[Cites 2, Cited by 0]
Calcutta High Court
M/S. Besco Limited (Foundry Division) vs Employees State Insurance on 9 April, 2026
OD-3
IN THE HIGH COURT AT CALCUTTA
Constitutional Writ Jurisdiction
ORIGINAL SIDE
WPO/829/2025
M/s. BESCO LIMITED (FOUNDRY DIVISION)
-VERSUS-
EMPLOYEES STATE INSURANCE
CORPORATION AND ORS.
BEFORE:
The Hon'ble JUSTICE SHAMPA DUTT (PAUL)
Date : 9th April, 2026.
Appearance:
Mr. Soumya Majumdar, Sr. Adv.
Ms. Debjani Sengupta, Adv.
Mr. Rajib Mullick, Adv.
Ms. Priyanka Barik, Adv.
.... for the petitioner.
Ms. Soumi Guha Thakurta, Adv.
Ms. Raima Ganguly, Adv.
Ms. Madiha Haider, Adv.
...for the respondent nos.1 to 3.
1. The writ application has been preferred challenging the
demand notice dated 27th May, 2025 and the garnishee order
dated 14th October, 2025 and all other recovery action.
2. It is the case of the petitioner that the petitioner was not given
a proper hearing during the proceeding under Section 45A of
the ESI Act, 1948 and the respondent authority without
hearing the petitioner/company has passed the impugned
order dated 27th May, 2025.
3. It is further stated that in spite of passing the order without
granting an opportunity of hearing to the petitioner, the
respondent authorities have proceeded against the petitioner
vide an order dated 14th October, 2025 by issuing a garnishee
order under Section 45G of the ESI Act.
4. Mr. Majumder, learned senior counsel for the petitioner bas
brought to the notice of the Court, the order under Section 45A
of the ESI Act dated 26th December, 2018 which is marked as
annexure B at page 22 of the supplementary affidavit to the
affidavit in opposition filed by the respondent nos.1 to 3.
5. On perusal of the said order, on the basis of which the
impugned orders and notices have been issued, this Court
finds that the authority concerned in his order in the
proceeding under Section 45A of the ESI Act noted as follows :
"Whereas on 26.04.2017, the employer did not
turn up for personal hearing but submitted a letter
dated 20.04.2017 declaring suspension of work from
19.04.2017. However, in the interest of natural
justice, the employer was given another opportunity
of personal hearing on 14.06.2017 which was
communicated to the employer vide this office letter
of even no. dated 30.05.2017."
6. It appears from the said observation that the date of hearing
in the proceeding under Section 45A of the ESI Act was
fixed during the period when there was admittedly
suspension of work [lock-out] in the petitioner's
establishment. The respondent authorities without giving the
petitioner further opportunity and/or waiting till the
suspension of work was withdrawn, proceeded to hold that the
employer did not attend the hearing and, as such, passed an
order against the petitioner herein. The said conduct is clearly
aginst the principles of natural justice.
7. Mr. Majumder, has further brought to the notice of this Court
several discrepancies in the order under Section 45A of the ESI
Act and the statement attached to the impugned notice dated
27th May, 2025. It appears that there are several discrepancies
regarding the amount claimed and the period for which the
said amount has been claimed.
8. Considering that the hearing under Section 45A was concluded
without taking into consideration, the predicament of the
petitioner that there was "suspension of work" in his
establishment, the authorities concerned neither waited for the
suspension of work to be withdrawn, nor did they fix any date
after the suspension period and have proceeded to come to a
finding without thus granting an opportunity of hearing to the
petitioner. Such conduct on the part of the respondent
authorities is, prima facie, against the principles of natural
justice and is thus clearly an abuse of the process of law.
9. Accordingly, on hearing the parties and considering the
materials on record and the issues involved, this Court sets
aside the order under Section 45A of the ESI Act dated 26th
December, 2018 and the impugned demand notice dated 27th
May, 2025 and also the garnishee order dated 14th October,
2025 with a direction that the authority concerned shall
initiate a fresh proceeding under Section 45A of the ESI
Act and on granting opportunity to the petitioner, who shall be
at liberty to place the discrepancies, as pointed out in the writ
application, before the authority concerned and on giving due
consideration to the said submission of the petitioner, shall
complete the proceeding by passing a reasoned order in
accordance with law.
10. Mr. Majumder, further submits that on the basis of such an
erroneous order passed by violating the principles of natural
justice, the respondent authorities have recovered a
substantial amount for which the petitioner is liable to the
Bank and submits that as the amount has been recovered by
way of an erroneous order, the same be refunded to the
petitioner herein, who has suffered severe prejudice. On the
other hand, learned counsel for the ESI authorities submits
that as the matter is being freshly heard, the amount may be
retained and the same may be adjusted after the fresh
adjudication is completed.
11. Considering the submissions of both the parties, the materials
on record and in the interest of justice, this Court directs the
respondent authority to refund/return the amount which has
been withdrawn on the basis of the garnishee order,
considering the fact the amount has been recovered on the
basis of an order which is, prima facie, erroneous.
12. It is further directed that the authorities concerned while
passing the order shall proceed in accordance with law.
13. Writ application stands disposed of.
(SHAMPA DUTT (PAUL), J.)
pkd/nm.
