Dismissed

Esi Corporation v. M/S Jos Tex/Jose Brothers/Saree Kendra

Kerala HC14 Sept 2017Ins.APP/3/2016

Case brief

AI extract

What is this about?

An insurance appeal preferred by the ESI Corporation against an order of the Employees' Insurance Court, Alappuzha, that reduced the damages for failure to remit contributions. The High Court upheld the lower court's order.

What did the court decide?

Appeal dismissed; order dated 3.3.2016 of the Employees' Insurance Court, Alappuzha, directing remittance of ₹3500/- as damages, upheld.

Esi Corporation Vs M/S Jos Tex/Jose Brothers/Saree Kendra — Banking and Recovery | Kerala HC (2017)

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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 P.D.RAJAN

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THURSDAY, THE 14TH DAY OF SEPTEMBER 2017/23RD BHADRA, 1939

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Ins.APP.No. 3 of 2016 ()

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AGAINST THE ORDER IN IC 123/2013 of EMPLOYEES'INSURANCE COURT, ALAPPUZHA DATED 3.3.2016

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APPELLANT(S)/1ST RESPONDENT:

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ESI CORPORATION SUB REGIONAL OFFICE, MALU'S COMPLEX, KALOOR, ERNAKULAM-682 017, REPRESENTED BY ITS DEPUTY DIRECTOR.

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BY ADV. SRI.K.SANDESH RAJA

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RESPONDENT(S)/APPLICANT:

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M/S JOS TEX/JOSE BROTHERS/SAREE KENDRA EAST FORT GATE, TRIPUNITHURA-682301, (REPRESENTED BY ITS PRINCIPAL EMPLOYER MS.LALY ANTONY).

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R1 BY ADV. SRI.M.P.MATHEW (MALAYIL)

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THIS INSURANCE APPEAL HAVING BEEN FINALLY HEARD ON 14-09-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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acd

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P.D.RAJAN, J.

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Ins. Appeal No. 3 of 2016

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Dated this the 14^th day of September, 2017

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JUDGMENT

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This appeal is preferred against the order in I.C.No.123/2013 of Employees' Insurance Court, Alappuzha

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by the Deputy Director, ESI Corporation. The respondent establishment is covered under the Employees' State Insurance Act and they failed to remit the contribution from 3/2009 to 6/2010. The respondent contended that the contribution from 3/2009 to 92009 was paid in the year 2011 and the contribution from 10/2009 to 6/2010 was paid in the year 2013. Hence, the appellant issued notice to realise damages for 24,888/- from the respondent. Being₹ aggrieved by that, the respondent approached the Employees' Insurance Court, Alappuzha, where the application was partly allowed and the learned Insurance Court directed the respondent to remit 3500/- as damages.₹

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Being aggrieved by that, the ESI Corporation preferred this

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Ins. Appeal No.3/2016

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appeal.

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2. Section 85B of Employees' State Insurance Act

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reads as follows:

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“85B.Power to recover damages .- (1) Where an employer fails to pay the amount due in respect of any contribution or any other amount payable under this Act, the Corporation may recover from the employer by way of penalty such damages not exceeding the amount of arrears as may be specified in the regulations:

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Provided that before recovering such damages, the employer shall be given a reasonable opportunity of being heard:

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Provided further that the Corporation may reduce or waive the damages recoverable under this section in relation to an establishment which is a sick industrial company in respect of which a scheme for rehabilitation has been sanctioned by the Board for Industrial and Financial Reconstruction established under section 4 of the Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986), subject to such terms and conditions as may be specified in regulations.

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(2) Any damages recoverable under sub-section (1) may be recovered as an arrear of land revenue or under section 45C to section 45-1.”

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Apex Court in Employees State Insurance Corporation v. H.M.T. Ltd. [2008(3) SCC 35] held that

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existence of mens rea or actus reus to contravene a statutory

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provision must also be held to be a necessary ingredient for

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levy of damages and the quantum thereof.

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Ins. Appeal No.3/2016 3

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Nothing was stated in the appeal to show that there was deliberate action from the side of the respondent for remitting the dues. In the absence of such mens rea or actus reus the learned E.I. Court reduced the compensation to ₹3500/-. I find no illegality in the order. There is no merit in this appeal and it is dismissed accordingly.

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P.D.RAJAN, JUDGE.

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acd

Esi Corporation v. M/S Jos Tex/Jose Brothers/Saree Kendra

Case brief

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Esi Corporation v. M/S Jos Tex/Jose Brothers/Saree Kendra

Case brief

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