Research › Search › Judgment

Madras High Court · body

2026 DIGILAW 473 (MAD)

A. Sunder Singh v. Recovery Officer, ESI Corporation, Tirunelveli

2026-02-06

K.SURENDER

body2026
ORDER : 1. By this common order, all these nine Writ Petitions are being disposed of. 2. In these Writ Petitions, the petitioners have challenged the impugned garnishee orders passed by the first respondent under Section 131(3) of the Code on Social Security, 2020, whereby all the petitioners’ bank accounts have been frozen and the concerned Bank Managers have been directed to transfer all future credits to the first respondent. 3. The petitioners are engaged in providing security services, housekeeping services, guarding duties and allied manpower services to various Government Departments. The petitioners have been disbursing wages and remitting statutory contributions such as ESI, EPF and GST in accordance with law. However, the petitioners have defaulted in remitting the statutory dues. 4. Since the petitioners failed to pay the arrears covered under the certificates issued by the Authorised Officer, Employees’ State Insurance Corporation, Tirunelveli, the first respondent issued demand notices to the petitioners. Even thereafter, the petitioners failed to clear the arrears. Therefore, the first respondent passed the impugned orders directing freezing of the petitioners’ bank accounts and transfer of all future credits in the said accounts to the first respondent. 5. The learned counsel for the petitioners would submit that nearly 400 employees are working under the petitioners; that due to the freezing of the petitioners’ bank accounts, the business has come to a complete standstill and the salaries could not be credited to the employees, who have been severely affected; that all the bank accounts of the petitioners maintained in nine banks have been frozen for a total due amount of Rs.22,19,827/- which the petitioners are ready to pay in instalments; and that that the petitioners may be permitted to operate the bank accounts for their business activities. 6. The learned Standing Counsel appearing for the first respondent in all the Writ Petitions, namely, the Recovery Officer, would submit that the recovery proceedings were initiated in the year 2019 and several demand notices were issued to the petitioners from 2019 onwards; that the petitioners kept silent and did not take any steps to remit the dues even in instalments; and that only after the garnishee orders were passed and the bank accounts were frozen, the petitioners rushed to this Court. 7. I have considered the submissions made by the learned counsel for the petitioners and the learned counsel for the respondents. 8. 7. I have considered the submissions made by the learned counsel for the petitioners and the learned counsel for the respondents. 8. It is not in dispute that a sum of Rs.22,19,827/- is due from the petitioners. According to the petitioners, the default occurred due to financial crisis and on account of the freezing of the bank accounts, the employees working under them have been severely affected. On a perusal of the impugned garnishee orders, it is seen that the Bank Managers have been directed to transfer the amounts in the accounts until the arrears are fully cleared. The petitioners have also undertaken to pay the said amount in instalments. 9. Therefore, balancing the interests of both parties and also considering the interest of the employees, this Court permits the petitioners to pay the defaulted amount of Rs.22,19,827/- in equal monthly instalments. On payment of three instalments, the bank accounts shall be defreezed and the petitioners shall be permitted to operate the same. It is made clear that the petitioners shall pay the instalment amount on or before the 5 th day of every English calendar month without fail. In the event of default in payment of any instalment, the first respondent is at liberty to proceed further in accordance with law. It is needless to state that if the petitioners are able to pay the amount earlier, they are at liberty to do so. 10. With the above directions, this Writ Petitions are disposed of. No costs. Consequently, the connected Miscellaneous Petitions are closed.