the Act against the
Mills. It is against this order that the Regional
Commr. has come to this Court with a certificate
granted by the High Court.
For the sake of convenience, the Regional Commissioner will hereafter
be called the appellant, whereas the Oudh Sugar
Mills Ltd. will be described as the Mills.
The appellant contends that the High Court
was in error in coming to the conclusions that the
company and the Mills did.not constitute a factory
as defined by s. 1(3}(a) of the Act.
Section ,1 (3) at
the relevant period read thus:
"Subject to the provisions contained in
section 16, it (i.e., the Act) applies in the first
196S
The RezionaZ
Provident Fund
CommitJinner,
Bomba7
••
Shree Krishna Meta/,
11 anufactraint Co.,
Bh1ntlara
' --
Gojendragodkor J.
1962
rll t'•iarcal
eni'Fzu:rl
iJJions1,
nnhay
v.
irhna Mttal
Oc1uri111 Co. ,
•ndara
1aga,!ar J.
820 SUPREME COURT REPORTS [IS62] SUPP.
instance to all factories engaged in any industry specified in Schedule I in which fifty or
more pcrRons are employed, but tho Central
Government may, after giving not less than
two months' notice of its intention tto to do,
by notification in the Ollicial Gazett-0, apply
the provisions of thiH Act to all factories employing such number of persons less than fifty
as may be specified in tho notification and
engaged in any such industry."
As a result of the amendment made in 19ii6, section
1(3) has become 1(3)(a) and so, it is referred to as
such.
Before construing thiR clause, it may be relevant to remember that tho Aot was passed to provide for the institution of provident funds for
employees in factories and other establishments.
The object of the Act, broadly staged, is to bring
into exist-enco a scheme to bo called "Tht' Emploj ees' Provident, Funds Scheme" for the establishment of provident funds under the Act for employees to whom its provisions apply.
This object is
specified by s. 5 of the Act.
Section 6 provides for
the contributions to be made by the employers and
s. 9 recognises the Fund constituted under the
Act for the purpose of income-tax. Section 10
affords protection against attachment in rnspect of
the amount standing to the credit of any member in
the Fund and s.11 prescribes for priority of payment
of contributious over other debts.
In other words,
the provisions of tho Act constitut.. a welfare measure intended for the benefit of the workmen to
whom the Act applies, and thiR beneficent purpose
cf thu Act has to be borne in mind in construing the
relevant clause with which we are concerned in the
present appeals.,
The first question which calls for our dcoiRion
is whether s. l(:i)(a) excludes oomposite factories
f
I
'
3 S.C.R. SUPREME COURT REPORTS
821
from its scope. It has been urged before us on behalf of the respondents that composite factories are
not intended to be covered by s. 1 (3 )(a). It is only
factories which are exclusively engaged in any
industry specified in Schedule I to which the Act
applies, provided, of course, they
satisfy the
other test that there are 50 or more persons
employed in them. This argument is based on the
fact that when the Act was originally passed in
March, 1913~, the Legislature had provided for only
six industries in Schedule I.
The intention of the
Legislature was to extend the benefits of the Act
to the workmen industry-wise step by step. The
Legislature wa.s conscious that the relevant provi ·
sions 'of the Act imposed a burden on the employer
and so, it took the precaution of confining the
operation of tbe Act only to six important industries specified in Schedule I. ·Section l (3) (a) no
doubt confers power on the Central Government to
extend the provisions of the Act to other factories
by issuing a notifications, as contemplated by it ;
and so, whenever the Central Government comes
to the conclusion that the benefits of the Act shC>uld
be extended to workmen engaged in additional
categories of factories, it could exercise its power
in that behalf and by issuing ·a notification, bring
within the scope of the Act such factories.
But
this has to be done factory-wise in the sense that
it has to be done by reference to the factories
engaged in industdes included in Schedule I and
that shows that. it is only factories exclusively
engaged in the said industries that are included
within the purview of s. J (3) (a).
In our opinion, this argument is not welt.
founded.
