This is a petition filed under Section 33 of the EOB Act, 1976 against the impugned demand & Show Cause Notice dated 24-6-1990 based on assessment of the respondent No.1 and No.2 for Rs.1,25,000.00 being contribution for the period July 1989 to April 1990 and Rs. 10,313.00 as statutory increase thereon.
2. Counsel of the petitioner contended that their Mill is newly constructed and most of the important sections of the Mill are still to be commissioned. Therefore required maximum strength of employees have not been engaged as compared to the other established Mills. The capital work remained in progress and the petitioners Mills started work for the first season 1990-91 on a very small scale. He further contended that job of construction and installation was assigned to the civil contractors.
3. On the point of assessm ent counsel of the petitioner contended that the Respondent has made assessm ent unilaterally without examining their books of accounts and also the basis of assessm ent was never disclosed to the petitioner. He further contended that assessment had not been made in accordance with the provisions of Section 12 of the EOB Act, 1976.
4. On the point of levy of statutory increase he contended that statutory increase has not been imposed according to Section 13 of the EOB Act read with the relevant Rules and Regulations.
5. With regard to recovery of contribution under the Land Revenue Act, the counsel of the petitioner contended that respondent No.2 issued the notice under Section 81 of the Land Revenue Act without determining the actual amount due and payable whereas no recovery can be affected under the Land Revenue Act as per authoritative pronouncement of the Honourable Supreme .Court of Pakistan published in PLD-1962-SC.
6. The representative of the respondent Institution contended that assessment of contribution on behalf of the Employees has been made on the lower side keeping in view of the fact that the Mill is newly constructed and production is not in its full capacity. Amount mentioned in the impugned demand, therefore, pertains to the period of construction and not for crushing season. The assessm ent has been made on permanent, temporary and daily paid staff. According to the petitioner engaged contractors executed entrusted civil construction assignments in connection with the raising factory building and Mills colonies which did not have direct link with the affairs of an industry/establishment are registered under the EOB Act as an independent employer.
7. On the point of assessm ent he contended that before issuing Demand Show Cause Notice dated 24-6-1990 assessm ent was communicated to the petition vide respondent letter dated 9-6-1990 wherein opportunity was provided to him to provide relevant books of accounts if he has any objection to the assessm ent of the respondent. But the petitioner failed to .Provide the books of accounts, hence, assessm ent was made by the respondent in accordance with the provisions of Section 12(3) of the EOB Act.
8. On the point of levy of statutory increase he contended that the increase has been levied according to the proviso of Section 13 of the EOB Act.
9. With regards to recovery of contribution as arrears of Land Revenue Act, the respondent contended that an opportunity was provided to the petitioner vide registered letter dated 9-6-1990 wherein he was clearly advised to get the assessed amount determined by showing the relevant record latest by 15-6-1990 failing which assessment shall be deemed to have been determined as the dues payable and recoverable under Section 13(2) of the EOB Act. Since the petitioner failed to comply with the instructions contained in the above letter dated 9-6-1990 the respondent No.2 issued the notice under Section 81 of the Land Revenue Act which is just and legal etc.
10. Since the impugned demand was based on assessment, therefore, a commission was constituted to determine the actual amount of contribution due and payable by the petitioner and also to establish the exact date of commencement of the petitioner's establishment. The commission after checking the record of the petitioner has submitted its report wherein the amount of contribution due and payable has been determined as Rs. 34,891.00 and Rs. 17,446.00 as statutory increase thereon for the period 14-2-1890 to 28-3-1990. The commission also established on the available documentary evidence that the Mill was started on trial basis on 14-2-1990. Report of the' commission was provided to the petitioner counsel who did not file any objection on the report. However, requested to waive the statutory increase.
11. After hearing both the parties and examining .The case file I come to the conclusion that job of construction of building and colonies executed by the civil contractors is not considered directly links up with the affairs of an industry or establishment as envisaged in Section 2(bb) of the EOB Act. Petitioner is, therefore, not liable to pay contribution on behalf of such civil contractors. On the basis of commission's report I hold that the determined amount of contribution actually due and payable by the petitioner is Rs. 34,891.00 and Rs. 17,446.00 as statutory increase thereon and the impugned demand of Rs. 1,25,000.00 being, contribution for the period 7489 to 4/90 and Rs.
10,313.00 as statutory increase thereon was improperly raised. Accordingly, I set aside the impugned demand. The petitioner may approach the authority competent to waite the statutory increase within 30 days of the Order.
Given under my hand and seal of the Authority on this 6th day of August, 1 1992.