Anil Kumar v. State of Kerala and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR. JUSTICE P.M.MANOJ** **MONDAY, THE 29[TH] DAY OF JULY 2024 / 7TH SRAVANA, 1946** **WP(C) NO. 28757 OF 2016** ## **PETITIONER:** **ANIL KUMAR, AGED 50 YEARS, S/O.RAGHAVAN M R, KIZHAKEMAYIKARA VEEDU, VANMAZHI MURI, PANDANADU VILLAGE, CHENGANNUR TALUK, ALAPPUZHA DISTRICT.** ## **BY ADV SRI.K.V.ANIL KUMAR** ## **RESPONDENTS:** - **1 STATE OF KERALA, REPRESENTED BY CHIEF SECRETARY, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695001.** - **2 THE SECRETARY, EXCISE DEPARTMENT, GOVERNMENT SECRETARIAT, THIRUVANANTHAPURAM-695001** - **3 THE CHIEF WELFARE FUND INSPECTOR TODDY WORKERS WELFARE FUND BOARD, THIRUVANANTHAPURAM-695001.** - **4 THE WELFARE FUND INSPECTOR TODDY WORKERS WELFARE FUND BOARD OFFICE, THIRUVALLA, PATHANAMTHITTA DISTRICT, PIN-689645.** - **5 THE ASSISTANT EXCISE COMMISSIONER, PATHANAMTHITTA DISTRICT, PIN-689645** - **6 THE DEPUTY TAHSILDAR (REVENUE) TALUK OFFICE, CHENGANNUR TALUK, ALAPPUZHA DISTRICT, PIN-689121.** - **7 THE VILLAGE OFFICER, PANDANADU VILLAGE, CHENGANNUR TALUK, ALAPPUZHA DISTRICT, PIN-689121.** **SRI.SANTHOSH KUMAR R3 & R4 SRI.E.G.GORDEN, GP** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY** **HEARD ON 29.07.2024, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** 2 W.P.(C) No.28757 of 2016 ## **JUDGMENT** Dated this the 29th day of July, 2024 The above writ petition is preferred by a person, who is stated to be an employee in shop No.9 of Ranny Excise Range, being aggrieved by the issuance of Ext.P1, the order of determination by the 4[th] respondent and consequential revenue recovery proceedings issued as per Ext.P2 by the 6[th] respondent. 2. It is stated that toddy shop Nos.6, 9, 10 and 11 of the Ranny Range for the year 2005-2006 were licensed to Sri.Rajappan Achari. The petitioner was stated to be an employee of toddy shop No.9 of Ranny Excise Range. The original licensee died during the pendency of the proceedings initiated as per Ext.P1. In fact, Ext.P1 was issued under Section 8 of the Kerala Toddy Workers Welfare Fund Act 1969 (for short ‘Act of 1969’) as there is a default occurred on the part of the employer of the toddy shop to remit the contribution to the Toddy Workers Welfare Fund, as contemplated under Section 4 of the Act. On finding such default, the 4[th] respondent initiated proceedings and issued Ext.P1 order whereby, the liability fixed as per Ext.P1 for an amount of Rs.1,91,465/- and total amount comes to Rs.3,74,204/- including the interest at the rate of 18%. 3 W.P.(C) No.28757 of 2016 On the basis of Ext.P2, revenue recovery proceedings were initiated addressing the petitioner to remit his part out of the total amount, which comes to an amount of Rs.1,70,847/-. 3. The primary contention of the petitioner is that Ext.P1 order is incorrect since he was only an employee during 2005-2006 and hence, he is not liable to pay the amount. It is for the employer to pay the welfare fund contribution as per Section 4 of the Act. The powers exercised by the 4[th] respondent under Section 8 is erroneous and hence, it is liable to be set aside. 4. A counter affidavit has been filed by the 4[th] respondent, in which it is stated that the petitioner herein had appeared before the Welfare Fund Inspector on 13.12.2013 and deposed that he had conducted Toddy Shop No.9, i.e. Vechoochira shop of Ranny range for the year 2005-2006 for the licensee. He detailed the workers employed by him in the shop and the wages paid by him. Above that, he agreed to remit the welfare fund of toddy Shop No.9 employees and requested issuance of determination order as per his deposition. By signing before the Welfare Fund Inspector and producing the original agreement between himself and licensee Sri.Rajappan Achari, along with a copy thereof, he acknowledged his 4 W.P.(C) No.28757 of 2016 responsibility to settle the welfare fund dues of his shop's employees. Consequently, as per Section 2(c) of the Act, the petitioner falls within the ambit of the term employer, thereby obligating him to remit the welfare fund. By virtue of Section 2(c) of the Act, an 'employer' means any person who employs whether directly or through another person or whether on behalf of himself or any other person one or more employees and includes any person who has a licence for the manufacture, distribution, storage or sale of toddy under the Abkari Act for the time being in force. The deposition dated 13.12.2013 given by the petitioner himself during the course of final determination order itself is the speaking evidence to prove that the contentions raised by the petitioner is baseless. 5. In this regard, the 4[th] respondent has produced Ext.R4(b), whereby the petitioner herein undertakes to pay the amount demanded as per Ext.P2 in instalments though he states that he is not responsible to pay the same. He also contended that the interest charged on the amount is exorbitant. It is further contended in the counter affidavit filed by the 4[th] respondent that adequate opportunities were given to the petitioner before issuing determination order by the Welfare Fund Inspector on 26.01.2016, specifying that the liability fixed on the petitioner is Rs.56,312/- for the 5 W.P.