Tata Power Delhi Distribution ... vs Mind Shaper Technologies Pvt. ...
2018 Latest Caselaw 3550 Del

        IN THE HIGH COURT OF DELHI AT NEW DELHI

                               Judgment reserved on: January 10, 2018
                               Judgment delivered on: July 02, 2018

+       W.P.(C) 2288/2015

        TATA POWER DELHI DISTRIBUTION LTD.
                                                                  ..... Petitioner

                               Through:   Mr. Manish Srivastava, Mr. Aditya
                                          Gupta and Ms. Moulshree Shukla,
                                          Advs.
                      versus

        MIND SHAPER TECHNOLOGIES PVT. LTD.
                                                                ..... Respondent

                               Through:   Ms. Ayushi Kiran and Mr. Rupeshwar
                                          Sandhu, Advs.

      CORAM:
      HON'BLE MR JUSTICE V. KAMESWAR RAO
                                 JUDGMENT

V. KAMESWAR RAO, J

CM No. 30763/2017

This is an application seeking substitution of authorized

representative on behalf of respondent under Section 151 of CPC.

For the reasons stated in the application, the same is allowed

and disposed of.

W.P.(C) 2288/2015

1. The present petition has been filed by TATA Power Delhi Distribution

Limited challenging the order dated July 10, 2014 passed by the Learned

Addl. District Magistrate, District-New Delhi (ADM in short) in Appeal no.

ADM(ND)/Appeal/ELEC CASES/2012/9841, M/s. Mind Shaper Technology

Pvt. Ltd. v. Tata Power Delhi Distribution Limited and Anr. whereby the

learned ADM has quashed the provisional assessment order dated May 31,

2012 as well as the final assessment order dated August 8, 2012 on the ground

that the activity being carried out by the respondent in its premises is of

industrial nature.

2. Some of the relevant facts necessary for the adjudication of the writ

petition are, that on April 10, 2012, an inspection was conducted by the

Enforcement Team of the petitioner company of the meter bearing no.

K.NO.33200527865 which was installed at the respondent‟s premises vide a

sanctioned load of 89 KW for small industrial power (SIP) purposes. It is the

case of the petitioner that the representative of the respondent was present at

the time of inspection and the observation made during the inspection was

that the connection / meter is sanctioned for SIP purpose but it is being used

for software training and distribution and office purpose which are

commercial activities. It is the petitioner‟s case that one Mr. Santosh, an

employee / representative of the respondent duly signed and received the

inspection report bearing no. 202986 and show cause notice bearing no.

170401 dated April 10, 2004. The respondent was given an opportunity of

personal hearing on April 18, 2012. However, no reply was filed by the

respondent to the show cause notice. It is averred that that on April 24, 2012

a written representation was submitted by one Mr. Deepak Kumar Tyagi,

Vice President (Finance) of the respondent company in the office of the

Enforcement Assessment Cell of the petitioner company. Thereafter, the

matter was proceeded further and a provisional order dated May 31, 2012

under section 126 (1) of Electricity Act, 2003 (hereinafter referred to as „Act‟)

was passed against the respondent and the same was sent to the consumer on

June 1, 2012. It is averred that no objections were filed against the said

provisional order. Even the hearing was not attended to by the respondent on

June 8, 2012. The assessment amount on account of unauthorized use of

electricity to the tune of `6,69,738 for the period April 10, 2011 to August 10,

2012 was calculated as per the provisions of law. It is also stated that the bill

amount was further raised to `10,60,450/-. The bill remains unpaid.

Accordingly, on August 30, 2012, the respondent was served with a

disconnection notice. On October 9, 2012, a final assessment bill with due

date on October 26, 2012 was sent to the respondent. On November 14, 2012,

an appeal was preferred on behalf of the respondent before the learned ADM

against the provisional assessment order dated May 31, 2012 under Section

126(1) of the Act. It is stated that for the reasons known to the respondent,

the final order dated October 09, 2012 was not challenged and instead appeal

was preferred against provisional assessment order dated May 31, 2012. On

January 08, 2013, reply was filed to the appeal by the petitioner. On July 10,

2014, the impugned order was passed.

