Engaged In Selling And Repairing Electrical Goods Falls In Definition Of “Factory” And “Manufacturing Process”: SC

07 May 2024 8:19 AM

By: Admin

In a significant ruling, the Supreme Court of India has affirmed the interpretation of the definitions of “Factory” and “manufacturing process” under the Employees State Insurance Act and the Factories Act. The case, which saw M/S J.P.LIGHTS INDIA pitted against The Regional Director E.S.I. Corporation, Bangalore, centered around the classification of the appellant’s business activities under these definitions.

The Bench, comprising of Hon’ble Ms. Justice Hima Kohli and Hon’ble Mr. Justice Rajesh Bindal, delivered the verdict on July 27^th, 2023. The appellant, a sole proprietorship firm, challenged the dismissal of its appeal against the order of the Employees State Insurance Court.

The Court’s judgment extensively explored the terms “Factory” and “manufacturing process,” citing Sections 2(12), 2(14AA) of the Employees State Insurance Act, and Section 2(k) of the Factories Act. The Bench clarified the conditions that define a premises as a “Factory” and the scope of a “manufacturing process.”

In the crucial observation, the Court confirmed that the appellant-firm, engaged in selling and repairing electrical goods, using electrical energy, fell within the definition of a “Factory” and was involved in a “manufacturing process” under both statutes. The ruling upheld the impugned judgment, emphasizing its alignment with statutory provisions.

The Court concluded by dismissing the appeal as meritless, with each party bearing its own expenses. This judgment not only solidifies the legal understanding of these definitions but also sheds light on the application of statutory provisions to specific business scenarios.

Date of Decision: 27th July, 2023

M/S J.P.LIGHTS INDIA vs THE REGIONAL DIRECTOR E.S.I. CORPORATION, BANGALORE