Karnataka High Court
Secretary, John Fowler Employees Union vs Managing Director, John Fowler (I) Ltd. ... on 12 March, 2001
Equivalent citations: [2001(89)FLR1101], ILR2001KAR2272, (2001)IILLJ22KANT, 2002 LAB IC (NOC) 143 (KAR), 2002 AIR - KANT. H. C. R. 2759, (2001) 89 FACLR 1101, (2001) 2 LABLJ 22, (2001) 3 LAB LN 1078, 2001 LABLR 574, (2001) 3 SCT 921
JUDGMENT Chandrashekaraiah, J.
1. This appeal is by the Employees' Union which made the application before the Employees' State Insurance Court, Bangalore, under Section 75(1)(g) of the E.S.I. Act, 1948 hereinafter referred to as the Act.
2. The case of the Union is that the employees who draw salary more than the ceiling limit as on the date of commencement of the contribution period are not liable to pay any contribution even if their salary were to come below the ceiling limits during the currency of that contribution period. The E.S.I. Court dismissed the application filed by the Union holding that the interpretation given by the Deputy Director, E.S.I. Corporation by letter dated July 3, 1998 is correct.
3. Sri B.V. Puttegowda, learned counsel appearing for the appellant submits that Section 2(9)(iii)(b) provides that an employee whose wages (excluding remuneration for overtime work) exceed such wages as may be prescribed by the Central Government a month at any time after and not before the beginning of the contribution period, shall continue to be an employee until the end of that period and if so, an employee who is not covered under the scheme for contribution as on the date of commencement of the contribution period is to be treated as an employee not covered under the scheme even though his wages were to come below the ceiling limit during the period of contribution. In order to appreciate this contention, it is relevant to refer to the relevant regulations and the provisions of the Act.
Regulation No. 4 of the Employees' State Insurance (General) Regulations, 1950 reads as follows:
"4. Contribution and Benefit periods -Contribution periods and the corresponding benefit periods shall be as under:
Contribution period Corresponding benefit period April 1 to September 30 January 1 of the year following to June 30.
October 1 to March 31 of the year following.
July 1 to December 31 Provided that in the case of a person who becomes an employee within the meaning of the Act for the first time, the first contribution period shall commence from the date of such employment in the contribution period current on that day and the corresponding benefit period for him shall commence on the expiry of the period of nine months from the date of such employment."
Section 2(9) defines "Who is an employee" which reads as follows:
9) "employee" means any person employed for wages in or in connection with the work of a factory or establishment to which this Act applies and -
i) who is directly employed by the principal employer on any work of, or incidental or preliminary to or connected with the work of the factory or establishment, whether such work is done by the employee in the factory or establishment or elsewhere; or
ii) who is employed by or through an immediate employer on the premises of the factory or establishment or under the supervision of the principal employer or his agent or work which is ordinarily part of the work of the factory or establishment or which is preliminary to the work carried on in or incidental to the purpose of the factory or establishment; or
iii) whose services are temporarily lent or let on hire to the principal employer by the person with whom the person whose services are so lent or let on hire has entered into a contract of service:
(and includes any person employed for wages on any work connected with the administration of the factory or establishment or any part, department or branch thereof or with the purchase of raw materials for, or the distribution or sale of the products of, the factory or establishment (or any person engaged as an apprentice, not being an apprentice engaged under the Apprentices Act, 1961 (52 of 1961), or under the Standing Orders of the establishment but does not include)
a) any member of (the Indian) naval, military or air forces; or
b) any person so employed whose wages (excluding remuneration for overtime work) exceed (such wages as may be prescribed by the Central Government) a month;
Provided that an employee whose wages (excluding remuneration for overtime work) exceed (such wages as may be prescribed by the Central Government) a month at any time after (and not before) the beginning of the contribution period, shall continue to be an employee until the end of that period."
4. It is an admitted fact that an employee whose salary is below Rs. 6,500/- p.m. during the year 1998 is an employee covered under the scheme in order to get certain benefits under Chapter 5 of the Act. The case of the appellants-Union is that the employee whose salary is above Rs. 6,500/- as on the date of commencement of the contribution period were to come below Rs. 6,500/- p.m. during the contribution period is to be treated as not an employee covered under the Scheme. The contribution period as per the regulation referred to above is from April 1 to September 30 and from October 1 to March 31 of the year following. Section 2(9)(iii)(b) of the proviso provides that an employee whose wages exceed the prescribed wages by the Central Government, a month at any time after and not before the beginning of the contribution period, shall be treated as an employee until the end of that contribution period. So far as an employee whose salary is more than the ceiling limit were to come below the ceiling limit during the commencement of the contribution period is concerned, the statute is silent and therefore, he cannot be treated as an employee not covered under the Scheme. If that is so, the interpretation given by the Deputy Director, E.S.I. Corporation in its letter dated July 3, 1998 is correct.
5. Sri B.V. Puttegowda, learned counsel for the appellant submits that even though the statute is silent in so far as it relates to an employee who is not covered under the scheme to treat him as not covered even though he is covered under the scheme by reason of reduction in his salary below the ceiling limit during the period of contribution, the proviso to 2(9)(iii)(a)(b) to be interpreted to include such employee and declare that he is not an employee covered under the scheme.
6. This argument cannot be accepted because when the statute is silent, the Court cannot interpret the proviso in the manner suggested by Sri B.V. Puttegowda since, it amounts to legislating the law by the Court. Further, ESI Act is a welfare legislation enacted for the benefit of the employees. Keeping this in mind, I find no reason to enlarge the scope of the proviso by adding something as it is not the function of judiciary. Therefore, I am of the considered view that the clarification given by the Deputy Director of E.S.I. is justified and, it does not call for any interference by this Court.
7. In the result, I pass the following order: