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2010 DIGILAW 63 (GUJ)

Employees State Insurance Corporative v. Rainbow Surgical Dressing

2010-02-09

H.K.RATHOD

body2010
JUDGMENT : H.K. Rathod, J. 1. Heard learned Advocate, Mr. Sachin D. Vasavada on behalf of applicant - Employees State Insurance (ESI) Corporation and learned Advocate Mr. J.T. Trivedi appearing on behalf of respondent Company. 2. The appellant - Insurance Corporation has challenged the order passed by ESI Court, Ahmedabad in ESI Application No.31/1998 Exhibit 47 under Section 75 of ESI Act dated 15.07.2005. The ESI Court has set aside the order passed by Corporation dated 14.05.1990 coverage decision C/11 and 17.11.1992 C/18 demanding contribution from respondent under Section 45A of ESI Act which was passed by Corporation without giving any reason and without giving reasonable opportunity of hearing to respondent. The demand of contribution comes to a total amount of Rs. 3,866/- which has been set aside by ESI Court. As this is a small amount involving only Rs. 3,866/-, it has been challenged by appellant- Corporation in First Appeal. But in filing First Appeal, there is delay of 1010 days, therefore, present application is preferred with a prayer to condone delay of 1010 days in filing first appeal. This delay condonation application has been opposed by respondent. Therefore, affidavit-in-reply is filed by one - K.A. Taktawala date 10.08.2009 against which an affidavit-in-rejoinder is filed by ESI Corporation on 14.09.2009. 3. The delay occurred mainly on the ground that lawyer who represented the Corporation before ESI Court has to apply for certified copy of judgment and order immediately. According to Corporation, it is mandatory for a lawyer to inform outcome of any case and also apply for certified copy of said order and to supply the same to applicant - Corporation. The Corporation cannot clear the bill of any lawyer who does not provide certified copy of judgment and order of the case. According to applicant, after completion of arguments, lawyer went to U.S.A. for more than six months and also did not intimate to appellant-Corporation. The date of pronouncement of judgment was also not informed to Insurance Inspector of appellant-Corporation. The lawyer did not submit his professional fee to the office of Corporation. The lawyer has raised his professional bill on 25.04.2008 and represented to Corporation on 02.05.2008. The date of pronouncement of judgment was also not informed to Insurance Inspector of appellant-Corporation. The lawyer did not submit his professional fee to the office of Corporation. The lawyer has raised his professional bill on 25.04.2008 and represented to Corporation on 02.05.2008. Therefore, ESI Corporation was not aware about judgment and order passed by ESI Court and thereafter, received the certified copy on 02.05.2008 and because of vacation from 16.05.2008 to 15.06.2008, it consumed sometime and thereafter, appeal has been preferred having delay of 1010 days. It is necessary to note that judgment and order passed by ESI Court on 15.07.2005; this averment has been opposed by respondent raising contention that the inspector of the applicant who had been looking after the case before ESI Court and he was supposed to make periodical enquiry with the said learned Advocate. It was pointed out that it was the duty of the inspector of Corporation to make enquiries with the ESI Court and he cannot be expected to sleep over the matter for what is obviously inordinate as well as an indefensible delay. According to respondent, such an Advocate would be entrusted number of matters by Corporation and in one matter only, his absence would be immediately noticed and remedial measures would be taken swiftly. In short, respondent has opposed this application with lapses on part of lawyer for six months but lapses on part of Corporation is more than three years who remained inactive and has not enquired from ESI Court as to what happened in the matter. Therefore, according to respondent such delay which is not satisfactorily explained, the entire period of delay and giving one excuse that lawyer went abroad cannot be considered a bona-fide or genuine delay and applicant has not satisfactorily explained the delay and no sufficient cause is made out by applicant to condone delay of more than 1010 days. Rejoinder was filed by Corporation repeating the same averments and same cause in rejoinder and giving additional facts that lawyer has been removed from panel. Ultimately, question is that whether applicant has shown sufficient cause for condoning delay of 1010 days or not? Certified copy has been placed on record of the judgment and order passed by ESI Court dated 15.07.2005 where application made on 18.03.2008 by one - Shri. N.K. Sharma. Ultimately, question is that whether applicant has shown sufficient cause for condoning delay of 1010 days or not? Certified copy has been placed on record of the judgment and order passed by ESI Court dated 15.07.2005 where application made on 18.03.2008 by one - Shri. N.K. Sharma. The application for certified copy was filed on 18.03.2008 and certified copy was received on 25.03.2008 then subsequent period up-to 02.05.2008 is not explained by ESI Corporation. Who is Shri. N.K. Sharma who has filed application on 18.03.2008, that aspect is also not explained by ESI Corporation. Therefore, in light of this vague explanation and except the lapses on part of lawyer for period of 5-6 months as