Madras High Court
M/S. St. Thomas Matriculation ... vs The E.S.I Corporation on 29 October, 2021
W.A. Nos.2037, 2048 and 2049 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 29/10/ 2021
CORAM:
THE HONOURABLE MR. JUSTICE K.KALYANASUNDARAM
and
THE HONOURABLE MR. JUSTICE V.SIVAGNANAM
W.A.Nos.2037, 2048 and 2049 of 2021 &
C.M.P.Nos.12995, 13024, and 13028 of 2021
(Heard through VC)
M/s. St. Thomas Matriculation Higher
Secondary School,
Rep. by its Correspondent,
T.Rajan Mathews No.14,
Sai Nagar, Chinnasekkadu, Manali,
Chennai - 600 068. .. Appellant in
all Writ Appeals
Versus
1.The E.S.I Corporation,
Regional Office (T.N.),
Rep. by its Regional Director,
Panchadeep Bhavan,
No.143, Sterling Road, Chennai - 600 034.
2.The Assistant / Deputy Director,
Regional Office (Tamil Nadu),
Employees State Insurance Corporation,
No.143, Sterling Road,
Chennai - 60 0034. .. Respondents in
all Writ Appeals
https://www.mhc.tn.gov.in/judis/
W.A. Nos.2037, 2048 and 2049 of 2021
PRAYER in all Writ Appeals: Writ Appeals filed under Clause 15 of Letters
Patent to set aside the Order dated 23.06.2021 in W.M.P.Nos.1609, 1603, 1600
of 2021 in W.P.Nos.1428, 1421 and 1417 of 2021.
For Appellant in
all Writ Appeals : Mr.P.Ebeneezer Paul
For Respondents in
all Writ Appeals : Mr.G.Bharadwaj
COMMON JUDGMENT
K.KALYANASUNDARAM, J.,
These appeals have been filed challenging the common order passed by
the Writ Court in the interim applications in W.M.P.Nos.1609, 1603, 1600 of
2021 in W.P.Nos.1428, 1421 and 1417 of 2021, wherein the appellant was
directed to pay principal amount in four equal instalments within a period of
four months.
2. The Government of Tamil Nadu issued a notification G.O.Ms.No.237,
Labour and Employment (K1) Department, dated 26.11.2010 extending purview
of the Employees State Insurance Act, 1948 (hereinafter referred to as "ESI
Act") to un-aided Private Educational Institutions under caption
"Establishments" within the meaning of Section 1(5) of ESI Act. The
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W.A. Nos.2037, 2048 and 2049 of 2021
notification was put to challenge by various educational institutions, including
the petitioner in the year 2015. The Hon'ble Full Bench of this Court in All
India Private Educational Institutions Association V. State of Tamil Nadu
[2020 (5) CTC 93] upheld the G.O.
3. The orders demanding ESI contribution for various periods dated
27.10.2020 and 27.11.2020 were challenged by the appellant in Writ Petition
Nos.1417, 1421 and 1428 of 2021. When the Writ Petitions along with the stay
applications in W.M.P.No.1600, 1603 and 1609 of 2021 were taken up for
hearing, the counsel appearing for the respondent had taken notice and the
matters are posted on 10.02.2021. Till such time, the respondent-Corporation
was directed not to demand past arrears of contribution. Again when stay
petitions came up for hearing on 23.06.2021, the interim order was modified
and interim stay was restricted to in respect of interest and damages alone.
The appellant was directed to pay the principal amount along with other
regular payments in four equal installments within a period of four months.
The said order is challenged by the appellant in these appeals.
4. The learned counsel for the appellant Mr.P.Ebenezer Paul would
argue that the demand of payment of compensation was challenged by the
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W.A. Nos.2037, 2048 and 2049 of 2021
appellant on the grounds that the demand is barred by limitation as per Second
Proviso to Section 45 A (1) of the ESI Act; the Corporation failed to consider
the directions issued by the Full Bench of this Court reported in [2020 (5) CTC
93] (supra); the show-cause notice dated 09.01.2020 was issued during time of
operation of interim orders of this Court in Writ Appeal No.1233 of 2011 and
etc. batch, dated 09.06.2015 and hence the consequential notices impugned in
the Writ Petitions are illegal. It is the submission of the learned counsel that
when an order is bad in its inception, it does not get sanctified at a later
stage. Though the appellant has an alternative remedy, however
mere existence of an alternative remedy would not bar the jurisdiction under
Article 226 of the Constitution of India. It is also stated that the learned Single
Judge has not given any reason for modifying the earlier order. In this regard,
the learned counsel relying upon the following decisions:-
(i) All India Private Educational Institutions Association V. State of
Tamil Nadu [2020 (5) CTC 93 (FB)]
(ii) State of Orissa and another v. Mamata Mohanty
[(2011) 4 MLJ 692]
(iii) M.S. Munivenkatappa Vs. State Bank of India [2007 (2) CTC 135]
(iv) Maharashtra Chess Association Vs. Union of India and Ors.
[2019 (10) Scale 67]
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W.A. Nos.2037, 2048 and 2049 of 2021
(v) Commissioner of Income Tax Vs. Chhabil Dass Agarwal
[(2014) 1 SCC 603]
(vi) Union of India, Ministry of Petroleum Vs.
