Saikia J.:- This writ appeal is from a Single Bench Judg­ment allowing the writ petition of the first respondent M/S. Assam Ayurvedic Bhandar holding it not to be an establishment liable to contribute to the Employees' Provident Fund under the pro­visions of the Employees' Provident Fund and Family Pension Funds Act 1952 hereinafter referred to as "the Act." 2. The first respondent filed the writ petition impugning the order (said to have been passed on 27.6.75 ) of the Regi­onal Provident Fund Commissioner Assam in an enquiry under S. 7-A of the Act holding that the first respondent was liable to pay provident fund dues under the Act and the subsequent order dated 30.8.76 fixing its liability for the period from Octo­ber 1969 to July 1976 at Rs. 11 653. 30 (P) as the successor establishment of Shri Baidyanath Ayurved Bhawan Pvt. Ltd. hereinafter referred to as "the Baidyanaths". The first respondent denied the liability claiming to be a new establishment and not a successor of the Baidyanaths as alleged. The succession was sought to be brought he me by the appellants mainly on two grounds namely carrying on of the same business as that of Baidyanaths and that too in the same permises. It was cont­ended that as the Baidyanaths was an establishment Covered under the Act there being mere change of ownership the first respondent as successor was also covered. The contention of the first respondent was that" it was a new establishment carrying on the business of sale of the ayurvedic medicines manufactured by the Baidyanaths as its 'vasista' agent i.e. sole-distributor as per agreement between the two taking the same premises on new lease from the landlord. The appellants relying on section 16(1) and 17-B of the Act contended that there was a mere change of ownership from the Baidyanaths to the first respondent which was immatterial the establishment con­tinuing for the purpose of liability to pay provident fund con­tribution under the Act. Rejecting the contention the Hon'ble Single Judge having held the respondent No. 1 to be a new establishment and not a successor the appellants have appealed. 3. Mr. S. N. Chetia learned Addl. Rejecting the contention the Hon'ble Single Judge having held the respondent No. 1 to be a new establishment and not a successor the appellants have appealed. 3. Mr. S. N. Chetia learned Addl. Standing Counsel for the Union of India for the appellants submits inter alia that not only one but two enquiries were held under section 7 A of the Act wherein the Regional Provident Fund Commissioner Shri K. M. Bhatt has found as facts that the first respondent was coverable under the Act "as it has continued to carry on the same activities and at the same place where M/s. Baidyanath Ayurved Bhawan Pvt. Ltd. was located"; the case is that of change of ownership of the establishment; and that a change of ownership is not in any way material in applying the pro­visions of the Act; and as such the establishment should comply with the statutory provisions. Counsel submits that the Regional Provident Fund Commissioner on a consideration of the materi­als on record including the contention raised by the Provident Fund Inspector in his letter dated 23.6.75 and the materials filed by the first respondent held that the first respondent being a successor firm of the Baidyanaths was liable to continue to pay contribution under the Act which he subsequently assessed at Rs. 11.653.30 by order dated 30.8.76. This finding of fact according to counsel ought not to have been set aside by the impugned order. 4. Mr. Chetia takes us through the agreement between the Baidyanaths and the first respondent dated 11.11.68 wherein the first respondent agrees : To act as the 'vasista' agent of the Baidyanaths; to use the name and signboard of the Baidya­naths who will supply the medicines to be sold at the prices fixed by the Baidyanaths and will not sell medicines manufact­ured by any one else for 'vasista' agency commission @ Rs. 2 per cent; the Baidyanaths reserved the right to accept the man­agement of the shop if the first respondent does anything in contravention of the agreement. He submits that the first resp­ondent is merely an agent of the Baidyanaths and as such covered by the definition of employer in S. 2 (e) (ii) of the Act. 5. Mr. 2 per cent; the Baidyanaths reserved the right to accept the man­agement of the shop if the first respondent does anything in contravention of the agreement. He submits that the first resp­ondent is merely an agent of the Baidyanaths and as such covered by the definition of employer in S. 2 (e) (ii) of the Act. 5. Mr. J. Singh learned counsel appearing for the respondents supporting the impugned judgment submits inter-alia that the Assam Ayurvedic Bhandar is in no way a successor of the Baidya­naths in as-much-as the latter completely closed down its sale depot at Gauhati after issuing retrenchment notices to its workers and paying them compensation as per law. After sometime the first respondent contacted the Baidyanaths at Calcutta and obtained the 'vasista' agency or the sole distributorship as per terms of the agreement dated 11.11.68. It recruited its staff on fresh advertise­ment took the premises of course the same as occupied by the Baidyanaths on new lease from its landlord Bohitram Chowdhury as per new lease-deed. Counsel draws our attention to page 62 of the record wherein we find a notice dated October 4, 1963 issued for the Baidyadaths announcing their decision to close down their Gauhati sales Depot as they had found it impossible to continue and that closure would be effected to 00 hours on October 8 1968 and with that closure of the establisment the services of the workers would come to a close and they would be paid all the dues including the closure compensation as per provisions of section 25 FFF of the Industrial Dispute Act Mr. Singh states at the bar that labourers had not raised any indus­trial dispute in this regard Counsel further points out that in paras 3 and 4 of the writ petition the above facts were averred and those were not denied by the appellants in their counter. Mr. Singh also points out from the records several letters which subs­tantiate the above averments. 