he went to abroad, for the remaining period what happened to the matter and what steps have been taken by office or inspector of Corporation have not been disclosed by ESI Corporation. Normally in a delay condonation application, Court has to consider with a liberal approach but when delay is not satisfactorily explained and no sufficient cause is established for entire period and merely lapses of lawyer has been pointed out which does not cover entire period of 1010 days, then said delay which is not genuine and bona-fide and what steps have been taken by Corporation in between period it is not disclosed, then such gross delay cannot be condoned, otherwise it causes great prejudice to the rights of the respondent. The Apex Court has considered the case of Rafiq and another v. Munshilal and another reported in, AIR 1981 SC 1400 , which has been distinguished Paragraph 3 of the decision in case of Salil Dutta V. T.M. & M.C. Private Ltd. reported in, JT 1993 (4) S.C. 528, The relevant discussion made in Paragraphs 7 and 8 are quoted as under :- "7. The question is whether the principle of the said decision comes to the rescue of the defendant respondent herein. Firstly, in the case before us it was not an appeal preferred by an outstation litigant but a suit which was posted for final hearing seven years after the institution of the suit. The defendant is a private limited company having its registered office at Calcutta itself. The persons incharge of the defendant-company are not rustic villagers nor they are innocent illiterates unaware of Court procedures. The defendant is a private limited company having its registered office at Calcutta itself. The persons incharge of the defendant-company are not rustic villagers nor they are innocent illiterates unaware of Court procedures. Prior to the suit coming up for final hearing on 9th June, 1988 the defendant had filed two applications whereupon the Court ordered that they will be considered at the time of the final hearing of the suit. The plaintiff's case no doubt is that the said applications were part of delaying tactics being adopted by the defendant-tenants with a view to protract the suit. Be that as it may, the defendant thereafter refused to appear before the court. According to the defendant, their advocate advised them that until the interlocutory applications filed by them are disposed of, the defendant need not appear before the Court which means that the defendants need not appear at the final hearing of the suit. It may be remembered that the Court proposed to consider the said interlocutory applications at the final hearing of the suit. It is difficult to believe that the defendants implicitly believed their advocate's advice. Being educated businessmen they would have known that non-participation at the final hearing of the suit would necessarily result in an adverse decision. Indeed we are not prepared to believe that such an advice was in fact tendered by the advocate. No advocate worth his salt would give such advice to his client. Secondly, the several contradictions in his deposition which are pointed out by the Division Bench in the impugned order go to show that the whole story is a later fabrication. The following are the observations made in the Judgment of the Division Bench with respect to the conduct of the said advocate: "we found that the said learned advocate conducted the proceedings in a most improper manner and that his absence on 10th June, 1988 and on subsequent date was not only discourteous but possibly a dereliction of duty to his client........ the learned advocate had forgotten his professional duty in not making inquiry to the Court as to what happened on 10th, 11th and 13th June, 1988........ the learned advocate acted in a most perfunctory manner in the matter and the learned advocate dealt with the matter in a most unusual manner. the learned advocate had forgotten his professional duty in not making inquiry to the Court as to what happened on 10th, 11th and 13th June, 1988........ the learned advocate acted in a most perfunctory manner in the matter and the learned advocate dealt with the matter in a most unusual manner. We have also found that the said learned advocate had made serious contradiction in the deposition before the court below. The learned advocate in his deposition stated that he did not file an application for adjournment on 9th June, 1988. But from the record it was evident that it was on the basis of the application filed on 9th June, 1988, the case was adjourned for cross-examination of the witnesses whose examination was called on the next date." The above facts stated in the deposition of the advocate show that he indeed made an application for adjournment on the 9th June, 1988 to enable him to cross examine the witnesses on the next date. Therefore, his present stand that he advised his client not to participate in the trial from and including 9th June, 1988 onwards is evidently untrue. We are, therefore, of the opinion that the story set up by the defendant in his application under Order 9, Rule 13 is an after-thought and ought not to have been accepted by the Division Bench in its order dated 3rd March, 1992 more particular when it had rejected the very case in its earlier Judgment dated 8.7.1991. 