Calcutta High Court
Belur Sramajibi Swasthya Prakalpa ... vs The State Of West Bengal & Ors on 16 January, 2024
IN THE HIGH COURT AT CALCUTTA
CONSTITUTIONAL WRIT JURISDICTION
ORIGINAL SIDE
BEFORE:
HON'BLE JUSTICE RAJA BASU CHOWDHURY
WPO/1484/2023
Belur Sramajibi Swasthya Prakalpa Samity & Anr.
Versus
The State of West Bengal & Ors.
For the petitioners : Mr. Supriya Chattopadhyay
Mr. Mr. Sandip Kr. Maity
Mr. Tapan Sarkar
Ms. Deboshree Chatterjee
For the respondent : Mr. Kishore Dutta
nos. 1 & 2 Mr. Santanu Kr. Mitra
Ms. Tapati Samanta
For the respondent : Mr. Soumitra Banerjee
nos. 3 & 4
Heard on : 10.10.2023, 11.10.2023 & 17.10.2023.
Judgment on : 16th January, 2024.
RAJA BASU CHOWDHURY, J:
1. The instant writ petition has been filed, inter alia, challenging an order
dated 9th June, 2023 and the communication letter dated 12 th June,
2023, issued by the Additional Chief Secretary, Labour Department,
Government of West Bengal.
2. Shorn of unnecessary details, the facts are that the petitioner no.1 is a
society registered under the provisions of the Societies Registration
Act, 1961 and is dedicated to provide health services to the
marginalised section of the society who are in need of health services.
In usual course, the petitioner no.1 had applied for exemption under
Section 87 of the Employees' State Insurance Act, 1948, sometimes in
November, 2011. The said application was considered by the
appropriate Government through the Principal Secretary, who by an
order dated 1st November, 2012 while considering the grant of an
exemption under Section 91 of the Employees' State Insurance Act,
1948 (hereinafter referred to as the "said Act") was, inter alia, pleased
to observe as follows:-
"The Applicant Establishment, it appears, is a Charitable
organization. The way the activities of the establishment
are administered apparently justify its claim for exemption
from application of the provisions of ESI Act. The
organization therefore may be considered eligible for
exemption in terms of Section 91 of the Act. However, since
such order of exemption is required to be issued with
consent of the Corporation, Additional Commissioner &
Regional Director is requested to examine and advise
suitably on the limits of exemption that may be considered
in case of this establishment.
Since a decision on exemption under Section 91 of the Act
will take some time, exemption hereby is given to the
Applicant Establishment under Section 87 of the Act for
one year from 01.4.2012 to 31.3.2013."
3. Since then, the appropriate Government had from time to time granted
exemption to the petitioner no.1. Incidentally, by an order dated 17 th
November, 2016, the appropriate Government, had, inter alia, rejected
the petitioner no.1's application for grant of exemption, for the period
from 1st April, 2016 to 31st March, 2017.
4. Although, the writ petitioners had challenged such order before this
Court by filing a writ petition, which was registered as WPO. 1113 of
2016, notwithstanding such petition being entertained by this Court,
the same was ultimately dismissed for default on 15 th January,
2020.
5. Since then, the petitioners had made a representation dated 28 th
September, 2021, calling upon the Hon'ble Labour Minister to look
into the matter, for grant of permanent exemption to the petitioner
no.1. Simultaneously, since WPO. 1113 of 2016 was dismissed,
without a decision on merit, the petitioners also filed a fresh writ
petition challenging the order dated 17th November, 2016, which was
registered as WPO. 917 of 2022.
6. It is, in connection with the aforesaid petition that a Coordinate Bench
of this Hon'ble Court, by taking note of the order dated 1 st November,
2012 passed by the Principal Secretary, Labour Department,
whereunder the petitioner no. 1 was found to be eligible, for grant of
exemption under Section 91 of the said Act, by an order dated 17 th
February, 2022, directed the Joint Secretary, Government of West
Bengal, Labour Department, Directorate of ESI Branch, to consider
and dispose of the representation filed by the petitioner no.1 on 28 th
September, 2021, within one month from the date of communication of
the order, after giving reasonable opportunity of hearing to all the
interested parties. The Hon'ble Court by the aforesaid order had also
directed the concerned authority, in considering the representation to
take into account the observations made by the Principal Secretary,
Department of Labour, Government of West Bengal, in his order dated
1st November, 2012, without in any way, being influenced by the
observation made in the order dated 17 th November, 2016 as aforesaid.
