Delhi District Court
M/S. Smc Global Securities Ltd vs Employees State Insurance Corporation on 21 December, 2022
In the Court of Shri Anuj Kumar Singh : Additional Senior Civil
Judge of Central District at Tis Hazari Courts, Delhi
ESIC No.15/2016
CNR No.DLCT030002372012
In the matter of :-
M/s. SMC Global Securities Ltd.
(Through Authorized Representative)
11/6B, Shanti Chamber, Pusa Road,
Rajendra Place, New Delhi-110008
......Petitioner
VERSUS
Employees State Insurance Corporation,
Rajendra Place, Rajendra Bhawan,
New Delhi-110008
......Respondent
Date of institution : 13.02.2012
Reserved for Judgment : 30.09.2022
Date of decision : 21.12.2022
Petition under Section 75 of the ESI Act.
JUDGMENT
1. This is the petition filed by petitioner under Section 75 of Employees State Insurance Act, 1948 (hereinafter referred as "Act") seeking setting aside/quashing of the order under Section 45A dated 18.10.2010 passed by the Joint Director as well as the order dated 06.01.2012 under Section 45AA passed by the appellate authority i.e. the Additional Commissioner and the Regional Director of the respondent and also for seeking refund of 25% of the determined amount of Rs.7,76,613/- deposited by the petitioner alongwith its appeal under Section 45AA by the respondent.
ESIC No.15/2016 Page no. 1 of 18 Petitioner's case
2. The brief facts of the case of the petitioner as averred in the petition are that the petitioner, by means of the present petition under section 75 of the Employees' State Insurance Act, 1948 (hereinafter referred to as "the Act") impugns the order under Section 45A of the Act dated 18.10.2010 as well as subsequent order under Section 45AA dated 06.01.2012 passed by Appellate Authority of the respondent, upholding the order dated 18.10.2010 thereby directing the petitioner to pay contribution of sum of Rs.31,06,450/- for the period 09/2005 to 12/2007. It is stated that the petitioner is a public limited company, incorporated under the Companies Act, 1956 and having its Registered office at 11/6-B, Shanti Chambers, Pusa Road, New Delhi-110005. (previously at 17, N.S. Marg, Darya Ganj, New Delhi -110002) and Sh. Suman Kumar is the Company Secretary & Legal Head of the Company, who is fully conversant with the facts and circumstances of the present case and besides he is duly authorized by the Board of directors of the Company in their meeting, held on 30.05.2011 to sign, file and institute the present petition on behalf of the Petitioner. It is stated that the the petitioner company is a share broking house and registered with Securities and Exchange Board of India (SEBI). It is further averred in the petition that whenever any ESI inspector had visited the premises of the petitioner company, the petitioner company had shown all the records and provided all the details of the petitioner company as sought by the inspector, which have been duly acknowledged. It is stated that vide letter dated 15/01/2008 of Sh. Prakash Chand, Assistant Area Director, the petitioner company was informed that it has been allotted code No. 11-40- 1347-1001 on the basis of the report of the inspector as the establishment is ESIC No.15/2016 Page no. 2 of 18 covered under Section 1(5) of the ESI Act, 1948. It is stated that the inspector of the respondent visiting the premises of the petitioner informed the petitioner that the ESI Act is made for the welfare of the employees and hence, advised the petitioner company to enroll itself to avail the benefits of ESI for its employees. Accordingly, the petitioner filled in the employer's registration from as per the advice of the visiting inspector of the respondent while specifically mentioning therein regarding "non- applicability" of the Act to the respondent. It is pertinent to mention that an Inspector of the Respondent have visited and verified the requisite records of the petitioner on 8th September 2009, 9th September 2009, 16 September 2009, 21st September 2009, 22st September 2009, 23st September 2009 and on each and every visit of the said inspector, the petitioner has fully co operated and provided all the documents and records of the petitioner company. It is stated that the petitioner, however, received a showcause notice in form C18 dated 23.08.2010 from the Joint Director of the respondent vaguely mentioning therein that the petitioner company is liable to pay E.S.I. contribution amounting to Rs. 31,06,450/ from 07/05 to 12/07 and asking why assessment should not be made of the aforesaid sum. The petitioner company was given time of 15 days to reply to the aforesaid notice. It is stated that on the scheduled date of hearing i.e. 12.10.2010, Ashok Aggarwal and Sh. Suman Kumar, Authorized Representatives of the petitioner company appeared before the respondent and submitted a detailed reply to the said show cause notice and argued that the petitioner company is not liable to make the aforesaid contribution as its establishment is not covered under the act. The petitioner