3. In the counter-affidavit it is stated that the respondent is a company

which is in the business of providing technology aided teaching and e-

learning solutions to schools by developing content software and hardware,

i.e., digital equipments as per needs and requirements of the school. That it

had its head office at A-1, Naraina Industrial Area, Phase-I, New Delhi which

it had rented from M/s. Eternal Radio Corp. for running their industry and

accordingly had a small industrial power connection for the said purpose. On

April 10, 2012, the petitioner served a show cause notice on the respondent

and conducted a surprise inspection on the premises in the presence of an

office boy namely Santosh who was not authorized or aware of the activities

undertaken by the company. It is stated, a detail reply to the show cause

notice and inspection report dated April 10, 2012 was submitted vide letter

dated April 24, 2012 to the petitioner explaining that the averments in the

show cause notice are incorrect and the respondent is only providing

curriculum based software to the students / schools.

4. It is also stated that the industry is de-regulated as per the industrial

policy of the Central and State Governments and do not required any form of

registration with a licensing authority and can be operated from any premises

other than a residential one. It is averred that the petitioner was further

required to conduct an inspection of the premises again so that the concerned

person can show the working of the company and satisfy the petitioner that no

teaching centre is being run by the respondent. It also attached its Sales Tax

and Service Tax registration documents which referred to the respondent as a

company providing online information and data services and selling the

digital equipments. It is also averred that its representative has been

contacting the customer care of the petitioner and repeatedly meeting the

representatives of the petitioner, who had assured that the matter would be

resolved soon. The respondent also referred to a representation dated August

21, 2012 of the Industries Association. A reference is made to the

representations made against the disconnection notice and non-consideration

of the same and the filing of the appeal by the respondent. A reference in the

counter-affidavit is also made to a Judgment of this court in the case of M/s.

Panacea Biotech Ltd. v. DDA and Anr. W.P.(C) 9937/2005 wherein the

impugned provisional order issued by the petitioner was quashed.

5. The learned counsel for the petitioner submitted that the learned ADM

has failed to appreciate that no appeal against a provisional order was

maintainable. According to him, admittedly the final order was not challenged

and therefore, he should have dismissed the appeal as not being maintainable.

He referred to a judgment of the Supreme Court in the case of Executive

Engineer and Anr. v. Sri Seetaram Rice Mill MANU/SC/1334/2012 to

contend that the Supreme Court has interpreted the scope of Section 126 of

the Act to mean, that no appeal can be preferred against a provisional

assessment order issued under Section 126 (2) of the Act. According to him,

under Section 126 (3) of the Act a person on whom an order under sub-

section 2 has been served, shall be entitled to file objections if any against the

provisional assessment order before the assessing authority, who shall after

affording a reasonable opportunity of hearing to such person, pass a final

order of assessment within 30 days from the date of service of such order of

provisional assessment of the electricity charges payable by such person. He

also relied upon Section 127 (1) of the Act to contend that an appeal can be

preferred against the final assessment order issued under Section 126 that too

within 30 days of the said order. The respondent has grossly violated the

requirement of the said section by impugning the provisional order.

Therefore, the proceedings before the learned ADM were non est and void ab

initio. He also stated, under Section 127 (2) of the Act there is a pre-requisite

/ condition, for entertaining the appeal before the Appellate Authority on

deposit of amount equal to half of the assessed amount in cash or by way of

bank draft. He referred to a Judgment of the Supreme Court in the case of

Shyam Kishore and Ors. v. Municipal Corporation of Delhi

Manu/SC/0440/1992 that the condition of deposit of tax amount under

Section 170 (b) of the DMC Act is a condition precedent for hearing or

determination of the appeal and the learned District Judge has no discretion to

grant stay of the disputed amount or dispensed with the requirement of pre-

deposit of the amount. On merit, it is his submission that the Delhi Electricity

Supply Code and Performance Standard Regulations 2007 clearly segregate

the three kinds of electricity connection, i.e., Domestic connection, Non-

domestic Connection and Industrial connection. Regulation 5 clearly defines

and characterizes the establishment which shall be covered under the Non-

domestic connection. The sub-regulation (j) of the said regulation reads "all

other establishments, shops, chemists, tailors, washing, dying etc. which do

not come under factories Act". Moreover, it is to be read with Section 2 (m)

