Judgment Smt. ROSHAN DALVI, J.:- Rule. Returnable forthwith. The Respondents' affidavits in reply are filed. 2. The Petitioners are the Trade Union consisting of the employees of Konkan Railway Corporation Limited (KR). They have filed this Petition against the KR and Regional. Provident Fund Commissioner II (PFC) under the Employees Provident Fund and Miscellaneous Provisions Act, 1952 (PFA). 3. The Petitioners have prayed for declaration that the KR employees and the KR are not covered by PFA and consequently certain amounts transferred to the PFC under the PFA are sought to be declared illegal. The Petitioners have prayed to get a refund of the amounts so transferred along with interest at 18% p.a thereon. The Petitioners have also applied for the writ of mandamus calling upon KR to maintain the provident fund amounts of its employees in the Provident Fund Trust managed by KR. 4. Pursuant to an agreement dated 19.06.1990 KR came to be incorporated. The said agreement has been executed by and between the Government of India represented by the President of India, i.e., the Central Government (CG) and the Governments of the States of Maharashtra, Goa, Karnataka and Kerala represented by their respective Governments as State Governments. (S.Gs.). 5. The agreement was for constructing a railway line to connect Mangalore and Bombay on the West Coast of India and to operate it. Under Clause 4 of the said agreement it was incorporated to set up an autonomous organization under the administrative control of the Manager of the Railways, a company being Konkan Railway Corporation Limited to be incorporated. 6. Under Clause 6(iv) of the said agreement such company would be deemed to be a Railway Company under the Provisions of the Indian Railways Act, 1890 (IRA). It would be a wholly owned Government Company, owned by the Central and the aforesaid 4 State Governments as per the shares specified therein. 7. Under Clause 6(ix) of the said agreement the Board of Directors of KR would consist of 14 Directors. The Chairman and the Executive Directors would be appointed by the CG. The S.Gs would be entitled to nominate alternate Directors who would be non-executive Directors. 8. Under Clause 6 (XII) the agreement was to be valid for 15 years with such extension as required and thereafter the properties of the KR would vest in and be transferred to the CG. 9. The S.Gs would be entitled to nominate alternate Directors who would be non-executive Directors. 8. Under Clause 6 (XII) the agreement was to be valid for 15 years with such extension as required and thereafter the properties of the KR would vest in and be transferred to the CG. 9. Under Clause 6(XIX) the CG was to provide qualified and experienced manpower to manage the affairs of KR. 10. Under Clause 6(XX) the KR would be converted into a statutory authority created by an Act of Parliament. 11. Consequently it is seen that under the aforesaid agreement dated 19.06.1990 the Company was a wholly owned Government Undertaking. It was managed by the CG. Its properties were to vest and were to be transferred to the CO in due course of time. It was to be a Railway Company, as defined in Section 2(31) of the IRA. Under that definition it would be a railway for the public carriage of the passengers and goods and hence, covered by the said Act. 12. It has been contended by Ms. Kiran Bagalia on behalf of KR that the CO was to charge fares as determined by it under the Railway Act. The claims of KR are decided by Tribunals constituted under the IRA. It is shown as a Zonal Railway in the Zonal Railway Code. It is a national priority project for laying the Coastal railway line as per the demands of the citizens in the area in which it was to operate. It is a public utility undertaking established in national interest. Consequently it was deemed to be a Railway Company under the IRA as per Clause 6(iv) under the aforesaid agreement. 13. It is the case of the Petitioners as well as KR that the employees of KR are railway servants as per the definition of "Railway Servant" under Section 2(34) of IRA. Under that Section a person employed by the CG or by a Railway Administration in connection with the service of a railway is a railway servant. KR has about 3854 employees. They render services to Railway, which is for public carriage of passengers or goods. 14. Under that Section a person employed by the CG or by a Railway Administration in connection with the service of a railway is a railway servant. KR has about 3854 employees. They render services to Railway, which is for public carriage of passengers or goods. 14. The Petitioners and the KR entered into a Memorandum of Understanding (MOU) on 05.02.2004 under which all the employees who were on the rolls of KR on 01.06.1998 came to be entitled to the PF as well as the Pension under the Contributory Provident Fund Scheme of KR from the date of their joining service. They also became entitled to the pension under the Pension Rules of I.R from 01.06.1998. 15. It is contended on behalf of KR and the Petitioners that the provisions of this scheme for payment of PF, pension as well as Insurance to the employees of KR are more beneficial to the employees and hence, that scheme must be allowed to operate. 16. It is further contended on behalf of Petitioners as well as KR that in view of the fact that KR is a wholly owned Government undertaking as a part of the I.R and has got a scheme for payment of contributory provident fund, pension as well as insurance to its employees, it is exempt from the provisions of PFA under Section 16(b) of the PFA. Section 16(b) runs thus: " Act not to apply to certain establishments - (a) ....... (b) to any other establishment belonging to or under the control of 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." 