company argued that it is only a broking house'. It is stated that the definition of 'shop is not ESIC No.15/2016 Page no. 3 of 18 defined in the ESI Act and therefore to know the exact meaning of shop, one has to derive its meaning in the present context from the prevailing definition which is defined in Section2(27) of the Shops and Establishment Act. Moreover, the word 'shop' has not been defined in the ESI Act, 1948 which could facilitate the respondent to cover it under the ESI Act 1948 nor any notification has been issued by the respondent so as to cover the establishment like that of petition. It is stated that the petitioner company is a commercial establishment which is specifically excluded from the definition of the 'Shop' as above. It is, therefore, necessary to peruse carefully the definition of commercial establishment which is defined under Section 2(5) of Shops and Establishment Act.
3. It is further averred in the present execution petition that the petitioner herein requested the Joint Director of the respondent to supply to it the inspection report and findings as per S.S.O and Inspection report dated 09/07/2010 vide letter dated 12.10.2010 so as to enable the petitioner to represent itself before the respondent but the same was not supplied to the petitioner, which in the face of the highly vague show cause notice has highly prejudiced the petitioner in defending the 45A proceedings. It is stated that the petitioner company is a stockbroking house and it does not carry any such activity as defined in the definition of shop under the Delhi shops and establishments Act and nor any notification has been issued to cover the nature of establishment of the petitioner company hence, it is not liable to be covered. The Hon'ble Supreme Court has held that meaning of 'shop' has to be understood in common parlance. Therefore, a broking ESIC No.15/2016 Page no. 4 of 18 house is quite manifestly not a shop and hence, is not at all liable to be covered under the provisions of the ESI Act. It is stated that the petitioner company has always cooperated with the respondent and has provided all the details and documents sought by them from time to time. Furthermore, the show cause notice issued to the petitioner company is bad in law as has been held in ESIC vs. C.C. Santha Kumar by Hon'ble Supreme Court that "where records were produced for the assessment then the assessment has to be made under Section 75(2) (a) of the ESI Act and Section 45A comes into picture only when the employer fails to produce records to the corporation." Moreover the petitioner company did not itself apply to the respondent for its coverage under the act but was advised to do so by the inspector of the respondent, which it did by specifically mentioning in the form regarding' non applicability of the Act. It is stated that the Joint Director of the respondent did not pay heed to the sound and cogent contentions of the petitioner company and arbitrarily and capriciously passed an order under Section 45A dated 18.10.2010 directing the petitioner to pay contribution amounting to Rs. 31,06,450/ for the period 08/2005 to 12/2007. The aforesaid order was nonspeaking order which is against the law and no cogent reasons have been given for determining the liability of the petitioner to pay the contribution. It is stated that aggrieved by the order under section 45 A of the respondent corporation and by depositing the requisite 25% of the determined amount of Rs.7,76,613/ vide Demand Draft No. 063118 dated 15/12/2010 drawn on HDFC Bank, the petitioner company preferred an appeal under section 45AA of the ESI Act to the ADDl. Commissioner and Regional Director. It is stated that the ESIC No.15/2016 Page no. 5 of 18 petitioner company reiterated in its appeal that the order of the Joint Director under section 45A is bad in law as the establishment of the petitioner company is not liable to be covered under the ESI Act. The petitioner company further contended that it is not the case of the respondent that the petitioner has not cooperated with the respondent as it has provided all the documents as sought by the inspector on his visits. Hence, no cause of action ever arose in favour of the respondent to invoke the provisions of Section 45A of the ESI Act. It is pertinent to mention that the show cause notice under C18 was issued on adhoc basis. It is stated that the petitioner company further contended that the order passed under section 45A is patently absurd as the activities of the petitioner company by no stretch of imagination bring it within the ambit of 'shop' and hence, not liable to be covered under the ESI Act. While labeling the petitioner company as 'shop', the respondent has erred in applying its mind to the role of the petitioner company and the exact nature of work which merely is broking house. Hence, neither common prudence nor legal justification compels the judicious mind to term the petitioner's activities as that of a 'shop'.
