Delhi High Court
M/S. Sunny Packers vs Employees State Insurance ... on 17 July, 2009
Author: S.N. Aggarwal
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ WP(C) No.10735/2006 & CM No. 8223/2006
% Date of Decision: 17 July, 2009
# M/S SUNNY PACKERS
..... PETITIONER
! Through: Mr. Rajesh Banati, Advocate.
VERSUS
$ EMPLOYEES' STATE INDUSRANCE CORPORATION & ANR.
.....RESPONDENTS
^ Through: Mr. K.P. Mavi, Advocate
CORAM:
Hon'ble MR. JUSTICE S.N. AGGARWAL
1. Whether reporters of Local paper may be allowed to see
the judgment? YES
2. To be referred to the reporter or not? YES
3. Whether the judgment should be reported in the
Digest? YES
S.N.AGGARWAL, J (ORAL)
The petitioner M/s Sunny Packers, in this writ petition filed under
Article 226 of the Constitution, seeks setting aside of an order dated
16.02.2006 passed by respondent No. 1 directing the petitioner to
deposit the amount as per C-19 dated 20.01.2005 immediately.
2 The petitioner at the relevant time was a proprietorship firm. This
firm was covered by the provisions of the Employees' State Insurance
Act, 1948 w.e.f. 01.05.1998. The petitioner firm, vide order dated
06.10.2000 of the Commissioner of Industries, Government of NCT of
Delhi, was ordered to close down its unit as it was operating in residential
and non-conforming area at RZ-15-A, Narsingh Garden, Khayala, New
Delhi-110018. A copy of this order was sent by the Commissioner of
Industries to the Chairman, Delhi Vidyut Board also with a request to
disconnect the electrical power being used by the petitioner for industrial
activity. The petitioner firm allegedly closed down its unit from RZ-15-A,
Narsingh Garden, Khayala, New Delhi-110018 w.e.f. 31.10.2000. Its
electricity was also allegedly disconnected w.e.f. 31.10.2000. However,
the Inspector of Employees State Insurance Corporation allegedly visited
the petitioner's unit lastly on 20.01.2004 and at the time of his alleged
inspection, found the petitioner's unit in function and five employees
working there. The Employees' State Insurance Corporation (respondent
No. 1 herein) allegedly gave a show cause notice in Form C-18 dated
01.09.2004 to the petitioner's unit calling upon it to appear in person on
30.09.2004 and show cause why it has not deposited the Employees'
State Insurance contributions payable by it under the said Act. Since
nobody appeared on behalf of the petitioner firm before the Employees
State Insurance Corporation on 30.09.2004, date fixed for hearing,
respondent No. 1 Corporation vide its order dated 01.12.2004 under
Section 45-A of the Employees' State Insurance Act, 1948 passed an
order directing the petitioner's unit to deposit Rs.70,250/- with the
Employees State Insurance Corporation being its liability under the Act
for the period from August, 2000 till March, 2004. Thereafter, the
petitioner's establishment wrote a letter dated 21.06.2005 which is
Annexure P-2 at page 10 of the paper book and apprised it of closure of
its unit operating from RZ-15-A, Narsingh Garden, Khayala, New Delhi-
110018 w.e.f. 31.10.2000 and set down the circumstances under which,
it was not liable to pay the amount directed to be paid vide order dated
01.12.2004. This communication of the petitioner dated 21.06.2005 was
responded to by the ESI Corporation vide reply dated 15.02.2006 which is
at page 12 of the paper book. I have gone through the communication of
the petitioner dated 21.06.2005 as well as the reply of the ESI
Corporation dated 16.02.2006 and and on going through the same, I find
that there are disputed questions of fact raised by the parties relating to
liability of the petitioner's establishment under the Employees' State
Insurance Act, 1948 for the period from August, 2000 till March, 2004.
The main dispute between the parties is whether the petitioner's unit was
closed w.e.f. 31.10.2000 as claimed by it or not. In case the unit as
claimed was closed w.e.f. 31.10.2000 then the question of its liability
under the Employees' State Insurance Act, 1948 after 31.10.2000 would
not arise.
3 Mr. Rajesh Banati learned counsel appearing on behalf of the
petitioner contends that the show cause notice in Form C-19 dated
01.09.2004 was never received by his client. He further submits that
even the order dated 01.12.2004 under Section 45-A of the Employees'
State Corporation Act, 1948 was also not received by his client till the
time he sent the communication dated 21.06.2005 referred above. The
petitioner denies violation of principles of natural justice.
4 Mr. K.P. Mavi learned counsel appearing on behalf of the respondents
has referred and relied upon a judgment of the Supreme Court in
Employees' State Insurance Corporation Vs. F. Fibre Bangalore (P) Ltd.
1997 SCC (L&S) 190 wherein it is held that when an order under Section
45-A is passed by the Employees' State Insurance Corporation and in
case the employer denies it liability arising out of that order then the
appropriate remedy for the employee denying his alleged liability arising
out of that order is to approach the Employees' State Insurance
Corporation.
5 The petitioner in this case contends that it did not get opportunity
of hearing before the impugned order was passed by respondent No. 1.
The Supreme Court in M.P. State Agro Industries Development
Corporation & Anr Vs. Jahan Khan AIR 2007 Supreme Court 3153 has
held that a writ petition against the impugned order which was passed in
violation of principles of natural justice is maintainable notwithstanding
availability of an alternative remedy.
6 In the present case there are two important facts that have
emerged which cannot be completely ignored. One is about the alleged
closure of the petitioner's unit at RZ-15-A, Narsingh Garden, Khayala,
New Delhi-110018 and disconnection of electricity to its premises w.e.f.
31.10.2000 and the second is denial of opportunity of hearing before
passing of the impugned order under Section 45-A. Having regard to
these two important facts, this Court is of the opinion that ends of justice
shall be met in case an opportunity of hearing is afforded to the
petitioner to establish before respondent No. 1 itself that it had closed
down w.e.f. 31.10.2000 and was therefore not liable to make any deposit
after the said date under the Employees' State Insurance Act, 1948.
Under the circumstances, the impugned order is hereby set aside and
respondent No. 1 is directed to pass a fresh speaking order regarding
liability of the petitioner for the period in question i.e. from August, 2000
to March, 2004 after giving an opportunity of hearing to the petitioner in
this regard. Mr. K.P. Mavi learned counsel appearing on behalf of the
respondents submits that directions may be given to the petitioner for his
appearance before the Deputy Director (Legal) as he according to him is
the competent authority to hear and decide the liability of the petitioner
under Section 45-A of the Employees' State Insurance Act, 1948. The
petitioner is accordingly directed to appear before the Deputy Director
(Legal) of respondent No. 1 at Rajender Bhawan, Rajender Place, New
Delhi for necessary directions at 3:00 PM on 22.07.2009 and the
competent authority under the Employees' State Insurance Act, 1948 is
directed to decide the matter afresh by a speaking order as expeditiously
as possible preferably within one month to be reckoned from 22.07.2009
after giving an opportunity of hearing to the petitioner including
permission to be granted to him to place such documentary evidence as
it wants to place before him for establishing his plea of closure of its unit
w.e.f. 31.10.2000. Needless to say that in case the petitioner would have
any grievance against the fresh order to be passed by respondent No. 1
then he can avail his remedy against the said order as may be available
to him in law.
7 In view of the above, this writ petition stands disposed of. Stay
application also stands disposed of.
8 Order dasti.
JULY 17, 2009 S.N.AGGARWAL, J
'a'
