' IRSHAD HASAN KHAN, J.---This appeal, with the leave of the Court, is directed against the judgment of the Lahore High Court, Lahore, dated 6th April, 1995, dismissing the Writ Petition No,4335 of 1994.
2. The brief facts are that the Inspection Team of the Employees' Old-Age Benefits Institution, Lahore, South Region, created under the provisions of Employees' Old-Age Benefits Act, 1976 (hereinafter referred to as the Act), visited the appellant's establishment in January, 1992 and after checking their wages/salaries record for the period commencing from July, 1988 to June, 1991, found that the appellant was not making payment of the employees' contribution under the Act in respect of wages paid to the workers on daily wages. In consequence, a demand notice for the recovery of Rs,88,185 inclusive of 50% statutory increase of Rs,29,395, was issued to them.
3. The appellant resisted the demand notice before the Adjudicating Authority/respondent No,2 herein, on the ground that the appellant-Club has been paying Eniployees' Old-Age Benefits Contribution regularly in respect of all its regular employees covered by the Act but the demand raised by the respondent-Institution related to payments made to individuals who were engaged for three to four hours only on race days i.e, Thursdays and Sundays or on substituted race days and that too when race is being held. It was urged that these individuals may vary from one race day to another and none of these individuals worked for the Club on regular basis. It was further urged that these individuals did not work for more than three to four hours on the race day and were not granted leave, medical or other facilities.
4. The Adjudicating Authority vide order dated 12-11-1992, after appreciating the evidence on record, recorded a finding that the employees engaged by the appellant even on daily or hourly basis were its employees within the ambit of section 2(bb) of the Act, therefore, the appellant was liable to pay the contribution as demanded by the respondent-Institution.
5. Being dissatisfied with the said order, the appellant preferred an appeal before respondent No,3, which was dismissed vide decision dated 25-8-1993. Constitutional petition filed by the appellant to challenge the aforesaid decisions was also dismissed by the learned High Court vide impugned judgment.
6. Leave to appeal was granted to consider the only question as to whether the appellant is liable to pay the contribution in respect of persons who were employed for three or four hours only on two days of the week when the races were organized by the appellant.
7. The controversy involved herein revolves on the definition of the term "employee" as given in section 2(bb) of the Act which reads thus:-- 'employee' means any person employed, whether directly or through any other person, for wages or otherwise, to do any skilled or unskilled, supervisory, clerical, manual or other work in or in connection with the affairs of an industry or establishment, under a contract of service or apprenticeship, whether written or oral, express or implied, and includes such person when laid off:"
8. The word " employer" is defined in section 2(c) of the Act, which reads thus:-- 'employer' in relation to an industry or establishment, means any person who employs, either directly or through any other person, any employee, and includes---
(i) in the case of an individual, an heir, successor, administrator or assign;
(ii) a person who has ultimate control over the affairs of an industry or establishment, or where the affairs of an industry or establishment are entrusted to any other person (whether called a managing agent, managing director, a manager, superintendent, secretary or by any other name), such other person; and ' Section 3 of the Act provides that all employees in an industry or establishment shall be insured in the manner prescribed by or under this Act.
9. Regulation 8 of the Employees' Old-Age Benefits (General) Regulations, 1980, provides:--- "(1) Every employer is liable and shall so remain liable to pay the contribution in the manner prescribed in the Rules and Regulations.
(2) The liability of the employer to pay contributions in such manner shall not be extinguished by or depend upon any demand, written or oral being made by the Institution in that behalf."
10. Subject of contribution is dealt with in Chapter 3 of the Act. Section 9 relating to rates and assessm ent of contribution payable by the employer is to the following effect:-- "(1) On and from the first day of July, 1976, contributions shall be payable every month by the employer to the Institution in respect of every person in his insurable employment, at the rate of five per cent. Of his wages in the prescribed manner: ' Provided that no contribution shall be payable on so much of an insured person's wages as is in,acess of (three thousand) rupees: ' Provided further that no contribution shall be payable in respect of an insured person who is in receipt of pension under this Act or has attained the age of sixty years or fifty-five years in the case of a woman.
(2) Where an insured person does not receive any wages from the employer for any period, the Institution shall, subject to regulations, determine the amount of wages with reference to which the contributions shall be computed.
(3) Notwithstanding any agreement to the contrary, the employer shall not deduct from the wages of an insured person or otherwise recover from him any portion of contribution.
(4) Where the mode of payment of remuneration, whether in cash or in kind, makes it difficult to determine the amount of wages for computing the contribution, the Institution may, subject to regulations, determine such wages.