8. The advocate is the agent of the party. His acts and statements, made within the limits of authority given to him, are the acts and statements of the principal i.e. the party who engaged him. It is true that in certain situations, the Court may, in the interest of justice, set aside a dismissal order or an ex-parte decree notwithstanding the negligence and/or misdemeanor of the advocate where it finds that the client was an innocent litigant but there is no such absolute rule that a party can disown its advocate at any time and seek relief. No such absolute immunity can be recognised. Such an absolute rule would make the working of the system extremely difficult. The observations made in Rafiq must be understood in the facts and circumstances of that case and cannot be understood as an absolute proposition. No such absolute immunity can be recognised. Such an absolute rule would make the working of the system extremely difficult. The observations made in Rafiq must be understood in the facts and circumstances of that case and cannot be understood as an absolute proposition. As we have mentioned hereinabove, this was an on-going suit posted for final hearing after a lapse of seven years of its institution. It was not a second appeal filed by a villager residing away from the city, where the Court is located. The defendant is also not a rustic ignorant villager but a private limited company with its head-office at Calcutta itself and managed by educated businessmen who know where their interest lies. It is evident that when their application were not disposed of before taking up the suit for final hearing thy felt piqued and refused to appear before the court. May be, it was part of their delaying tactics as alleged by the plaintiff. May be not. But one thing is clear - they chose to non-cooperate with the court. Having adopted such a stands towards the Court, the defendant has no right to ask its indulgence. Putting the entire blame upon the advocate and trying to make it out as if they were totally unaware of the nature or significance of the proceedings is a theory which cannot be accepted and ought not to have been accepted." In view of aforesaid decision of Apex Court, in facts of this case, the office situated in Ahmedabad of ESI Corporation, number of inspectors are working in Ahmedabad Office of the Corporation. Normally the practice is that one inspector has to deputed to presiding officer in ESI Court alongwith lawyer who appears on behalf of ESI Corporation. The ESI Court is situated in Ahmedabad and distance from office of Corporation to Court is hardly 30 minutes, but no steps have been taken by ESI Corporation to enquire as to what happen to pending matter because lawyer went abroad for 5-6 months. The fact that the lawyer went abroad is known to the Corporation and this fact must have also been known to the Inspector who was with the lawyer in ESI Court. Therefore,it is clear that there was an intentional lapse or omission by Corporation not to enquire from ESI Court as to what happened to the matter which was pending in ESI Court. Therefore,it is clear that there was an intentional lapse or omission by Corporation not to enquire from ESI Court as to what happened to the matter which was pending in ESI Court. The periodical enquiry must have be made by ESI Corporation - by such an inspector who had normally attended the proceedings in ESI Court but Corporation remained throughout negligent for about three years and had not taken care to make any enquiries from ESI Court. Therefore, merely the lapses on part of the lawyer cannot be considered to be a sufficient cause for condoning delay of 1010 days. 4. Recently, Apex Court has considered question of delay and latches in the case of Yunus (Baboobhai) A. Hamid Padvekar v. State of Maharashtra through its Secretary & Ors. reported in, 2009 AIR SCW 1986, Reference made in Paragraphs 8 and 9 are quoted as under :- "8. Delay or laches is one of the factors which is to be borne in mind by the High Courts when they exercise their discretionary powers under Article 226 of the Constitution of India, 1950 (in short the 'Constitution'). In an appropriate case the High Court may refuse to invoke its extraordinary powers if there is such negligence or omission on the part of the applicant to assert his right as taken in conjunction with the lapse of time and other circumstances, causes prejudice to the opposite party. Even where fundamental right is involved the matter is still within the discretion of the Court as pointed out in Durga Prasad v. Chief Controller of Imports and Exports, ( AIR 1970 SC 769 ), Of course, the discretion has to be exercised judicially and reasonably. 9. What was stated in this regard by Sir Barnes Peacock in Lindsay Petroleum Company v. Prosper Armstrong Hurde etc., (1874) 5 PC 221 at page 239, was approved by this Court in Moon Mills Ltd. v. Industrial Courts, ( AIR 1967 SC 1450 ), and Maharashtra State Transport Corporation v. Balwant Regular Motor Service, ( AIR 1969 SC 329 ), Sir Barnes had stated : "Now the doctrine of laches in Courts of Equity is not an arbitary or technical doctrine. Where it would be practically unjust to give a remedy either because the party has, but his conduct done that which might fairly be regarded as equivalent to a waiver of it, or where by his conduct and neglect he has though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted, in either of these cases, lapse of time and delay were most material. But in every case, if an argument against relief, which otherwise would be just, if founded upon mere delay, that delay of course not amounting to a bar by any statute of limitation, the validity of that defence must be tried upon principles substantially equitable. Two circumstances always important in such cases are, the length of the delay and the nature of the acts done during the interval which might effect either party and cause a balance of justice or injustice in taking the one course or the other, so far as relates to the remedy." 