17. Section 16(1)(b) shows non-applicability of PFA to an establishment belonging to or under the control of the Central Government or State Government and whose employees are entitled to the benefit of a contributory provident fund or old age pension in accordance with the scheme or rule framed by the Central Government or State Government governing such benefits. The MOD dated 05.02.2004 is stated to be one such scheme framed by the KR as a wholly owned government undertaking controlled by the C.G and having 100% equity participation of only C.G and the aforesaid S.Gs. 18. The MOD dated 05.02.2004 is stated to be one such scheme framed by the KR as a wholly owned government undertaking controlled by the C.G and having 100% equity participation of only C.G and the aforesaid S.Gs. 18. This aspect is disputed by PFC, Respondent No.2. It is argued on behalf of the PFC that the PFA applies to KR as an establishment specified in Schedule-I of the PFA. Consequently under Section 1(3)(a) it would be covered under PFA. Section 1(3) runs thus: "(3) 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-I and in which (twenty) or more persons are employed and (b)------ Provided that the Central Government may, after giving not less than two months' notice of its intention so to do, by notification in the Official Gazette, apply the provisions of this Act to any establishment employing such number of persons less than (twenty) as may be specified in the notification." 19. It may be at once stated that KR is not a factory engaged in any industry. Hence, it cannot be included in Schedule-I. 20. An order came to be passed by the Assistant PFC on 11.10.2004 against KR holding that KR was a building and construction Industry under Schedule-I of PFA, since it had built and constructed the Konkan Railway and was operating it. The construction of the Konkan Railway line was its primary activity and hence, the Act would be applicable to it. 21. In an appeal from the said order filed by KR before the Appellate Tribunal under the PF A the said order came to be set aside by the order dated 09.03.2005. Upon considering that KR was "Railway" under Section 2(31) of the IRA, it held that the ambit of its activities cannot be brought within the scope of "Building and construction Industry" as mentioned in Schedule-I of PFA. Consequently it was held that KR would not fall within the ambit of Section 1 (3)(b) of the PF A. This has not been challenged by the PFC. 22. It is contended on behalf of the PFC that by a notification dated 10.11.2005, Exhibit-E to the Petition, KR came to be included in the provisions of the PFA. Consequently it was held that KR would not fall within the ambit of Section 1 (3)(b) of the PF A. This has not been challenged by the PFC. 22. It is contended on behalf of the PFC that by a notification dated 10.11.2005, Exhibit-E to the Petition, KR came to be included in the provisions of the PFA. It would be worth citing the relevant portion of the said Gazette notification dated 10.11.2005 showing the establishments to which PFA would apply: "Any establishment engaged in construction, maintenance, operation and commercial activity of Railways other than Indian Railway and other Railway establishment owned and controlled by Central or State Government." 23. It is contended on behalf of PFC by Mr. Karnik that KR is engaged in construction, maintenance, operation and commercial activities of railways and hence pursuant to the said notification a PFA would be squarely applicable to KR. He concedes that I.R is excluded from the said notification. He however, claims that any other railway establishments which have been owned and controlled by Central and State Governments are not excluded from the said notification. 24. A reading of the original notification shows that what is covered by the notification dated 10/11/2005 is any establishment engaged in construction, maintenance, operation and commercial activities of railways. The remainder of the notification shows the exclusion. We may mention that there is no comma before and after the words "other than Indian Railways" hence it is impossible to accept the contention of Mr. Karnik that only I.R is excluded from the notification. The exclusion is not only for I.R but for I.R and other Railway Establishment owned and controlled by the C.G or S.Gs. The KR is an establishment owned by the C.G. We have no hesitation in concluding that the KR is excluded from the said notification. Consequently KR is not covered under Section 1(3) of the PFA including its proviso. Further being an establishment under the control of the C.G and having its own contributory PF and Pension Scheme it would be exempt under Section 16(b) of the PFA. 25. Consequently KR is not covered under Section 1(3) of the PFA including its proviso. Further being an establishment under the control of the C.G and having its own contributory PF and Pension Scheme it would be exempt under Section 16(b) of the PFA. 25. Despite the aforesaid order of the Appellate Authority and presumably upon an erroneous construction of the above Notification dated 10/11/2005 the Assistant PFC by his Note dated 14.02.2006 sought from KR copies of approved balance sheets for the last 3 years' projects undertaken by KR and Memorandum and Articles of Association of KR. Thereafter by his letter dated 16.03.2006 the Regional PFC directed KR to implement the provisions of PFA and the schemes framed thereunder. 