Karnataka High Court
Bapuji Education Society vs Esi Corporation on 9 February, 2024
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NC: 2024:KHC:5617
WP No. 5070 of 2018
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 9TH DAY OF FEBRUARY, 2024
BEFORE
THE HON'BLE MR JUSTICE SACHIN SHANKAR MAGADUM
WRIT PETITION NO. 5070 OF 2018 (GM-RES)
BETWEEN:
1. BAPUJI EDUCATION SOCIETY
BAPUJI CAMPUS, T.R.NAGAR
CHITRADURGA DISTRICT
CHELLAKERE-577522
REPRESENTED BY ITS SECRETARY
M.JAGADEESH
2. M JAGADEESH
THE SECRETARY
BAPUJI EDUCATION SOCIETY
BAPUJI CAMPUS, T.R.NAGAR
CHITRADURGA DISTRICT
Digitally CHELLAKERE-577522
signed by
CHAITHRA A
...PETITIONERS
Location:
HIGH (BY SRI. RAGHAVENDRA M G, ADVOCATE)
COURT OF
KARNATAKA AND:
1. ESI CORPORATION
SUB-REGIONAL OFFICE
NO.4, DOLLAR HEIGHTS
3RD AND 4TH FLOOR, DOLLAR COLONY
GOKUL ROAD
HUBLI-580030
-2-
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WP No. 5070 of 2018
REPRESENTED BY ITS
BRANCH MANAGER
BRANCH OFFICE AT
ESI CORPORATION 1ST FLOOR
SRI.GANGADHARAIAH BLDG
4TH CROSS, HOLALKERE ROAD
OPP. SAVITHA BHAVAN
CHITRADURGA - 577501
...RESPONDENT
(BY SMT.GEETHADEVI M P, ADVOCATE)
THIS WRIT PETITION IS FILED UNDER ARTICLE 226 OF
CONSTITUTION OF INDIA PRAYING TO QUASH THE ENTIRE
PROCEEDINGS IN C.C.NO.553/2014 ON THE FILE OF
PRINCIPAL CIVIL JUDGE AND JMFC, CHALLAKERE VIDE
ANNEX-A ON THE BASIS OF COMPLAINT FILED BY THE
RESPONDENT AGAINST THE PETITIONERS UNDER SEC.85,
85-C AND SUB SECION (i) (b) OF SEC.85 OF THE ESI ACT AND
ETC.
THIS PETITION, COMING ON FOR FURTHER HEARING,
THIS DAY, THE COURT MADE THE FOLLOWING:
ORDER
The captioned writ petition is filed by the petitioner -
Bapuji Education Society seeking quashing of the
proceedings pending in C.C.No.553/2014 on the file of the
Principal Civil Judge and JMFC, Chellakere for the offence
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punishable under Sections 85, 85-C and Sub
Section (i) (b) of Section 85 of the Employees State
Insurance Act, 1948 (for short 'ESI Act').
2. Facts leading to the case are as under;
The respondent - Corporation filed a complaint under
Section 200 Cr.P.C against the petitioners - Society
alleging that petitioners' society is guilty of offence
punishable under Sub-Clause (a) of Sub-Section (i) (b)
of Section 85 of the 'ESI Act' and hence, prayed to convict
petitioners - Society and impose sentence under Sub-
Clause (a) of Sub-Section (i)(b) of Section 85 of the
'ESI Act'. In the complaint, the respondent - Corporation
claimed that petitioners, who are Secretary and Principal
of Society, have failed to make employer's and employee's
contribution from 16.03.2011 to 30.06.2013 in terms of
Section 40 of the 'ESI Act'. The respondent - Corporation
claimed that in spite of repeated notices calling upon the
petitioners - Society to make contribution, there was no
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response to the notice and therefore, the Authorized
Officer of respondent - Corporation left with no other
option based on the materials available on record has
passed an order under Section 45A of 'ESI Act', which is
questioned by the petitioners - Society.
3. Learned counsel appearing for petitioners placing
reliance on the order passed by Co-ordinate Bench in
MFA No.100875/2020 would vehemently argue and
contend that since order passed by the Officer of
respondent - Corporation under Section 45A of the
'ESI Act' is set-aside and the matter is remitted back by
this Court in MFA No.100875/2020, the proceedings
initiated pursuant to the complaint filed under Section 200
Cr.P.C for the offence punishable under Section 85 of the
'ESI Act' do not survive for consideration and they are
liable to be quashed.
