JUDGMENT Lokeshwar Singh Panta, J.:- This appeal by Employees State Insurance (for short E.S.I. Corporation) under Section 82 of the Employees State Insurance Act, 1948 is directed against the order dated 4.9.1992 of Employees State Insurance Court, Shimla in APP-Case/6790(ESI), where under order dated 9.4.1987 of the appellant-E.S.I. Corporation was held illegal, unlawful and erroneous to the extent of their entire claim from the Employer except that the Management was held liable only to pay contribution of Rs.1,33,363/- with interest thereon at the relevant rates prevalent at the time when the amount was due to be deposited by the Management. The facts leading to the appeal may briefly be states as follows: 2. M/s. Shivani Agro Industries Ltd., Parwanoo, respondent herein filed an application under Section 75 of the E.S.I. Act, 1948 in the Court of Seniro Sub Judge, Solan which was transferred to the Judge, Employees State Insurance Court, Himachal Pradesh on constitution of the said Court in the year 1990. The respondent-Management was registered under the Factories Act, 1948 and admittedly, it is covered under the Employees State Insurance Act, 1948. The respondent- Management herein urged before the State Insurance Court below that the order of the Deputy Regional Director of E.S.I. Corporation annexed herein passed under Section 45-A and 45-B of the E.S.I. Act for recovery of E.S.I, contribution for period from 11/81 to 12/84 amounting to Rs.1.43,937.25p with interest amounting to Rs.13,632/- upto 31.3.1987 due thereon was not legal and justified in pursuance of the demand letters dated 31.7.1985 and 5.8.1985 placed before the State Insurance Court. The respondent-Management further alleged that it has been dealing in the manufacturing process of Terpolines and has been getting its work done through contract labour on contract job over which the factory has no control and supervision. The Factory of the respondent-Management had been visited by Shri H.K. Mehta (RW-2) Insurance Inspector of the E.S.I. Corporation on 22.2.1985, 2.3.1985, 16.3.1985 and 25.3.1985 respectively for assessing die contribution from 8/83 to 12.83. According to the version of Shri Mehta, 26 workers plus two Canteen employees were working in the main factory and there were 67 employees of Fabrication Contractor including the above said 28 employees for loading and unloading jobs. Other contractors had also engaged workers according to the agreement dated 17.9.1982 executed by M/s. Surinder Kumar for the work of fabrication and the Firm had employed its labour. Other contractors had also engaged workers according to the agreement dated 17.9.1982 executed by M/s. Surinder Kumar for the work of fabrication and the Firm had employed its labour. Similarly, Shri Pyare Lal Kalsi had also employed the labour for supplying the raw material vide agreement dated 19.3.1987. One Shri Dara Singh had also entered into contract with the respondent-Management for unloading bags etc. of the Industries and had employed the labour vide agreement dated 25.3.1983. Shri Mehta after examining the record which was made available to him had submitted his report to the Regional Director and on the basis of which, notice RW-2/D (On the file of the State Insurance Court) was issued by the competent authority i.e. Regional Director of the Appellant-E.S.I. Corporation to the respondent-Management. Shri Bakshish Singh (RW-1), Deputy Regional Director of the appellant- E.S.I. Corporation also visited the Factory of the respondent- Management and after examining the ledger/voucher etc. of the respondent-Management made an assessment, the details of which were placed on record and marked as Exhibits R-l to R-4 on the file of the State Insurance Court. Thereafter the appellant-E.S.I. Corporation issued Demand Notice Ext. PW-1/2 and total demand made was reflected in Ext.P-1/B. The assessment was made by the appellant-E.S.I. Corporation on the basis of the records made available to the authority during the inspection by the Inspector and Deputy Regional Director under Section 45-A of the Act after satisfying that prima facie case was made out for issuance of the said notice. 3. The respondent-Management before the State Insurance Court below stated that whatever record was available on 9.3.1987; was shown to the officials of the Corporation and the officials had made wrong assessment regarding expenditure incurred on fabrication, loading and unloading, under the head, "Labour Charges Account", Building account, wages to labour production, ex-gratia and washing allowances. It was also alleged that since fabrication work etc. have been got done through the immediate employers mentioned in the agreement and hence principal employer had no responsibility of contribution. It was pleaded that the demand could not be created regarding the labour employed by the Contractors. On these premises the order of the Regional Director of E.S.I. Corporation under Section 45-A of the Act had been challenged being illegal, ultra vires and without jurisdiction as the impugned order was passed without applying the mind and without giving opportunity to the respondent-Management. 4. On these premises the order of the Regional Director of E.S.I. Corporation under Section 45-A of the Act had been challenged being illegal, ultra vires and without jurisdiction as the impugned order was passed without applying the mind and without giving opportunity to the respondent-Management. 