7. Pursuant to the aforesaid order, the Principal Secretary, Department of
Labour, Government of West Bengal, had given an opportunity of
hearing to the petitioners and thereafter, had passed an order dated
8th June, 2022 thereby disposing of such representation, by granting
exemption to the petitioner no.1's establishment under Section 87 of
the said Act, from 1st July, 2022 to 31st March, 2023. Subsequently,
by a separate order dated 27th July, 2022, the Deputy Secretary,
Government of West Bengal was, inter alia, pleased to record the
approval of the Governor, for renewal of exemption in respect of the
coverage of regular employees of the petitioner no.1 under Section 87
of the said Act, for the period from 1 st July, 2022 to 31st March, 2023.
8. The petitioners, however, being aggrieved with the failure on the part
of the Joint Secretary, Government of West Bengal, Department of
Labour, to hear out and consider the petitioners' representation filed
on 28th September, 2021, insofar as the same concerned non
consideration of the exemption under Section 91A of the said Act, had
filed a writ petition which was registered as WPO. 2471 of 2022.
9. On contested hearing, this Court by an order dated 9 th February, 2023
by taking note of the order of the Co-ordinate Bench of this Court
dated 17th February, 2022 directing the Joint Secretary, Department of
Labour, Government of West Bengal to decide the petitioners'
representation for granting exemption, in the light of the order passed
by the Principal Secretary, Department of Labour, Government of West
Bengal on 1st November, 2012, and the Principal Secretary himself in
its order on 8th June, 2022 having concluded that the petitioner no.1
is otherwise entitled to exemption, had directed the Principal Secretary
to adjudicate upon the issue, as to whether the petitioner no.1 is
entitled to exemption under Section 88 read with Section 91 of the said
Act, and if the petitioner no.1 was found eligible, to grant such
exemption.
10. The petitioners claim that in terms of the aforesaid order dated
9th February, 2023, the Additional Chief Secretary, Labour
Department, Government of West Bengal had issued an order directing
the petitioner no. 2 to appear personally for hearing on 12 th April
2023. Pursuant to the aforesaid the petitioner no. 2 had attended the
hearing and had also made submissions, however, in course of such
hearing, although, the Employees' State Insurance Corporation (Corporation)
had submitted a written objection, despite request, copy of such objection
was not made available to the petitioners. It is the petitioners' case
that the Additional Chief Secretary was of the view that if the
petitioners were interested to obtain copy of such document, they may
apply in writing, for the same to be supplied to them. The petitioners,
accordingly, by a letter dated 25 th April, 2023 had sought for a copy of
such document/objection filed by the Employees' State Insurance
Corporation. Despite such written request, the objection submitted by
the Corporation was not supplied instead, by cover of letter dated 12 th
June, 2023, the Additional Chief Secretary by placing reliance on the
objection filed on behalf of the Corporation was of the view that the
employees of the petitioner no.1's establishment are not receiving
benefits substantially similar or superior to the benefits provided
under the Scheme of Corporation and that the way activities of the
establishment are being administered does not justify its claim for
exemption from the application of provisions of the said Act.
Accordingly, it was held that the petitioner no.1 is not eligible for
exemption in terms of the provisions of Section 91 of the said Act, for
not fulfilling the conditions of proviso to Section 87 of the said Act.
11. Mr. Chattopadhyay, learned advocate representing the
petitioners, submits that the aforesaid decision had been taken by the
Additional Chief Secretary in a manner which is unknown in law. The
order is violative of the principles of natural justice. No opportunity
was given to the petitioners to controvert the objections taken by the
Corporation. In fact the petitioners were never made aware as to what
were the objections raised by the Corporation, until passing of the
Order impugned. In absence of such disclosure, the petitioners could
not appropriately respond. The same severely prejudiced the
petitioners. By referring to the order under challenge, it is submitted
that the benefits that the petitioners provide to its volunteers are more
superior than that has been claimed by the Corporation. The health
benefits are being provided in addition to various insurance policies.