6. From the report of the Provident Fund Commissioner it appears that he considered the contentions raised by the Provident Fund Inspector in his letter dated 23rd June 1975. During the course of hearing the learned standing counsel for the Union of India was directed to submit entire records including the said letter. Again by our order dated 26.4.83 the direction was reiterated. During the course of hearing the learned standing counsel for the Union of India was directed to submit entire records including the said letter. Again by our order dated 26.4.83 the direction was reiterated. However this letter was not available with the records at the time of hearing and as such we are in the dark as to what were the contentions raised therein. We have therefore to rely on the other records to which our attention has been drawn by counsel. 7. The facts that transpire from the records as well as the affidavits filed in the Civil Rule and in this appeal are that the Baidyanaths was an establishment covered by the Act that the Baidyanaths closed their branch at Gauhati from 8/9 October 1968 that they retrenched their entire staff before closure of their branch by issuing them notices and paid them compen­sation according to law that the first respondent entered into an agreement of 'vasista' agency (sole distributorship) of the Baidyanaths on 1.11.68 that the Assam Ayurved Bhandar appointed its staff by fresh applications and new candidates that it took the same premises as were occupied by the Baidyanaths taking lease from the landlord by separate lease-deed and not from the Baidyanaths that while the Baidyanaths are still in existence as a producer of Ayurvedic medicines the first respondent is a proprietory concern with no apparent relationship with the Baidyanaths except that of 'vasista' agency ( sole distributorship ) that the number of workers of the first respondent during the first five years of its establishment has been claimed to be such as not to bring it within the definition of 'establishment' under the Act. 8. The precise question that requires judicial determination is whether under the above facts and circumstances the first respondent may be regarded as the same or continuous establish­ment as that of the Baidyanaths so as to continue to be covered under the Act and not a new establishment ? 8. The precise question that requires judicial determination is whether under the above facts and circumstances the first respondent may be regarded as the same or continuous establish­ment as that of the Baidyanaths so as to continue to be covered under the Act and not a new establishment ? Under section 2(e) of the Act 'employer' means : (i) in relation to an establishment which is a factory the owner or occupier of the factory including the agent of such owner or occupier the legal representative of a deceased owner or occupier and where a person has been named as a manager of the factory under clause (f) of sub-section (1) of section 7 of the Factories Act 1948 the person so named and (ii) in relation to any other establishment the person who or the authority which has the ultimate control over the affairs of the establishment and where the said affairs are entrusted to a manager managing director or managing agent such managers managing director or managing agent. The Act is an Act to provide for the institution of provident fund for employers in factories and other establishments. The word "establishment" has not been defined in the Act. It means an organised body of men maintained for a purpose under sub­section (3) of section 1 of the Act subject to the provisions contained in section 16. It applies- (a) to every establishment which is a factory engaged in any industry specified in Schedule 1 and in which twenty or more persons are employed and (b) to any other establishment employing twenty or more persons or class of such establishments which the Central Government may by notification in the Official Gazette specify in this behalf. But under sub-section (5) an establishment to which this Act applies shall continue to be governed by this Act notwithstanding that the number of persons employed therein at any time falls below twenty : Under S. 5 of the Act the Central Government may from Employees' Provident Fund Schemes for establishments to which the Act is made applicable. 9. It is clear from the provisions of the Act that the liability to contribute to the provident fund arises from application of a scheme to a particular establishment. The moment the scheme is put into operation the liability of the employer to make the required contributions springs into being. 