1 SBCWP NO.9972/2008 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR. O R D E R Piyush R.Vora Vs. Employees' State Insurance Corporation S.B.CIVIL WRIT PETITION NO.9972/2008 Date of Order : : 18/03/2009 PRESENT HON'BLE MR. JUSTICE H.R. PANWAR Mr.Prem Dayal Bohra, for the petitioner. Mr.Raj Kamal Soni, Addl.Govt.Counsel for the respondents. BY THE COURT: By the instant writ petition under Article 226 of the Constitution of India, the petitioner seeks quashing of the notice Annexure-1 dated 25th September, 2008 and notice Annexure-3 dated 27th October, 2008. I have heard learned counsel for the parties. It is contended by learned counsel for the petitioner that by order Annexure-4 dated 27th October, 2008 2 SBCWP NO.9972/2008 addressing to M/s Marudhar Yarns Pvt.Ltd., Tirupati Industrial Area, Abu Road, the respondents informed M/s Marudhar Yarns Pvt. Ltd. that a sum of Rs.45,49,087.50 is out standing under the provisions of the Employees State Insurance Act, 1948 (for short “ESI Act” hereinafter), more particularly under Section 93A, the employer is responsible to pay all the outstanding amount as contribution and the interest thereon. A similar notice was issued to the petitioner vide Annexure-1 dated 25th September, 2008 requiring the petitioner to deposit a sum of Rs.41,68,184.00 plus further interest. According to learned counsel for the petitioner, the petitioner has deposited the amount of contribution due to him and only the interest is outstanding but the respondents have not given bifurcation of the interest as to how amount demanded by Annexure-1 is worked out and therefore, the petitioner seeks quashing of the order Annexure-1 dated 25th September, 2008 as also the notice Annexure-3 dated 27th October, 2008 addressed to the petitioner. Learned counsel appearing for the respondents submits that the amount demanded by the aforesaid notice is the interest outstanding since the petitioner failed to pay the employees' contribution under the provisions of the ESI Act 3 SBCWP NO.9972/2008 and made delayed payment of contribution and for the period for which the payment was made delayed, the interest was demanded. According to learned counsel appearing for the respondents, the respondents are justified in demanding the interest under Regulation 31C of the Employees' State Insurance (General Regulations), 1950 (for short “the Regulation of 1950” hereinafter) which provides that if an employer fails to pay contributions within the periods specified under regulation 31 or any other amount payable under the Act, the corporation may recover damages, not exceeding the rates mentioned thereunder, by way of penalty whereas Regulation 31A provides that contribution within the periods specified in regulation 31, shall be liable to pay, the simple interest at the rate of fifteen percent per annum, in respect of each day of default or delay in payment of contribution. Learned counsel has relied on a decision of the Hon'ble Supreme in M/s Goetze (India) Ltd. Vs. Employees' State Insurance Corporation, 2008 LLR 897. Learned counsel appearing for the respondents further submits that a detailed reply to the writ petition has been filed and in para 8 of the reply to the writ petition, it has been stated by the respondents that the outstanding of ESI 4 SBCWP NO.9972/2008 contribution was for April 1995 to March 2005 and the amount was Rs.1,15,07,787/-. As against this outstanding amount, the petitioner paid Rs.1,15,23,534/- and therefore, an excess amount paid by the petitioner came to be amounting to Rs.15,747 has been adjusted against the interest. It has further been stated that for the short period w.e.f. June 1996 to October 1996 and January 1998 to January 1999, a sum of Rs.3,80,904/- was due which is leviable by virtue of Regulation 31C of the Regulation of 1950. By letter dated 9th January, 2008 Annexure-R/2, it has been clarified that the petitioner paid only balance of the actual part of the ESI contributions for the period April 1995 to March 2005 to the tune of Rs.44,00,000/- on 8th November, 2007 and failed to deposit the requisite contribution in time and therefore, the interest is leivable. The Hon'ble Supreme Court in M/s Goetze (India) Ltd. Vs. Employees' State Insurance Corporation (supra) held that liability to pay interest is statutory. There is no power of waiver. The question of any compromise or settlement does not really arise. In the instant case, the respondents have placed on record the document Annexure-R/1 and R/2. By Annexure- 5 SBCWP NO.9972/2008 R/2, the details of payment due and deposited by the petitioner have been elaborately shown and amount demanded vide notice Anneuxre-1 has specifically been worked out as outstanding amount. From the material available on record, learned counsel for the petitioner failed to show that the petitioner regularly deposited ESI contribution as and when it fell due. Obviously, in view of the reply filed by the respondents, though the petitioner paid ESI contribution but after a lapse of long time, as has been noticed above. In the circumstances, therefore, in my view, the respondents are justified in issuing impugned notices Anneuxres-1 and 3. I do not find any good ground to interfere with the notices impugned. The writ petition is devoid of merit and the same is dismissed. (H.R. PANWAR), J. NK 6 SBCWP NO.9972/2008 S.B.CIVIL MISC.STAY APPLICATION NO.17122/2008 IN S.B.CIVIL WRIT PETITION NO.9972/2008 Date of Order : : 18/03/2009 PRESENT HON'BLE MR. JUSTICE H.R. PANWAR Mr.Prem Dayal Bohra, for the petitioner. Mr.Raj Kamal Soni, Addl.Govt.Counsel for the respondents. Since the writ petition itself has been dismissed, the stay petition also stands dismissed. Ad interim order dated 19.12.2008 is hereby vacated. (H.R.PANWAR), J. NK