In Brief
A grant-in-aid educational school run by the appellant, governed by State law and receiving 100% financial support and regulatory oversight from the State Government, is exempt from the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 under Section 16(1)(b). The Court held that once an establishment qualifies for exemption, it enjoys complete exemption for all purposes and all employees. Central authorities cannot proceed against such an establishment merely because a small number of part-time employees do not qualify for the State Contributory Provident Fund Scheme. The exemption is not partial or employee-specific; it protects the entire establishment. The appeal was allowed and all recovery proceedings initiated under the Central Act were set aside.
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