IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN THURSDAY, THE 25TH FEBRUARY 2010 / 6TH PHALGUNA 1931 Ins.APP.No. 44 of 2009(B) ------------------------ IC.98/2003 of EMPLOYEES INSURANCE COURT, ALAPPUZHA .................... APPELLANT/RESPONDENT ------------------------------------ THE REGIONAL DIRECTOR, ESI CORPORATION, THRISSUR BY ADV. SMT.T.D.RAJALAKSHMY, SC, ESI CORPN. RESPONDENT(S): APPLICANT ------------------------------------- M/S.DUROFLEX INDUSTRIES PVT.LTD. ALAPPUZHA ADV. SRI.R.AZAD BABU THIS INSURANCE APPEALS HAVING COME UP FOR ADMISSION ON 25/02/2010, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: M.N. KRISHNAN, J. = = = = = = = = = = = = = = INS.APPEAL NO. 44 OF 2009 = = = = = = = = = = = = = = = Dated this the 25th day of February, 2010. J U D G M E N T This appeal is preferred against the order of the Employees Insurance Court, Alappuzha in I.C.98/03. The said application was filed for a declaration that the demand of Rs.27,703/- as contribution of omitted wages relating to the period 1995-96 and 1996-97 plus interest is unsustainable. The E.I.Court after consideration found that the demand on omitted wages is sustainable and directed that the amount to be deposited. But it did not grant the interest from the due date but only ordered it from 8.9.03 on the ground that it was only demanded on that date. It is against that decision the Insurance Corporation has come up in appeal. 2. Heard the learned counsel for the appellant as well as respondents. There cannot be much controversy on the question of interest for the reason that the position is fairly settled by decisions of the Apex Court as well as by this INS.APPEAL NO. 44 OF 2009 -:2:- court. In the decision reported in Goetize (India) Ltd. v. E.S.I. Corporation (2008 (8) SCC 705) the Apex Court held that even in a decree for compromise there is no power vested with the E.S.I. Corporation to waive the interest. This court has also considered the same point in the decision reported in Cannanore Drug Lines v. E.S.I. Corporation (2007 (1) KLT 880). The Bench held that, “The bona fide impression of the appellant that his establishment was not covered under the provisions of the E.S.I. Act or the pendency of a dispute before the E.S.I. Court regarding the appellant's liability to pay E.S.I. contribution cannot be a valid ground for exempting the appellant from paying interest in terms of S.39(5)(a) and Regulation 31A. When the statute does not provide for any such exemption the respondent cannot exclude the amount of interest from the demand made against the appellant.” 3. So what is laid down in that decision is that when it is found out that an amount is due interest also accrues INS.APPEAL NO. 44 OF 2009 -:3:- from that date with a grace period of 21 days. Therefore the finding of the E.I.Court that the interest need to be paid only from the date of demand is incorrect and is therefore liable to set aside and I do so. I declare that the E.S.I.Corporation is entitled to claim interest from the due date with a grace period of 21 days. The Ins.Appeal is disposed of accordingly. M.N. KRISHNAN, JUDGE. ul/-