24 December 2014
Pursuant to Section 1 of the Employees' State Insurance Act, 1948 (ESI Act), the ESI Act is applicable to all factories in the first instance. The appropriate government however is empowered to extend the provisions of the ESI Act to other class of establishments with appropriate notice. In a recent ruling, while determining the applicability of the ESI Act to a software company, the Bombay High Court took a view that software development is a manufacturing process and the premises where computers are involved in such a manufacturing process is a factory for the purposes of the ESI Act.