Dismissed¶13

Sunbeam Vanijya Pvt. Ltd. and Anr. v. Employees State Insurance Corporation and Ors.

Calcutta HC10 Feb 2025FMAT/274/2024

Case brief

AI extract

What is this about?

Keywords: Section 75(2B) Employees’ State Insurance Act, 1948; proviso to Section 75(2B); prior/pre-deposit; waiver and reduction; reasons to be recorded in writing; mandatory fifty per cent deposit; Employees’ Insurance Court; Section 82(2) maintainability; substantial question of law; FMAT 274 of 2024; CAN 1 of 2024; Sunbeam Vanijya Private Limited; appeal against partial allowance of waiver application dismissed.

What did the court decide?

The default provision in Section 75(2B) of the 1948 Act imposes a mandatory duty on the appellants to deposit fifty per cent of the amount due from it in order to prefer a challenge to any order of the Employees’ Insurance Court. ¶6

Sunbeam Vanijya Pvt. Ltd. and Anr. Vs Employees State Insurance Corporation and Ors. — Calcutta HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

Dismissed

¶13

Issue for consideration

Whether the impugned order of the Employees’ Insurance Court reducing the pre-deposit from fifty per cent to twenty per cent, without granting a complete waiver, is tainted by perversity and calls for interference. +2 more

¶2

Court's answer

¶6

Ratio / Principle

Reduction or waiver of the statutory deposit is available only by way of exception under the proviso to Section 75(2B), for reasons to be recorded in writing.

¶8

Key takeaways

The proviso casts a duty on the court, if it chooses to waive or reduce the deposit, to attribute reasons for doing so.ratio¶8
The converse does not follow: where the challenger is directed to deposit the mandated fifty per cent, the court is not obliged to give reasons; reasons are required only when a waiver or reduction is granted.ratio¶9
Since the Employees’ Insurance Court had already reduced the pre-deposit from fifty per cent to twenty per cent, the appellants’ only conceivable grievance is the non-waiver of the twenty per cent portion, for which no reasons are required to be given.

Detailed headnote1 paragraphs

Pre-deposit under Section 75(2B), Employees’ State Insurance Act, 1948 — reasons for waiver/reduction. The Court held that the statutory fifty per cent prior deposit is the mandatory default for challenging an order of the Employees’ Insurance Court, and that waiver or reduction under the proviso is an exception exercisable only for reasons recorded in writing. Where a reduction is in fact granted (here, from fifty per cent to twenty per cent), no reasons are required for declining to waive the residual portion, since the converse obligation exists only when a waiver or reduction is granted. The appellants’ grievance thus reduced to the non-waiver of the twenty per cent, for which no reasons were needed; no error or substantial question of law arose to sustain the appeal under Section 82(2) of the Act. FMAT 274 of 2024 dismissed on contest; consequentially CAN 1 of 2024 dismissed; no order as to costs.

¶1

A-30 Ct No.16 10.02.2025 TN

¶2

FMAT 274 of 2024 IA No: CAN 1 of 2024

¶3

Sunbeam Vanijya Private Limited and another Vs.

¶4

Employees’ State Insurance Corporation and others

¶5

Mr. Soumya Majumdar, Ld. Sr. Adv., Mr. Ayan Poddar, Mr. Debdut Mukherjee, Mr. Agnish Basu, Mr. Vipul Vedant

¶6

….for the appellants

¶7

Mr. Tilak Mitra ….for the respondent (ESI corporation)

¶8

Ms. A. Rao

¶9

….for the respondent no.6

¶10

The present appeal has been preferred against an order whereby the appellants’ application under Section 75(2B) of the Employees’ State Insurance Act, 1948 has been partially allowed and partially rejected. The appellants sought a complete waiver of the statutory fifty per cent prior deposit to be put in by an entity challenging an order of the Employees’ Insurance Court. While dealing with the said application, the Employees’ Insurance Court dealt with several issues and ultimately reduced the deposit to twenty per cent from the statutory fifty per cent.