4. It is further averred in the petition that the petitioner company further contended that both the orders passed by Section 45A and 45AA respectively are in complete violation of natural justice as the petitioner was deprived and not entitled to have the copy of the Inspection record as sought by the petitioner and the respondent arbitrarily rejected this vital contention by saying that no prejudice has caused to the petitioner which is ESIC No.15/2016 Page no. 6 of 18 grossly erroneous and untenable ground. It is stated that since the Act does not define the word "Shop" whereas it is defined under Delhi shops and Establishment Act under section 2(27) to not include a factory or commercial establishment and under section 2(5) that the commercial establishment having been defined to include premises in which business of stocks and share brokerage is carried on, the establishment of the petitioner admittedly engaged in carrying on the business of stocks and share brokerage, could not have validly been held to be a 'Shop' covered under the Act. Besides, for any common parlance, such establishment is not publicly recognized as 'Shop'. Therefore the Act was not applicable to it. The petitioner further argued before appellate authority that the petitioner has not been expressly covered under the ESI Act as only those establishment are covered which are notified under Section 1(5) in the official gazette. The same view has been given by Supreme Court in the case of Bangalore Turf Club Ltd. vs. ESIC wherein the court has held that the presumption that all the establishments are covered is not correct. The appellate authority also ignored the fact that the order given under Section 45A was bad in law as the same was a nonspeaking order which is clearly against the established legal principles and natural justice.
5. The contentions of the petitioner to assail the order passed under Section 45A were arbitrarily rejected by the Appellate Authority which wrongly upheld the order of the Joint Director, vide its order dated 06.01.2012. It is quite important to take note that both the orders under Section 45A and 45AA respectively are clearly untenable in law as the ESIC No.15/2016 Page no. 7 of 18 respondent had no legal ground to invoke the provisions of the Section 45 A and thereby passing order to pay the contribution. Both the orders are totally misconceived, completely illegal and liable to be quashed. Hence, the present petition.
Respondent's case
6. Reply has been filed on behalf of the respondent wherein it is contended that the respondent/ESIC is a statutory body established under the Employees State Insurance Act, 1948 to achieve the Goal of securing Social security and social justice set out in Part IV of the Constitution of India in form of Directive Principles of State Policy. ESI Act is beneficial piece of legislation. It is stated that for achieving the goal of social security to the small laborers having average monthly wage of less that Rupees Ten thousand, the Employees State Insurance Corporation has established many hospitals including nodal hospitals with all modern technology and techniques having highly qualified medical and non medical staff. It is stated that the corporation is wholly dependant on the contributions made by the covered enterprises, interest on delayed payments and damages for default for maintenance of its fund etc for achieving the aims set out by the Act. It is further contended in the preliminary objections of the reply that the petitioner herein has not approached this court with clean hands and has concealed material facts therefrom and made false, frivolous and concocted claims. It is stated that the present petition is not maintainable for non compliance of the provisions of Section 75 (2B) of the ESI Act. It is stated that the petition is not maintainable for non-joinder of necessary parties. It is stated that the petitioner herein has refrained from impleading the ESIC No.15/2016 Page no. 8 of 18 workers or alternatively the union representing the workers as party, therefore the petition is not maintainable in its present form unless the workers/ employees or its union/ s are