The expression "all factories engaged in
any industry specified in Schedule I" does not lend
itseJf to the construction that it is confined to
factories exclusively engaged in any industry specified in Schedule l.
What exactly is meant by the
19611
The Reg
Provident
Commiss,
Bomb
v.
Shree Krishn
M anuftJClut
Bhan
196•
Tlk Regional
Prot•ldtnt Fund
Com111i1sio11er,
Bom6c1
••
Slv11 Kris/ono .\/tlal
M.nu/octu1i11g Co.,
Bhaiara
822 SUPI\.EME COURT REPORTS [1962] SUPP.
clause, we will have occasion to deal with later on.
For the present, it would be enough to sa.y tha.t
when the Legislature has described factories as factories engaged in a.ny industry, it did not intend
that the said factories should be exclusively engaged
in the indusir·y specified in Sohedule I. The construction for which the re~pondents contend requires
that we should add tho word "eil:dusively'' in tho
clauJe and that clearly would not bo permissible.
The definition of th" word "factory" prescribed ny s. ~(g) of the Act shows that a "factory"
means any premises. including the precincts thereof, in any part of which a manufacturing process is
being carried on or is ordinarily so carried on,
whether with the aid of power or without the aid of
power.
Thus, t.he word "factory" used ins. 1(3)(a)
has a comprehensive meaning and it includes
premis~s in which any manufacturing process is
being c.~rried on a.s described in the definition. This
definition of the wore! "factory" shows that the
factory engaged in any industry specified in Schedule I •::mnot necnssarily mean a factory exclusively
engaged in the pnrticular industry specified in the
said Schedule.
Besides, s.l(:l)(a), as it has been amended
in 19;36, now referA to cvnry establishment which is
a factory engaged in any industry specified in
Schedule I a.ncl the introduction of the word "establishment" clearly shows that it may consis\ of
different factories clealing with different. industries
and yet considered as one establishment, it may
fall under section l(:l)(a),
provided the other requirements of the said section a.re satisfied. Section
2A which has been added in the Act by the Amending Act 46 of 1961) makes it clear that an establishment mav consist of rlitTnrrmt departmcnt8 or 111ay
h:we different branches, whether sit.uate in the
same place or in cliffcrnnt placc8, and yet all such
departments or hrancjies H!1all he treated as parts
I
3 S.C.lt.
SUPREME COURT REPORTS
823
of the same establishment. Therefore, the concept
of establishment being of such a comprehensive
character, the insertion of the word "establishment"
in s.l(3)(a) by the Amending Act of 1956 helps to
negative the argument that the factory therein contemplated cannot be a composite factory.
Besides, the explanation to Schedule I which
has been added by Act 37 of l953 clearly shows
that one of the industries originally included in
Schedule Tin 1952 definitely ·suggests the idea of a
composite factory and wou Id, thus, assist the inter·
pretation of the word "factory" as including a
composite factory under s.l(3)(a). The industry in
question is electrical, mechanical or general engineering products and the explanation of this
industry shows that it includes 25 different items,
and so any factory carrying on the work of producing one or more of these items would. not be exclu·
sively engaged in producing one or the othf'f of
those items and would be in the nature of a composite factory and yet it would definitely fall under
s.1(3)(a). ThereforP, in our opinion, the argument
that a composite factory carrying on different industrial opera1 ions is outside the purview of s.1 (3)( a)
cannot be accepted.
•
The next question which falls to be considered
is whether the requirement
that the workmen
employed should be 50 or more, governs tho w:ird
"Industry" or the word "factor" is under s. l (3)(a).
T]).e respondents' contention is that tbis rmmcrica]
test must be satisfied by t.he industry and not by
the factory.
In other worcfa, even if a composite
factory is included in s.1(3)(a), before the provisions
of the Act can be applied to it. it must be shown
that 50 or more persons are employed in that unit
of the factory which iR
~ng•tged in the industry
specified in :Schcdlllo I. If this is the true and
correct position, neither the Mills nor the Company
would fall within the mischief of thP Act. The
J9iM
Thi Regional
Provident Fund
Oommis;ioner,
Bomba.,v
v.