4. The appellant-E.S.I. Corporation in its reply had reiterated and reasserted its stand that the assessment made by the Deputy Regional Director was in accordance with law and based upon the available record on the spot at the time of the assessment. It was further stated that the E.S.I. Corporation was entitled to recover the contribution under the head of building and other heads mentioned in the demand notice and that the loading and unloading work was the part of the production programme for which the labour was employed and was the subject-matter of the assessment of contribution. It was further submitted that full and reasonable opportunity was given to the respondent-Management who did not co-operate. 5. On the controversial pleadings of the parties the State Insurance Court framed as many as four issues. 6. Finding on issue No. 1 was returned in favour of the appellant-E.S.I. Corporation and against the respondent-Management by the State Insurance Court. No finding on issue No. 2 was recorded for the reason that the said issue was not pressed by the parties during the course of arguments as stated in the order and issue No. 3 was rendered redundant in view of the finding on issue No. 1. Consequently, the order dated 9.4.1987 impugned before the State Insurance Court below passed by the appellant-E.S.I. Corporation was found illegal, unlawful and erroneous to the extent of their entire claim except that the employer was held liable only to pay contribution on Rs.1,33,363/-with interest thereon at the relevant rate and at the relevant time when the amount was due to be deposited by the employer and the Corporation was directed to realize the amount through the court except the amount paid, besides giving some other directions. 7. Feeling aggrieved against the order of the State Insurance Court the appellant-E.S.I. Corporation filed the present appeal challenging the order inter alia that the claim of the appellant-E.S.I. Corporation amounting to Rs1, 57,569.25p inclusive of interest for the period 11/81 to 12/84 was wrongly disallowed by the Court below by accepting the application filed by the respondent-Management under Section 75 of the E.S.I. Act. The substantial questions of law pressed into service by Shri S. R. Sharma, learned Counsel for the appellant-E.S.I. Corporation during the course of the hearing of the appeal are as under :- 1) Whether the Corporation is justified in determining the contribution on the basis of information as available or as made available by the respondent-Management on account of the failure on the part of the Industries to produce the entire record for verification? 2) Whether the report of the Chartered Accountant in the capacity of Local Commissioner appointed by the Court below cannot be accepted at a belated stage for record, which always remained in possession of the respondent-Management? 8. We have examined the entire material on record to appreciate the correctness and validity of the impugned order. The respondent-Management was inspected by Shri H.K. Mehta, Insurance Inspector on-22.2.1985, 12.3.1985, 16.3.1985 and 25.3.1985 and he had submitted his report Ext. RW-2/A placed before the Court below. He found 67 employees working under the Fabrication Contractor, loading and unloading and other Contractors. He stated before the court below that the respondent-Management refused to sign a copy of his visit note despite his requests. He placed on record copy of the notice Ext.RW-2/A issued on the basis of his inspection dated 22.2.1985. He stated that he made correct assessment on the basis of the record as made available to him at the time of inspection by the respondent- Management. The Court below appointed Shri Rajiv Sod, Chartered Accountant, Shimla as the Local Commissioner who submitted his report Ext.LC/1 and fixed the amount of Rs.l,33,363.02p on which the respondent-Management was to pay contribution at the rate of 7% to E.S.I. Corporation and the said amount would work out to Rs.11,000/-approximately. In this cross-examination he admitted that he had not verified the number of employees of the management who were paid Rs.1000/- or more. Shri H.K. Mehta RW-2 had challenged the report of the Local Commissioner on the ground that it was not exhaustive nor the record of the contractors had been shown to the Commissioner and accordingly, correct analysis had not been done by the Local Commissioner. He stated that when he visited respondent-Management and assessed the assessment, he mentioned the name of the account and Muster Rolls in respect of the Contractors as mentioned in the report were not shown to him. He stated that when he visited respondent-Management and assessed the assessment, he mentioned the name of the account and Muster Rolls in respect of the Contractors as mentioned in the report were not shown to him. Shri Bakshish Singh, Deputy Regional Director of appellant-E.S.I. Corporation conducted a test check and submitted his report Ext.RW-1/A. He made his report Ext.RW-1/A on the basis of the record of the respondent-Management and found total wages distributed by the respondent-Management amounting to Rs.7,28,110.35p on which according to his assessment the contribution payable was Rs.50,967.80p by the respondent-Management. He stated that total demand made to the respondent-Management was for payment of the contributions and thereafter a reminder was also issued to pay the contribution. He also stated that the respondent-Management was given full opportunities but it did not avail the same and no salary sheet was prepared and shown even on his demand. He found that according to the report of the Local Commissioner, no income tax was deducted at source whereas respondent-Management had represented that the tax was deducted at source which was gross- mis-statement of the fact on the part of