impleaded as defendatns herein. In the parawise reply, it is contended that there is no illegality in order dated 18.10.2010 as well as order dated 06.01.2012. It is submitted that the Social Security Officer of the Corporation visited the premises of the petitioner company on 13.12.2007 and again on 14.12.2007, however the records were not produced. It is stated that the SSO also visited the employer premises on 08.09.09, 09.09.09, 16.09.09, 21.09.09 and 22.09.09. The petitioner submitted a letter dated 23.09.09 requesting that they are producing the records from 1998-99 and that the records prior to 1 st April 1998 are not available. It is stated that the SSO again visited on 30.10.09, 09.11.09 and 11.05.10 and finally on 09.07.10 on which date the records were produced. It is stated that the notice of assessment in form C-18 dated 23.08.10 for Rs. 31,24,133/- was issued for a period of 08/05 to 12/07 on the basis of the verification of records conducted by the corporation. It is stated that the petitioner company is squarely covered under the definition of term "Shop" and thus coverable as such. It is stated that the order dated 18.10.10 and 06.01.12 have been passed after giving due opportunity to the employer and taking into consideration all the averments made by him during the course of personal hearing. It is stated that the order under Section 45A was issued in accordance with the provisions of the ESI Act. It is prayed that the petition may be dismissed with exemplary cost.
7. Rejoinder was also filed by the petitioner to the reply of the respondent wherein the contents of the petition were reiterated and contentions raised in the written statement have been traversed.
ESIC No.15/2016 Page no. 9 of 18 Issues:
8. From the pleadings of the parties, following issues were framed by Ld. Predecessor of this Court on 23.04.2012 for trial :-
1. Whether the orders dated 18.10.2011 and 06.01.2012 are liable to be quashed, if so to what effect? OPP
2. Relief.
Plaintiff's evidence:-
9. In support of his case, the petitioner has examined Shri Suman Kumar, Company Secretary and Legal Head, AR of the petitioner company as PW1 who in his affidavit in evidence Ex.P1 has stated and reiterated on oath the contents of the petition. The petitioner has relied upon certain documents which are as under:-
i. Ex PW1/1 is copy of order under Section 45A dated 18.10.2010. ii. Ex PW1/2 is copy of order under Section 45AA dated 06.01.2012.
iii. Ex.PW1/3 is copy of extract of board resolution dated 30.05.2011 iv. Ex.PW1/4 is copy of letter dated 15.01.2008.
v. Ex.PW1/5 is copy of employer's registration form.
vi. Ex.PW1/6 is copy of Form C18 dated 23.08.2010
vii. Ex.PW1/7 is copy of letter dated 12.10.2010.
viii. Ex.PW1/8 is copy of appeal.
ix. Ex.PW1/9 is copy of demand draft no.063118 dt.15.12.2010.
ESIC No.15/2016 Page no. 10 of 18
10. The PE was closed vide order dated 10.07.2012. On the same day, the Respondent Evidence was also closed and the matter was fixed for final arguments.
11. Final arguments have been heard. Record has been carefully perused. I have also gone through the written arguments placed on record on behalf of the parties along with the supporting judgments.
12. Now I shall give my issue-wise findings.
Issue no. 1 : Whether the orders dated 18.10.2011 and 06.01.2012 are liable to be quashed, if so to what effect? OPP
13. It is the case of the petitioner that whenever the ESI Inspector had visited the premises of petitioner, petitioner company had shown all the record and provided all the details of the petitioner company as sought by the inspector. Petitioner company was informed vide letter dated 15.01.2008 by the Assistant Area Director of the respondent that petitioner company has been allotted Code no.11-40-1347-1001 and the petitioner company is covered under Section 1 (5) of the ESIC Act, 1948. It is averred in the petition that inspector of the respondent have visited and verified the record of the petitioner on 08.09.2009, 09.09.2009, 16.09.2009, 21.09.2009, 22.09.2009, 23.09.2009 and on each and every visit of the ESIC inspector, the petitioner company fully cooperated and provided all the documents and record.