Slir1e_K1isJ.na Met11.
M aun.fac'ttring c,.1
Bhantf14ra
Gajeridragadkar J,
l!ldZ
Tii1 R,giufUJI
ProtJid,nt Pim I
Commissionrr,
Bomb•_p
v.
· S"'• Kriolno .If t14/
JI ~actruing Co.,
Bh111dar12.
O~tridr•fad.l:ar J.
824 SUPREME COURT REPORTS [19G2] SUPP·
argumont in 811(lport of thiH construction jg that the
pronoun "which" must under the ordinary rules of
grammar qualify the noun immediately preceding
it an<l that take~ it to the word "[ndustrv" rather
than to the word "factories".
·
We are not indincd to accept this construction. The ordinary rule of grammar on which this
construction is based r.annot be treated as an invariable rule which must alwnys nnd in every case be
accepted without regard to thn context. If the
contoxt definitely suggests that the relevant rule of
grammar is ina.pplica.ble, then the requirement of
the context must prevail over the rule of i!rammar.
As the provision stands, the word •factories' is qualified by two clauAes.
The firAt n.<ljoctival clause is
'engaged in any industry specified in Schedule I'
and the second clause is "in which 50 or more persons a.re employed".
In other words, in order that
the factories should fall within th•• Hcopu of the provision, they must satisfy two tests : they must be
engaged in any inrlustry sμecifit•rl in Schcclule I and
they must have employed ;)0 nr more persons. The
first ;Lrljectival clauij<: is in thn natme of a parenthetic11.l ehiusc am! so the clause b"ginning with t.Jw
worrls "in which" must neceHsarily qualify the word
"factories'' and not tho word "industry''. Therefore,
in our opinion, the requir<>ment ns to the prescribed
number qualifies the word "factories" and does not
qualify the word "industry" ; that means the question to ask is : does the factory employ 50 or more
persons ? The quest.ion is not : does the industry
employ .~O or more persons ?
This conclusion is Rtrengthoned by the. provision contained in the latter part of s. \(:{)(,i).
This
latter clause empowers· the CPntral Government .to
brin" within the purview of the A<'t other· factories
in the manner specified by it, .While referring to
the factories which may thns be brought: within the
purview of the Act, t.h? clause provides that these
I
J
3 S.C.R.
SUPREME COURT REPORTS
825
factories must be such as employ such number of
persons less than fifty as may be specified in the
notification and they must be engaged in any such
industry. In other words, this latter clause makes
it clear that it is the factories which have to satiafy
two tests-(i} that the number of their employees
should not be less than 50 and (ii) that they must
be engaged in any such industry as is specified in
Schedule I,
This position has been placed beyond all doubt
by the amended clause as It now stands as a proviso
to s. 1(3)(a) and (b) after the amendment of
1956. This proviso reads that the Central Government, may, after giving not less than two months'
notice of its intention so to do, by notification in
the Official Gazette, apply the pro~isions of the Act
to any establishment employing such number of
persons less than fifty as may be specified in the
notification. This proviso makes it absolutely clear
that the requirement as to the number of the employees applies to the establishment and not to the
industry. We may incidentally add that the requirement of fifty has now been reduced to twenty by
the Amending Act 46 of 1960 .
. There is yet another provision in the Act
which supports the same conclusion.
Section l 9A
provides, inter alia, that if any difficulty arises in
giving effect to the provisions of the Act, and in
particular, if any doubt arises as to whether 50 or
more persons are employed in a factory, the Central
Government may. by order, make such provision or
give such direction, not inconsistent with the provisions of the Act, as appears to it to be necessary or
expedient for the removal of the doubt or difficulty;
and the order of the Central Government, in such
cases, Ahall be final.
This clause has been subsequently amended, but for our present purpose
those amendments do not matter. The point about
the provision is that the Central Qovernnient h"s
1962
The Regional
Provident li'und
Commissioner,
B1mbay
v.