¶11

¶12

Learned senior counsel appearing for the appellants contends that the impugned order is tainted by perversity.

¶13

First, although the agreement by which the present appellants took over the functioning of the company categorically mentioned the cut-off date of the liabilities to be taken by the appellants, which commenced after the date when the dues-in-question accrued, the learned Trial Judge completely overlooked such aspect of the matter by observing in a perverse manner that no such provision is found in the agreement.

¶14

That apart, the learned Employees’ Insurance Court also held that the applicant, that is, the present appellants were served notices by the Corporation at the “relevant point of time”. There was no question of such service of notice since it was found by the ESI Corporation that the predecessor-in-interest of the appellants, one Union General, had the liability to pay the dues of the employees under ESI Act, when the appellants had not yet taken over management of the concern.

¶15

Learned senior counsel places stress on the proviso to Section 75(2B) in support of his contentions and argues that for reduction and/or waiver, reasons have to be given. In the present case, the reasons

¶16

¶17

given are insufficient and perverse, calling for interference by this court.

¶18

However, with respect to the erudition of learned senior counsel for the appellants, we are unable to accept such contention. The default provision in Section 75(2B) of the 1948 Act imposes a mandatory duty on the appellants to deposit fifty per cent of the amount due from it in order to prefer a challenge to any order of the Employees’ Insurance Court.

¶19

The proviso to the said sub-section carves out an exception to the effect that the Court may, that too for reasons to be recorded in writing, waive or reduce the amount to be deposited under the sub-section.

¶20

Thus, it is only by way of an exception that the court has the discretion to reduce or waive the deposit amount. As such, the proviso casts a duty on the court, if it chooses to waive or reduce the amount, to attribute reasons for doing so.

¶21

However, it is evident from the language of the proviso that the converse logic is not borne out by the said language. In the event the appellants are directed to deposit the entire fifty per cent as mandated by sub-section (2B), there is nothing in law to mandate the court to give reasons therefor, since it is the default requirement of preferring a challenge. Only in the event a waiver or reduction is granted by the court, reasons are to be attributed by the court.

¶22

¶23

In the present case, the Employees’ Insurance Court has reduced the pre-deposit from fifty per cent to twenty per cent. By no stretch of imagination can the appellants be aggrieved by such reduction to twenty per cent. The only conceivable grievance of the appellants can be that the entire pre-deposit was not waived, that is, with the twenty per cent deposit directed to be made.

¶24

Thus, the grievance of the appellants boils down to the non-waiver of the prior deposit to the extent of twenty per cent of the dues, for which no reasons are required to be given as discussed above.

¶25

Thus, we do not find any error and/or any substantial question of law being involved in the present appeal, which is a prerequisite for the maintainability of an appeal before this court under Section 82(2) of the Employees’ State Insurance Act, 1948.

¶26

As such, FMAT 274 of 2024 is dismissed on contest.

¶27

Consequentially, CAN 1 of 2024 is also dismissed.

¶28

There will be no order as to costs.

¶29

(Sabyasachi Bhattacharyya, J.)

¶30

(Uday Kumar, J.)

Sunbeam Vanijya Pvt. Ltd. and Anr. v. Employees State Insurance Corporation and Ors.

Case brief

What is this about?

What did the court decide?

Sunbeam Vanijya Pvt. Ltd. and Anr. v. Employees State Insurance Corporation and Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

Issues for consideration

Statutes considered

Procedural history

Parties & counsel

Coram

Case details

Similar cases

Standard Chartered Bank Ltd. Vs Sanjib Kumar Dey Alias Sanjib Dey and Anr.

Standard Chartered Bank Ltd. Vs Sanjib Kumar Dey and Anr.

Dipak Samanta Vs Biswajit Ray

Subrata Chowdhury Vs Apurba Paul and Anr.

Shuvendra Mullick Vs Indranil Mullick and Ors.

Yajur Fibres Limited Vs Dharmendra Tiwari and Ors.