Dismissed

The Joint Director, Esi Corporation, v. M/S.Eastern Rug Mills

Kerala HC17 Jan 2013Ins.APP/45/2010

Case brief

AI extract

What is this about?

The High Court of Kerala dismissed an appeal filed by the Joint Director, ESI Corporation, against the Employees' Insurance Court's decision to grant a declaration that M/s. Eastern Rug Mills was not liable under the E.S.I Act due to insufficient employment strength.

What did the court decide?

The appeal against the Employees' Insurance Court's judgment is dismissed; the declaration that the establishment is not covered stands affirmed.

The Joint Director, Esi Corporation, Vs… — Pension and Retirement Benefits | Kerala HC (2013)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR.JUSTICE HARUN-UL-RASHID

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THURSDAY, THE 17TH DAY OF JANUARY 2013/27TH POUSHA 1934

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Ins.APP.No. 45 of 2010 ( )

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AGAINST THE JUDGMENT IN IC.6/2006 DATED 21-12-2009 ON THE FILE OF THE EMPLOYEES' INSURANCE COURT, ALAPPUZHA

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APPELLANT(S)/RESPONDENT:

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THE JOINT DIRECTOR, ESI CORPORATION, DIVISIONAL OFFICE, KURUMPELIL AVENUE, POLAYATHODU KOLLAM-691 021.

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BY ADV. SMT.T.D.RAJALAKSHMY, SC, ESI CORPN.

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RESPONDENT(S)/APPLICANT:

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M/S.EASTERN RUG MILLS, C.C.S.B.ROAD,CIVIL STATION WARD, ALAPPUZHA 1 REPRESENTED BY ITS MANAGING PARTNER MR.JACOB NEROTH-PIN-688 001.

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R1 BY ADV. SRI.R.AZAD BABU

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THIS INSURANCE APPEALS HAVING BEEN FINALLY HEARD ON 17-01-2013, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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mns

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HARUN-UL-RASHID, J.

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Ins.Appeal No. 45 of 2010

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Dated this the 17^th day of January, 2013

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JUDGMENT

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The appellant is the Joint Director of the E.S.I Corporation. The appeal is directed against the judgment dated 21.12.2009 in

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I.C.No.6 of 2006 on the file of the Employees' Insurance Court, Alappuzha. The respondent herein is the applicant before the Employees' Insurance Court. The application is filed for a declaration that the applicant establishment is not liable to be covered under the E.S.I Act and they are not bound to comply with the provisions of the said Act. The Tribunal allowed the application and granted a declaration as sought for. Being aggrieved by the judgment the respondent has preferred this appeal.

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The applicant is an establishment engaged in the business of export of coir and other allied products. According to the applicant, the applicant has never employed 10 or more employees and therefore, the applicant establishment will not come within the purview of E.S.I Act.

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The Insurance Inspector attached to the appellant

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Ins.Appeal No. 45 of 2010 2

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Corporation inspected the applicant establishment on 13.10.2005. He submitted a report reporting that the applicant has employed 10 persons for wages on 6.12.2003 and therefore, the applicant establishment is liable to be covered under the E.S.I Act. Based on the said report, the appellant covered the establishment w.e.f 6.12.2003 and intimated it as per C-11 notice dated 23.11.2005.

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The applicant was examined as PW1. The respondent has examined one witness as DW1. Exts.P1 to P6 and D1 to D4 were also marked.

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The Tribunal examined the issue as to whether the applicant establishment is liable to be covered under the E.S.I. Act. The appellant has imposed coverage on the applicant establishment treating it as a factory as per Section 2(12) of the E.S.I Act. According to the appellant, the applicant has employed 10 persons for wages and the manufacturing process was carried on with the aid of power as on 6.12.2003. The applicant disputed the case of the Corporation that they have employed 10 persons for wages. With regard to the use of power in the manufacturing

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Ins.Appeal No. 45 of 2010

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process there is no dispute between the parties. The dispute is regarding the employment strength.

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The Employees' Insurance Court have scrutinized oral evidence of PW1, DW1 and also evaluated the documentary evidence adduced by the parties. The Employees' Insurance Court, after reading the testimony of PW1, observed that the applicant's case, that he has never employed 10 or more persons for wages on any day, is not controverted in his cross examination in any manner. The evidence tendered by DW1 and on behalf of the appellant Corporation was evaluated in detail. DW1 has conducted inspection of the applicant establishment on 13.10.2005. The attendance register, petty cash book and electricity receipts maintained by the applicant are perused. At the time of survey, he found eight persons were employed for wages there. Out of this, the names of five persons were included in the muster roll. On the basis of the vouchers in the petty cash book, DW1 noticed that in the month of December, the applicant has disbursed salary to five monthly rated employees and has disbursed packing wages, shearing wages,

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Ins.Appeal No. 45 of 2010 4

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loading wages, passing charges and carpentry charges on 6.12.2003 and disbursed wages for attending the above 5 items of wages. On the basis of the report submitted by DW1, the proceedings under the E.S.I Act has been initiated. When DW1 was cross examined he has admitted that on 13.10.2005 he has not come across 10 persons employed for wages there. It is also admitted that 10 persons were not employed for wages on 6.12.2003. The Employees' Insurance Court scrutinized the evidence of DW1 and Ext.D4 survey report and observed that based on payment vouchers dated 6.12.2003, DW1 has assumed that the applicant must have employed 10 persons for wages on 6.12.2003 and 10 persons must have received wages on 6.12.2003.

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After examining the oral and documentary evidence, the Employees' Insurance Court concluded that the assumption of DW1 Insurance Inspector that the applicant must have employed at least 10 persons for wages on 6.12.2003 is only a suspicion and based on this, it cannot be concluded as per law, that the applicant has employed 10 persons for wages on 6.12.2003. In

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Ins.Appeal No. 45 of 2010 5

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the above said facts and circumstances, the Employees' Insurance Court took the view that the action of the respondent in imposing coverage on the applicant establishment based on Ext.D4 report is unsustainable. The observations and findings recorded by the Employees' Insurance Court is based on the evidence adduced by the parties. After examining the evidence on record and after evaluating the same the Employees Insurance Court concluded that there is no evidence to show that 10 or more persons have been employed for wages as alleged by the appellant Corporation. Since the finding is recorded by the Employees Insurance Court on the basis of the materials and evidence on record, I find that no sustainable grounds are made out for interference in the appeal.

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In the result, the appeal fails and is dismissed.

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mns/

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Ins.Appeal No. 45 of 2010 6

The Joint Director, Esi Corporation, v. M/S.Eastern Rug Mills

Case brief

What is this about?

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The Joint Director, Esi Corporation, v. M/S.Eastern Rug Mills

Case brief

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