of the Factories Act, 1948 that defines the term "Factory". A plain reading of

the definition of the term factory makes it apparent that the activity of the

Respondent, i.e., „software training, distribution and office‟, can only be said

to be a non-domestic activity under the purview of Regulation 5. The activity

carried out by the Respondent cannot be said to be of industrial nature in any

manner whatsoever. That the petitioner, being the licensee in terms of the

Act, and the Respondent, being the user of the premises, where the disputed

electricity connection was sanctioned are covered and bound by these

Regulations. Hence, reliance placed upon the Master Plan 2021 or Industrial

Disputes Act by the Respondent to contend that it would override the

provisions of Electricity Act is misconceived.

6. It is the submission of the learned counsel for the petitioner that the

learned ADM has erred in observing that the petitioner wrongly concluded

that the respondent is running the activity of „software training, distribution

and office‟ merely on the basis of the Respondent Company‟s name and the

Display Board affixed outside the said premises. The Display Board and the

visiting cards read, "CLASS TEACHER" with a tagline, "LEARNING

SYSTEMS", and accompanied by a description which says, "THINKING

TECHNOLOGY IN YOUR SCHOOLS NOW", It is his submission that by

merely contending that it is running an activity of a „software development

establishment‟ and not of a „software training, distribution and office‟ without

any substantive documentary evidence or any other proof is not sufficient.

That the onus and burden of proof in this matter was on the Respondent and it

has failed to carry out the same.

7. Learned counsel for the petitioner also submitted that the learned ADM

has erred in observing that the activities of the Respondent come within the

definition of the "Industry" and thus the usage is for industrial purpose. He

refers to a judgment of the Supreme Court in the case Bangalore Water

Supply and Sewerage Board v. A. Rajappa and Anrs. MANU/SC/0257/1978,

wherein the Supreme Court has laid down the triple test, which will enable an

activity to fall under the definition of "Industry" as envisaged by Section 2 (j)

of the Industrial Disputes Act, 1947. The triple test in the Bangalore case

forms the quintessential part of the amended definition of "Industry" in 1982.

The triple test provides that a) systematic activities b) organized by

cooperation between employer and employees c) for the production of goods

and services calculated to satisfy human wants and wishes would constitute

industry. However, this test was subjected to exceptions, namely industry

does not include spiritual or religious services; absence of profit motive or

gainful objective is irrelevant (although an organization will not cease to be a

trade or business because of philanthropy animating the undertaking). The

main test is the nature of activity with emphasis of employer - employee

relationship therefore all organized activities that satisfy the triple test will

constitute industry including undertakings, callings and services adventures‟

analogous to the carrying on of trade or business. It is submitted that when

Electricity Act, 2003 read with provisions of Supply Code, 2007 clearly

categorizes the type of connection, definition adopted by other statute in any

event cannot be read into Electricity Act, 2003 to interpret the provisions of

Electricity Act, 2003. It is strongly argued by the learned counsel for the

petitioner that the Respondent provides training and distribution of software

for purely commercial purposes and nowhere has the Respondent been able to

prove that it develops software per se.

8. Learned counsel for the petitioner would submit that the requirement to

record reasons emanates from the broad doctrine of fairness in decision

making and such reasons should be cogent, clear and succinct. It is well

settled principle of law that the Appellate Authority is supposed to decide the

appeal both on facts and law; it is also required to address all issues before

concluding. A pretense of reasons is not to be equated with a valid decision -

making process. The impugned order passed by the ld. ADM is non-speaking

and cryptic because it fails to convince the petitioner to accept the

Respondent‟s contentions about it running a so-called, „software development

establishment‟.