9. It is clear from the provisions of the Act that the liability to contribute to the provident fund arises from application of a scheme to a particular establishment. The moment the scheme is put into operation the liability of the employer to make the required contributions springs into being. Thus liability is fastened to an establishment to which the Act and a Scheme is applicable. In the instant case admittedly the Baidyanaths was such an establishment and it was made liable to pay provident fund contributions. But the question is whether the same establish­ment continued was by the first respondent or a new establishment was set up by him ? Answer to this question must necessaraly depend on the facts of the case. The continuity or discontinuity of the entity the management the staff the nature of the bus­iness the location ownership the control the machineries and other aspects of the establishment have to be considered for arri­ving at a conclusion. 10. If on consideration it is found that the establishment is a new one in the since that the earlier one has ceased to exist and a new one has come into being the liability of the new establishment may be exempted for the prescribed period under section 16 of the Act which shall not apply: (a) to any establishment registered under the Co-operative Societies Act 1912 or under any other law for the time being in force in any State relating to co-operative societies employing less than fifty persons and working without the aid of power; or (b) to any other establishment employing fifty or more persons or twenty or more but less than fifty persons until the expiry of three years in the case of the latter from the date on which the establishment is or has been set up. But an establishment shall not be deemed to be newly set up merely by reason of change in the location. In the instant case admittedly there is no change of location. But it has to be seen whether the Act is not applicable to it by the reason of its being newly set up and during the exempted period. The case of first respondent however is that it is not an establishment to which the Act is at all applicable as according to him it has been employing less than the required minimum number of workers. The case of first respondent however is that it is not an establishment to which the Act is at all applicable as according to him it has been employing less than the required minimum number of workers. 11. Is it then a new establishment ? ID Laxmi Rattan Engineering Works vs. The Regional Provident Fund Commissioner Punjab reported in 1966 LIJ 741 (S. C.) it has been held that the period of three years for the purpose of section 16(1)(b) should count from the date on which the establishment was first established and the fact that there has been a change in the ownership makes no difference to the counting of this period of three years so long as the establishment has continued to work all along and that the date of its establish­ment shall not be deemed to have been changed merely by reason of change of the premises or the location of the establishment. The mere change in the line of business would not also make any difference to the date of its first establishment when a running factory is taken over. As has been observed in R. Ramakrishna Rao vs. The State of Kerala AIR 1968 SC 1637 section 16 (1) (b) is intended to give breathing time to a new establishment and that reason does not hold when the establishment is already old and well founded. 12. Similarly in State of Panjab vs. Satpal and another AIR 1970 SC 655 : 1910 (2) LLJ 64 : 1970 Lab. I. C. 772 it has been stated that the period of infancy for the purpose of section 16 (1) (b) must be calculated first from its first establishment and not from the moment of time when the figure of employment of twenty of more workers is first reached. The law takes into account only the existence of establishment and the employment of a certain number of persons in factories from a given period. Change of location or change of composition of partners or a change in the manufacturing process is not vital in the appli­cation of the law. An establishment is deemed to have started at the point of time when it first came into existence. Change of location or change of composition of partners or a change in the manufacturing process is not vital in the appli­cation of the law. An establishment is deemed to have started at the point of time when it first came into existence. Law takes into account only the existence of establishment and the employment of a certain number of persons in it over a given period and for this purpose change of location or change of composi­tion of partners or change in the manufacturing process is not considered vital for the application of the law. 13. ln a case where the question is whether an establish­ment is a new one or a continuity of a pre-existing ore discon­tinuity of existence of the pre-existing one for a period of time will be very material in leading to the conclusion that the latter one is a newly established one and not a continuity of the pre­existing one. Thus in the Provident Fund Inspector Trivendrum vs. Secretary NSS Co-operative Society Changannacerry AIR 1971 SC 82 : 1971 Lab. I. C. 18 which was a case of prosecution for contravention of Employees Provident Fund Scheme 1946 a printing press established in 1946 was sold in 1961 and the accused in that case became the new owner. The work of the press was stopped on sale and was restarted after a break of about 3 months the machinery was also altered the persons employed previously were not continued in service while a fresh recruit­ment of employees took place amongst whom only six happened to be previous employees and compensation was paid to the workmen at the time of the sale by the previous owners. It was held under those circumstances that the old establishment was completely closed when a transfer of ownership