5. Question of delay also considered by the Jammu & Kashmir High Court in the case of Oriental Insurance Co. Ltd. v. S.D. Sahare and others reported in, 2008 ACJ 1327 : (AIR 2008 (NOC) 2196, Relevant discussion in Paragraphs 14 to 20. "14. Expiry of the period of limitation prescribed for filing appeal in a contested matter, particularly in those cases where claims are allowed under the Motor Vehicles Act, in favour of the injured or those who are left behind to suffer because of the death of their breadwinner, vests a valuable right in the claimant which cannot be taken away on mere ipsi dixit of the party losing the litigation. Strong reasons are, therefore, required to be spelled out by such appellant seeking condonation of delay in filing the appeal. It is further required to indicate the steps taken by it to ensure filing of appeal within the prescribed time and the circumstances which had prevented it from filing the appeal within the prescribed period of limitation. 15. Strong reasons are, therefore, required to be spelled out by such appellant seeking condonation of delay in filing the appeal. It is further required to indicate the steps taken by it to ensure filing of appeal within the prescribed time and the circumstances which had prevented it from filing the appeal within the prescribed period of limitation. 15. The ground urged by the insurance company to seek condonation of delay does not indicates its awareness that the appeals had to be filed within the prescribed period of limitation and about the efforts and steps taken by it to ensure that no delay was caused in filing the appeals within the prescribed period of limitation as also the factors which despite its having taken steps to file appeal within the prescribed period of limitation had disabled it to file the appeal. 16. The insurance company has not placed any material on record either, on the basis whereof it may be said that it had all along been aware that it had to file the appeal within the prescribed period of limitation and that it had taken requisite steps needed for filing such appeals, or to expedite the reconstruction of records which are stated to have been allegedly lost in transit when the file had been sent to the Regional Office and despite taking all steps, it had been disabled because of one or the other reasons to file the appeal within the prescribed period of limitation. 17. Spelling out of the difficulty or the purported genuine cause which had disabled an insurance company or, for that matter, any other authority which acts through its impersonal machinery, to file an appeal within the prescribed period of limitation or the discernment of such cause from any other material on record thus becomes necessary because in its absence the court may be disabled to find out as to whether the difficulty or cause projected was a genuine cause justifying condonation of delay or was a self invited or misconceived cause which may not, in the given facts and circumstances of a case, warrant consideration for allowing condonation of delay and deprivation of a party of its right which had accrued to it because of omission of the opposite party to file the appeal within the prescribed period of limitation. 18. 18. Appellant insurance company has neither projected nor spelled out any such cause or genuine difficulty in the present case which had disabled it from filing its appeals within the prescribed period of limitation. Its long wait for more than a year for receipt of its files from its Regional Office, without having taken any steps for reconstruction of records so as to file appeals within the shortest possible time, cannot be accepted as a genuine/sufficient cause which may be said to have disabled it from filing appeals within the prescribed period of limitation justifying condonation of delay. 19. I am supported in taking this view by a Division Bench judgment of this Court in National Insurance Co. Ltd. v. Sep. Bhagirath Singh, Cond (C) No.205 of 2005; decided on 13.12.2005, where, the Bench observed as follows : "Grounds raised by the appellants do not exhibit any cause muchless sufficient, which appears to have prevented that company in filing the appeals within prescribed time of limitation. On the other hand, the grounds only show the route, which the files appear to have taken before the appeals, came to be filed in this court. The appellant, it appears, has multipolar legal hierarchy, which the appellant urges that a file has to travel before a final decision, as to the filing or otherwise of an appeal, is taken by the company. In other words, it suggests that the company has devised its own procedure for taking a decision as to whether or not an appeal be filed against a decision of the court. If this practice, which has been adopted by the company, has to be accepted, then one has to do that at the cost of the prevailing law of the land which does not contemplate providing more than three months' time to a litigant to consider as to whether or not, it wanted to file an appeal against the judgment of a court. The company cannot, in our opinion, be permitted to have a separate period of