9. It is the submission of the learned counsel for the petitioner that it is a

well-settled principle of law that equity aids the vigilant and not the indolent,

for vigilantibus non domientibusjur or subventiunt. He also submitted that the

period of limitation for preferring an appeal before the appellate authority as

provided under Section 127 (1) of the Act is 30 days of the final assessment

order passed by the assessing officer under Section 126 of the Act. The

Respondent filed the appeal on November 14, 2012 against the provisional

assessment order dated May 31, 2012 which was duly sent to the Respondent

on June 1, 2012. According to him, even the final assessment order was

passed on August 8, 2012 and the disconnection notice pursuant to the final

assessment order was dispatched to the Respondent on August 30, 2012. The

appeal in question against the provisional assessment order dated May 31,

2012 was filed only on November 14, 2012, which evidently amounts to more

than five months (i.e., clearly beyond the period of 30 days) from the date of

the provisional assessment order and 3 months after the final assessment order

dated August 8, 2012. The appeal filed by the Respondent was therefore

hopelessly barred by limitation and ought not to have been entertained.

10. On the maintainability of the petition, it is the submission of the learned

counsel for the petitioner that only those authorities or tribunals, who in law

are required to defend the orders passed by them are to be made necessary

parties. It is his submission that in the present case Ld. ADM, New Delhi is

not a necessary party to the writ petition because the orders passed by the Ld.

ADM are not required to be defended by it. Thus, the writ petition of the

petitioner is maintainable. He placed reliance on the recent judgment of the

Supreme Court in the case of Jogendrasinji Vijaysinghji v. State of Gujarat

and Ors. MANU/SC/0719/2015, wherein it has held as under:

"There are many authorities under many a statute. Therefore, the proposition that can safely be culled out is that the authorities or the tribunals, who in law are entitled to defend the orders passed by them, are necessary parties and if they are not arrayed as parties, the writ petition can be treated to be not maintainable or the court may grant liberty to implead them as parties in exercise of its discretion. There

are tribunals which are not at all required to defend their own order, and in that case such tribunals need not be arrayed as parties. To give another example; in certain enactments, the District Judges function as Election Tribunals from whose orders a revision or a writ may lie depending upon the provisions in the Act. In such a situation, the superior court, that is the High Court, even if required to call for the records, the District Judge need need not be a party. Thus, in essence, when a tribunal or authority is required to defend its own order, it is to be made a party failing which the proceeding before the High Court would be regarded as not maintainable.(Relevant Paragraphs 27 to

34)

11. Without prejudice to the submissions as stated above, learned counsel

for the petitioner submitted that if the court deems necessary, in exercise of its

jurisdiction under Article 226 and 227, the petitioner may be granted liberty

to implead the adjudicating authority as party. In the last it is his submission,

that respondent is not entitled to the relief sought for in the appeal, which is

misconceived, frivolous, wrong and hence the impugned order deserves to be

set aside. In support of his submissions, learned counsel for the petitioner has

relied Executive Engineer, Southern Electricity Supply Company of Orissa

Limited (South Co.) and Anr. v. Sri Seeetaram Rice Mill reported as (2012)

2 SCC 108.

12. On the other hand, it is the submission of the learned counsel for the

respondent that the writ petition is squarely covered by the Judgment of this

court in the case of M/s. Panacea Biotech Ltd. (supra) wherein this court has

unequivocally held that the activities of a computer hardware or software

Company are industrial in nature as per the Master Plan of Delhi, 2021 and

thus the respondent was correct in having an industrial connection and ought

not to have been assessed on the ground of commercial connection.

13. It is the submission of the learned counsel for the respondent that the

learned counsel for the petitioner is wrong to contend that the appeal was

preferred only against the provisional assessment order dated May 31, 2012.

According to her, the ADM had considered both the provisional assessment

order dated May 31, 2012 and the final order dated August 8, 2012 and

quashed the both and held "it is found that the employees of the appellant are

covered under ESI and further ordered in the light of judgment of Hon‟ble

High Court of Delhi in Case No. 9937 of 2005, Panacea Biotec Ltd. v. DDA

and Ors. in Para 17.1, that the appeal of the appellant is allowed quashing

the provisional assessment order dated May 31, 2012 and also the final order

passes on the basis of the provisional order. As this is not the case of of

misuse of electricity for which respondent are directed to restore the

connection as per sanction."

