Case Note & Summary
The petitioner, Tata Consultancy Services Ltd., challenged the decision of the Regional Provident Fund Commissioner and the Appellate Tribunal that it was covered under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 by virtue of a notification dated 17th May 1971. The notification extended the Act to every establishment rendering expert services such as supplying of personnel, advice on domestic or departmental enquiries, special services in rectifying pilferage, thefts and pay roll irregularities to factories and establishments, employing 20 or more persons. The petitioner argued that the words 'expert services' are followed by 'such as', which indicates that only establishments analogous to those specifically listed are covered. The court agreed, holding that while 'such as' is illustrative and not exhaustive, the principle of ejusdem generis applies, and the establishment must render expert services of the type adverted to in the notification. The court found that the business activities of Tata Consultancy Services, being computer consultancy, are not of the same nature as the listed services. The court allowed the petition, setting aside the orders of the authorities below.
Headnote
A) Employees' Provident Funds - Coverage of Establishments - Notification under Section 1(3)(b) - Interpretation of 'expert services' - The notification dated 17th May 1971 extended the Act to 'every establishment rendering expert services such as supplying of personnel, advice on domestic or departmental enquiries, special services in rectifying pilferage, thefts and pay roll irregularities to factories and establishments' employing 20 or more persons. The court held that the expression 'such as' is illustrative but the establishments must be analogous to those specifically listed. Computer consultancy services are not of the same nature as the listed services. (Paras 1-3)
B) Employees' Provident Funds - Ejusdem Generis - Application to Notification - The principle of ejusdem generis applies to the notification, requiring that the expert services rendered must be of the same kind as those exemplified. The court relied on Royal Hatcheries Pvt. Ltd. vs. State of A.P., Central Bank of India vs. Ravindra, and Bombay Municipal Corporation vs. Daily Taj Pvt. Ltd. (Paras 3)
C) Employees' Provident Funds - Tata Consultancy Services - Not Covered - The nature of business activities of the petitioner, being computer consultancy, does not fall within the type of expert services contemplated by the notification. The petition was allowed. (Paras 3)
Issue of Consideration
Whether Tata Consultancy Services Ltd., a computer consultancy firm, falls within the purview of the notification dated 17th May 1971 extending the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 to establishments rendering expert services such as supplying personnel, advice on domestic enquiries, special services in rectifying pilferage, thefts and pay roll irregularities.
Final Decision
The court allowed the writ petition, holding that the nature of business activities carried on by the petitioner does not fall within the purview of the type of expert services brought within the scope of the notification dated 17th May 1971. The orders of the authorities below were set aside.
Law Points
- Interpretation of notification under Section 1(3)(b) of Employees' Provident Funds and Miscellaneous Provisions Act
- 1952
- 'such as' is illustrative but ejusdem generis applies
- establishment must render expert services of the type specified
Case Details
2006 LawText (BOM) (06) 6
WRIT PETITION NO.1246 OF 2005
Mr.K. M. Naik with Mr. S. P. Salkar for the Petitioner, Mr.M. S. Karnik for Respondent No.1
Tata Consultancy Services Ltd.
The Regional Provident Fund Commissioner & Ors.
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Nature of Litigation
Writ petition under Article 226 of the Constitution of India challenging the decision of the Regional Provident Fund Commissioner and the Appellate Tribunal that the petitioner is covered under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 by virtue of a notification dated 17th May 1971.
Remedy Sought
The petitioner sought to quash the orders of the authorities below and declare that it is not covered under the Act.
Filing Reason
The petitioner disputed the interpretation of the notification dated 17th May 1971 which extended the Act to establishments rendering expert services.
Previous Decisions
The adjudicating authorities under the Act and the Appellate Tribunal held that Tata Consultancy Services Ltd. meets the description of an organization rendering expert services within the meaning of the notification.
Issues
Whether the notification dated 17th May 1971 covers any and every establishment rendering expert services or only those analogous to the specifically listed establishments.
Whether Tata Consultancy Services Ltd. falls within the purview of the notification.
Submissions/Arguments
The petitioner argued that the words 'expert services' are followed by 'such as', which indicates that only establishments analogous to those specifically listed (supplying personnel, advice on enquiries, special services in rectifying pilferage etc.) are covered.
The respondent contended that the expression 'such as' is illustrative and not exhaustive, and therefore any establishment rendering expert services is covered.
Ratio Decidendi
The expression 'such as' in the notification is illustrative but the principle of ejusdem generis applies, requiring that the expert services rendered must be of the same kind as those exemplified. Computer consultancy services are not analogous to the listed services such as supplying personnel, advice on domestic enquiries, or special services in rectifying pilferage, thefts and pay roll irregularities.
Judgment Excerpts
The issue which arises in these proceedings under Article 226 of the Constitution of India turns upon the interpretation of a notification issued by the Central Government in the exercise of the power conferred by Section 1(3)(b) of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952.
The question before the Court is whether any and every establishment rendering expert services is within the purview of the notification dated 17th May 1971 or whether, as submitted by the Petitioner, establishments analogous to those which have specifically been listed out would fall within the purview of the notification.
The conclusion that has been arrived at in this judgment is that the nature of the business activities that are carried on by the Petitioner does not fall within the purview of the type of expert services brought within the scope of the notification dated 17th May 1971.
Procedural History
The adjudicating authorities under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and the Appellate Tribunal held that Tata Consultancy Services Ltd. is covered under the Act by virtue of the notification dated 17th May 1971. The petitioner challenged these decisions by filing a writ petition under Article 226 of the Constitution of India before the Bombay High Court.
Acts & Sections
- Employees' Provident Funds and Miscellaneous Provisions Act, 1952: Section 1(3)(b)
- Constitution of India: Article 226