limitation for its appeals. The insurance company cannot be treated differently from an ordinary litigant. The appellant company possessed of the requisite legal expertise knows fully well that if an appeal is to be filed, it is required to be so filed within the prescribed period of limitation. The insurance company cannot be treated differently from an ordinary litigant. The appellant company possessed of the requisite legal expertise knows fully well that if an appeal is to be filed, it is required to be so filed within the prescribed period of limitation. Proviso appended to section 173 of the Motor Vehicles Act, 1988, does not contemplate the condonation of delay on such self invited, disabling grounds to seek condonation of delay. What is contemplated by second proviso of section 173 of the Motor Vehicles Act, 1988, is the 'sufficient cause' which prevents a litigant from filing an appeal. This sufficient cause, cannot be countenanced as cause invited by a litigant on his own. Sufficient cause contemplated by proviso to section 173, is an unforeseen act or event because of which a litigant is prevented in filing appeal within the statutory period of limitation. Appellant company has failed to project any such cause unexpected or unforeseen as is contemplated by section 173 of Motor Vehicles Act, 1988. Applications filed by the applicants/appellants, were, thus, misconceived. We have examined the reasoning given by the learned single Judge. We are satisfied with the order passed by learned single Judge. The order impugned in the appeals, thus, does not call for any interference. The appeals are, accordingly, rejected." 20. Petitions filed by the insurance company, which do not spell out requisite details as to what the company had been doing sitting silent for more than a year, what steps had it taken to ensure filing of appeals within the prescribed period of limitation or within the shortest period of time and which are those circumstances which had prevented it from filing appeals within the prescribed period of limitation, do not, therefore, deserve liberal consideration for condoning delay in filing the appeals and depriving the claimants of the right which has accrued to them because of the omission of the company to file appeals within the prescribed period of limitation." 6. The Delhi High Court has also considered question of delay whether it is to be condoned or not in the case of V.K. Thukral and others v. Lalit and others reported in, 2006 ACJ 2440, Relevant discussion in Paragraphs 8 and 9 are quoted as under :- "8. The Delhi High Court has also considered question of delay whether it is to be condoned or not in the case of V.K. Thukral and others v. Lalit and others reported in, 2006 ACJ 2440, Relevant discussion in Paragraphs 8 and 9 are quoted as under :- "8. It is true that in an adversarial litigation, clients repose faith in their advocate and having paid the fee and given requisite instructions to their lawyer, a party would be fully justified in being confident that his lawyer would discharge his professional obligations. Therefore, where it is brought on record that a party has done everything in its power to effectively participate in a proceedings, courts should be liberal in construing sufficient cause and should lean in favour of such party. A litigant does not stand to benefit by lodging appeals at a belated stage. Whenever substantial justice and technical consideration are opposed to each other, cause of substantial justice has to be preferred. Justice oriented approach has to be taken by a court. However, this does not mean that litigant has a free license to approach the court at its will. 9. At some stage of the judicial proceedings, where a litigant finds that his lawyer is not rendering the requisite professional services, it becomes the duty of the litigant to be come vigilant." 7. In light of aforesaid decision of Apex Court, Jammu and Kashmir High Court as well as Delhi High Court, according to my opinion, no requisite details have been given by ESI Corporation to establish sufficient cause for condoning delay of 1010 days in filing First Appeal. Apart from that, there is no substantial question of law involved in First Appeal prima facie, because only amount of Rs. 3866/- demanded by Corporation being contribution from respondent has been set aside only on the ground that order which has been passed by Corporation under Section 45A is without reason and without giving reasonable opportunity of hearing to respondent which violated principles of natural justice. Therefore, prima-facie there is no merits in First Appeal. Therefore, prayer made in this Application cannot be granted and such delay cannot be condoned because no sufficient cause is established and no satisfactory explanation given and there is no genuine cause pointed out for condoning delay of 1010 days in filing First Appeal. Therefore, prima-facie there is no merits in First Appeal. Therefore, prayer made in this Application cannot be granted and such delay cannot be condoned because no sufficient cause is established and no satisfactory explanation given and there is no genuine cause pointed out for condoning delay of 1010 days in filing First Appeal. Therefore prayer made in this Application is rejected and First Appeal (Stamp Number) No.2025/2008 is also accordingly, dismissed. There is no substance in the present application. Therefore, the same stands dismissed. No order as to costs. Application dismissed.