M.P. SHIKSHAK CONGRESS AND ORS.versusR.P.F. COMMISSIONER, JABALPUR AND ORS.

A                  M.P. SHIKSHAK CONGRESS AND ORS.
                                  v.
               R.P.F. COMMISSIONER, JABALPUR AND ORS.

                               DECEMBER I, 1998

B            [SUJATA V. MANOHAR AND G.B. PATTANAIK, JJ.]


         Constitution of India, 1950; Article 254

          Central law-State /aw-Repugnancy-App/icabi/ity of Article
C   254(2)-Conditionfor-There must be a repugnancy between any provision
    ofa State law and any provision of an earlier existing law made by Parliament.

        M.P. Ashaskiya Sikshan Sansthan (Adhyapekon Tatha Anya
    Karamchariyon Ke Vetano Ka Sandaya) Adhiniyam, 1978: Section 5(2).

D         Employees' Provident Fund and miscellaneous Provisions Act, 1952:
    Sections 1(3) (b) and 16(1) (b) (As amended with effect from 1.8.1988).

          State of Madhya Pradesh-Aided Schools-Teachers and Emp/oyees-
    Regiona/ Provident Fund Commissioner--Order directing the appellant to
    deposit contribution of employers as well as employees from 1.8.82 to
E   1.12.88-Writ challenging order-Dismissal by High Court-Appeal before
    Supreme Court-Plea of repugnancy between State and Central Act-Held ·
    in the present case, when the Madhya Pradesh Act of 1978 was enacted,
    there was no repugnancy between that State Act and the Employees Provident
    Fund and Miscellaneous Provisions Act of 1952 already enacted by
    Parliament-The Parliamentary Act did not apply to educational
F   institutions-The State Act dealt with salaries and other ancillary matters
    governing certain educational institutions-Therefore, there was no
    repugnancy between the earlier Parliamentary legislation and the late State
    legislation-There was no question, therefore, of the State Act prevailing
    over the Parliamentary Act of 1952-Infact, quite clearly the Central Act did
G   not apply to educational institutions either in the State of Madhya Pradesh
    or anywhere else-The Employees' Provident Fund and Miscellaneous
    Provisions Act. 1952 became applicable to educational institutions in the
    State of Madhya pradesh for the first time on 6th of March, 1982-This was
    much later than the enactment of the State Act of 1978-The Parliamentary
    enactment, therefore, would prevail over the State Act of 1978-For the
H                                        198
        M.P. SHIKSHAK CONGRESS v. R.P.F. COMMR. JABALPUR                  199
 period 1st August, 1982 to 1st August, 1988 the Employees' Provident Fund A
 Act was applicable to such teachers and employees of the aided schools in
 the State of Madhya Pradesh who are covered by the provisions of the
 scheme framed thereunder-The order of the Regional Provident Fund
 Commissioner, therefore; in so far as the orders cover the period 1st August,
 1982 to isl August, 1988 are valid-For the limited purpose of examining B
 whether for the period 1st of August 1988 to isl of December, 1988 the
 provisions of Employees' Provident Fund and Miscellaneous Provisions Act.
 1952 are applicable to the concerned institutions-The matter referred to
 Regional Provident Fund Commissioner.

       Doctrine of pith and substance-Applicability of
                                                                                  c
      Pt. Rishikesh & Anr. v. Sa/ma Begum (Smt.), [1995] 4 SCC 718, held
 inapplicable.

      CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 3969-70
 of 1994.
                                                                                  D
      From the Judgment and Order dated 15.4.93 of the Madhya Pradesh
 High Court in M.P.Nos. 1555 and 3040of1991.

       S.K. Mehta, C.L. Sahu and Ms. Shobha for the Appellants.

      Ms. Kamareshwari, Praveen Swarup, Ms. Anil Katiyar, (Mrs. Madhur            E
 Dadlani and S.K. Agnihotri for the Respondents.

       The Order of the Court was delivered by

        The present appeals arise from the judgments and orders of the Madhya
  Pradesh High Court under which the High Court has upheld the orders of the
  Regional Provident Fund Commissioner dated 24th of April, 1991 and 15th of      F
  July, 1991 directing the employer concerned, being the schools mentioned in
  the said orders, to deposit, the contribution of the employees as well as the
  employers to the provident fund constituted under the Employees' Provident
  Fund and Miscellaneous Provisions Act, 1952, for the period I st August,
  1982 to I st December, 1988. The writ petitions filed by the appellants to      G
  challenge these orders have been dismissed by the High Court. The appellants
  have filed the present appeals in a representative capacity on behalf of the
  teachers and other employees of various private but aided schools in the
' State of Madhya Pradesh.

