The Madras High Court has dismissed a batch of writ petitions challenging an order by the Puducherry Lt.Governor of June 24, 2005 notifying educational institutions wherein 20 or more persons are employed or were employed for wages on any day of the preceding 12 months, to be covered by ESI Act. The institutions included public, private, aided or partially aided schools run by individuals, trustees, societies or other organisations.
The petitioners contended that the Lt.Governor lacked legislative sanction for issuing the notification under the ESI Act. Only the Centre could issue the notification. Also, an educational institution could not be covered by the ESI Act as it was not an establishment within the meaning of the legislation.
Justice K. Chandru said inasmuch as the Administrator had acted on behalf of the President in terms of Art.239 in having issued the notification, no fault could be found. The impugned notification did not suffer from want of legislative sanction by the ESI Act. He said as held by the Allahabad and Kerala High Courts, the term establishment under section 1 (5) of the ESI Act would include every establishment which need not have the characteristics of industrial, commercial or agricultural establishments. Any establishment could be validly notified by the appropriate government to be covered by the Act.