4. Learned counsel appearing for petitioners has
placed reliance on the un-reported judgment rendered by
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the Bombay High Court in the case of ARUN GOPAL RAO
POHARE V. E.S.I.C in CRL. REVISION PETITION
NO.214/1992 to buttress that pending consideration of
dispute before ESI Tribunal, the Corporation cannot
proceed with a criminal case. On these set of grounds,
learned counsel appearing for petitioners has sought for
quashing of the proceedings.
5. Learned counsel appearing for respondent -
Corporation, while countering petitioners' claim, would
contend that dehors remand order passed by this Court in
MFA No.100875/2020, proceedings pending in
C.C.No.553/2014 are independent proceedings and the
remand order passed by this Court relating to quantum of
contribution cannot be a ground to quash the proceedings
pending in C.C.No.553/2014. She has placed reliance on
the judgment rendered by the Hon'ble Apex Court in the
case of BHAGIRATH KANORIA AND OTHERS VS.
STATE OF M.P1 Referring to Clause-A of Section 85 of
(1984) 4 SCC 222
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the 'ESI Act, she would contend that employers liability to
make contribution in terms of Regulations 31 of
Employees' State Insurance (General) Regulations, 1950
before due date is mandatory. Referring to the dictum laid
down by the Hon'ble Apex Court, she would point out that
subsequent payments will not take away the act that is
already committed by the empoyer on account of default.
There being a default in making contributions, she would
vehemently argue and contend that petitioners were
unquestionably liable to pay their contribution before due
date. The subsequent payments will not come to the aid of
the petitioners and therefore, remand order passed by this
Court has no bearing on the proceedings pending in
C.C.No.553/2014 on the file of the Principal Civil Judge
and JMFC, Chellakere.
6. Heard learned counsel appearing for the
petitioner and learned counsel appearing for the
respondent. Perused the records.
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7. The short point that needs consideration at the
hands of this Court is;
Whether remand order passed by this
Court disputing the quantum of contribution
of Employer/Employee by the petitioners -
Society would lead to quashing of
proceedings pending in C.C.No.553/2014 on
the file of the Principal Civil Judge and JMFC,
Chellakere?
8. Under Regulations 29 of the Employees State
Insurance (General) Regulations, an employee has to
make contribution and that contribution has to be paid into
a Bank, which is duly authorized by the Corporation.
Regulations 31 of the Employees State Insurance
(General) Regulations further contemplates that employer
is liable to pay contribution in respect of an employee and
such contribution shall be made within 15 days of the last
date of calendar month in which contribution falls due.
9. In the present case on hand, the Corporation has
alleged that petitioners are guilty of not depositing
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employer's and employee's contribution for a period of two
years. This factual matrix is not seriously contested and
disputed by the petitioner. Even, in this writ petition, no
single piece of evidence is placed on record to
demonstrate that the petitioner - Society has duly
complied Regulations 29 and 31 of the Employees State
Insurance (General) Regulations. Merely because the
dispute relating to quantum is pending consideration
before ESI Tribunal, that in itself will not constitute a
ground seeking quashing of the proceedings for the
offence punishable under Section 85A of the ESI Act.
10. In the light of the dictum laid down by the
Hon'ble Apex Court, considering object and purpose of the
'ESI Act', which ensures to the welfare of the employee,
the offence of non-payment of employer's contribution
before due date must be regarded as continuing one.
Now, whether petitioner - Society is guilty of not making
contribution as contemplated under Regulations 29 and 31
of the Employees State Insurance (General) Regulations is
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a matter of trial. The initial burden is on the Corporation to
demonstrate that mandatory requirement under
Regulations 29 and 31 is violated by the petitioners -
Society. The onus would equally shift on the petitioners to
lead rebuttal evidence and demonstrate that contribution
was made to the Bank, which is duly authorized by the
Corporation. All these significant details are to be
examined and considered in the pending proceedings in
C.C.No.553/2014 on the file of Principal Civil Judge and
JMFC, Challakere.
11. In the light of discussions made supra, the
contention of the petitioner that proceedings are liable to
be quashed as the matter is remitted back by this Court in
MFA No.100875/2020 cannot be acceded to.
12. The dispute pending before ESI Tribunal
pursuant to remand order passed by this Court is an
independent proceeding and is only related to quantum,
while lis in the pending criminal proceedings relates to an
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offence punishable under Section 85A of the Act. Since
learned counsel appearing for respondent - Corporation
has relied on decision passed by the Hon'ble Apex Court, it
would be unnecessary to take cognizance of un-reported
judgment of the Bombay High Court relied on by the
petitioner.
Therefore, I am not inclined to interfere and no
indulgence can be granted at this juncture.
The writ petition is devoid of merits and accordingly,
stands dismissed.
Pending applications, if any, are also dismissed.
Sd/-
JUDGE
NBM
