JUDGMENT : Vipul M. Pancholi, J. Present appeal is filed by the original applicant against the judgment and order dated 18.10.1994 passed by the Employees State Insurance Court, Ahmedabad ('the ESI Court' for short) in ESI Application No. 50 of 1991, by which, the ESI Court has dismissed the application of the present appellant. 2. Brief facts of the present case are as under: 2.1 That the applicant filed an application being ESI Application No. 50 of 1991 under Section 75 of Employees State Insurance Act, 1948 ('ESI Act' for short) before the ESI Court, wherein, the applicant has mainly contended that he is carrying on his business as commission agent and dealing in products like tomato catchup, bournvita, cadbaury chocolates, blue cherry blossom shoe polish etc. 15 to 16 employees were engaged. However, in the said premises, neither any manufacturing activity has been carried on, nor the aforesaid items were preserved in the cold storage. In fact, there is no cold storage or cold room in the said premises and therefore provisions of ESI Act is not applicable to the applicant. When the ESI Inspector called for the record and information from the applicant in the prescribed form, such details were submitted to the said Inspector. After verifying the record, it was decided that provisions of ESI Act is not applicable to the applicant. Communication dated 12.05.1989 was also sent by the Employees Insurance Corporation ('the Corporation' for short), whereby, the applicant was informed that the applicant is uncovered under the ESI Act. 2.2 Thereafter, once again the Inspector of the Corporation visited the premises of the applicant. Necessary details were given to him in July 1990. Thereafter, the respondent Corporation informed the applicant by communication dated 20.03.1991, whereby, the order dated 12.05.1989, whereby the applicant was uncovered under the ESI Act was cancelled. In the said communication, the Corporation informed the applicant that Air-conditioner machine is used in the room, which can be said to be a 'cold store room' and therefore ESI Act is applicable to the applicant. In response to the said communication, the applicant informed to the Corporation by letter dated 06.06.1991 that Air-conditioner machine is used in the office and the said Air-conditioner machine is not used for the purpose of storage of goods or any articles and therefore Air-conditioner machine cannot be termed as cold store room as alleged by the Corporation. In response to the said communication, the applicant informed to the Corporation by letter dated 06.06.1991 that Air-conditioner machine is used in the office and the said Air-conditioner machine is not used for the purpose of storage of goods or any articles and therefore Air-conditioner machine cannot be termed as cold store room as alleged by the Corporation. All the necessary details were supplied by the applicant to the Corporation. Thus, in the said application, the applicant prayed that order dated 20.03.1991 passed by the Corporation be quashed. 2.3 ESI Court issued the notice to the Corporation. The Corporation filed its reply vide Exh.8, in which, it has been mainly contended that the Inspector of the Corporation examined the record of the applicant and thereafter issued C-11 notice dated 13/15-10-87 covering the applicant's establishment under Section 1(5) with effect from 01.03.1983. Applicant failed to comply the said notice and therefore, the Corporation issued C-18 notice dated 05.10.1988 on ad-hoc basis and demanded Rs.62,278/- for the period between 01.03.1983 to 31.03.1988. Subsequently, the Area Insurance Inspector of the Corporation conducted inspection of the applicant in February, 1989. Thereafter Area Insurance Inspector also recommended for un-coverage with effect from 01.01.1985 after verifying the record. Therefore the order dated 12.05.1989 was passed, whereby, applicant establishment was uncovered with effect from 01.01.1985. However, it was also added that in case the information supplied by the applicant is found incorrect, the applicant will render liable himself to legal action. 2.4 Once again the Area Insurance Inspector visited the premises of the applicant on 02.09.1990, wherein, he has observed that the applicant is using Air-conditioner as cold storage for preservation of chocolates and other food items. The applicant was employing 15 persons in January 1989. Thus, the impugned order was passed by the Corporation and therefore, no illegality is committed by the Corporation. 2.5 Before the ESI Court, the applicant examined Vinodchandra Hiralal vide Exh.22 and Vikrambhai Kantilal vide Exh.42. The Corporation had not examined any witness. Parties have produced documentary evidence on record and thereafter ESI Court by way of impugned order, dismissed the application of the present appellant and therefore the present appeal is filed by the original applicant. 3. Heard learned advocate Mr. Dipen Desai for the appellant and learned advocate Mr. Hemant S. Shah for the respondent-Corporation. 4. Learned advocate Mr. Parties have produced documentary evidence on record and thereafter ESI Court by way of impugned order, dismissed the application of the present appellant and therefore the present appeal is filed by the original applicant. 3. Heard learned advocate Mr. Dipen Desai for the appellant and learned advocate Mr. Hemant S. Shah for the respondent-Corporation. 