14. The petitioner has failed to produce before the ADM as well as before

this Court even an iota of proof that the work of the respondent is commercial

in nature as opposed to industrial in nature.

15. The respondent is a company which is in the business of providing

technology aided teaching and e-learning solutions to schools by developing

content software and hardware, i.e., digital equipment as per needs and

requirements of the school. Activities of the respondent comes within the

definition of "industry" under S. 2 (j) of the Industrial Disputes Act, 1947 and

the respondent‟s computer industry is covered under Employees‟ State

Insurance Act, 1948 and the same has been affirmed by the High Court of

Bombay in the case of Employees State Insurance Corporation v. M/s.

Western Outdoor Interactive Pvt. Ltd. First Appeal No. 143 of 2012 vide

judgment dated July 11, 2012.

16. The petitioner did not even considered the averments in the

representation of the respondent company to the show cause notice and

without application of mind, issued the provisional assessment order on May

31, 2012. The petitioner instead of rectifying the matter, issued a notice of

disconnection dated August 30, 2012 to the Respondent Company. Thus,

when no reply was forthcoming from the petitioner, respondent made another

representation to the petitioner vide letter dated October 16, 2012. But

petitioner did not consider the same and instead sent a highly inflated bill

dated October 26, 2012 for the alleged unauthorized misuse of the connection.

Thereafter on November 10, 2012, they sent some officials who threatened to

disconnect the connection, which left the respondent company with no option

but to file an appeal before the ADM on November 14, 2012. The petitioner

filed its reply to the appeal on January 8, 2013 referring to the final order

dated August 8, 2012 passed under Section 126 of the Electricity Act, 2003

which was never served upon the respondent company under the provisions of

Section 126 read with Section 171 of the Electricity Act, 2003 or in terms of

delivery of notice, Order or Document Rules, 2004. The said final order came

to the knowledge of the Respondent Company only at the time of hearing of

the appeal which till date remains unserved as per due procedure and the

petitioner has till date failed to provide any proof of service of the final order.

17. It is the submission of the learned counsel for the respondent company

that the ADM quashed both the provisional assessment order dated May 31,

2012 and the final assessment order dated August 8, 2012 vide the impugned

final order dated July 10, 2014 and relied upon the judgment of this court in

M/s. Panacea Biotech Pvt. Ltd. (supra).

18. In the last, it is her submission that the writ petition is maintainable

only against a State, defined under Article 12 of the Constitution of India and

the respondent herein is admittedly not a State and seeks the dismissal of the

petition due to non-joinder of necessary parties. They also seek the refund of

the excess payment of electricity consumption charges worth `6,51,139/-

along with interest as deemed fit by this court. In support of her submissions,

counsel for the respondent has placed reliance on the following judgments:

1. Rakhee Gupta v. State of Maharashtra and Ors. decided on October 18, 2016 by High Court of Judicature at Bombay.

2. The Assistant Director Employees' State Insurance Corporation, Mumbai v. M/s. Western Outdoor Interactive Pvt. Ltd., Mumbai AND M/s. Reliable Software Systems Pvt. Ltd., Mumbai v. Employees' State Insurance Corporation, Mumbai reported as 2012 Vol. 114 (4) Bom. L.R. 2520.

3. Panacea Biotec Ltd. v. DDA & Ors. reported as 2008 (103) DRJ 213.

19. Having heard the learned counsel for the parties, the first and foremost

issue which needs to be decided is whether the appeal filed under Section 127

of the Electricity Act, 2003 by the respondent challenging the provisional

order of assessment under Section 126 (1) of the Electricity Act, 2003 was

maintainable.