       In the State of Madhya Pradesh, under the Central Provinces and Berar      H
    200                     SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

A Education Manual, 1928, in Appendix XVIII there was a scheme constituting
    a provident fund for teachers in non-pensionable service, under Rule 3 of
    Appendix XVIII the proportion of contribution to be paid by the teachers was
    specified, while under Rule 4, contribution by the Government and by the
    management of the school to the Provident Fund was also specified. Rule 6
B   dealt with the management of the Contributory Provident Fund.

          In 1978, the Madhya Pradesh Act 20 of 1978 was promulgated known
    as the Madhya Pradesh Ashaskiya Sikshan Sanstha (Adhyapakon Tatha
    Anya Karmchariyon ke vetano ka Sandaya) Adhiniyam, 1978. The preamble
    of the Act states that it is an act to make provision for regulating payment
C   of salaries to teachers and other employees of Non-Government Schools
    receiving grant-in-aid from the State Government and Non-Government
    Educational Institutions for High Education receiving grants from the Madhya
    Pradesh Uchcha Shiksha Anudan Ayog and other matters ancillary thereto.
    The Act was, therefore, basically meant to regulate payment of salaries to the
    employees of the Institutions covered by that Act.
D
           Under Section 5 of the said Act 1978 and institutional fund was
    constituted for payment of salary to the teachers. The section prescribes the
    amounts which have to be deposited in the institutional fund. Under Section
    5(2), the State Government or the Ayog, as the case may be, was required to
    place to the credit of the institution fund, in advance, such sums as may be
E   required for the payment of salary to teachers and employees of the institution
    including the institutions contribution to the provident fund accounts at the
    rate at which it was required to make such contribution under any enactment
    for the time being in fore<:. Therefore, the amount which was required to be
    contributed as the institutions' contribution to any provident fund, was now
F   required to be deposited in the institutional fund. The Act of 1978 did not
    prescribe any scheme for provident fund as such.

          Therefore, the existing scheme for contributory provident fund under
    the Central Provinces and Berar Educational Manual, 1928 continued to remain
    in force except that the institution's contribution was now required to be
G   deposited in the institutional fund. The Rules framed in 1978 under the said
    Act 1978 also did not set up any new scheme for contributory provident fund.

          The Rule of 1978 also did not prescribe any rate of contribution to a
    contributory provident fund. The Rules of 1978 were, however, replaced by
    the Ashasiya Shikshan Sanstha Institutional Fund Rules, 1983. Under these
H   Rules, for the first time, specific provisions were made under Rule 8 for
       M.P. SHIKSHAK CONGRESS v. R.P.F. COMMR. JABALPUR                 201
opening of accounts for deposit of salary and teachers' contribution to the     A
provident fund. Under Rule I 0, the deductions to be made, inter alia, in
respect of provident fund were also required to be set out in the statement
in Form IV prescribed under the Rules and the amounts had to be dealt with
as prescribed under those Rules. Sub-rule (6) of Rule I 0, however, was as
follows:
                                                                                B
       "10(6) :Notwithstanding anything contained in rules 8,9 and this rule;
       where the provisions of the Employees Provident Fund and
       Miscellaneous Provisions Act, 1952 (No. 19 of 1952) apply to the
       teachers and other employees of any institution, the Provident Fund
       account and other record relating thereto shall be maintained in
       accordance with the provisions ?f the said Act."                         C
       In 1952, much prior to the Madhya Pradesh Act 20 of 1978, the
Employees' Provident Fund and Miscellaneous Provisions Act, 1952 was
promulgated by the Central Government. The said Act, however, initially did
not apply to educational institutions. Hence the teachers and employees of
the aided schools in Madhya Pradesh remained under the Contributory D
Provident scheme of the Central Provinces and Berar Educational Manual.
Even after the Madhya Pradesh Act 20 of 1978 came into force, the same
scheme continued with the modification set out above. However, by
Notification dated 19.2.1982 which came into effect on its publication in the
Gazette of India dated 6th of March, 1982, in exercise of powers conferred by E
Section 1(3 )(b) of the Employees' Provident Fund and Miscellaneous
Provisions Act, the Central Government specified certain classes of
establishments in which 20 or more persons were employed, as covered by
the said Central Act of 1952. The establishments so covered included any
College whether or not affiliated with the University, as also any School
whether or not recognised or aided by the Central or the State Government. F
It also covered any other institution in which the activity of imparting
knowledge or training was carried on. By virtue of this Notification, therefore,
from 6th of March 1982, the Employees' Provident Fund and Miscellaneous
Provisions Act, 1952 became applicable, inter alia, to the aided schools of the
 State of Madhya Pradesh.
                                                                                G
     Thereafter, by an amendment to Section 16(1)(b) of the Employees'
Provident Fund and Miscellaneous Provisions Act, 1952 made on Ist of
August, 1988, it was provided as follows :
      "Section 16(1): The Act shall not apply-
        (b)   to any other establishment belonging to or under the control of   fl
     202                     SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