Shree Krishna Met al
Manufacturing Co.,
Bhandara
Gajendtagadkar J.
1962
Tlie Rezionol
ProvU/mt Fund
<.A~ssio11e1,
B1mbay
v.
Shr11 Krish11~ Metal
jfGIUl.fatbtrinf! Co.,
Blumdara
826 SUPREME COURT REPORTS (1962[ SUPP.
been given powur to resolvo a doubt as to whether
fifty or more persons are employed in a factory or
in an establishment and that shows that the requirement as to tho number of employHes governs the
factory or the establishment but not the industry.
That takfs us to the question as to the meaning of the expression "engaged in any industry
specified in Schedule I", and this question no don bt,
presents some difficulty. We have already reject<'d
the argument that the composite factory is not
included in s. 1(3Xa).
That means that the clause
"engaged in any industry" does not mean "exclusi·
vely engaged in any industry". If that is so, what
exactly is the meaning and significance of thig
clause ? Two views are possible. It may be said that
even if a factory is only partiall.v engaged in any
industry specified in Schedule I, it would satisfy the
test however small or insignificant may be the <>Xtent of its operation in the said industry. On this
construction, it would follow that if a factory is
engaged in several industrial operation one of ,,:hirh
relates to an industry specified in Schedule I, the
factory would fall under s. 1(3)(a) even though its
relevant a<:tivity in the specified industry may be of
a minor,
incidental or subsidiary character. The
other construction would be that tho oxprossion
"engaged in any industry" means "primarily or
mainly engagod in any inclustry". On this construe·
tion, if a factory is engaged in several industrial
activities one of which relateH to tho industry ~pt~l'i·
fied in Schedule I, it would he rieccs8ary to enquire
whether the said specified activity is subsidiary or
minor; if it is subsidiary, incidental or minor, tho
factory cannot be said to be engaged in that industry.
Cases may occur where a factory is primarily or
mainly engaged in other industrial activities ancl it
is only for feeding one or more of such activit ics
that the factory may undertake an activity in
respect of the $pecified industry. But surh an
undertaking is mornly for the purpose of feeding its
3 S.C.R.
SUPREME COURT REPORTS
827
major activity; it is subsidiary, incidental and
minor. In that case, the factory cannot be said to
be engaged in the industry specified in Schedule I.
Both constructions are possible and each one of
them presents
some 'lnomalies.
On
the first
construction, it would follow that even if half a
dozen employees arc engaged by the factory in
regard to.its activity in the industry specified in
Schedule
I, the provisions of the Act would
apply to all the workmen engaged in the whole
of the factory because the factory would
be
deemed to have
satisfied the test that it is
engaged in the industry specified in Schedule I and
that, no doubt, looks anomalous. On the other
hand, if the second construction is accepted, though
more then 50 persons may be employed in the
incidental and subsidiary activity relating to an
industry specified in Schedule I, the provisions of
the Act will not apply to such workmen because
the factory, as a whole, does not satisfy the test
that it is engaged in the said industry and that also
is anomalous.
It is true that in dealing with the construction
of a clause which is capable of two reasonably
possible constructions, it is not easy to make a
choice, particularly when bot.h constructions seem
to lead to some anomalies. On the whole, however,
we are inclined to take the view that the clause
"engaged in any ·industry specified in Schedule I''
should be interpreted to mean "mainly engaged in
any indn>tr,y specified in Schedule I". If a fantory
is engaged in two industrial activities one of which
is itH primary, principal or dominant activity and
the other is a purely subsidiary, incidental, minor
or feeding activity, then it is the primary or the
dominant activity which should determine the
character of the factory under s. I (3) (a).
This
view does not purport to add any word to the
section; it merely interprets the relevant expression
••engaged in any industry specified in Schedule I",
1962
'l'he Regional
Provid111t Fund
Commissioner,
Bombay
v.