4. Learned advocate Mr. Desai submitted that the impugned order is bad, illegal and perverse and therefore this Court may quash and set aside the same. He has mainly contended that the Air-conditioner is installed in the cabin of the Manager, which is not used for the purpose of storage of the goods or preserving any article in the said Air conditioner office. Air-conditioner office cannot be termed as cold-storage and therefore only on this ground, the impugned order passed by the ESI Court as well as the Corporation are required to be quashed and set aside. Learned advocate Mr. Desai thereafter submitted that there are only 15 employees, employed by the appellant, the premises of the appellant, cannot be termed as 'factory' within the meaning of Section 2(12) of ESI Act and therefore ESI Court ought to have allowed the application of the applicant. 5. Learned advocate Mr. Desai would contend that there is no manufacturing activity carrying on in the premises of the applicant. The applicant is merely a trader. Various food items such as chocolates, bournvita, tomato-catchup and even shoe polish are purchased from the concerned manufacturer and after few days, said items are sold to the other traders. Thus, the applicant is merely a commission agent. For preservation of the aforesaid articles/items, cold-storage/refrigerator is not required. Aforesaid items are stored in a separate room, where there is no Air-conditioner. In fact, Air-conditioner is installed in the cabin of the Manager. Manager is using the said Air-conditioner during office hours and it is not the case of the Corporation that such Air-conditioner was used for 24 hours. Thus, when the Air-conditioner is used during office hours, there is no reason for the applicant to keep chocolates, bournvita, tomato-catchup etc., in the Air-conditioner cabin of the Manager. The Corporation has not produced any documents on record to prove that the applicant is keeping all his goods/items in the Air-conditioner cabin of the Manager and such Air-conditioner is used for 24 hours. In short, it is the contention of learned advocate Mr. The Corporation has not produced any documents on record to prove that the applicant is keeping all his goods/items in the Air-conditioner cabin of the Manager and such Air-conditioner is used for 24 hours. In short, it is the contention of learned advocate Mr. Desai that merely because the Air-Page conditioner is installed in the cabin of the Manager, it cannot be said that the said Air-conditioner is used as cold-storage for preserving the articles. Thus, when no manufacturing process is being carried on in the premises of the applicant and when the premises of the applicant is not a factory, the Corporation has wrongly applied the provisions of the ESI Act to the establishment of the applicant, though, initially order of 'un-coverage' was passed by the Corporation. ESI Court has failed to appreciate the aforesaid important aspect and thereby wrongly rejected the application. Thus, this Court may quash and set aside the impugned orders. 6. Learned advocate Mr. Desai has placed reliance upon the following decisions. I. In case of Ritz Hotel (Vegetarian), Pune v. Joint Regional Director, reported in 1998 (3) LLJ 309 II. In case of Hotel New Nalanda v. Regional Director, E.S.I. Corporation, reported in 2009 (14) SCC 558 . III. In case of Employees State Insurance Corporation and Another v. Shri Nasik Panchavati Panjarapole, reported in 1997 (3) LLJ 777 IV. In case of Gujarat Electricity Board v. State of Gujarat, reported in 1984 (1) GLR 51 V. In case of Regional Director, Employees State Insurance Corporation v. Serofie Bernard Vaz, reported in 2009 LLR 361 7. On the other hand, learned advocate Mr. Hemant S. Shah appearing for the Corporation submitted that no error is committed by the ESI Court while passing the impugned order and therefore, the present appeal be dismissed. He mainly contended that the applicant establishment has installed the Air-conditioner machine in its premises. Said Air-conditioner is used for the purpose of keeping the chocolates, bournvita, tomato-catchup and other foods items in proper condition. Thus, indirectly, the Air-conditioner machine is used as cold storage for preserving the articles and therefore it is a manufacturing process within the meaning of Section 2(k) of the Factories Act. Said Air-conditioner is used for the purpose of keeping the chocolates, bournvita, tomato-catchup and other foods items in proper condition. Thus, indirectly, the Air-conditioner machine is used as cold storage for preserving the articles and therefore it is a manufacturing process within the meaning of Section 2(k) of the Factories Act. Thus, if the manufacturing process is carried out in the premises of the applicant with the aid of power and when 15 employees are working, the premises of the applicant can be said to be a factory within the meaning of Section 2(12) of ESI Act. Thus, when the Corporation came to know that Air-conditioner machine is installed in the premises of the applicant, the impugned order was passed and the provisions of ESI Act were applied to the establishment of the applicant. ESI Court has after considering the material on record, rightly rejected the application of the applicant and therefore the present appeal is required to be dismissed. 