The Kerala High Court has affirmed that repairing three-wheelers using power with a workforce of over ten persons constitutes a manufacturing process under the Factories Act, 1948. While upholding the conviction of the accused for violations under Section 92, the Court reduced the sentence of imprisonment, holding it disproportionate to the nature of the offence. The judgment clarifies the scope of "manufacturing process" under Section 2(k) and reinforces the applicability of the Act to small-scale repair workshops.
The Verdict
The petitioners were convicted under Section 92 of the Factories Act, 1948 for failing to test a pressure vessel and maintain a muster roll. The Kerala High Court upheld the conviction, confirming that their repair workshop qualified as a factory under Section 2(m). However, the Court set aside the six-month simple imprisonment as disproportionate and substituted it with a fine of Rs.10,000 each, with three months’ imprisonment in default of payment.
Background & Facts
The petitioners operated a business under the name M/s Vinayaka Prime Vehicles (Pvt.) Ltd. at Muttathara, Thiruvananthapuram, where 22 workers were engaged in repairing and servicing three-wheelers. On 24 December 2012, an Inspector of Factories and Boilers conducted an inspection and found two violations: failure to hydrostatically test the air receiver of an air compressor, as required under Rule 74 of the Factories Rules, 1957, and failure to maintain a muster roll in Form No.25. The petitioners did not respond to the show cause notice issued on 22 January 2013.
A criminal complaint was filed under Section 92 of the Factories Act, which penalizes contravention of provisions of the Act or Rules. The Judicial Magistrate of First Class-II, Thiruvananthapuram, convicted the petitioners after examining the Inspector as PW1 and admitting ten prosecution documents. The petitioners examined one defence witness and submitted two documents. The Magistrate sentenced them to six months’ simple imprisonment and a fine of Rs.10,000 each.
The petitioners appealed to the Additional Sessions Court, which dismissed the appeal, affirming the conviction and sentence. Aggrieved, they filed a criminal revision petition before the Kerala High Court. The petitioners failed to appear on multiple dates, and notices were returned unserved. The Court appointed an Amicus Curiae to represent their interests.
The Legal Issue
The central legal question was whether repairing and servicing three-wheelers by a workforce of more than ten persons, using power, constitutes a "manufacturing process" under Section 2(k) of the Factories Act, 1948, thereby bringing the establishment within the definition of a "factory" under Section 2(m).
Arguments Presented
For the Petitioner
The Amicus Curiae contended that the establishment was not a factory as defined under the Act. It was argued that repairing three-wheelers amounted to maintenance or servicing, not manufacturing. The Amicus relied on judicial precedents distinguishing repair work from manufacturing, emphasizing that no new article was created or substantially transformed. It was further submitted that the term "manufacturing process" must be interpreted narrowly to avoid overreach into small-scale repair units.
For the Respondent
The Public Prosecutor argued that the definition of "manufacturing process" under Section 2(k) explicitly includes "repairing" as one of the enumerated activities. The presence of 22 workers and the use of power for repair operations satisfied the twin conditions of Section 2(m)(i). The prosecution relied on the inspection report and the statutory language, asserting that the Act’s purpose is to ensure safety and welfare in all industrial premises, regardless of scale.
The Court's Analysis
The Court undertook a textual analysis of Sections 2(k) and 2(m) of the Factories Act, 1948. Section 2(k) defines manufacturing process as including "repairing" among other activities such as altering, cleaning, and packing. The Court held that the inclusion of "repairing" in the statutory definition is deliberate and unambiguous. The fact that the activity was carried out with the aid of power and involved more than ten workers squarely brought the establishment within the ambit of Section 2(m)(i).
"The repair and servicing of three-wheelers by employing 22 workers using power constitutes a manufacturing process under Section 2(k) of the Act. The statutory definition is inclusive and does not require the creation of a new article, only adaptation for use or disposal."
The Court rejected the petitioner’s argument that repair work is inherently non-manufacturing. It noted that the Act’s legislative intent is to cover all industrial premises where hazardous operations occur, irrespective of whether the output is new or refurbished. The Court emphasized that the courts below had correctly applied the law and that revision under Section 397 CrPC is not a forum to reappreciate evidence.
However, the Court exercised its discretion under Section 397 CrPC to modify the sentence. It observed that while the violations were technical in nature and posed no immediate public danger, the six-month imprisonment was excessive. The Court noted that Section 92 prescribes a maximum punishment of two years, but the nature of the offence - failure to maintain records and test equipment - did not warrant incarceration. The fine was deemed sufficient and proportionate.
What This Means For Similar Cases
This judgment has significant implications for small-scale repair workshops, garages, and service centers across India. Any such establishment employing ten or more workers using power for repairing vehicles, machinery, or equipment now falls squarely within the definition of a factory under the Factories Act. Employers must comply with mandatory requirements including hydrostatic testing of pressure vessels, maintenance of muster rolls, and adherence to safety norms.
Practitioners should advise clients in the automotive, mechanical, and industrial repair sectors to assess their workforce and power usage. Non-compliance may now attract criminal liability under Section 92. The judgment also signals judicial restraint in imposing imprisonment for technical violations of labour statutes, favouring fines where the risk to public safety is minimal. Future litigation may see challenges to the classification of other repair activities, but this ruling sets a clear precedent: repair is manufacturing under the Act if done with power and sufficient labour.
The Court’s reduction of sentence also provides a useful precedent for defence counsel seeking leniency in similar regulatory offences where the violation is procedural rather than hazardous.
