JUDGMENT 1. Civil Miscellaneous Appeal filed against the judgment and decree of the Employees Insurance Court (Principal Labour Court), Chennai dated 8.3.2013 passed in EIOP No.51 of 2002. 2. The appeal is directed against an order passed by the Employees Insurance Court (Principal Labour Court), Chennai dated 8.3.2013. The appellant is covered under the provisions of the Employees State Insurance Act, 1948 and the contributions are paid without any default. However, an order dated 20.5.2002 was passed under sec.45(A) of ESI Act demanding a sum of Rs. 7,08,439/- for the period from 96-97 and 98-99 with interest at the rate of 15%. 3. The said order was challenged by the appellant before ESI Court in EIOP No.51 of 2002. The appellant had assailed the order on various grounds. 4. The respondent Corporation resisted stating that only after considering the profit and loss account produced by the petitioner for the year 1996-97 and 1997-98 the contribution amount was determined. 5. The learned Presiding Officer, considered the rival contentions and re-determined the contribution amount as Rs.6,84,792/- and directed the appellant to pay the same. Aggrieved by which, the appellant is before this Court. 6. Pending appeal, a demand notice dated 10/6/2013 was issued to pay a sum of Rs.17,57,539/-. The order was stayed by a conditional order of this court. Since there was an attachment order invoking the provisions of the Act by the respondent, the appellant issued five post-dated cheques covering the demand amount. 7. The appeal was taken on file and heard in adjourned admission stage for disposal. The following substantial questions of law are framed for proper adjudication. i) Whether Respondents can act beyond the scope of the order of the Employees State Insurance Court by compelling the Appellants to pay amounts more than what is ordered by the Employees State Insurance Court? ii) Whether the quantum of Rs.6,84,792/- fixed as contribution payable by the Appellant to the respondent is worked out on the basis of statutory principles? 8. Assailing the order dated 20.5.2002 of the Corporation and also the order of ESI court dated 8.3.2013, Mr.S. Suresh Kumar, the learned counsel for the appellant, would submit that the respondent is acting beyond the scope of the order of ESI Court and the percentage of the contribution ascertained by the Court is excessive and not based on any provisions of the Act. The learned counsel pointed out that the court below has not taken into consideration the expenditure which do not attract ESI contribution. The learned counsel also submitted that the respondent has issued a notice dated 10.6.2013 demanding interest at 15%p.a without any basis. The learned counsel relied on a decision reported in AIR 1970 Madras 439 (The Reid Co-operative Timber Works Ltd, Madras vs Employees” State Insurance Corporation) 9. On the other hand, Mr.G. Bharadwaj, learned counsel for ESI Corporation submitted that the ESI Court had considered the calculation made by the Corporation and had reduced the amount of contribution which attracts a statutory interest. The learned counsel pointed out that a statutory interest cannot be interfered with and the court cannot waive such interest. 10. The learned counsel also relied on the following case laws: i) 2008(8) SCC 705 (Goetze (India) Ltd vs Employees' State Insurance Corporation) ii) 2007 (II) LLJ 661 (Cannanore Drug Lines and Employees State Insurance Corporation) iii) 2008(4) LLN 445 ( Employees' State Insurance Corporation vs Bharat Hotel) iv) Order in WP No.14498 of 2005 dt 15.2.2011 11.Heard and perused the materials available on record. 12. The appellant is a contributor towards Employees State Insurance. However, the Corporation felt that the contributions were not in accordance with Sec.40 of the Act read with Regulations 29 and 30 of the General Regulations. A show cause notice was issued on 31.5.2001 to furnish certain particulars. However, only the profit and loss account for the year 1997-98 and 1998-99 were produced before the authorities. The Deputy Director considered the records and calculated the wages as follows: 25% of the total amount was claimed where civil construction work, and repairs and maintenance are involved. 80% of the total amount was claimed where accounts relating to loading and unloading , laundry charges and sundry expenses. In respect of salary and allowances 100% was claimed. 13. After calculation, a total amount of Rs.1,08,99,007/- was calculated as wages, on which, a sum of Rs.7,08,439/- was demanded as contribution with interest at 15%. This was under challenge before ESI Court. 14. The learned ESI Court considered in detail these calculations. It negatived determination of 80% on loading and unloading and laundry charges and deducted the stipend and allowances and reduced the said amount. This was under challenge before ESI Court. 14. The learned ESI Court considered in detail these calculations. It negatived determination of 80% on loading and unloading and laundry charges and deducted the stipend and allowances and reduced the said amount. Ultimately, the ESI Court took into consideration only two heads for a total sum of Rs.1,05,35,256/- and determined a sum of Rs.6,84,792/- as contribution. While passing the order, ESI Court had stated that the appellant is liable to pay a sum of Rs.6,84,792/- and has not awarded the interest, payable on the defaulted amount. 15. This order was passed on 8.3.2013. On 10.6.2013, a demand notice was issued by the authorities, demanding the following amount 1. Contribution Amount (Rs.) 684792.00 2. Interest upto (Rs.) 1071371.00 3. Further interest upto (Rs.) 10.06.13 1126.00 4. Damages (Rs.) 0.00 5. Cost and Charges (Rs.) 250.00 6. Total (Rs.) 1757539.00 16. On 12.6.2013, the appellant made a part payment of Rs.5,19,000/- to avoid attachment proceedings. Subsequently, on 14.6.2013, the appellant also sent a letter expressing its inability to pay the interest component at Rs.10,72,497/- as their company which is a hotel has been closed from 1.4.1999. 