26. Consequent upon its letter dated 16.03.2006 to cover its employees under the PF Scheme, KR applied for an exemption under Section 17 of the PF A. The PFC called upon it to furnish further details and the documents. Those have not yet been furnished, the application for exemption has remained at that. 27. Under pain of penalties under the PF A, which has several stringent provisions enshrined therein, KR accepted the provisions of the scheme under the PF A. This was done without the consent of the Petitioner Union or the individual employees of KR. KR transferred certain huge amounts available under its individual contributory scheme to the PFC. These are the amounts that the Petitioners seek refund of. It is for this transfer that the Petitioners seek the aforesaid declaration followed by the Writ of Mandamus calling upon KR to maintain its separate provident fund amounts in the Provident Fund Trust managed by KR and not under the PFA. 28. It is contended by Mr. Karnik on behalf of the PFC that once the amount was transferred by KR it shows an implicit acceptance of KR to the applicability of the Act to it:' Consequently KR would be estopped from contending that the Act does not apply to it. It need hardly be stated there can be no estoppel against the Statutes. Nevertheless it is contended on behalf of the PFC that KR may make application for exemption of itself from the PFA under Section 17 of the PFA. It need hardly be stated there can be no estoppel against the Statutes. Nevertheless it is contended on behalf of the PFC that KR may make application for exemption of itself from the PFA under Section 17 of the PFA. The Petitioners as well as KR dispute this aspect upon the premise that there is no question of applying for exemption of the Act as the Act is not applicable to KR. 29. We may mention that KR is indeed a wholly owned undertaking of the C.G and S.Gs. It is controlled by the CG. It has been incorporated for being run as a part of the IR. We are told that it is soon to amalgamate into the Indian Railways. It has got its own individual separate contributory P.F as well as old age pension schemes. It is, therefore, exempt from the provisions of the PF A under Section 16(l)(b) thereof. 30. Nevertheless all parties have contended that the interest of the employees should be the prime consideration for applying the PF A or the Individual Contributory Schemes of KR. The Petitioners as well as KR contend that their scheme is far from beneficial to their employees. The PFC contends otherwise. It is contended that Sections 6, 6a and 6 a of PFA apply to KR's employees which confer benefits also under the Employees Pension Scheme (EPS) framed under PF A. The parties are not at dispute with regard to the intrinsic features of the scheme. We have been shown a columnar statement specifying the relative merits and demerits of the 2 schemes. We may broadly consider the 2 schemes to understand which would be more beneficial to the employees of KR. Sr.No. PFA Scheme KR Scheme 1 Applicable from Applicable from 16.11.2005 (CI.1 the date the (2)(a) of the BPS) employees started contributing to the scheme. (Several have contributed since 1998). 2 Scheme is not All Employees compulsory for are covered by employees earning the Scheme. above Rs.6,500/- (this excludes 90% of the employees of KR including several Class IV workers) 3 Minimum pension Minimum contributable pension is Rs.697/-. Contributable is Rs.1913?- + DA @ 41% 4 Maximum pension Maximum contributable is pension Rs.3,250/- . contributable is Rs.19500 / - + DA @ 4%. Maximum Deposit Maximum Linked Insurance Deposit Scheme (DLIS) Linked of Rs.60,000/- . Insurance Scheme (DLIS) of Rs.75,000/ for employees and Rs.1,50,000/ - for Officers. Contributable is Rs.1913?- + DA @ 41% 4 Maximum pension Maximum contributable is pension Rs.3,250/- . contributable is Rs.19500 / - + DA @ 4%. Maximum Deposit Maximum Linked Insurance Deposit Scheme (DLIS) Linked of Rs.60,000/- . Insurance Scheme (DLIS) of Rs.75,000/ for employees and Rs.1,50,000/ - for Officers. 5 Pension amount is Pension amount static is revisable as per Pay Commission benefits + D.A. 6 33.33% of pension 40% of pension is commutable is commutable. 7 N.A. Commuted pension is restored at the end of 15 years. 8 N.A. D.A. Relief is declared every 6 months. 9 Minimum amount Minimum of family pension amount of is Rs.450/- family pension is Rs.l,913/- . 10 Maximum amount Maximum of family pension amount of family is Rs.2051/- pension is Rs.1l,700/- + D.A. 11 N.A. Enhanced family pension is payable if pensioner dies within 7 years of entering the Scheme. 12 Payable only at Payable the age of 58 years forthwith in even if employees case of voluntarily retire Voluntary years before. Retirement Scheme (VRS). 13 N.A. Professional Management by LIC/SBI resulting in increased yield. 31. We have no hesitation in concluding that the KR Scheme is distinctly more beneficial to the employees also. We are gratified to note that KR itself is desirous of its employees availing of its contributory scheme. That is the scheme applicable to the employees of the LR. The employees would therefore, have no legal impediment even when KR gets merged into Indian Railways as contemplated in the agreement dated 19.06.1990. 32. Hence, the Petitioners have made out a case for grant of each of the reliefs sought. There shall be a declaration that the employees of KR and the KR are not governed by the provisions of the PF A. The transfer of the amounts made by KR to PFC under PF A has been made under misconception of law. The amount standing to the credit of the KR with the PFC shall, therefore, be returned/refunded by the PFC to KR within 8 weeks from today. 33. If the amount is not refunded within 8 weeks the PFC shall pay interest at the rate of 18% p.a on the amount detained by him. 34. The KR shall maintain the provident fund amounts of its employees in the Provident Fund Trust managed by itself as per the M.O.U executed by KR with its employees Union on 05.02.2004. 33. If the amount is not refunded within 8 weeks the PFC shall pay interest at the rate of 18% p.a on the amount detained by him. 34. The KR shall maintain the provident fund amounts of its employees in the Provident Fund Trust managed by itself as per the M.O.U executed by KR with its employees Union on 05.02.2004. The contributory provident fund, pension as well as insurance scheme of KR shall be made applicable forthwith. 35. Rule made absolute accordingly. Petition allowed.