2006 (2) TMI 634 - SC - Indian Laws

Whether Act 10 of 1998 seeking to amend provisions of Section 16 of the Employees Provident Fund and Miscellaneous Provisions Act, 1952 shall not apply to the writ petitioners and they would continue to have the infancy protection for the period of 3 years starting from the date of establishment of the industry?

Summary

Issues Involved
1. Applicability of Act 10 of 1998 amending Section 16 of the Employees Provident Fund and Miscellaneous Provisions Act, 1952.
2. Entitlement of appellants to "infancy protection" for three years from the date of establishment.
3. Retrospective effect of the amendment on existing rights.

Issue-Wise Detailed Analysis

1. Applicability of Act 10 of 1998 Amending Section 16 of the Employees Provident Fund and Miscellaneous Provisions Act, 1952
The appellants challenged the Division Bench of the Andhra Pradesh High Court's decision dismissing their writ petitions. They sought a writ of mandamus to declare that Act 10 of 1998, which amended Section 16, should not apply to them, and they should continue to benefit from the "infancy protection" for three years from the date of establishment. The High Court ruled that the amendment aimed to treat all establishments equally under the Act, removing any exemptions, including the infancy protection, effective from the date of the amendment.

2. Entitlement of Appellants to "Infancy Protection" for Three Years from the Date of Establishment
The appellants argued that under the un-amended provisions of Section 16, they were entitled to the infancy protection for three years. The factual scenario provided dates of establishment and the balance of the infancy period each appellant claimed. The High Court held that with the deletion of clause (d) of Section 16, the Act applied to all establishments from 22.9.1997, nullifying any existing infancy protection.

3. Retrospective Effect of the Amendment on Existing Rights
The Supreme Court examined whether the amendment affected the existing rights of the appellants. Citing precedents, the Court noted that unless a statute explicitly states or necessarily implies retrospective operation, it should not be interpreted to impair existing rights. The Court referred to several cases, including Jayantilal Amratlal v. Union of India, Govinddas v. Income Tax Officer, and Magic Wash Industries (P) Ltd v. Assistant Provident Fund Commissioner, emphasizing that vested rights should not be taken away without clear legislative intent.

The Court also discussed Section 6 of the General Clauses Act, 1897, which protects rights, privileges, obligations, or liabilities acquired under repealed enactments unless a different intention appears. The Court concluded that the amendment did not express an intention to retrospectively affect the existing rights of the appellants.

Conclusion
The Supreme Court found the High Court's judgments indefensible and set them aside. It ruled that the appellants were entitled to the protection of the infancy period for three years from the date of establishment, as accrued before the 1997 amendment. The appeals were accordingly allowed, with no costs awarded.