17. On 24.6.2013, the present appeal is filed by challenging both the order of ESI Court as well as the demand of ESI Corporation charging interest at 6% upto 19.10.1989, 12% from 20.10.1989 to 31.8.94 and 15% from 1.9.94 till date. 18. Adding fuel to the fire, the Corporation has again issued a notice dated 21.6.2013 calculating further interest upto 14.6.2013 at Rs.9,43,710/-. In effect, the original demanded contribution was only Rs.7,08,439/- payable at the rate of 15%; the appellant was successful in reducing the amount before the court at Rs.6,84,792/- and there is no order about interest and the present demand for interest alone is more than 19,00,000/-. 19. At the outset, this court is of the view that the interest calculated by the Corporation at is Rs.19,00,000/- may not be correct. It is true that interest payable is statutory under Sec.39(f)(a) of the Act and under Regulation 31(A) of Employees State Insurance General Rules. 20. Though the ESI Court has not specified the rate of interest payable on the amount determined as contribution, under the statute for a delayed payment interest is payable. It is true that interest payable is statutory under Sec.39(f)(a) of the Act and under Regulation 31(A) of Employees State Insurance General Rules. 20. Though the ESI Court has not specified the rate of interest payable on the amount determined as contribution, under the statute for a delayed payment interest is payable. It is pertinent to point out that only in the year 2001, a show cause notice was issued to the appellant to furnish particulars for contribution. The profit and loss account for the year 1997-98 and 1998-99 are produced by the appellant and only on that basis, on 20.5.2002, the wages were calculated and the amount was determined. 21. A mere reading of Sec.39 of the Act would show that if any contribution payable is not paid by the principal employer on the date on which such contribution has become due, he shall be liable to pay simple interest at the rate of 12% p.a or at such higher rate as may be specified in the Regulation. 22. Under the Regulation 31(A) if an employer fails to pay the contribution within the period specified in Regulation 31, he shall be liable to pay at the rate of 12% p.a in respect of each day default. Therefore, the interest which is calculated at 15% is not allowed either under the Act or under the Regulation. 23. The next point is Under Regulation 31 when the amount has become due and payable? 24. As stated above, only in the year 2000, an authorised inspector of Corporation conducted inspection and a demand letter was issued to the employer whether the wage elements were considered for payment of contribution in respect of certain amount of expenditure as intimated in the enclosure. 25. In the petition filed before ESI Court, the appellant would state that the contribution to ESI has always been paid without default. In the written statement filed by the respondent, it is stated that on the basis of the inspection conducted by the statutory inspector on 16 and 17.11.2000, it was brought out to the notice of the Corporation that a large sum of contribution is due under the Act in respect of certain heads of accounts. Based on such report, a notice was issued for the production of bills, vouchers, copies of the agreement with the contractors. Based on such report, a notice was issued for the production of bills, vouchers, copies of the agreement with the contractors. It was for the purpose of deciding the contribution payable on certain wages paid to the employees. 26. However, according to the employer, certain heads of expenses and wages are vague and it is not clear as to whether ESI Contribution has to be paid on such heads and has stated that due to bonafide reasons there is a likelihood of error in calculation which was not deliberate. It is further stated that the appellant has remitted the lawful and bonafide contribution which has been accepted by the Corporation. Such timely contribution was not denied by the Corporation. Therefore, what was determined and demanded by an order dated 20.5.2002 modified by the ESI Court by an order dated 8.3.2013 is only a later demand for which the payable date has to be calculated only after 20.5.2002 and not before. 27. It is very amusing to see that the Corporation has calculated interest at the rate of 6% upto 9.10.1989, 12% from 20.10.89 to 31.8.94 and 15% from 1.9.94 to 30.9.2005 and again 12% from 1.10.2005 onwards. 28. Such demand is neither contemplated under Section 39 of the Act or under 31 (A) of the Regulation. There is also a force in the argument of the learned counsel for the appellant that the corporation can not go beyond the decree. His contention is that the ESI court has not granted any interest and there is no appeal against that order. However this court is of the view a minimum statuary interest has to be awarded. It is pertinent to point out the respondent had demanded only 6% at the initial stage. Therefore, this court is of the view that the amount determined by the ESI Court need not be interfered with as the wages actually paid was considered, but should be modified as the appellant is liable to pay a sum of Rs.6,84,792/- with simple interest at 6% p.a from 21.6.2002 till 12.6.2013 when a sum of RS 5,19,000/- was paid. The amount already paid and appropriated by the Corporation has to be given credit to. If excess has been paid, the same is liable to be repaid with similar interest. 29. The amount already paid and appropriated by the Corporation has to be given credit to. If excess has been paid, the same is liable to be repaid with similar interest. 29. In the result, appeal is partly allowed and the order of ESI Court is modified to the extent that the appellant is liable to pay a sum of Rs.6,84,792/- with simple interest at 6% p.a from 21.6.2002 till 12.6.2013. Three months time is granted to make payment from the date of receipt this order. The amount already paid and appropriated by the Corporation has to be given credit to. If excess has been paid, the same is liable to be repaid with similar interest. No costs. Consequently, connected MP is closed.