IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN FRIDAY, THE 23RD MAY 2008 / 2ND JYAISHTA 1930 Ins.APP.No. 39 of 2004() -------------------------------------- (AGAINST ORDER DATED 15/04/2004 IN I.C.24/90 OF E.I.COURT, KOLAM) APPELLANT/OPPOSITE PARTY: ---------------------------------------------- THE REGIONAL DIRECTOR, E.S.I.CORPORATION, TRICHUR. BY ADV. SRI.P.SANKARANKUTTY NAIR RESPONDENTS: APPLICANT: -------------------------------------------- * 1. SRI.A.M.ZAINALABDEEN MUSALIAR, PROPRIETOR, M/S.ZAINUL CASHEW PACKERS, SHAFI MANZIL, KARIKODE, KOLLAM-5. ( D I E D) – LRS IMPLEADED: 2. THE DISTRICT COLLECTOR, KOLLAM. 3. THE TAHSILDAR (R.R.), KOLLAM. *ADDL.R4 IS IMPLEADED: R4. SRI.S.NAZEEM MUSALIAR, S/O.ZAINULBDEEN MUSALIAR, SHAFI MANZIL, KARIKODE, KOLLAM – 691 005. (*L.R. OF THE DECEASED FIRST RESPONDENT IS IMPLEADED AS ADDITIONAL4TH RESPONDENT VIDE ORDER DTD. 10/03/08 ON I.A.NO.2795/07) R2 & R3 BY GOVERNMENT PLEADER SRI.V.T.K.MOHANAN R4 BY ADV. SRI. E.D. GEORGE THIS INSURANCE APPEALS HAVING BEEN FINALLY HEARD ON 23/05/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: M.N. KRISHNAN, J. = = = = = = = = = = = = = = INS.APPL. NO. 39 OF 2004 = = = = = = = = = = = = = = = Dated this the 23rd day of May, 2008. J U D G M E N T This appeal is preferred against the order of the E.I. Court in I.C.24/90 whereby the Court held that the claim of the Corporation as per Ext.B2 notice dated 16.8.89 is barred by limitation and the action of the Corporation is violative of the principles of natural justice and had quashed Exts.B2 and B3 notices. The question of limitation was answered in the light of a Full Bench decision of this Court reported in ESI Corporation v. Excel Glasses Ltd. (2003 (3) KLT 42) wherein this Court held that if action is initiated beyond a period of five years it will be barred by limitation. The learned counsel for the Insurance Corporation had brought to my notice the decision of the Apex Court reported in E.S.I. Corporation v. Santhakumar (2007 (1) KLT 133) wherein the Apex Court had reversed the decision of this Court. In paragraph 29 of the judgment it is stated that, INS. APPL. 39 OF 2004 -:2:- “Section 77 of the Act relates to commencement of proceeding before the E.S.I. Court. The proviso to sub-Section 77 of the Act cannot independently give any meaning without reference to the main provision, namely, Section 77 of the Act. Therefore the proviso to Clause (b) of Section 77(1A) of the Act, fixing the period of five years for the claim made by the Corporation, will apply only in respect of claim made by the Corporation before the E.S.I. Court and to no other proceedings.” In paragraph 32 the Apex Court held that, “The inevitable conclusion, therefore, is that the view of the Full Bench of the Kerala High Court is not correct and that of the Madras High Court is correct.” 2. So from the decision it is very clear that the question of limitation will apply only in a proceeding initiated by the Insurance Corporation in a Insurance Court and therefore the finding of the Employee's State Insurance Court that the claim is barred by limitation has to be annulled and therefore it is set aside. INS. APPL. 39 OF 2004 -:3:- 3. A perusal of the order would reveal that various proceedings are initiated and in some cases objections had been filed even disputing the entitlement and claim of the respondents. When it is so it is desirable the matter is heard by giving an opportunity to the other side and fix the amount and thereafter to proceed further. In the result the appeal is allowed and order of the E.I. Court is set aside and it is held that there is no limitation. The E.S.I. Corporation is directed to give opportunity to the respondents in the appeal to submit their answers to the assessment notice issued/ to be issued, hear the objections and then dispose of the matter in accordance with law. M.N. KRISHNAN, JUDGE. ul/-