ESIC No.15/2016 Page no. 11 of 18
14. Main contention of the petitioner company is that the petitioner company is only a broking house and does not come within the prevailing definition of shop as defined in Section 2 (27) of the Shops and Establishment Act, so notice of assessment in Form C-18 for a period of August, 2005 to December, 2007 under Section 45A and Section 45AA by respondent/ESIC is in complete violation of natural justice.
15. Section 45A of the ESIC Act reads as follows:
45A. Determination of contributions is certain cases. - (1) Where in respect of a factory or establishment no returns, particulars, registers or records are submitted, furnished or maintained in accordance with the provisions of section 44 or any [ Social Security Officer] or other official of the Corporation referred to in sub-section (2) of section 45 is [prevented in any manner] by the principal or immediate employer or any other person, in exercising his functions or discharging his duties under section 45, the Corporation may, on the basis of information available to it, by order, determine the amount of contributions payable in respect of the employees of that factory or establishment:
[Provided that no such order shall be passed by the Corporation unless the principal or immediate employer or the person in charge of the factory or establishment has been given a reasonable opportunity of being heard:] [Provided further that no such order shall be passed by the Corporation in respect of the period beyond five years from the date on which th contribution shall become payable.]
2. An order made by the Corporation under sub-section (1) shall be sufficient proof of the claim of the Corporation under section 75 or for recovery of the amount determined by such order as an arrear of land revenue under section 45B [or the recovery under sections 45C to 45-I].
16. On the other hand, it is the case of the respondent that SSO of the respondent visited the premises of the petitioner on 08.09.2009, 09.09.2009, 16.09.2009, 21.09.2009, 22.09.2009 and 23.09.2009 and the petitioner company produced the record of 1998-1999 and record prior to 01.04.1998 were not made available. The SSO again visited on 30.10.2009, 09.11.2009, 11.05.2010 and finally on 09.07.2010 and on 09.07.2010, records were produced. It is further case of the respondent that notice of ESIC No.15/2016 Page no. 12 of 18 assessment in Form C-18 dated 23.08.2010 for Rs.31,24,133/- was issued for a period of August, 2005 to December, 2007 on the basis of the verification of the record conducted by the Corporation and representative of the petitioner appeared before the respondent on 12.10.2010 and an order under Section 45A was passed on 18.10.2010. The said order was challenged by the petitioner before the Appellate Authority under Section 45 AA of the Act. The Appellate Authority passed an order dated 06.01.2012. Thereafter, petitioner preferred the present petition.
17. It is argued by ld. counsel for the petitioner company that the petitioner company is not covered under ESI Act as no definition covers the activity of the petitioner. It is not covered under Section 1 (4) under the category of factory/establishment and also definition of 'factory' under Section 2 (12) of the Act is also not applicable to the petitioner. It is further argued that the petitioner is not covered under Section 2 (27) of the Shops and Establishment Act. It is further argued that there is nothing on record on behalf of the respondent that activity of the petitioner comes under the purview of shop and no clarification has been taken from petitioner company.