8. Learned advocate Mr. Shah has placed reliance upon the decision rendered by the Hon'ble Supreme Court in case of The Regional Director, Employees' State Insurance Corporation v. Ram Chander, reported in AIR 1988 SC 113 and submitted that in the said case, in the tailoring shop, less than 20 employees were working. However, in the said shop, electric iron was used in stitching process. The Hon'ble Supreme Court has therefore held that the said activity amounted to manufacturing process and the said establishment is covered within the purview of the ESI Act. He therefore requested that this appeal be dismissed. 9. I have considered the arguments advanced on behalf of learned advocates for the parties. I have also gone through the paper book supplied by the learned advocates of the parties as well as the records and proceedings called for from the ESI Court. 10. The question of law which is required to be considered by this Court in the present appeal is whether the Air-conditioner cabin used by the Manager of the applicant can be said to be a cold storage ? 11. For deciding the aforesaid question, following provisions of law are required to be kept in mind. Section 2(12) of the ESI Act provides for the definition of 'factory'. 11. For deciding the aforesaid question, following provisions of law are required to be kept in mind. Section 2(12) of the ESI Act provides for the definition of 'factory'. The said section reads as under: (12) "factory" means any premises including the precincts thereof -(a) whereon ten or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on with the aid of power or is ordinarily so carried on, or (b) whereon twenty or more persons are employed or were employed for wages on any day of the preceding twelve months, and in any part of which a manufacturing process is being carried on without the aid of power or is ordinarily so carried on. But does not include a mine subject to the operation of the Mines Act, 1952 or a railway running shed. 12. Now this definition is amended with effect from 01.06.2010. However, in the present proceedings, the dispute in question is with regard to period prior to June 2010, and therefore, the aforesaid definition is required to be considered. 13. Thus, a particular premises can be said to be a factory where 10 or more persons are employed or were employed for wages and in any part of which, a manufacturing process is being carried on with the aid of power. In the present proceedings, we are concerned with the first part of the definition. In the present case, it is not in dispute that in the establishment of the appellant-applicant, 15 workers are working. Therefore, another question which is required to be considered is whether any manufacturing process is being carried on in the said premises or not. The definition of manufacturing process is given in Section 14AA of the ESI Act, which provides that manufacturing process shall have the meaning assigned to it in the Factories Act of 1948. 14. Thus, the definition of the manufacturing process given in Section 2(k) of the Factories Act of 1948 is required to be seen. The definition of manufacturing process is given in Section 14AA of the ESI Act, which provides that manufacturing process shall have the meaning assigned to it in the Factories Act of 1948. 14. Thus, the definition of the manufacturing process given in Section 2(k) of the Factories Act of 1948 is required to be seen. Section 2(k) provides that: 2(k) "manufacturing process" means any process for -(i) making, altering, repairing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up, demolishing or otherwise treating or adapting any article or substance with a view to use, sale, transport, delivery or disposal, or b. [(ii) pumping oil, water, sewage or any other substance; or (iii) generating, transforming or transmitting power, or c. [(iv) composing types for printing, printing by letter-press, lithography, photogravure or other similar process or book-binding;] c [or] (v) constructing, reconstructing, repairing, refitting, finishing or breaking up ships or vessels, d [or] f. (vi) preserving or storing any article in cold-storage;] 15. In the present proceedings, this Court is concerned with Clause-VI of the definition given in Section 2(k) of the Factories Act. As per the said Clause, if any Article is preserved or stored in the cold storage, the said activity can be said to be a manufacturing process. 16. Keeping in mind the aforesaid provisions of law, facts of present case are required to be considered by this Court. It is not in dispute that 15 workers are working in the establishment of the appellant-applicant. The applicant Unit is carrying on the business as whole-seller/commission agent. The applicant is working as commission agent and dealing in various articles/items like chocolates, bournvita, tomato-catchup, shoe polish etc. The case of the applicant is that aforesaid items are purchased from the manufacturer and after keeping the said items in the premises of the applicant, after 15 to 20 days, the said items are sold to the concerned traders. Separate room is used for keeping the said items. It is also revealed from the record that the applicant is in the said business since 1969 and for the first time, the Air-conditioner machine is installed in the year 1983 in the cabin of the Manager of the applicant. Initially, the Corporation passed an order on 12.05.1989 