·A                the Central Government or a State Government and whose
                  employees are entitled to the benefit of contributory provident
                  fund or old age pension in accordance with any scheme or rule
                  framed by the Central Government or the State Government
                  governing such benefits; ......"
B          We have to examine whether, by the amendment of Section 16(I)(b),
     with, effect from !st of August, 1988, the Employees' Provident Fund and
     Miscellaneous Provisions Act, 1952 ceased to apply to the employees and
     teachers of the aided schools of the State of Madhya Pradesh. The respondents
     contend that in any event, the said Central Act of 1952 was applicable to all
C    teachers and employees of the aided schools in the State of Madhya Pradesh
     from 6th of March, 1982 till I st August, 1988.

            The appellants, however, contend that the Central Act, that is to say,
     the Employees' Provident Fund and Miscellaneous Provisions Act, 1952 is
     not applicable to the aided schools of the State of Madhya Pradesh. They
D    contend that the Central Act was a prior Act existing at the time when the
     State Act 20 of 1978 came into force. The State Act of 1978 had received ihe
     assent of the President. Hence under Article 254(2) of the Constitution, in the
     State of Madhya Pradesh, Act 20of1978 would prevail over the Employees'
     Provident Fund and Miscellaneous Provisions Act 1952. This argument is
E    fallacious. Under Article 254( 1) of the Constitution, if any provision of a law
     made by the legislature of a State is repugnant to any provision of a law made
     by Parliament, which Parliament is competent to enact, then subject to the
     provisions of clause (2), the law made by the Parliament, whether passed
     before or after the law made by the legislature of such State, shall prevail and
     the law made by the legislature of the State shall, to the extent of the
F    repugnancy, be void. The ordinary rule, therefore, is that when both the State
     legislature as well as Parliament are competent to enact a law on a given
     subject, it is the law made by Parliament which will prevail. The exception
     which is carved out is under clause (2) of Article 254. Under this clause (2)
     where a law made by the legislature of a State with respect to one of the
G    matters enumerated in the Concurrent List contains any provision repugnant
     to the provisions of an earlier law made by Parliament, then the law so made
     by the legislature of such State shall, if it has been reserved for the
     consideration of the President and has received his assent, prevail in the
     State. Provided that nothing in this clause shall prevent Parliament from
     enacting at any time any law with respect to the same matter including a law
H    adding to, amending, varying or repealing the law so made by the legislature
               M.P. SHIKSHAK CONGRESS v. R.P.F. COM MR. JABALPUR                    203

        of the State.                                                                       A
               Before clause (2) of Article 254 is attracted, there must be a repugnancy
        between any provision of a State law and any provision of an earlier existing
        law made by Parliament. In the present case, when the Madhya Pradesh Act
        20 of 1978 was enacted, there was no repugnancy between the Madhya
        Pradesh Act 20of1978 and the Employees' Provident Fund and Miscellaneous            B
        Provisions Act of I 952 already enacted by Parliament. The Parliamentary Act
        did not apply to educational institutions. The State Act dealt with salaries and
        other ancillary matters governing certain educational institutions. Therefore,
        there was no repugnancy between the earlier Parliamentary legislation and the
        late State legislation. There was no question, therefore, of the State Act          C
        prevailing over the Parliamentary Act of 1952. In fact, quite clearly the Central
        Act did not apply to educational institutions either in the State of Madhya
        Pradesh or anywhere else. Secondly, as the preamble and other provisions of
        the State Act 20 of 1978 show, the primary purpose of the State Act was to
        make provisions for regulating the payment of salaries to teachers and other        D
        employees of aided Non-Government schools. The Act did not even provide
         for any scheme for setting up a Provident Fund. The Act incidental required
        that the institutional contribution to any existing Provident Fund scheme
      / should be paid into the institutional fund set up under the said Act. Looking
        to the pith and substance of the State Act of 1978 also, it cannot be said that
         it in any way made provisions which were repugnant to the Employees                E
        Provident Fund and Miscellaneous Provisions Act, 1952.