Government of Tamil Nadu [(2013) 4 MLJ 721 (DB)]
5. Per contra, Mr.G.Bharadwaj the learned counsel for the respondents
would urge that a show cause notice dated 07.08.2012 was issued proposing to
determine the contribution covering the period from 29.12.2010 to 31.12.2010,
and 03.01.2011 to 30.04.2012. The appellant was given opportunities to attend
personal hearing with relevant records. But the appellant had challenged the
G.O.Ms.No.237, dated 26.11.2010, after lapse of 5 years in W.P.No.4312 of
2015 and obtained interim stay. In the meanwhile, the Writ Petitions filed by
some other institutions challenging the said G.O. were dismissed vide order
dated 14.03.2011. Aggrieved over the same, Writ Appeals were filed. The
First Bench had disposed all the Writ Appeals and the Writ Petitions on
09.06.2015 and continued interim stay till the disposal of the case in State of
U.P. Vs. Jai Bir Singh, which was pending before the Larger Bench of Apex
Court. According to the learned counsel, the matter referred to the Larger
Bench has nothing to do with the coverage of the act to the educational
institutions. It is further stated that the Special Leave Petition filed by the
School in Kerala against the similar order of the High Court of Kerala upholding
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W.A. Nos.2037, 2048 and 2049 of 2021
the similar notification was dismissed by the Apex Court on 15.03.2016.
Eventually, the Full Bench in 2020 upheld the G.O.
6. He further added that Second Provisio to Section 45 A (1) of the ESI
Act has no application to the case on hand and the limitation period has to be
excluded during the pendency of the stay; the Hon'ble Full Bench directed all
the educational institutions to apply to ESI for waiver / reduction under
Section 91-C of the ESI Act, but no application was filed by the appellant;
Proceedings dated 09.01.2020 is not a show cause notice and it was the
proceedings demanding contribution, which was determined based on the
records produced by the appellant. Without challenging the proceedings dated
09.01.2020, the appellant is not entitled to challenge the consequential
recovery proceedings dated 27.10.2020 and 27.11.2020. It is also contended
that the appellant is having alternative effective remedy and without
exhausting the statutory remedy, these Writ Petitions are not maintainable. In
support of the said contentions, the learned counsel has cited the decision of
the Apex Court in ESIC Vs. C.C.Santhakumar [(2007) 1 SCC 584]; CIT v.
Chhabil Dass Agarwal, [(2014) 1 SCC 603] and Assistant Commissioner (CT)
LTU, Kakinada Vs. Glaxo Smith Kline Consumer Health Care Limited, [2020
SCC Online SC 440].
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W.A. Nos.2037, 2048 and 2049 of 2021
7. We have considered the rival submissions and perused the relevant
materials.
8. In the instant case, it is evident from the records that G.O.Ms.No.237,
Labour and Employment (K1) Department, dated 26.11.2010 was issued to
cover the unaided educational institutions under ESI Act. Perusal of the
Judgment of the Full Bench shows that so many Writ Petitions were filed
challenging the notification and the Division Benches had taken different view
and hence, the matter was referred to a Larger Bench. Eventually,
G.O.Ms.No.237, Labour and Employment (K1) Department, was upheld. Taking
note of the COVID-19 Pandemic, it was also observed in paragraph Nos.130 to
133, that the educational institutions should apply to ESI Corporation for
waiver and reduction of dues under Section 91-C of ESI Act. It is the
contention of the learned counsel appearing for the respondents that the
appellant has not filed any application till date under Section 91-C of ESI Act.
9. Indisputably, the Writ Petitions are still pending and it is represented
that they were directed to be listed for final hearing. So, we refrain ourself
from expressing any opinion on the issue of limitation and maintainability of
the Writ Petition. Any observation made made in the Writ Appeal will have an
impact on the Writ Proceedings.
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W.A. Nos.2037, 2048 and 2049 of 2021
10. It is true on 27.01.2021, the learned Single Judge directed the
respondent Corporation not to demand past arrears of contribution. However,
subsequently, on 23.06.2021, the learned Single Judge modified the order and
granted stay in respect of interest and damages and further directed the
appellant to pay the principal amount along with other regular payments in
four equal installments.
11. Taking note of the fact that the Hon'be Full Bench has upheld the
G.O., and the learned Single Judge has exercised discretionary jurisdiction to
modify the earlier order, we are of the considered view that the order
impugned in these Writ Appeals does not warrant interference of this Court.
In such view of the matter, we find no merit in the Writ Appeals and they are
dismissed. However, there shall be order as to costs. Consequently, connected
miscellaneous petitions are closed.
[M.K.K.S., J] [V.S.G., J]
29.10.2021
Speaking order : Yes/No.
Index : Yes/No.
rns
https://www.mhc.tn.gov.in/judis/
W.A. Nos.2037, 2048 and 2049 of 2021
To
1.The E.S.I Corporation,
Regional Office (T.N.),
Rep. by its Regional Director,
Panchadeep Bhavan,
No.143, Sterling Road, Chennai - 600 034.
2.The Assistant / Deputy Director,
Regional Office (Tamil Nadu),
Employees State Insurance Corporation,
No.143, Sterling Road,
Chennai - 60 0034.
https://www.mhc.tn.gov.in/judis/
W.A. Nos.2037, 2048 and 2049 of 2021
K.KALYANASUNDARAM, J.
and
V.SIVAGNANAM, J.
rns
W.A.Nos.2037, 2048 and 2049 of 2021 &
C.M.P.Nos.12995, 13024, and 13028 of 2021
29/10/2021
https://www.mhc.tn.gov.in/judis/