the respondent-Management No regular, proper and correct records of wages were being maintained by the respondent-Management. The respondent-Management was given notice for production of the records and thereafter one more notice under Section 39 of the E.S.I. Act 9. A notice was issued by the Regional Office of the appellant-E.S.I. Corporation vide letter No. Pb./l 4/3/2008 dated nil directing the respondent-Management to show cause within IS days why contributions as per statement enclosed be not recovered from the respondent- Management. In reply to the notice representative of the respondent- Management appeared on 24.9.1986 and submitted that as the record was not available with him on that day so it was not possible for him to explain the position. On his request the matter was fixed for 13.10.1986 for personal hearing by the authority concerned. The respondent-Management sent a letter dated 20.10.1986 requesting for adjournment of the matter to 30.10.1986 and the request was accepted by the authority accordingly. Again a representative of the respondent-Management sent a letter to the Regional Office dated 28.10.1986 explaining that his client had produced the entire record which was demanded by the officials who inspected the records and in addition the registers which were required to be maintained were shown to the visiting officials for their satisfaction. Again a representative of the respondent-Management sent a letter to the Regional Office dated 28.10.1986 explaining that his client had produced the entire record which was demanded by the officials who inspected the records and in addition the registers which were required to be maintained were shown to the visiting officials for their satisfaction. The appellant- E.S.I. Corporation inspite of clarifying the position to the respondent-Management made the assessment for the period from 11/81 to 12/84 of Rs.l,43,937.25p plus interest amounting to Rs.13,635/- upto 31.3.1987, against Shri Arun Anand, Managing Director of the respondent-Management which was impugned before the Insurance Court below. 10. Section 44 of the Employees State Insurance Act, 1948 imposes a condition upon the Principal and immediate employer to submit to the Corporation as it may direct such returns in such form and containing such particulars relating to persons employed by him or to any factory or establishment in respect of which he is the principal or immediate employer as may be specified in regulations made in this behalf. Where the Corporation has reason to believe that a return should have been submitted under sub-section (1) but has not been so submitted, the Corporation may require any person in charge of the factory or establishment to furnish such particulars as it may consider necessary for the purpose of enabling the Corporation to decide whether the factory or establishment is a factory or establishment to which this Act applies. Under sub-section 3 of Section 44 every principal and immediate employer shall maintain such registers or records in respect of his factory or establishment as may be required by regulations made in this behalf. 11. Under Section 45 Inspectors functions and duties have beet; prescribed. Section 45-A read as under:- "45A. Under sub-section 3 of Section 44 every principal and immediate employer shall maintain such registers or records in respect of his factory or establishment as may be required by regulations made in this behalf. 11. Under Section 45 Inspectors functions and duties have beet; prescribed. Section 45-A read as under:- "45A. Determination of contributions in 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 Inspector or others official of the Corporation referred to in sub-section (2) of Section 45 is (prevented i n any manner) by the principal or immediate employer or any other person, in exercising his functions or discharging his duties d Section 45, the Corporation may, on the basis of information K 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). (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 45-A (or the recovery under Section 45-C to Section 45-1). 12. The appellant-E.S.I. Corporation passed the assessment order after the respondent-Management had failed to produce the entire record before the Inspector or the Deputy Regional Director. A show cause notice was also given to the respondent-Management and at the request of the authorised representative of the respondent-Management time was granted to produce the entire record before the authority concerned but the respondent-Management had failed to avail the opportunity granted to its representative and on the contrary the respondent- Management had challenged the authority of the Deputy Regional Director who had issued the show cause notice. 13. Under Section 45-A of the Act the appellant-E.S.I. Corporation has the power and authority based upon the information available to it to determine the amount of contributions payable and make necessary demands. 