By reasons of failure on the part of the Additional Chief Secretary to
permit the petitioners to be entitled to a copy of the objection filed by
the Corporation, the petitioners could not specify the facilities and/or
benefits provides to its volunteers, by comparing the same with that
what was made available by the Corporation. By referring to the third
column being the remarks column of Annexure-A to the order dated
9th June, 2023, it is submitted that it has been claimed that no
expenditure had been shown in the audited accounts as regards
expenses incurred for providing health services. Such a finding
according to the petitioners is perverse. No opportunity was given to
the petitioners to explain the accounts. The Additional Chief Secretary
also misconstrued the accounts, not only for the current year but for
the previous years as well, for which exemption had been granted. The
Additional Chief Secretary further overlooked the relevant
considerations and had also refused the petitioners' an opportunity to
explain which resulted in failure of justice. By referring to the order
dated 27th July, 2022 issued by the Deputy Secretary to the
Government of West Bengal, it is submitted that the Additional Chief
Secretary did not identify the change in circumstances, for the
respondents to arrive at a completely different decision than the one
which has been taken by them earlier. The aforesaid order also does
not take note of the directions passed by this Court dated 9 th
February, 2023, which remains unchallenged. Having regard to the
aforesaid, it is submitted that the aforesaid decision taken by the
Additional Chief Secretary is perverse. The same seriously prejudiced
the petitioners as such the same should be set aside.
12. Per contra, Mr. Kishore Dutta, learned Senior Advocate
representing the respondent nos. 1 and 2, in an attempt to justify the
order passed by the Additional Chief Secretary on 9 th June, 2023,
submits that it is immaterial whether the written objection was not
made over to the petitioners for the purpose of ascertaining whether
the order stands vitiated. Simply because, a copy of an objection was
not made over to the petitioners, the same does not entitle the
petitioners to claim that the said order stands vitiated. The petitioners
should be in a position to identify the prejudice caused by reasons of
non-supply of the aforesaid objection. Admittedly, the objection has
now been supplied to the petitioners along with the copy of the order.
Notwithstanding the aforesaid, the petitioners have not been able to
identify in the writ petition the prejudice caused or suffered by the
petitioners. There is also no challenge to the findings made in the
remarks column. The principles of natural justice is not a straight
jacket formula, even in the application of doctrine of the fair play,
there must be some real prejudice to the complainant, without such
prejudice being identified, the order should not be set aside on the
mere technicality of non-service of the objection. According to him,
non-supply of the objection would at best infringe the rights of the
petitioners. The petitioners in such a case are obliged to demonstrate
the prejudice caused while challenging the order. In the present case,
no attempt has been made by the petitioners to question the findings.
In support of his contention, reliance is placed on the following
judgments:
i. Natwar Singh v. Director of Enforcement & Anr.,
reported in (2010) 13 SCC 255,
ii. Sohan Lal Gupta & Ors. v. Ashi Devi Gupta & Ors.,
reported in (2003) 7 SCC 492
iii. Chairman, State Bank of India & Anr. v. M. J. James,
reported in (2022) 2 SCC 301.
13. Independent of the above, it is submitted that in order to seek
an exemption under Section 88, the conditions referred in the first
proviso to Section 87 of the said Act must be satisfied. By referring to
the order impugned, it is submitted that the Additional Chief Secretary
by analysing the case put up by the petitioners and the objections
raised by the respondents had come to the conclusion, which is
reflected in the remarks column of Annexure-A to the said order. There
is no challenge to such findings. In view thereof, no relief can be
afforded to the petitioners. It is still further submitted that in order to
be entitled to an exemption under Section 91 of the said Act, the
consent of the Corporation is necessary. Admittedly, in this case, the
Corporation has not consented and as such, no such exemption can
be granted. Referring to the representations made by the employees of
the petitioners, it is submitted that there is no scope to opt out of the
scheme even by consent, as such the same are of no assistance. In the
facts noted hereinabove, no interference is called for.