took place and an entirely new shop was set up three months later so that the benefit of non applicability of the Act under section 16 (1) (b) of the Act for the period of three years was available to the case from June or July 1961 when the new establishment was set up. 14. In M/s. Balaji Enterprises vs. The Deputy Regional Provident Fund Commissioner Madras 1980 Lab. 14. In M/s. Balaji Enterprises vs. The Deputy Regional Provident Fund Commissioner Madras 1980 Lab. I. C. 571 Padnabhan J. on a consideration of the case law suggested that the test to be applied is to find out whether on the entire complex of facts of a given case it can be concluded that the original legal entity the establishment has come to an end and has been succeeded by a fresh legal entity. If the answer is in the affirma­tive then that fresh entity will be the entity to which the Act will apply as a first impact and that entity is entitled to infancy protection and that protection will have to be granted as a matter of course. Further if that entity is an entity which does not come within the meaning of establishment as defined in the Act in view of the fact that it does not employ 20 or more persons then that entity will not be covered by the provisions of the Act. On the other hand if on the facts of the indivi­dual case it is found that the new establishment is not genuinely such but is only an old one formally resuscitated in order to avoid the legal obligation then it is always open to the Court to hold that it is the old establishment which is substantially continuing and that the liability to contribute must be affixed to the apparently new form also. 15. In M/s. Sanjay Automobiles vs. The Regional Provident Fund Commissioner UP. 1982 Lab. I. C. 536 it has been observed that section 16 (1) (b) would apply only to a new establishment which has all the ingredients of having been started for the first time from scratch. It is only then that it can be said that the establishment was in its infancy and needed protection. On facts it was held that where the business of servicing and repairs of motor vehicles was carried on in the same premises and with the same machinery mere change of ownership and management would not make it a new establishment so as to be entitled to the exemption provided under section 16 (1) (b). Further the period of protection of three or five years under S. 16 (1) (b) was to be computed from the date of the setting up of the business initially. Further the period of protection of three or five years under S. 16 (1) (b) was to be computed from the date of the setting up of the business initially. It would not relate back to the date when the establish­ment had twenty or more persons on its rolls or from the date of change of ownership and management of the establishment or its incorporation under the Companies Act. 16. Applying the above principles to the facts of the instant case we find that the Baidyanaths has been a private limited company and is still continuing but its sales depot at Gauhati had been closed down with effect from 8.10.68. Prior to its closure it issued notices of closure to its workers and paid them closure compensation and the workers did not even raise any industrial dispute about it. After a break of about twenty days from 1st November 1968 the agreement of 'visista' agency came into being and the respondent No. 1 started its business as the sole distributor of the medicines manufactured by the Baidyanaths with effect from 1.11.68. He appointed his staff by fresh advertisement and new candidates. The establishment is a proprietary concern. The agreement envisages displaying of the 'Baidyanaths' signboard side by side with that of the first respondent but this may be a matter of business practice for the purpose of utilising business goodwill. No doubt the business continued in the same premises but the premises were taken on new lease from its landlord after the 'Baidyanaths' lease came to an end. Nothing has been placed before us to show that it is a case of mere change of ownership or that the proprietor Shri Basu Deo Nirmal had or have any interest in the Baidya­naths. There is therefore a clear discontinuity between the two. Nothing has been placed before us to show that it is a case of mere change of ownership or that the proprietor Shri Basu Deo Nirmal had or have any interest in the Baidya­naths. There is therefore a clear discontinuity between the two. Under similar circumstances in M/s. Offset Printers Pvt. Ltd. vs. The Regional Provident Fund Commissioner Shi I long in Civil Rule No. 308 of 1974 where after the Natun Assamiya Pvt. Ltd. closed down its establishment and business on 31.10.71 and thereafter M/s. Offset Printers Pvt. Ltd. was newly floated and it started its business in 1973 employing only 19 persons including the 14 ex-employees of erstwhile Natun Assamiya Pvt. Ltd. it was held that M/s. Offset Printers Pvt. Ltd. was entitled for exemption for a period of five years from the date of its establishment under section 16(1)(b) of the Act. 17. For the reasons discussed above there can be no doubt that the first respondent M/s. Assam Ayurved Bhandar has to be treated as a new establishment and not a continuity of the Baidyanaths. It will not be covered by the provisions of the Act by reason of the Baidyanaths having been covered. Whether it will be covered or not as a new establishment is however a different question which we are not required to decide in this appeal. 18. In the result this writ appeal is found to be without merit and it is dismissed. No order as to costs.