after verifying the record of the applicant, whereby, the establishment of the applicant was uncovered from the provision of the ESI Act with effect from 01.01.1985. Initially, the Corporation passed an order on 12.05.1989 after verifying the record of the applicant, whereby, the establishment of the applicant was uncovered from the provision of the ESI Act with effect from 01.01.1985. However, once again the concerned Inspector visited the premises of the applicant on 02.09.1990. The said Inspector observed that Air-conditioner is installed in the premise. Therefore, the order dated 12.05.1989 was cancelled. However, the Corporation has failed to establish from the record that the Air-conditioner machine is used for preserving the Chocolates and other food items as cold-storage. In fact, there is separate room for keeping the goods where no such Air-conditioner is installed, nor any refrigerator is installed by the applicant-establishment for preserving the said items. The Air-conditioner is installed in the cabin of the Manager and even it is not the case of the Corporation that the said Air-conditioner machine is used for 24 hours i.e. even after office hours. Thus, in the aforesaid facts of the present case, the decisions relied upon by the learned advocates for the parties are required to be considered by this Court. 17. In case of Employees State Insurance Corporation and Another (supra), the Bombay High Court has observed in paragraph No. 6 as under: "6. The expression 'cold storage' has a special meaning. Mere refrigerator by itself without anything more cannot be considered as cold storage. It is unfortunate that the trial Court has not recorded its finding from this point of view land has not addressed itself to the question as to whether the Respondent in this appeal was storing articles in "cold storage" popularly so-called and as to whether milk chilling process followed by the original applicant for which the original applicant had a milk chilling plant of 5 H.P. capacity was covered by Section 2(k)(vi) of the Act. It is also unfortunate that the learned trial Judge has not recorded any finding on the two defences raised by the applicant in its written statement i.e. defence pertaining to mixing cattle feed and defence pertaining to chaffing and cutting machine of 1.5 H.P. capacity and 3 H.P. capacity respectively. In this view of the matter it is absolutely necessary to remand the proceedings to the trial Court for rehearing of the application in accordance with law after giving an opportunity to both parties to lead further evidence." 18. In this view of the matter it is absolutely necessary to remand the proceedings to the trial Court for rehearing of the application in accordance with law after giving an opportunity to both parties to lead further evidence." 18. Thus, from the said decision, it is clear that the word 'cold-storage' has a special meaning. In the said case, it was observed that merely refrigerator was kept by the establishment itself without anything more cannot be considered as a cold-storage. In the present case, merely because the Air-conditioner is installed in the cabin of the Manager, the same cannot be considered as a cold-storage used for preserving the articles/food items. 19. In the case of Ritz Hotel (Vegetarian), Pune (supra), the Bombay High Court has observed in paragraphs No. 2, 5, 6, 7 and 10 as under: "2. Sometime in the year 1961, Ritz Hotel (Vegetarian) was registered under the Bombay Shops and Establishments Act, 1948. At the material time the said hotel employed about 14 to 17 employees. The appellant stores and preserves milk curds in a refrigerator kept in its hotel. The said refrigerator is operator by power with 3 horse power capacity. The milk which is stored in the freeze is used for preparing tea for the customers. The curd which is kept in the freeze is used for preparing buttermilk to be served to the customers or for preparation of kadi (a liquid preparation). No power is used in the kitchen or for any other activity of the hotel. The said refrigerator appears to be like a domestic refrigerator. 5. The trial Court has held that the establishment of the appellant was covered by and under the provisions of the said Act inasmuch as the appellant employed more than 20 employees on wages at the relevant time and the appellant preserved or stored milk or curd in 'cold storage'. The trial Court has held that storing of milk or curd in the refrigerator amounts to storing of articles in cold storage. The trial Court has held that the definition of the expression "manufacturing process" prescribed by section 2(k) of the Factories Act, 1948 was clearly attracted. The trial Court has held that storing of milk or curd in the refrigerator amounts to storing of articles in cold storage. The trial Court has held that the definition of the expression "manufacturing process" prescribed by section 2(k) of the Factories Act, 1948 was clearly attracted. The trial Court has held that sub-clause (6) of the said definition incorporated in the Act by Amendment Act 94 of 1976 including process for preserving of any article in cold storage was wide enough to include the case of storage of articles by restaurant or a hotel even in a domestic refrigerator. 