IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN FRIDAY, THE 31ST OCTOBER 2008 / 9TH KARTHIKA 1930 Ins.APP.No. 22 of 2007() ------------------------ IC.97/2003 of EMPLOYEES INSURANCE COURT, ALAPPUZHA .................... APPELLANTS/RESPONDENTs ----------------------------------------- 1. THE REGIONAL DIRECTOR, E.S.I. CORPORATION, PANCHADEEP BHAVAN, N.S.ROUND, THRISSUR-20. 2. THE RECOVERY OFFICER, E.S.I. CORPORATION, PANCHADEEP BHAVAN, N.S.ROUND, THRISSUR. BY ADV. SRI.P.SANKARANKUTTY NAIR RESPONDENT/ APPLICANT ------------------------ GENERAL ENGINEERING INDUSTRIES, ATHANI, THRIKKAKARA, COCHIN-30, REPRESENTED BY ITS MANAGING PARTNER SRI.M.J.GEORGE. ADV. SRI.A.V.XAVIER FOR R1 THIS INSURANCE APPEAL HAVING COME UP FOR ADMISSION ON 31/10/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: M.N.KRISHNAN, J. -------------------------- Ins. Appeal No. 22 OF 2007 --------------------- Dated this the 31st day of October, 2008 JUDGMENT This appeal is preferred against the judgment of the Employees’ Insurance Court, Alappuzha, in I.C. 97/03. It was an application filed for declaration that the assessment made in pursuance to the orders are unsustainable and that the claim is barred by limitation. The EI court after consideration held that there is limitation and also held that the interest can be recalculated from 28.1.03 along with other findings. It is against that decision, the ESI Corporation has come up in appeal. In the light of the demand made or action initiated after a period of five years is barred by limitation is the challenged question. But in the decision reported in Employees State Insurance Corporation v. Santhakumar [2007 (1) KLT 133] the Apex court has held that so far as section 45A and section 77 (1A)(b) is concerned, there is no limitation for the Corporation to initiate action against the establishment. But the question of limitation arises only when the Corporation approaches a court for reliefs. It was further held that the initiation of action within a reasonable period also has to be considered on the facts and circumstances of every case. The Apex court has reversed the decision of the Full Bench of this court. So the matter requires reconsideration on the basis of the decision of the Apex court reported in Employees State Insurance Corporation v. Santhakumar [2007 (1) KLT 133]. So far as the interest aspect is concerned, a Division Bench of this court had considered the question in the light of the decision reported in Cannanore Drug Lines v. E.S.I. Corporation [2007 (1) KLT 880] wherein this court has held that so far as imposition of interest is concerned, Section 39(5)(a) and Regulation 31A does not give any discretionary power to the Corporation. But it is a statutory mandate. It is also a matter that has to be considered by the EI court. Since the order of the court below has to be set aside and remanded back for consideration on these two grounds, it is only desirable that all the questions are decided afresh by the same court after giving equal opportunities to both sides to produce documentary as well as oral evidence in support of their respective contentions. The court below shall decide the matter in accordance with the settled position of law. The EI court is directed to issue notice to the parties intimating the date of appearance for further proceedings. The appeal is disposed of accordingly. M.N.KRISHNAN, JUDGE vps