Karnataka High Court
M/S. H.G.S. International Services ... vs Esi Corporation on 18 October, 2016
Author: Anand Byrareddy
Bench: Anand Byrareddy
-1-
IN THE HIGH COURT OF KARNATAKA AT
BENGALURU
DATED THIS THE 18TH DAY OF OCTOBER 2016
BEFORE
THE HON'BLE MR.JUSTICE ANAND BYRAREDDY
CRIMINAL PETITION NO.833/2016
BETWEEN:
1. M/s.H.G.S.International Services (Pvt) Ltd.,
SEZ Tower,
No.2, 3rd Floor,
Global Village, IT Sector,
SES Mylasandra, RVCE Post,
Bangalore - 560 059
Represented by
Sri Subramanya Chandarashekar
Director.
2. Sri Subramanya Chandrashekar
Director, 1004/B,
17th D Cross,
Indiranagar II Stage,
Bangalore - 560 068. ...Petitioners
(By Shri S.S.Naganand, Senior Counsel for Shri.Mahesh.S,
Advocate)
AND :
ESI Corporation,
-2-
No.10, Binnyfield,
Binnypet,
Bangalore - 560 023.
Represented by R.Chandrashekar,
Social Security Officer ...Respondent
(By Shri V.Narasimha Holla, State Public Prosecutor- II)
This Criminal Petition is filed under section 482 of the
Criminal Procedure Code, 1973, praying to quash the entire
proceedings against the petitioners herein pending before the
Hon'ble Special Court for economic offences at Bangalore in
C.C.No.394/2015.
This Criminal Petition coming on for admission this day,
the Court made the following:
ORDER
Heard the learned counsel for the petitioners and the learned State Public Prosecutor.
2. The present petitioners are accused for offences punishable under Section 85(ii) of the Employees' State Insurance Act, 1948. The allegation against the petitioners is that there was a requirement under the Regulation 16 of the Employees' State Insurance (General) Regulations, 1950, -3- (hereinafter referred to as 'the Regulations' for brevity) wherein petitioners were to assist the Department in photographing and biometric scanning of their employees and family members, which was only partially complied with and therefore, the proceedings had been initiated and the same is pending. In the meanwhile, the petitioners, who had done their best to ensure that their employees complied with the requirement of obtaining the Pehchan cards did not succeed inasmuch as some of the employees had not chosen to co-operate. However, even during the pendency of this petition, it is stated that all 680 employees, who are presently in the employment of respondent No.1, have been issued Pehchan cards and incidentally, in the first instance, though such cards were issued on submission of physical forms by each of the employees, the present system envisages online submission and it is also linked to the Aadhaar card. The Department, in turn, has outsourced the process of enrolling the members to a third-party. The obligation referred to has been duly complied with in respect of 680 employees, -4- who continue to be in the employment of petitioner No.1. It is stated that in the interregnum, about 270 employees have resigned and the question of enrolling them under the Regulations did not arise. In this regard, the learned senior Advocate, Shri S.S. Naganand, appearing for the petitioners, has filed a memo placing the above circumstances on record and seeks that the proceedings pending before the Court below be quashed.
3. However, the learned standing counsel for the respondent would vehemently oppose any such measure being taken at the instance of petitioners for it is pointed out that as on the relevant date when the complaint was initiated, there was admittedly no compliance by the petitioners and therefore, it did amount to violation of the Regulations and consequently, the petitioners are bound to face proceedings, which would run its course. If any concession or lenience is shown, it would result in endorsing such petitioners flouting the Rules and -5- Regulations, which would result in the entire scheme of the Act to collapse and it would be impossible for the respondent to maintain discipline and ensure compliance with the legal procedures and provisions by employers.
4. There is, indeed, substance in the contention of the learned counsel for the respondent, but then again, the Regulation or the Rule framed by the Authority would have to be kept in view and the seriousness of the matter would have to be weighed having due regard to the object or the result that is sought to be achieved while insisting on compliance with such Rule or Regulation. As rightly pointed out by Shri S.S.Naganand, violation in the present case cannot be said to be of such a nature, as would, warrant a strict view. Especially, when it was not wholly in the hands of the petitioners, to ensure such compliance. Petitioners, have to the extent possible persuaded their employees to obtain the necessary cards by enrolling themselves, which is also not denied by the -6- Department as there is partial compliance, in several employees having enrolled themselves in the first instance. However, there is indeed non-compliance, in some of the employees not having enrolled themselves. This is a case, where the fault cannot entirely be laid at the door of the petitioners. However, it is pointed out by the learned counsel for the respondent that there was a responsibility cast on the petitioners to the extent of persuading all their employees to obtain the necessary cards by enrolling themselves. If there was some delay in such compliance, it would be necessary for the petitioners to adequately compensate the Department for its troubles in having filed the complaint and having to defend these proceedings.
5. Accordingly, the petition is allowed. The proceedings pending in CC No.394/2015 before the Special Court for Economic Offences, Bangalore, stands quashed subject to payment of Rs.2,000/- (Rupees two thousand) to the -7- respondent by petitioners. Petitioners shall not default in enrolling, further employees taken in employment, for Pehchan cards.
Sd/-
JUDGE sma