20. There is no dispute that the respondent had received copy of the

provisional order of assessment dated May 31, 2012. The last paragraph of

the said order clearly stipulates the respondent to submit written objections

within 7 days of the receipt of the order. It is a conceded case that no

objections were filed by the respondent. Naturally, the petitioner in the

absence of objections from the respondent proceeded to issue a final

assessment order dated August 8, 2012. The appeal was filed by the

respondent challenging the provisional assessment order on November 14,

2012, which is admittedly beyond a period of 30 days of limitation prescribed

under Section 127 of the Electricity Act, 2003. The order dated August 8,

2012 has not been challenged. On a reading of Sections 126 and 127 of the

Act of 2003, it is clear that against the provisional assessment order a

consumer is required to file objections under Section 126(3). He is also

required to pay provisional assessment amount as required under Section 126

(4). Once the objections are filed under Section 126(3), an opportunity is

given to the consumer of hearing on the objections if any filed and an order of

final assessment is passed under Section 126(5) of the Act of 2003. If

aggrieved from such an order, he prefers an appeal under Section 127 of the

Act of 2003. It is clear that an appeal is filed within 30 days of the said order.

So an appeal does not lie against a provisional order of assessment. It is the

case of the respondent in the written submissions that the final order dated

August 8, 2012 was never served upon it. I may only state that no such stand

was ever taken by the respondent in its appeal. Be that as it may, if a final

assessment order is not received by the respondent, there was no occasion for

the respondent to file an appeal. Having filed an appeal against a provisional

assessment order, which was not maintainable, the learned ADM should have

only dismissed the appeal as not maintainable, more so when a specific

objection has been taken by the petitioner in its reply to the appeal. I find,

the respondent has not even cared to amend the appeal filed by it by

incorporating a prayer challenging the final assessment order dated August 8,

2012. That apart, even the challenge to the order dated May 31, 2012 was

beyond the period of 30 days. It appears there was no application seeking

condonation of delay in filing the appeal belatedly. Surprisingly, the learned

ADM entertained the appeal and allows the same by quashing even the final

assessment order (though not challenged) without adverting to the objection

taken by the petitioner herein on the maintainability of the appeal per se. The

order is clearly erroneous where the learned ADM exceeded his jurisdiction,

which was not vested in him by law.

21. In so far as the merit of the case is concerned, it is the case of the

petitioner and also accepted by the respondent that an inspection was carried

out on the premises of the respondent on April 10, 2012, when it was found

by the inspection team that an industrial connection is being used for

commercial purposes (software training + distribution + office). Based on the

inspection carried out by the petitioner on April 10, 2012, a show cause notice

was issued to the respondent on April 10, 2012 itself calling upon the

respondent to appear before the enforcement assessment cell for a personal

hearing along with the relevant records. A representation was submitted by

the respondent on April 24, 2012 wherein it was stated that the respondent is

not involved in the business of providing software training. It is a company

engaged in the business of developing software and content for schools to be

used for digital learning by their students. It is also stated, it can operate from

any locality except the residential places. On that reply, the petitioner passed

a final provisional assessment order dated May 31, 2012 of which reference

has already been made above and dispatched to the respondent on June 1,

2012. The provisional assessment order, though received, went unchallenged

by the respondent as despite calling for objections, the same were not filed.

Resultantly, a final assessment order was passed.

22. From the above it is noticed that the stand of the respondent to the

show cause notice dated April 10, 2012 in its representation dated April 24,

2012 is as under:

 This is w.r.t the notice and the visit by you yesterday in connection thereto being alleged for the misuse / unauthorized use of electricity and have also been stated of running a software training centre at the given premise.

 You are not in business of providing software training at all. We may check your records and can inspect the place as well & will appreciate that there is no commercial software training is conducted here.

 You are a company engaged in the business of developing software and content of schools to be used for digital learning by their students. This is your head office and development centre. The services of the company are provided to the schools and students by various means, mainly by internet.

 Development of software is a deregulated industry and do not require any registration with any licensing authority. As per the regulations and guidelines of industrial policy of central and Delhi Government, it can be operated from any locality, except the residential places.

 You are registered with service tax department, the copy of the registration certificate attached. The department has registered you for providing the service under the category of online information and data.