13. Under Section 45-A of the Act the appellant-E.S.I. Corporation has the power and authority based upon the information available to it to determine the amount of contributions payable and make necessary demands. Apparently, the scheme of the Act, after amendment in 1966, is that the E.S.I. Corporation itself should in a case where there is omission on the part of the Employer to maintain the records in accordance with law under Section 44 of the Act, determine the amount of contributions on the strength of such information as it may collect, it can then make the demand, if the employer refused to comply the demand so made. 14. Section 75 of the Act empowers the Employees Insurance Court to decide the question or dispute concerning the matters covered under the Section. Under this Section, E.S.I. Corporation need not seek adjudication before the Insurance Court but it is not for the Employer to move for determination of the contribution under Section 45-A if the determination is not made by the E.S.I. Corporation itself. The E.S.I. Corporation is empowered under Section 45-A to directly take steps for the realization of the contribution if the Employer has failed to comply the obligations contemplated under Section 44 of the Act. The scheme of Sections 45-A and B and 75 of the Act sufficiently indicate that the Legislature do not intend to leave the successful working of the Act to the good-will of the Employer nor it envisages a situation where Insurance coverage would be refused to employees only because Employer chose not to furnish return or supply information. In this context the provision of Section 45-A, empowers the Corporation to determine the amount contribution on basis of "best judgment assessment method". Such a method in the absence of necessary information involves guess work and inspection reports of earlier and subsequent periods, nature of work collected from the workers about wages and minimum wage fixed for occupation under the Minimum Wages Act are relevant for best judgment assessment. Simply because the aggrieved party has remedy to approach the E.S.I. Court under Section 75 questioning the order of Corporation, it would not mean that the Corporation need not perform its functions in a fair and upright way by giving opportunity of hearing to the person affected, before passing order determining the contribution. Simply because the aggrieved party has remedy to approach the E.S.I. Court under Section 75 questioning the order of Corporation, it would not mean that the Corporation need not perform its functions in a fair and upright way by giving opportunity of hearing to the person affected, before passing order determining the contribution. Only requirement under Section 45-A is that the Corporation should pass best judgment assessment order which should be reasoned order, since the Act contemplates that the assessment is subject to judicial review under Section 75 before the E.S.I. Court. 15. In this view of the matter, as noticed above, the appellant-E.S.I. Corporation had passed its order impugned under Section 75 of the Act before the E.S.I. Court by the respondent-Management. The Insurance Inspector and Deputy Regional Director who visited the Industrial Unit of the respondent-Management several times made their reports to the authority of E.S.I. Corporation. Thereafter show cause notice was issued to the respondent-Management by the competent authority and on its request opportunities were given to the respondent-Management to produce the entire records which was demanded by the officials who inspected the records and j in addition the registers which were required to be maintained, but after availing the opportunities the respondent-Management has filed to comply with the requirement of notice and to clarify the position; it challenged the authority of the Deputy Regional Director to issue the show cause notice. Thereafter, as reflected in the order of determination of amount before the E.S.I. Court below, the appellant-E.S.I. Corporation advised its Insurance Inspector to visit the factory and verify the correctness of the statement and the Inspector accordingly visited the factory of the respondent-Management on 9.3.1987 and contacted Shri A. S. Rawat, Manger, Legal and administration who was requested to produce the record for re-verification but he told that he was busy in some other work and was not in a position to get the record verified. Thereafter the Deputy Regional Director exercising the powers under Section 45-A of the Act on the basis of the relevant record including the repots of the Inspector and the Deputy Regional Director who visited the factory of the respondent-Management several times passed speaking and well reasoned order: From the narration of the entire facts we find that reasonable opportunity was given to the respondent-Management by the authority before the assessment order was passed, but the respondent-Management has not availed such opportunity and thereafter order under Section 45-A of the Act was passed by competent authority. 16. In our considered view the appointment of the Local Commissioner by the E.S.I. Court and calling his report was un-warranted and not within the jurisdiction of the said Court and therefore is unsustainable. The report of the Local Commissioner was entirely accepted by the E.S.I. Court without recording any finding on the objections raised by the appellant-E.S.I. Corporation against the said report. Appellant-E.S.I. Corporation has the jurisdiction to determine the amount of constitutions payable in respect of the employees of the factory of respondent-Management and the power has been rightly exercised by it in the case on hand, and the E.S.I. Court has wrongly accepted the report of the Local Commissioner pointed by it and ignored well reasoned order of the authority of the appellant-E.S.I. Corporation. 17. For the reasons stated above, the present appeal is allowed and order dated 4.9.1992 passed by the E.S.I. Court in APP-Case-6/90 shall stand set aside. The assessment order dated 9.4.1987 of the Deputy Regional Director determining the amount of contributions is held to be valid and legal and the respondent-Management is directed to pay the contribution in accordance with the said over. The parties are left to bear their own costs. Appeal allowed.