' Section 9-A lays down:--- "On and from the first day of July, 1986, contribution shall be payable every quarter by the Federal Government to the Institution in respect of every insured person at the rate of five per cent. Of his wages in the prescribed manner: ' Provided that no contribution shall be payable on so much of an insured person's wages as is in excess of (three thousand) rupees: ' Provided further that no contribution shall be payable in respect of an insured person who is in receipt of pension under this Act or has attained the age of sixty years, or fifty-five years in the case of a woman.
' Section 10 lays down that:--- "Every employer shall keep such records and shall submit to the Institution such returns, at such times, in such form and containing such particulars relating to persons employed by him, as may be provided in regulations.
' Under section 11 it is incumbent upon the employer to communicate to the Institution the name and other prescribed particulars of the Industry or Establishment and of every insured person employed in the Industry or Establishment.
11. Section 12 makes provision for enabling any officials of the Institution, duly authorized by a certificate in a form specified in the Regulations, may, for the purpose of inquiring into the correctness of any of the particulars stated in the records or returns referred to in section 10 or for the purpose of ascertaining whether any of the provisions of this Act have been complied with or not.
' Section 13 of the Act introduces a penal provision that if any employer fails to pay, on the due date, the contribution payable by him under subsection (1) of section 9, the amount so payable by him shall be increased by such percentage or amount as may be prescribed. It further enables the recovery of arrears of contribution as arrears of land revenue. The provisions of section 13 are supplemented by penal provisions contained in section 37 thereof according to which non-making of contribution is an offence punishable with imprisonment which may extend to two years, or with fine which may extend to ten thousand rupees, or with both.
12. A perusal of the above provisions of the Act and Regulation therein establishes beyond doubt that the employer liable to contribution of all the insured workers and his failure to pay result in imposition of penalty by way of increase in amount payable and also the prosecution before a criminal Court. The question whether one is an employee or not within the ambit of section 2(bb), will depend upon the facts and circumstances of each case.
13. A bare reading of the definition of the term "employee" as given in section 2(bb) when read alongwith other provisions of the Act and the relevant Regulations, lead to the irresistible conclusion that definition of the term "employee" means any person in the service of an Industry or Establishment whether employed directly or indirectly for wages or otherwise under a contract of service or apprenticeship, whether written or oral, express or implied, including such person that are laid off, if he is required to do any skilled, unskilled, supervisory, clerical, manual or other work.
14. The definition of the term "employee" does not exclude from its operation the part-time employees engaged in one's service for wages or otherwise. Only such persons are excluded from the provisions of the Act who fall within the purview of clause (f) to section 47 of the Act which reads thus:-- "persons in the service of statutory bodies other than those employed in or in connection with the affairs of a factory (as defined in) section 2(j) of the Factories Act, 1934 (XXV of 1934), (or a mine as defined in the) Mines Act, 1923 (IV of 1923): "Provided that workshops maintained exclusively for the purposes of repair or maintenance of equipment or vehicles used in such statutory bodies shall not be treated as factories for the purposes of this clause:"
15. The persons in dispute employed by the appellant were admittedly entrusted with some work in connection with the business of the appellant. It is not disputed that the nature of work performed by them falls within the category of work specified under section 2(bb). Contribution is resisted only on the ground that they were part-timers. If the Legislature intended that the definition of employee shall not apply to a person who is employed by the employer in his establishment/industry on part-time basis it would have so provided in the statute. Section 2(bb) does not say that it would only apply to persons who are engaged by the employer in his establishment/industry on whole time basis. The number of working hours/days simpliciter, for which a person is engaged in an establishment/industry, by the employer is not a test to determine his status as employee under the definition clause. Section 47(f) is the only exception clause, which excludes applicability of the Act on certain persons specified therein. Part-time employees do not find mention in section 47(f) as is apparent from a bare reading thereof. The liability of the employer to pay contribution is independent of the entitlement of the ensured persons to claim benefit, with reference to their length of service in insurable employment under sections 22(0ld- Age Pension), 22-A (Old-Age grant), 22-B (Survivors' pension) and section 23 (Invalidity Pension) of the Act and is not subject to provisions contained in above sections.
16. Needless to observe that the Act is not a fiscal statute but is beneficial and remedial one, which is intended to provide security and benefit to old age employees of Industrial, Commercial and other organizations and is, therefore, to be construed liberally.
17. In discovering whether any amount payable as wages is liable to contribution, first it is to be seen whether the employee falls within the definition of section 2(bb) and thereafter, liability of contribution should be determined in accordance with section 9 read with other provisions of the Act. Here, the persons in respect of whom contribution is demanded, have been rightly found to be employees in terms of section 2(bb) of the Act by the Courts below. The mere fact that the disputed employees were working on part-time basis could not be a valid reason for excluding them from the category of employees as envisaged by section 2(bb) of the Act. The appellant is, therefore, not absolved from the liability to pay contribution under the Act, as demanded by the Institution.
18. We, therefore, find no merit in this appeal which is hereby dismissed with no order as to costs.