(C) No.28757 of 2016 welfare fund dues and Rs.1,10,058/- for interest dues up to the order date pertaining to shop No.9 of Ranny range for the year 2005-2006. It is further contended in the counter affidavit that Sri.Rajeev Rajappan, the son and legal heir of Sri.Rajappan Achari is explicitly included in the determination order as an employer. Consequently, he shares responsibility for remitting the welfare fund arrears. 6. I have heard Sri. Ajith Murali, the learned counsel for the petitioner, Sri.Santhosh Kumar, the learned counsel for respondents 3 and 4 and Sri.E.G.Gorden, the learned Government Pleader for official respondents. 7. The question to be decided in this writ petition is whether the petitioner is an employer of the shop in question at the relevant point of time. As per Section 4 of the Act, the employer is bound to pay the contribution towards the Toddy Workers Welfare Fund Board. ## 8. Section 2(c) of the Act of 1969 defines ‘employer’ as under: ## “2. **Definitions** : (c) "employer" means any person who employs, whether directly or through another person, or whether on behalf of himself or any other person, one or more employees and includes any person who has a licence for the manufacture distribution, storage or sale of toddy under the Abkari Act for the time being 6 W.P.(C) No.28757 of 2016 in force;” ‘Employee’ is defined under Section 2(d) of the Act of 1969 thus: “(d) "employee" means any person who is employed for wages in connection with the tapping, manufacture, transport, storage or sale of toddy and who gets his wages directly or indirectly from the employer and includes any person employed by or through a contractor or through an agent in or in connection with the tapping, manufacture, transport, storage or sale of toddy;” 9. The Toddy Workers’ Welfare Fund is contemplated under Section 3, which provides that the Government may, by notification in the Gazette, frame a scheme to be called “the Kerala Toddy Workers’ Welfare Fund Scheme” for the establishment of a fund under this Act for the employees and there shall be established, as soon as may be after the framing of the scheme, a fund in accordance with the provisions of this Act and the scheme. 10. Sections 3(2), and (3) and Section 4 of the Act of 1969 read thus: - (2) The fund shall vest in, and be administered by the Board constituted under section 6. (3) Subject to the provisions of this Act the scheme framed under sub-section (1) may provide for all or any of the matters specified in the Schedule. 4. Contributions and matters which may be provided for in the 7 W.P.(C) No.28757 of 2016 scheme.- (1) The contribution which shall be paid by the employer to the fund shall be eight per cent of the wages for the time being payable to each of the employees, and the employee’s contribution shall be equal to the contribution payable by the employer in respect of him. 11. Here, the question arises for consideration is with regard to the dues occurred on the part of the employer towards the welfare fund contemplated under section 3. Admittedly, there is due occurred on the part of the employer and the employer has to pay the dues, which has been determined by the 4[th] respondent as per Ext.P1. In this regard it is stated that he has conducted various hearings for the determination of the dues in which various persons including the petitioner and other persons, who are stated to be conducted toddy shop Nos. 6, 9, 10 and 11 of Ranny Excise Range were heard. 12. On the hearing conducted on 13.12.2013, the 4[th] respondent found that the petitioner herein, who appeared in person, had stated that in the year 2005-2006, the shop room No.9 was conducted by him. It is also stated during hearing that another person namely Sri.Bhaskaran, who also deposed that Sri.Anilkumar had conducted shop room No.9. On the basis of such depositions, the 4[th] respondent found that the petitioner is 8 W.P.(C) No.28757 of 2016 liable to pay the contribution towards welfare fund. 13. The submissions made by the learned counsel for the 4[th] respondent that since the petitioner had admitted the liability as per Ext.R4(b), he has to pay the dues towards the contribution to the welfare fund. 14. In this regard, the petitioner brought to the notice of this Court a division bench judgment of this Court in **Welfare Fund Inspector v. Jaya** [2006 (3) KLT 988],in which it is held that: “9. xxxxx xxxxx though admitted to be conducting the shop, the contention of the appellants was that they were not the employers and the licensees of the shop named thereunder were the actual employers. The High Court held that the appellants were also running the business of the shop had employed the workers, they shall be deemed to be the employers vis-a-vis those workers and liable to pay the contribution to the fund under the Act. After perusing the definition contained in Section 2(c) of the Act, the Apex Court held that "it refers to the person who employs any person, whether directly or through any other person or whether on behalf of himself or any other person, as employer. The employment by any person can be for himself or for any other person. Merely because the person is associated with the conduct of the business of an establishment or shop, it cannot be said that he had employed the workers on his own behalf. There may be cases where it can be shown that besides the owner any other person conducting the business of the said shop may employ workers on his own behalf 9 W.P.