14. Mr. Banerjee, learned advocate representing the respondent nos.
3 and 4, adopts the submission made by Mr. Kishore Dutta, learned
Senior Advocate representing the respondent nos. 1 and 2.
15. Mr. Chattopadhyay, in reply, places paragraphs 22 and 23 of the
writ petition to identify the prejudice caused to the petitioners. He
submits that the Additional Chief Secretary while observing that the
petitioner no.1 is not entitled to exemption under Section 91 of the
said Act, since, the conditions set forth in the first proviso to Section
87 of the said Act does not stand satisfied, has overlooked the previous
exemptions granted to the petitioner no.1. He submits that no greater
prejudice can be caused than to decide a case without giving
opportunity to defend. Admittedly, the written objection filed by the
Corporation was not made over to the petitioners. Supply of such
written objection along with copy of the order is no substitute for
supply of such objection in course of hearing, for the petitioners to
respond to the same. The aforesaid has caused irreparable prejudice to
the petitioners, and the same has rendered the order bad. The
judgments relied on by the State respondents do not concern non-
supply of documents and objections taken into consideration by the
Authority/Tribunal without making available copies thereof, or making
the contents thereof, known to the other party. The aforesaid
judgments do not assist the State respondents. It is further submitted
that the order impugned has not been passed having due regard to the
order dated 9th February, 2023 and as such the same cannot be
sustained and should be set aside with a further direction upon the
State respondents to rehear the case.
16. Heard the learned advocates appearing for the respective parties
and considered the materials on record.
17. From the pleadings and the arguments narrated hereinabove,
the following issues arise :-
a. Whether, non-supply of the objection filed by the Corporation
to the petitioners constitutes violation of principles of natural
justice, so as to render the order impugned as bad?
b. Whether, the petitioners had suffered any prejudice by
reasons of non-supply of the copy of the objection relied by
the Additional Chief Secretary?
c. Whether, supply of the objection along with the final order
constitutes compliance with the rules of natural justice for
the petitioners to challenge the said order before this Court?
d. Whether, the order impugned can be or ought to be set aside?
18. As noted above, the decision which is impugned in the present
petition has been passed pursuant to the order dated 9 th February,
2023 whereby, the Principal Secretary, Department of Labour, was
directed to consider the issue, as to whether the petitioner no.1 is
entitled to exemption under Section 88 read with Section 91 of the said
Act, having regard to the observation made in the order dated 1 st
November, 2012 and the order dated 8th June, 2022, and if the
petitioner no.1 was found eligible for grant of exemption under Section
88 read with Section 91 of the said Act, to grant the same.
19. It appears that pursuant to the aforesaid order, the Additional
Chief Secretary, Labour Department, Government of West Bengal, had
considered the matter. Notwithstanding, it was for the Principal
Secretary, Labour Department to consider such an issue, he did not
decide the same. No clarification was, however, sought for by the
State-respondents as to whether the matter can be examined by the
Additional Chief Secretary, Labour Department.
20. Although, the petitioners were invited for a meeting on 12 th April,
2023 and though, an objection was filed by the Corporation, copy of
such objection was not made over to the petitioners despite request
from the petitioner no.2. It has been stated on oath by the petitioners
in paragraph 21 of the petition that on the prayer being made by the
petitioners for a copy of the objection, the Additional Chief Secretary,
Labour Department, Government of West Bengal had suggested the
petitioners to apply for the said document in writing. Interestingly,
although, the petitioner no.2 by letter dated 25 th April, 2023 had
sought for a copy of the objection filed by the Corporation, the
petitioners were not favoured with the same.
21. Admittedly, the order dated 9th June, 2023 proceeds to reject the
petitioners' claim for exemption by not only taking note of the objection
filed by the Corporation but by analysing the contents thereof, and by
holding that the petitioner no.1 is not entitled to exemption. Although,
affidavit in opposition had been filed by the respondent nos.1 and 2,
Mr. Dutta, learned senior advocate representing the aforesaid
respondents has confirmed the factum of non-supply of
objection/report filed by the Corporation to the petitioners. He has,
however, contended that mere non-supply of the aforesaid document is
not sufficient to vitiate the order as the petitioners have failed to
identify the prejudice caused. It is claimed that in the writ petition, the
petitioners have also not contested the findings in the order despite
being aware of the contents of objection, thereby, accepting the same.