6. This appeal involves a substantial question of law as to interpretation and application of the above referred notification dated 19th November 1976 and the provisions of law contained in section 2(k) of the Factories Act, 1948 and particularly section 2(k)(i) and section 2(k)(vi) of the said Act. 7. In my opinion, the trial Court committed a substantial error of law while holding that the establishment of the appellant was covered under the Employees' State Insurance Act, 1948. 10. Section 2(k)(vi) of the Act applies where a business is carried on of preserving or storing article in cold storage. It is common knowledge that there are several business concerns or companies owning cold storage equipments which are approached by others for preservation or storage of their articles in the cold storage apparatus of the owner. Perhaps it was little doubtful prior to amendment of Factories Act, 1948 as to whether the business of mere preservation or storing or articles in cold storage could be considered as a factory or whether the process of such storage could be considered as manufacturing process or not. To my mind, the definition of 'manufacturing process' was extended by Amending Act 94 of 1976 from this point of view. The expression 'cold storage' used in section 2(k)(vi) of the Factories Act cannot be interpreted literally and mechanically de hors the object of the Act. If preservation or storage of an article in a domestic refrigerator is to be treated as preservation or storage of an article in cold storage, it would be doing violence to the language. The definition of 'manufacturing process' is liable to be interpreted in business sense of the term having regard to the meaning of the words in common parlance and the usage of the trade. The definition of 'manufacturing process' is liable to be interpreted in business sense of the term having regard to the meaning of the words in common parlance and the usage of the trade. If the test is to be applied, it shall become clear that the trial Court was not right in treating a small refrigerator in the restaurant or the hotel as a place of cold storage." 20. In case of Serofie Bernard Vaz (supra), the Bombay High Court observed and held in paragraphs No. 2, 3, 5, 9 and 11 as under: "2. Facts which are relevant for deciding this appeal are as under. Respondent runs a Hotel and Bar which employed more than ten workers in 12 months' period commencing from April, 1990. Respondent was using power for a deep freezer and a bottle cooler to preserve raw materials and for cooling drinks. 3. The learned Judge of Employee' s state Insurance Court, relying on Judgment of this Court in Ritz Hotel v. E.S.I.C., Pune reported at 1995 (I) CLR 289 held that there was no nexus between preparation of food and the use of deep freezer/bottle cooler and that use of these gadgets on power is not for manufacturing or preparing food. He, therefore, concluded that the respondent's establishment was not covered and allowed respondent's application. 5. HOTELS employing more than 20 persons where food is cooked have been held to be factories by Judgment of this Court reported at 1980 LAB.I.C. 100 (Poona industrial Hotel Ltd. v. I.C. Sarin and anr.) and of the Supreme Court (1993) 4 SCC 363 (G.L. Hotels Limited and Ors. v. T.C. Sarin and anr.) It would be a 'factory' when it employs more than 10 but less than 20 persons and where manufacturing process is carried on with the aid of power. 9. I have carefully considered rival contentions. The key to the questions posed lies in the definition of 'factory' in Section 2(12) of Employee's State Insurance Act (or even Section 2(m) of Factories Act). The legislature intended to cover establishments where 20 or more persons are employed in a manufacturing process. This limit was reduced to 10 when the process was carried out with the aid of power. Obviously, since use of power reduces the need of work force. The legislature intended to cover establishments where 20 or more persons are employed in a manufacturing process. This limit was reduced to 10 when the process was carried out with the aid of power. Obviously, since use of power reduces the need of work force. The object is to ensure that an establishment does not escape from the applicability of benevolent provisions of these statutes by using power to mechanise processes and reduce work force. Thus if power has been used for performing a task for which labour would have otherwise been required, then such a process aided by power would be relevant. No amount of manpower is likely to achieve preserving articles by cooling them, which a freezer does, or cooling bottles for which a bottle cooler is used. Therefore, use of these gadgets does not bring the establishment within the ambit of Employee's State Insurance Act, so long as it employs less than 20 persons. 11. Secondly, at the cost of repetition, it may be pointed out that the provisions of the Act are made applicable to factories employing 20 persons or even 10 persons when manufacturing process is aided by power. Thus, it is only when power replaces manpower that reduced strength of persons employed also attracts the provisions of the Act." 21. In the case of Gujarat Electricity Board (supra), the Division Bench of this Court held that electric sub stations are not factories and no manufacturing process is being carried on in the sub-stations. In the sub-stations, Electricity is transformed and then transmitted to the customers, but it is not generated. 