(C) No.28757 of 2016 and not on behalf of original owner. But in the absence of proof to the contrary, particularly in view of the statement of principal employer that he had employed the workers, the intermediary persons could not be held to be the employer of the workers who were employed for the conduct of the business in the shop covered under the Act. Law presupposes the conduct of a legal business and cannot be interpreted in a manner which frustrates the object of the Act and results in not only miscarriage of justice but violation of the statutory provision of law. If under the Rules, the licensee was not authorised to lease out or sub-let the whole or any portion of the privilege or licence granted to him for conducting the Abkari business, holding the appellants as employer with respect to the licensee's shop would amount to facilitate the violation of the Kerala Abkari Shops Act and the rules framed thereunder. Such an interpretation is not called for as it is against the public policy. In any particular case, where the authorities find that besides the licensee any other person conducting the business in a licenced premises under the Abkari Act and the Rules framed thereunder is also liable to contribute to the fund under the Act, they are under the legal duty to assert and positively hold that such persons were the employers vis-a-vis the workers and that they were conducting the business either with the legal authority of the licensee or the licensing authority.” 15. Here, in the case on hand, going by Ext.P1 order and the counter affidavit, it is not brought to the notice of this Court that the 4[th] respondent could not adduce evidence to show that the petitioner herein has separately engaged certain employees for the conduct of shop No.9 of 10 W.P.(C) No.28757 of 2016 Ranny range. In the absence of any such specific evidence with regard to employment of separate employees to manage the shop under him, he cannot be mulcted with the liability of payment of welfare fund on the petitioner alone. It is also admitted in Ext.P1 that though the original licensee Sri.Rajappan Achari expired during the pendency of proceedings, later his son Sri.Rajeev Rajappan being the legal heir of Rajappan Achari is explicitly included in the determination order as an employer. However, while fixing the liability the employer's responsibility is not specifically mentioned by the 4[th] respondent instead the liability with respect to shop No.9 is merely fixed on the petitioner. This appears to be an injustice. 16. Moreover, such fixation of liability is against the decision rendered by this Court in **Sasi V. and others v. State of Kerala and Others** reported in [2016 KHC 694], wherein it is held that the liability to satisfy contribution under the relevant provisions of the Act of 1963, is jointly and severally upon the licensee as well as on the immediate employer concerned. 17. On going by these decisions, it appears that the determination order issued by the 4[th] respondent as per Ext.P1 is not a well considered order, which does not consider the aspects already held by this Court in the 11 W.P.(C) No.28757 of 2016 reported decisions as mentioned above. Under such circumstances, I set aside the impugned order and direct the 4[th] respondent to reconsider the issue in the light of the decision in **Welfare Fund Inspector v. Jaya** and **Sasi V. and others v. State of Kerala and Others** cited supra. 18. This shall be done within a period of two months from the date of receipt of a certified copy of this judgment. Till that time, the revenue recovery proceedings initiated against the petitioner as per Ext.P2 will be kept in abeyance and fresh steps shall be initiated on the basis of the fresh assessment order issued by the 4[th] respondent. Accordingly, this writ petition is disposed of. Sd/- **P.M.MANOJ JUDGE** das 12 W.P.(C) No.28757 of 2016 ## **APPENDIX OF WP(C) 28757/2016** ## **RESPONDENT EXHIBITS** **Exhibit-R4(a) True copy of the deposition dated 13/12/2013 provided by the petitioner.** **Exhibit-R4(b)** **True copy of the representation dated 28/04/2016 submitted by the Petitioner before the Kerala Toddy Worker's Welfare Fund Inspector, Pathanamthitta.** ## **PETITIONER EXHIBITS** **EXHIBIT P1 THE TRUE COPY OF THE ORDER NO E2/RANNY 6,9,10,11-05-06/DO/16 DTD 26/1/2016/3717/16 ISSUED BY THE 4TH RESPONDENT TO THE PETITIONER.** **EXHIBIT P2** **THE TRUE COPY OF THE DEMAND NOTICE NO 2016/957/4/500 AND DEMAND PRIOR TO ATTACHMENT OF LAND DTD 29/7/2016 ISSUED BY THE 6TH RESPONDENT TO THE PETITIONER.**