He has also placed judicial precedents noted above to contend that
mere non-supply of the report is not sufficient to vitiate the order.
22. Unfortunately, none of the authorities relied on, assist the
respondents. In the case of Natwar Singh (supra) the issue involved
was whether a noticee served with a show-cause notice under Rule
4(1) of the Foreign Exchange Management (Adjudication Proceedings
and Appeal) Rules, 2000, is entitled to demand all documents in the
possession of the adjudicating authority, including documents upon
which no reliance has been placed to issue the show-cause notice. It is
in response to such an issue that the Hon'ble Supreme Court had
observed that even in the application of doctrine of fair play, there
must be flexibility. There must have been caused some real prejudice
to the complainant as there can be no such thing as a merely technical
infringement of natural justice.
23. The judgment delivered in the case of Sohan Lal Gupta (supra)
deals with the question as what would constitute a reasonable notice
by an arbitrator. It is while answering such a question, the Hon'ble
Supreme Court observed that a party in a given case should not only
be required to show that he did not have proper notice resulting in
violation of principal of natural justice but also to show that he was
seriously prejudice thereby. The case of Chairman, State Bank of
India (supra) pertains to quashing of a disciplinary proceeding on the
ground of violation of a particular clause of the Bank of Cochin Service
Code. In none of the aforesaid cases the Hon'ble Supreme Court was
concerned with non-supply of objections, the consideration whereof,
resulted in rejection of petitioners' claim. In my view, a party cannot be
subjected to more prejudice than its claim being dismissed on
consideration of certain objections, without affording the party an
opportunity to explain the same. The manner in which the order
impugned has been passed by placing reliance on an objection filed by
the Corporation without making the same available to the petitioners
and the objections forming the basis of the order itself, shocks the
conscience of the Court.
24. Needless to note that the aforesaid order is in sharp contrast to
the repeated previous directions issued by the appropriate Government
upholding the entitlement of the petitioner no.1 for grant of exemption.
From the tenor of the order, it appears that the Additional Chief
Secretary by undermining the previous orders issued by the
appropriate Government from time to time, has come to a conclusion
based on the aforesaid objections filed by the Corporation that the
employees of the petitioner no.1's establishment are not receiving
benefits substantially similar or superior to the benefits provided by
the Corporation. The finding, that the way the activities of the
petitioner no.1's establishment is being administered do not justify the
claim for exemption, is also in contrast to the repeated observations of
the appropriate Government that the activities of the establishment
justify grant of exemption. It is not only strange but startling to note
that the Additional Chief Secretary had proceeded to adjudicate upon
the issue although, this Court had never empowered the Additional
Chief Secretary to adjudicate the same.
25. All issues noted above are thus, decided in favour of the
petitioners and against the respondents. For reasons as aforesaid, the
order impugned cannot be sustained and the same is set aside and
quashed. This Court accordingly directs the Principal Secretary,
Department of Labour, Government of West Bengal to take a fresh decision
as regards the grant of exemption to the petitioner no.1, strictly in
terms of the order dated 9th February, 2023 passed by this Court, by
following the principles of natural justice and the observations made
herein within a period of eight weeks from the date of communication
of this order. It is made clear that till a fresh order is passed, no
coercive steps shall be taken against the petitioners.
26. Further taking note of the manner in which the matter has been
decided, the Additional Chief Secretary, who had passed the order
impugned shall not be part of the aforesaid decision making process.
27. With the above observations/directions, the writ petition being
No. WPO 1484 of 2023 stands disposed of.
28. There shall be no order as to costs.
29. Urgent Photostat certified copy of this order, if applied for, be
made available to the parties on priority basis upon compliance of all
formalities.
(RAJA BASU CHOWDHURY, J)