22. However, in the present case, this Court is not concerned with Clause-III of Section 2(k) of the Factories Act and therefore the aforesaid decision is not relevant for considering the question involved in the present proceedings. 23. In case of Hotel New Nalanda (supra), the Hon'ble Supreme Court observed and held in para No. 11, 12 and 13 as under: "11. On the issue whether power was used in any manufacturing process in the establishment the Insurance Court considered the evidences led by the two sides in considerable detail and rejected the case of the Corporation giving a number of reasons. It pointed out that in the inspection report it was simply stated that a Kelvinator fridge (sic refrigerator) and a one litre grinder were used in the manufacturing process. It pointed out that in the inspection report it was simply stated that a Kelvinator fridge (sic refrigerator) and a one litre grinder were used in the manufacturing process. But the report was completely silent in regard to the activities that were termed as 'manufacturing process' and the purpose for which the two electrical appliances were used. The report left it completely for the court to presume that the cooking of food was the 'manufacturing process' and the two appliances were used in that connection. The Insurance Court next observed that both PW-1, the Managing Director and PW-3, the person who was named in the inspection report as operating the grinder, in their deposition before the court denied the use and even presence of the two appliances in the establishment. But neither of them was even cross-examined on that issue. The court further observed that the Insurance Inspector had obtained a written statement from the appellant containing a list of all the fifteen persons who were working in the establishment as employees. In the same way he could obtain a statement about the use of the two appliances in the establishment for cooking food. But there was no such statement and the grinder and the refrigerator found a vague and cryptic 6 mention only in the inspection report. In its order the Insurance Court stated as follows: "Next aspect to be considered is whether the applicant has used power in the manufacturing process being carried on there. It is the specific plea of the respondent that the applicant has used a grinder and a fridge in their establishment in order to carry out the manufacturing process. It is refuted by the applicant. The applicant as PW-1 testified before me that no grinder and fridge are used in their establishment. This aspect of his evidence is not controverted in his cross examination by the counsel for the respondent. It is not elicited as to what are all the manufacturing process being carried on in the applicant establishment and how they are got done. It is pertinent to note that there is no mention about the use of power in the manufacturing process in Ext.D-1 letter elicited from the applicant by the Insurance Inspector. It is common case that Govindan was an employee of the applicant establishment. He was examined as PW-3 before me. It is pertinent to note that there is no mention about the use of power in the manufacturing process in Ext.D-1 letter elicited from the applicant by the Insurance Inspector. It is common case that Govindan was an employee of the applicant establishment. He was examined as PW-3 before me. He testified before me that there was no grinder or fridge used in the applicant establishment. There is no cross examination at all on the above aspect and therefore his testimony in this regard stands unchallenged. The DW-1 Insurance Inspector has noted in his Ext.D-2 report that a grinder and a fridge are being used in the applicant establishment. It is pertinent to note that the Ext.D-2 report is silent with regard to what are the manufacturing processes being carried on in the applicant establishment and the purposes for which above equipments are used. A sweeping statement that there is a grinder of 10 litre capacity and a Kelvinator fridge is made in the D-2 report." The High Court reversed the findings observing as follows: "Ext.D-2 survey report shows that grinder and fridge there. In Ext.D- 2 it is stated that there was a grinder of 1- liter capacity and a Kelvinator fridge. Merely because the details of which is not stated is not a ground to discard the evidence of DW-1 and Ext.DW-2 report. At the time of examination, DW-1 stated that the grinder was being operated by one Damodaran Nair, a worker of the respondent's establishment. In the application itself it is submitted by the applicant that he is running a Tourist home and the rooms are let out on monthly as well as a daily basis. The name of the establishment is styled as "Hotel New Nalanda". DW-1 found grinder and fridge in the kitchen. Those who occupy a hotel do depend upon the food which are prepared in the hotel. It is not possible to conceive of a hotel without a kitchen. Lodging and boarding are both essential components of the service rendered by a Hotel. Hence, it cannot be denied no manufacturing process is being conducted in the establishment of the respondent." 12. We are unable to appreciate the way the High Court considered the evidence and deemed fit to interfere with the finding of fact recorded by the Insurance Court. Lodging and boarding are both essential components of the service rendered by a Hotel. Hence, it cannot be denied no manufacturing process is being conducted in the establishment of the respondent." 