IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN WEDNESDAY, THE 16TH DECEMBER 2009 / 25TH AGRAHAYANA 1931 WP(C).No. 36271 of 2009(D) ---------------------------------------- PETITIONER(S): ------------------------- M/S.RAJAGOPAL TEXTILE MILLS PRIVATE LTD., P.B.NO.404, MULAKUNNATHUKAVU, THRISSUR, REPRESENTED BY ITS MANAGING DIRECTOR. BY ADVS. MR.DEVAN RAMACHANDRAN, MR.K.M.ANEESH. RESPONDENT(S): ---------------------------- 1. EMPLOYEES STATE INSURANCE CORPORATION, REGIONAL OFFICE AT 'PANCHDEEP BHAVAN', NORTH SWARAJ ROUND, P.B.NO.2, TRICHUR-680 020. 2. THE RECOVERY OFFICER, REGIONAL OFFICE, EMPLOYEES STATE INSURANCE CORPORATION, 'PANCHDEEP BHAVAN', NORTH SWARAJ ROUND, P.B.NO.2, TRICHUR-680 020. R1 & R2 BY ADV. MR. P.SANKARANKUTTY NAIR,SC THIS WRIT PETITION (CIVIL) HAVING COME UP FOR ADMISSION ON 16/12/2009, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: Kss S. SIRI JAGAN, J ................................................ W.P(C) No. 36271 of 2009 ................................................. Dated this the 16th day of December, 2009 J U D G M E N T The petitioner defaulted payments of contributions due under the Employees State Insurance Act. The E.S.I. Corporation initiated proceedings for recovery of the same. They have already attached the properties belonging to the petitioner. The petitioner now apprehends proceedings under Section 45C(1)(b) of the Act for recovery of the arrears and arrest of the Directors of the petitioner to enforce payment. The contention of the petitioner is that since the properties of the petitioner have been attached, without first selling the properties to recover the amounts, further proceedings under 45C(1)(b) of the Act cannot be invoked against the Directors, that too only if the amounts recovered by the sale of the properties are not sufficient to cover the liability. The petitioner therefore seeks the following reliefs: “a) issue a writ of certiorari or such other appropriate writ, direction or order and to call for the records leading to Exhibits P1 order of attachment and the proceedings initiated against the Directors of the petitioner company under section 45C(1)(b) of the Employees State Insurance Act and to quash the same. b) issue a writ of mandamus or such other appropriate writ, direction or order and to direct the 2nd respondent to permit the petitioner to pay off the balance arrears of in twelve monthly installments.” W.P(C) No. 36271 of 2009 -2- 2. I have heard the learned standing counsel for the ESI Corporation also. He opposes the prayers in the writ petition. He points out that several times cheques issued by the petitioner in payment were dishonored. He also points out that the employees of the petitioner had enjoyed the benefits due to them under the ESI Act. Therefore according to the standing counsel there is no bonafides in the prayers of the petitioner. 4. I have considered the rival contentions in detail. 5. Notwithstanding the fact that the petitioner is a defaulter, I am of opinion that the respondents should first proceeded against the properties of the petitioner before taking the extreme step of arrest and detention of the Directors of the petitioner under Section 45C(1)(d). In the above circumstances, this writ petition is disposed of with the following directions: 6. Respondents shall first sell the properties attached for recovery of the amounts due. Only if the amounts so obtained are not sufficient to cover the liability due from the petitioner, further proceedings under Section 45C(1)(d) shall be proceeded with. The writ petition is disposed of as above. sd/- S. SIRI JAGAN, JUDGE rhs // True copy // PA to Judge