 Based on the above facts, you stated and pray that the notice was issued without gathering sufficient and proper information by the visiting officer and in the light of facts provided above, the notice be quashed. You shall be more than happy to provide any other information we may require.

The conclusion of the assessing officer on those objections is as under:

"In reply to your above contentions, it is pertinent to mention here that you have failed to substantiate your claim only on the basis of mere declaration as you unable to file any substantial document to prove that services provided by you come under the ambit of industrial activity and not under non-domestic activity. The connection was sanctioned to Eternal Radio Corpn. for industrial activity, but you are unauthorizedly using the power supply for non- domestic activities, i.e., (Software Training + Distribution + Office) as such no rebate can be granted to you on the basis of your request and mere declaration in view of the prevalent rules and regulations established by law as it comes under the purview of unauthorized use of electricity.

In the given circumstances, the company is left with no option than to proceed ahead with your case considering all the documents and facts on record.

It is relevant to mention here that for any request regarding change of category / withdrawal of penal tariff of unauthorized use of electricity further, you have to approach to our help line NO. 011- 66111912 or consumer care of district concerned which is Moti Nagar in your case.

Conclusion:

In view of above, the case of unauthorized use of electricity is established against you."

23. From the above it is clear that the assessing officer has come to a

conclusion that the respondent was using power supply for non-domestic

activities, i.e., software training + distribution + office. I may note here that

in its reply dated April 24, 2012 to the show cause notice April 10, 2012, the

respondent has categorically stated "this is our head office and development

centre". This conclusion remained unchallenged by the respondent before the

authorities in accordance with the procedure contemplated under the Act of

2003 till the filing of the Appeal on November 14, 2012.

24. The plea of the respondent before the learned ADM is that it is

developing software and content for schools to be used for digital learning by

their students. It denied the case of the petitioner that it is in the business of

providing software training. The petitioner in support of its case that the

respondent was running a software training institute had primarily relied on

the photograph of the name board at the premises where the respondent was

located. The same reads as "CLASS TEACHER - LEARNING SYSTEMS".

The said name does not necessarily mean that the respondent was running a

software training institute. It can also mean, as being projected by the

respondent, that it is engaged in the activity of developing software for

schools. But still that would not have any effect on the usage of premises as

"an office". This aspect was not projected before the learned ADM by any of

the parties. The assessing officer could not have concluded that the

respondent is running a software training institute solely based on the

photographs. I also find that the respondent had relied upon the judgment of

this Court in M/s. Panacea Biotech Ltd. (supra) and upon Section 2 (j) of the

Industrial Disputes Act which defines "Industry" and the fact the employees

of the respondent are covered under the ESI Act. I note, there is no finding

on these two aspects that is the effect thereof on the issue whether the activity

which the respondent is carrying out is an industrial activity or commercial

activity.

25. In view of the above discussion, I deem it appropriate to set aside the

order dated July 10, 2014 passed by the learned ADM and remand the matter

back to the said authority directing the respondent to file an application for

amendment of the appeal along with an application for condonation of delay

in filing the appeal on November 14, 2012 which shall be considered by the

learned ADM in accordance with law and pass appropriate orders. If the

learned ADM proceeds to hear the appeal on merit, same shall be confined to

the aspect whether the respondent having admitted that they are running the

Head Office from the premises in question shall amount to carrying out an

activity, which is commercial in nature; the effect of the judgment of this

Court in M/s. Panacea Biotech Ltd. (supra); Section 2(j) of the Industrial

Disputes Act and the respondent being covered under the provisions of ESI

Act. The parties herein shall rely upon such material as was available on

record at the time of passing of the final assessment order. It is expected that

the learned ADM shall pass a reasoned order dealing with all the submissions

advanced before him by the parties, as expeditiously as possible, but not

beyond a period of six months from the date of receipt of the order.

The petition stands disposed of.

CM Nos. 4094/2015 & 29656/2017

In view of the order passed in the petition, the applications have

become infructuous.

V. KAMESWAR RAO, J JULY 02, 2018/jg