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1987 DIGILAW 197 (KER)

ANTHONY KUTTY v. E. S. I. CORPORATION

1987-04-18

VISWANATHA IYER

body1987
JUDGMENT : Viswanatha Iyer, J.—The petitioner was the recipient of benefits under the Employees' State Insurance Act, 1948 ('the Act' for short) while employed as a working chargeman in the Transformers and Electricals (Kerala) Ltd., Angamaly. He met with an accident on December 29, 1980 in respect of which he was given a temporary disablement benefit of Rs. 1200/- and a permanent disablement benefit of Rs. 4823.45 by the Employees' State Insurance Corporation, the first respondent (hereinafter referred to as 'the Corporation'). 2. Long afterwards, and on February 17, 1983, he was intimated by the letter Ext. P1 from the Corporation that he was not an employee covered u/s 2(9) of the Act on the date of the accident and that "E.S.I, contributions" were not payable by him. As such, it was stated that he was not entitled to the payments made of temporary and permanent disablement benefits. The petitioner was therefore requested to refund the amount of Rs. 6023.45 within one month failing which revenue recovery action was threatened u/s 70 of the Act without further notice. The petitioner thereupon made representations to his employer, wherein he stated that he had approached the Corporation and availed the benefits on the advice of the employer and that the latter had suppressed the fact that his actual wages were more than Rs. 1000/-, The petitioner's further case was that "had not the Company represented the facts mistakenly" he would not have gone to the Corporation and availed the benefits, and therefore the entire benefit availed should be borne by the employer. Copy of the representation was sent to the Corporation also. There was no response to this representation. 3. The Corporation initiated proceedings under the Revenue Recovery Act for realisation of the amount. Notice Ext. P4 was issued u/s 7 of the said Act. The petitioner thereupon filed this original petition. His contention is that the claim arises u/s 70 and there should be an adjudication of the claim and of the liability by the Employees' Insurance Court ('the Court' for short) u/s 75(2)(e) before any proceedings can be initiated for realisation of the amount u/s 70(3). In other words the contention put forward is that the Corporation is bound to approach the Court for an adjudication of the claim as a condition precedent for recovery of the amount. 4. In other words the contention put forward is that the Corporation is bound to approach the Court for an adjudication of the claim as a condition precedent for recovery of the amount. 4. This contention is met by counsel for the Corporation with the plea that the Corporation is vested with the right to decide the question of liability u/s 70 and its enforceability is not dependent upon any order of Court. It is for the petitioner-employee, if he contests the liability, to apply to the Court and seek an adjudication if so advised. 5. I may at once point out that the petitioner has not so tar questioned the claim for repayment made in Ext. P1. He has not at any time disputed the Corporation's allegation made in Ext. P1 that he was not an employee falling u/s 2(9) of the Act and that therefore he was not entitled to the benefits given. Even in the Original Petition, he has no such case. He had only thrown the blame on his employer about some alleged suppression of facts or misrepresentation regarding his wages, and therefore requesting them to reimburse the amount to the Corporation. There was therefore no issue which was required to be decided by the Court u/s 75(2)(e). 6. Even otherwise, there is no merit in the petitioner's contention. Section 70 of the Act provides that where any person has received any benefit or payment under the Act when he is not lawfully entitled thereto, he shall be liable to repay to the Corporation the value of the benefit of the amount of such payment. The amount recoverable under this Section is also liable to be recovered as if it were an arrear of land revenue. 7. Section 74 provides for the constitution of the Employees' Insurance Court. Sub-section (1) of Section 75 prescribes that questions and disputes of the nature enumerated therein shall be decided by the Court in accordance with the provisions of the Act. Sub-Section (2) of this Section lays down that claims of the nature described therein shall be decided by the Court. The claim u/s 70 for the recovery of the value or amount of the benefits received by a person when he is not lawfully entitled thereto comes under Sub-clause (e) of this subsection. Sub-Section (2) of this Section lays down that claims of the nature described therein shall be decided by the Court. The claim u/s 70 for the recovery of the value or amount of the benefits received by a person when he is not lawfully entitled thereto comes under Sub-clause (e) of this subsection. Sub-Section (3) of the Section bars the jurisdiction of Civil Courts in regard to the questions or disputes mentioned earlier and 40 others. 