Shree Krishna ·Metal
Manufacturing Co .•
·BhandMa
G 'ljendragat!kar J,
1962
·r ht Rtf]ionol
Prtbidtnt Fund
Commissioner,
Bomb~y
v.
Shrtt Krishna .\I eta/
Afan11faclurint Co.,
' · llhandar•
fJajtnriragadkf1r J.
828
SUPRE~IE COGl~T REPORTS [1962] SUPP. I
\Vhen it is said that a person is engaged in any
business, it usually means he is engaged mainly or
. principally in that business; and the same wo:ilrl be
tho position when the relevant clause refers to an
establishment engaged in the specified industry.
That is the common-sense view which is consistent
with tho current and accepted denotation of tho
words "engaged in".
One of the tests which can sometimes be
applied is whothcr the product of the incidt•ntal
activity is intended for the market or exclusively
for use by the factory in its other department only.
If the answ"'r to this question is that the said
product is sent out in the market for sale, then the
activity in question cannot he treated as incidental.
In such a case, it may be said that thu factory is
engaged in both thn activities and as such, it is
engaged in the industry specified in Schedule I.
But tho test of sending the product in the market
cannot ho treated as decisive or even very significant ht>cnuse tho definition of tho word "manufacture'' given ins. 2(i)(a) shows that a commndity
may be produced by the fa,.tory as much for sale,
transport, delivery or disposal aH for its own use.
Therefore, the fact that a commodity is pro<luce<I
only for th" use of the factory in i~s other department may not necessarily show that tho activity
which IeadR to the production of the said commodity
is not the main activity of the factory.
.
.
If a factory iR engaged simultaneously in
different industrial artivities and one of these is in
relat.ion to an industry specified in Schedule I.
then it can be said that the factory is engnl!'ed in
the industry specified in Schedule f.
Th" fact that.
the factory is engaged in other inrhrntrial activities
will not ncr,cssnrily tulw it out of the purview of
s. I (3)(a).
The broad test which may safely he
appliecl in dealing with this question is: is the
3 s.c.R..
SUPREME COURT REPORTS
829
'actory engaged in the industry specified in
-dchedule I from a business point of viewY; and the
answer to this question would generally give a
satisfactory solution to the problem posed by
s. 1(3)(a). Whether or not. a factory is engaged in
any industry specified in Schedule I would, thus,
be a question of fact to be determined in the facts
and circumstances of each qase.
That appearn to
be the view taken by B11lakrishna Ayyar J. in the
Madras Pencil Factory, by its Proprietors v .. Perurnal
Clietty & Sons, by its partner V. Anantliakrislina .Clietty
' v. Tlie Regional Provident Fund Gornrnissioner, ( 1) and
with that view we are in general agreement.
What remains now is to consider whether
the High Court was right in holding that the company and the Mills are outside the purview
of s.1(3)ta). As we have already seen, company
carries on four different kinds of industrial activities, one ·of which ·is the manufacturing of brass
copper and 'kasa' circular sheets and the prepara·
tion of utensils thuefrom. For the manufacture
of metal circular sheets, the Co. has a rolling
machine. It is common ground that this work
would fall within Schedule I of the Act and so, if
it can be held that th.e Co. is a factory engaged in
the industry represented by this work, the first test
is satisfied. As we have already observed this Co.
carries on four diJferent kinds of activities and it
is impossible to hold that the activity in relation
to the industry which falls in Schedule I is either
minor, subsidiary or incidental to -the other activities.
This activity is as much the work of the
Co. as the other activities are and so, the Co. must
be hold to be a factory under s.1(3)(a) so far as
the first test is concerned. In regard to the test
of the number of employees elilgaged in the factory
it appears to be the Co.'s case that at the relevant
time, the · number of its total employees in all the
(I) A.I.R. 1959 Mad. 235.
1961
T/11: Regional
Providtnt l<Und
Commissioner,
8omba1J
••
Sh,.ee Krishna Metal
Monufadurinrr Co.,
Bhondara
Gajendraga4kar J.