18. Ld. counsel for the petitioner has relied upon the following judgments :
i. ESI Corpn. Vs. C.C. Santhakumar (2007) 1 SCC 584 ii. R.S. Ganesh Dass Dhomi Mal & Anr. Vs. Employees State Insurance
Corporation F.A.O. 139 of 1973 dated 15.10.1987 (Hon'ble Delhi High Court) ESIC No.15/2016 Page no. 13 of 18 iii. M/s. DCM Shriram Consolidated Ltd. Vs. Employees Insurance Court Delhi & Ors. FAO No.4/2001 dated 12.05.2008 (Hon'ble High Court of Delhi)
19. On the other hand, ld. counsel for the respondent has argued that term "shop" has not been defined in ESI Act, but in a catena of judgments, the word has been defined by the Hon'ble Supreme Court. He has cited the following judgments to support his arguments :
(i) Hindu Jea Band, Jaipur Vs. ESIC 1987 (2) SCC 101
(ii) International Ore and Fertilizers (India) Pvt. Ltd. Vs. ESI
Corporation (1987) 4 SCC 203
(iii) Cochin Shipping Company Vs. ESIC AIR 1993 SC 252
(iv) ESIC Vs. R.K. Swamy AIR 1994 SC 1154
(v) Kirloskar Consultant Ltd. Vs. ESIC AIR 2000 SC 3720
(vi) ESIC Vs. Hydrabad Race Club AIR 2004 SC 3972
vii Banaglore Turf Club Ltd. Vs. ESIC AIR 2015 SC 221
viii Kirloskar Brothers Ltd. Vs. ESIC 1996 (2) SCC 682
ix Delhi Gymkhana Club Vs. ESIC 2014 (143) FLR 927
x. Board of Control for Cricket in India Vs. Regional Director
Employees State Insurance Corporation SLP (C) No.13554-13555 of 2022
20. It is further argued by the counsel for the respondent that the petitioner company was having more than 10 employees for the period in question. It is also a matter of record that salaries were being paid to its employees by the petitioner company. He has relied upon the above mentioned judgments, but the most relevant one is Banaglore Turf Club Ltd. Vs. Regional Director, ESIC AIR 2015 SC 221 wherein it was held that :
ESIC No.15/2016 Page no. 14 of 18 "The word 'shop' is not defined either in the ESI Act or in the notification. The ESI Act being a Social Welfare Legislation intended to benefit as far as possible workers belonging to all categories, one has to be liberal in interpreting the words in such a welfare legislation. The definition of a shop which meant a house or building where goods are sold or purchased has now undergone a great change. The word 'shop' occurring in the Notification is used in the larger sense than its ordinary meaning. What is now required is a systematic economic or commercial activity and that is sufficient to bring that place within the sphere of a 'shop'. In view of the fact that an 'establishment' has been found to be a place of business and further that a 'shop' is a business establishment, it can be said that a 'shop' is indeed covered under, and may be called a sub-set of, the term 'establishment'."
21. Considering the above ratio, if a systematic, economic and commercial activity is carried on in the premises then such activity is to be considered in the category of shop. The traditional definition of shop has been given extended meaning by the Hon'ble Supreme Court. Since the petitioner company was having more than 10 employees in the period in question and salaries were paid by the petitioner company to its employees, it comes within the purview of ESIC Act. It is admitted case of the petitioner that the petitioner is a public limited company incorporated in the year 1994 and is a stock broking house and registered with SEBI. Similar question was dealt with by the Hon'ble Supreme Court in the case titled as Employee of State Insurance Corporation Versus R.K. Swamy and others AIR 1994 SC 1154, it has been held as under :
"16. In the light of these judgments and the expanded meaning now given to the word "shop", the evidence which we have reproduced above setting out the different activities of an advertising agency needs to be considered. Clients call on an advertising agency to initiate campaigns for promotion of their products.
ESIC No.15/2016 Page no. 15 of 18 Advertising campaigns can be conducted in the different media and otherwise. The advertising agency gives advice in this behalf and as to possible expenses. The advertising agency prepares and presents alternative campaigns for the client to choose from. For such purpose it must prepare the necessary art work and the appropriate words to go with it. It employs specialists in these fields. The advertising agency is paid for the service it renders as aforesaid by the client. It also receives commission from the media through whom advertising is done."
22. Applying the ratio of R.K. Swami's judgment (supra) to the present case, since the petitioner company is involved in systematic, economic and commercial activity and is a profit earning institution, it must pass on the benefits to its employees by extending a coverage of ESI contribution on the wages payable to the coverable employees. If the test of Banaglore Turf Club Ltd. (supra) is adopted, the activities carried out by the petitioner company are the commercial activities, therefore, for the purpose of ESIC Act, the petitioner company can be said to be a shop as held in aforesaid judgment. ESIC Act being a beneficial legislation, the broadest meaning should be given to achieve the object and purpose of enactment of the ESIC Act, namely, to provide certain benefits to employees in case of sickness, maternity in case of female employees, employment injury etc.