12. We are unable to appreciate the way the High Court considered the evidence and deemed fit to interfere with the finding of fact recorded by the Insurance Court. The High Court seems to have taken the inspection report exhibit D2 and the testimony of the Insurance Inspector DW-1 as non-rebuttable, conclusive pieces of evidence. Further, for filling-up what remained unsaid in the inspection report and the testimony of DW-1, it took recourse to presuming that the establishment must have kitchen where food would be cooked using the two appliances running with the aid of power. The High Court did not even advert to the reasons given by the Insurance Court for not accepting the Corporation's case on that issue. The Insurance Court had rightly pointed out that the inspection report did not state the process or the work that was called 'the manufacturing process'. It did not even say that the refrigerator and the grinder were used in connection with cooking food in the establishment. 13. For holding an establishment to be a 'factory' within the meaning of section 2(12) of the Act it must first be established that some work or process is carried on in any part of the establishment that amounts to 'manufacturing process' as defined under section 2(k) of the Factories Act, 1948. In case the number of persons employed in the establishment is less than twenty but more than ten then it must further be established that the manufacturing process in the establishment is being carried on with the aid of power. Further, the use of power in the manufacturing process should be direct and proximate. The expression 'manufacturing process being carried on with the aid of power' in section 2(12) of the Act does not mean a very indirect application of power such as use of electric bulbs for providing light in the work-area. Further, the use of power in the manufacturing process should be direct and proximate. The expression 'manufacturing process being carried on with the aid of power' in section 2(12) of the Act does not mean a very indirect application of power such as use of electric bulbs for providing light in the work-area. Unless the links are established, that is to say, it is shown that some process or work is carried on in the establishment which qualifies as 'manufacturing process' within the meaning of section 2(k) of the Factories Act and the manufacturing process is carried on with the aid of power, the mere presence of a refrigerator and a grinder there, even though connected to the main power line may not necessary lead to the inference that the establishment is a factory as defined under section 2(12) of the Act." 24. Keeping in mind the aforesaid decisions rendered by the Hon'ble Supreme Court and the concerned High Court, if the facts of the present case are considered, then it has emerged from the record that food items or any other material were not kept in the cabin of the manager. There is separate room for the purpose of storage of the said items. In the said room, cold-storage or refrigerator is not installed. Chocolates, bournvita, tomato-catchup etc., can be kept without any refrigerator for few days. From the deposition of the witness of the applicant, it is also clear that the establishment was keeping the stock for 10 to 15 days. Thus, merely because the Air-conditioner is installed in the cabin of the manager, it does not mean that said room is used for preserving or storing any article. Even the said room cannot be said to be cold-storage. There is nothing on record to suggest that even Air-conditioner is used by the establishment for 24 hours for preserving the said items. 25. In view of the aforesaid facts, this Court is of the opinion that the ESI Court has wrongly dismissed the application filed by the applicant merely on the basis of the presumption and assumption. ESI Court has observed in the impugned order that when the Air-conditioner is installed in the room by the applicant-establishment, the said Air-conditioner is presumed to be installed for preserving the food items. ESI Court has observed in the impugned order that when the Air-conditioner is installed in the room by the applicant-establishment, the said Air-conditioner is presumed to be installed for preserving the food items. It is further presumed by the ESI Court that Manager is getting salary of Rs.1100/- per month and therefore, it is difficult to believe that Air-conditioner is installed in the cabin of the employee, who is getting such salary. Thus, this Court is of the opinion that the Court below has committed an error while giving the finding that chocolates, bournvita, tomato-catchup etc., are preserved in the Air-conditioner room and the said Air-conditioner room is used as cold-storage. 26. Thus, use of Air-conditioner in the cabin of the manager of the establishment cannot be said to be used by the establishment as cold-storage within the meaning of Clause-VI of Section 2(k) of the Factories Act of 1948. Hence, Air-conditioner cabin of Manager cannot be said to be cold-storage. Thus, answer to the question of law framed in paragraph No. 10 of this judgment is in negative. 27. Accordingly, the impugned order passed by ESI Court is hereby quashed and set aside. Present appeal is allowed. R & P be sent back to the Court below.