1962
The Ileyion~l
f'ro•-'idtnf Fund
Bumboy
..
Slirte /(rislma ft[tlal
.'t-101.ufacluring Co.,
lJham/ar•
G'ojendroyaJkar J.
s3o SUPREME COuRT REPORTS [l!l62] sijpp_
four activities did not consistently exceed 50; but
that it is a point on which the High Court has expressed no opinion, and rightl.v, because it is a
disputed question of fact which cannot be tried
in writ proceedings. The appellant's case is that
the total number of cmploy<!CS engaged by the
Co. excoeded 50 at the relevant time and it is on
that footing "that the present writ petition has been
tried in the High Court. Therefore, without deciding this dispute question of fact, it may ho assumed
that for the purpose of the present writ proceedings,
the test of the numerical strength can be said to
hin·e been satisfied. The result is, the view taken
by the High Court that the company is outside
s. l (3)(a) is erroneous in Jaw and must be reversed;
and that means that appeal No. 361 of 1959 filed
by the regional Commissioner is allowed and the
writ petition filed by the Co. is dismiBBed with costs
throughout.
In the rosult, the respondent will have
to comply with the requisition issuad by the appellant against it under the relevant provisions of
the Act. In regard to the date from which the
respondent should make its statutory contribution
to the Provident Fund tho a!'lpellant may have to
.give a direction after consulting tho workmen,
because from the date so specified by the appellant
both the respondent and its workmen will have
to make their respective contribution.
The position with regard to the Mills is, however, different. The main industrial activity of
the Mills is the manufacture of hydrogenated vegetable oil named 'V a.nasada' and its by-products, such
as soap, oil-cakes etc. It is true that in the mills
tin containers are fabricated and this, no doubt,
is an activity covered by Schedule I. But it is
obvious that this branch of the activity of the mills
forms a very minor portion of its activity. The
number of employees engaged in this branch is 31,
whereas the total number of employees is 2ll.
3 S.C.R.
SUPREME COURT REPORTS
r
831
Besides; the containers are produced only for the
; use of the Mills.
They are not intended to be
sold in the market at all. Price for the containers is
not also charged from the customers. Indeed,
containers are required even for the purpose of
storage of the vegetable oil. It is thus clear that
the fabrication of tin containers has been under·
taken by the Mills only as a feeder activity ; it is
integrally connected with its main business of pro·
ducing and marketing vegetable oil and as such,
it is 't minor. part of the said activity. Having
regard to the relevant facts admitted or proved
in the present case, we are satisfied that the High
Court. was right in coming to the conclusion that
the Mills was not a factory within the meaning of
section 1(3)(a). The result is, the appeal .'lo. 387
of 1959 fails and is dismissed with costs.
C.A. 361 of 1959 allowed.
C.A: 387 of 1959 dismissed.
BOKARO AND RAMGUR LTD.
v.
THE STATE 01<' BIHAR AND ANOTHER
(B. P. SINHA, c. J., P. B. GAJENDRAGADKAR, K. N.
WANOHoo, N. RAJAGOPALA AYYANGAR, and
T. L. VENKATARAMA AIYAR, JJ.)
P.undamental right -
Right to hold property_ Ad. d'
t'
t t"tl
d'
~u zca·
b
i~n a8 O ,' .de .Pe~ z~y -Question of infringement, if could ariBe
e,ore sue,, a ~udzcatiun -
Constitu,tion of India Arts.19(1) (f)
31(1) -
Bihar Lanrl Reforms Act 1950 (Bihar 1 of 1950)'
•. 4(h).
.
'
h
The property regarding which the contention is raised
t at
the fundamental
rights of the·
petitioners
under
Arts. 19(1) (f) and 3] (I) of tl1e Constitution "'" "-lleged to
1962
Tire Regiortal
Provident Fund
Comm;ssion~r,
Bombay
v.
Sh~ee Krishna M~tal
M anufocturing Co.,
llnondora
Gajendragadkat J.
1962
Morch 14,