23. In view of above discussions, the petitioner company can be said to be a shop for the purpose of the ESIC Act. I find no merits in the arguments of the ld. counsel for petitioner that the petitioner company is not a shop. Before concluding, this Court is also of the opinion that petition is bad for non joinder of necessary parties as held in Fertilizers and Chemical Travancore Ltd. Vs. Regional Director ESIC & Ors. Civil Appeal No.917-918 of 2004. The relevant paragraphs of the said judgment are reproduced hereunder :
ESIC No.15/2016 Page no. 16 of 18
6. Labour Statutes are meant for the benefit of the workmen. Hence, ordinarily in all cases under labour statutes the workmen, or at lease some of them in a representative capacity, or the tradeunion representing the concerned workmen must be made a party. Hence, in our opinion the appellant (petitioner before the Employees Insurance Court) should have impleaded atleast some of the persons concerned, as respondents.
11. In our opinion, wherever any petition is filed by an employer under Section 75 of the Act, the employer has not only to implead the ESIC but has also to implead at least some of the workers concerned (in a representative capacity if there are a large number of workers) or the tradeunion representing the said workers. If that is not done, and a decision is given in favour of the employer, the same will be in violation of the rules of natural justice. After all, the real concerned parties in labour matters are the employer and the workers. The ESI Corporation will not be in any way affected if the demand notice sent by it under Section 45A/45B is quashed.
13. In the present case the workmen concerned were not made parties before the Employees Insurance Court, nor was noticed issue to them by the said Court.
14. Also, the order of the Employees Insurance Court dated 04.02.1993, relevant portion of which we have quoted, is not a very happy one as no proper determination has been made therein as to whether the workmen concerned are the employees of the appellant and whether they are entitled to the benefit of the Act. No doubt some observations have been made that some labourers come on one day but they may not come on the next day. Having said so, a direction has been given that the ESI Corporation will after making inquiries about the identities of the said workers will register them and then extended the benefit of the Act.
15. In our opinion, the Employees Insurance Court should have itself made a proper investigation of the facts after getting evidence from the parties, including the workmen concernd, and after impleading them as party in the petition, it should have determined the questions as to whether the persons concerned were the employees of the appellant or not.
24. In view of above, arguments of the petitioner that activity of the petitioner is beyond the scope of ESI Act and is not covered under the category of shop is not tenable and likely to be shelved. The Hon'ble Apex Court has categorically held that economic and systematic activity comes under the purview of shop.
ESIC No.15/2016 Page no. 17 of 18
25. A statutory duty had been cast to the employer under Regulation 10B of the ESI (General Regulation) to submit Form 01 as and when ESIC Act is applicable. When the petitioner company was detected for applicability of the ESIC Act since 2004, past liability cannot be ignored on whimsical technical ground. In my humble opinion, there is no infirmity, illegality in the orders dated 18.10.2010 and 06.01.2012. Therefore, the petitioner has miserably failed to prove that the petitioner company was not liable to pay ESIC dues from August, 2005 to December, 2007. Hence, this issue is decided in favour of the respondents and against the petitioner.
Relief
26. In the light of above discussions and my issue wise findings given above, the petition of the petitioner is dismissed. Respondent is at liberty to proceed for the recovery as per the law. No order as to cost. Decree sheet be prepared accordingly. File be consigned to Record Room after due compliance.
ANUJ Digitally signed
by ANUJ KUMAR
KUMAR SINGH
Announced in the Open Court SINGH
Date: 2022.12.21
16:42:58 +0530
on 21.12.2022
(Anuj Kumar Singh)
Additional Senior Civil Judge
Central District: Tis Hazari Courts: Delhi
ESIC No.15/2016 Page no. 18 of 18