              It was by reason of the Notification of 6th of March, 1982 that the
        Central Act was extended to educational institutions. The Employees' Provident
        Fund and Miscellaneous Provisions Act, 1952, therefore, became applicable
        to educational institutions in the State of Madhya Pradesh for the first time       F
        on 6th of March, 1982. This was much later than the enactment of the State
        Act 20 of 1978. The Parliamentary enactment, therefore, would prevail over
...     the State Act 20 or 1978," assuming that the State Act of 1978 created or
        affected any scheme for Provident Fund Article 254(2), therefore, has no
        application in the present case.                                                    G
              The Appellants, however, relied upon a decision of this Court in the
        case of Pt. Rishikesh & Anr. v. Sa/ma Begum (Smt.) [1995] ~ SCC 718 in which
        this Court said that if a law is made by Parliament at a given date, but is
        brought into force at a later date, then, if in the interregnum, a State law is
        made which has received the assent of the President the State law will prevail      H
    204                      SUPREME COURT REPORTS [1998] SUPP. 3 S.C.R.

A   because the law made by Parliament is an earlier law. This ratio has no
    application to the present case where the Act was already in force from
    inception. This law in force was not repugnant to the State Act when the
    State Act came into force. The Central Act however, in the present case, was
    appiled to educational institutions at a date later than the State Act. Hence
    the repugnancy arose only at a later date when the Central Act became
B   applicable to educational institutions. In such a situation, there can be no
    question of the application of Article 254(2) because the repugnancy arose
    later in point of time than the State Act. Moreover, in the present case, there
    is no question of repugnancy between the two Acts since the State Act of
    1978 does not provide for any Provident Fund Scheme.
c          However, after the application of the Employees' Provident Fund and
    Miscellaneous Provisions Act, 1952 to education institutions, in 1983 new
    Rules were framed by the State of Madhya Pradesh under Act 20 of 1978.
    These are referred to as the State Rules of 1983. Under the State Rules of 1983,
    for the · first time a scheme was set out for Contributory Provident Fund
D   covering the teachers and employees of aided school . The State Government,
    however, was conscious of the fact that the employees' Provident Fund and
    Miscellaneous Provisions Act, 1952 was applicable in the State of Madhya
    Pradesh. Therefore, by Rule 10(6) of the State Rules of 1983, it was provided
    that the scheme as set out in the State Rules of 1983 would not apply where
E   the provisions of the Employees' Provident Fund and Miscellaneous Provisions
    Act, 1952 apply. Clearly, therefore, far from there being any conflict between
    the State and the Central Legislation, the State Legislation by Rules framed
    in 1983 has excluded from the operation of the State scheme as framed under
    the 1983 rules, those employees to whom the Central Act applies.

F         In this view of the matter, there can be no doubt that for the period I st
    August, 1982 to I st August, 1988 the Employees' Provident Fund and
    Miscellaneous Provisions Act, 1952 was applicable to such teachers and
    employees of the aided schools in the State of Madhya Pradesh who are
    covered by the provisions of the scheme framed thereunder. The orders of
G   the Regional Provident, Fund Commissioner, therefore, in so far as the orders
    cover the period I st August, 1982 to I st August, 1988 are valid.

         The said orders, however, also refer to an additional period from I st of
    August, 1988 to 1st December, 1988. According to the appellants, on !st of
    August, 1988, by virtue of the amended Section 16(1)(b) of the Employees'
H   Provident Fund and Miscellaneous Provisions Act, 1952 coming into effect
         M.P. SHIKSHAK CONGRESS v. R.P.F. COMMR. JABALPUR                205

in the provisions of the 1952 Act are no longer applicable to them. Section     A
16(l}(b) provides that the 1952 Act will not apply to any establishment under
the control of the State Government whose employees are entitled to the
benefit of Contributory Provident Fund in accordance with any scheme framed
by the State Government conferring such benefits. Whether on I st of August,
1988, there was any scheme in existence of the State Government which           B
conferred Contributory Provident Fund benefit to the employees covered
earlier by the Central Act of 1952 or not is a matter which the Regional
Provident Fund Commissioner will have to examine if such a contention is
raised before him by the appellants.

      We, therefore, remit the matter to the concerned Regional Provident       C
Fund Commissioner only for the limited purpose of examining whether for the
period !st of August, 1988 to 1st of December, 1988 the provisions of
Employees' Provident Fund and Miscellaneous Provisions Act, 1952 are
applicable to the concerned institutions. The orders, however, for the period
I st August, 1982 to 1st August, 1988 are upheld.
                                                                                D
      The appeals are accordingly dismissed with the above modification.

T.N.A.                                                   Appeals dismissed.