8. There are various questions or disputes likely to arisein the course of administration of the Act-whether a particular person is an employee, rate of wages or contribution, liability of the employer, question of coverage and such like. The Corporation has been established for the administration of the scheme of Employees' State Insurance. The Corporation has the statutory authority to exercise all those powers which are necessary for the proper and effective administration of the scheme of insurance. The Corporation is therefore the primary authority to determine the various questions which arise for decision in the course of its functioning under the Act. On such decisions being rendered in relation to these matters covered by Sections 45A, 68(1), 70(1), or 85B(1), the amounts recoverable may be recovered as an arrear of land revenue. Section 75 has to be read in the context of this scheme of the Act. Section 75 is intended to provide a forum for the adjudication of disputes, questions or claims of the nature envisaged in Sub-sections (1) and (2) thereof. Any determination by the Corporation is subject to challenge before the court u/s 75. It is open to the Corporation itself in appropriate cases to approach the Court for the adjudication of any dispute, question or claim. Or the Corporation may proceed to recover the amount as an arrear of land revenue on the basis of its determination and leave it to the person affected, if he is aggrieved, to move the Court. Section 75(2) does not compel the Corporation to move the court whenever there is a claim which they have to enforce. As such, the proceedings initiated by the Corporation against the petitioner u/s 70(3) of the Act are not in any manner illegal. 9. this Court had occasion to consider a claim arising u/s 45A in the decision in Regional Director, E.S.I.C. Vs. As such, the proceedings initiated by the Corporation against the petitioner u/s 70(3) of the Act are not in any manner illegal. 9. this Court had occasion to consider a claim arising u/s 45A in the decision in Regional Director, E.S.I.C. Vs. Marikkar Engineers Limited and Another, (1982) 1 LLJ 59 and observed: Having considered the scheme of the Act and the legislative intent of the provisions of Sections 45A, 45B and 75 of the Act, I do not 40 feel persuaded to accept the argument of the counsel for the respondent-plaintiff that in a case like this where an order has been passed by the Corporation u/s 45A. about which, assuming that the respondent plaintiff feels aggrieved, the Corporation is precluded from taking steps to recover the amount due under the order invoking the provisions of Section 45-A(2) and Section 45-B of the Act without referring the matter to the Insurance Court u/s 75 merely because the Respondent Plaintiff has not accepted its correctness. The provisions of Section 75 arc meant to give an opportunity to the Corporation or the employer, as the case may be, to have an adjudication where the particular party feels aggrieved by a decision or order. In the case of an order u/s 45-A. normally it could only be the employer that could feel aggrieved, and it is the employer who feels aggrieved that has move the insurance court, because the order is to be made by the Corporation, but in a case where Section 45-A applies with respect to decision by the medical board, it might either be the Corporation or the employer that might feel aggrieved, in which case the party that has to move the Insurance Court u/s 75 would be the party that feels aggrieved by the Order. Essentially, therefore, it is the aggrieved party that has to approach the insurance court for its decision, not the party which wants to enforce the order of the decision. This Court made reference, inter alia, to the decisions of a Full Bench of the Karnataka High Court in Regional Director, E.S.I. Vs. Fibre Bangalore (Pvt.) Limited, (1980) 2 LLJ 301 and of the Madras High Court in K.C.S. Dhanushkodi Nadar and Sons. v. ESI. This Court made reference, inter alia, to the decisions of a Full Bench of the Karnataka High Court in Regional Director, E.S.I. Vs. Fibre Bangalore (Pvt.) Limited, (1980) 2 LLJ 301 and of the Madras High Court in K.C.S. Dhanushkodi Nadar and Sons. v. ESI. Corporation 1964 (I) L.L.J. 213 and M.S. Dhananjayan v. Regional Director, State Insurance Corporation 1972 (II) L.L.J. 338, and held that it is for the employer, to whom the order u/s 45A is not acceptable, to challenge its correctness in the court. In Dhanushkody Radar's case (supra) Jagadisan J. observes: 1964 (I) L.L.J 213 : It is impossible to hold that the Corporation should in every case of non-payment of contribution, resort to the State Insurance Court and obtain an order for recovery of the amount. The Patna High Court in Shriram Bearings Ltd. v. Employees State Insurance Corporation 45 (1977 Lab I C 1482) had occasion to consider whether an employer could approach the Court u/s 75 and not merely the Corporation. In that context, it was observed: There is nothing in Sub-section (2) from which it can be held that once there is a repudiation by the person concerned, it is obligatory on the Corporation to file an application for adjudication of its claim. The forum appears to be available for both; the person who is said to be liable to pay, as well as to the Corporation who claims recovery of the contribution from such person. 10. These decisions primarily deal with questions u/s 45-A and the like. The position is not in any manner different in respect of a claim arising u/s 70(1). Section 75 is only an enabling provision for either the Corporation or the person affected to have the question, dispute or claim adjudicated. It is not necessary that every claim should be recovered only through the court after obtaining an order therefrom regarding liability. 11. No other point is raised by the petitioner in this original petition. The original petition is therefore without merit and it is accordingly dismissed. There will be no order as to costs.