IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE M.N.KRISHNAN TUESDAY, THE 16TH SEPTEMBER 2008 / 25TH BHADRA 1930 Ins.APP.No. 13 of 2008(C) ------------------------------ IC.110/2005 of EMPLOYEES INSURANCE COURT, ALAPPUZHA .................... APPLICANT/ APPLICANT : --------------------------- K.N.SURYANARAYAN, SURYA VIMAL SHOW ROOM, M.G.ROAD, ERNAKULAM, COCHIN-35. BY ADV. SRI.E.K.NANDAKUMAR SRI.A.K.JAYASANKAR NAMBIAR SRI.K.JOHN MATHAI SRI.P.BENNY THOMAS SRI.ANIL D. NAIR RESPONDENTS: RESPONDENT: ---------------------------------- 1. THE REGIONAL DIRECTOR, ESI CORPORATION, N.S.ROUND, THRISSUR-20. 2. THE RECOVERY OFFICER, ESI CORPORATION, N.S.ROUND, THRISSUR-20. BY THIS INSURANCE APPEALS HAVING BEEN FINALLY HEARD ON 16/09/2008, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: ORDER ON I.A.636 OF 2008 IN INS.APL. NO. 13 OF 2008 DISMISSED 16/9/08 SD/- M.N. KRISHNAN, JUDGE. [ True Copy ] P.A. TO JUDGE. M.N. KRISHNAN, J. = = = = = = = = = = = = = = INS.APPEAL NO. 13 OF 2008 = = = = = = = = = = = = = = = Dated this the 16th day of September, 2008. J U D G M E N T This appeal is preferred against the judgment of the Employees Insurance Court, Alappuzha in I.C.110/05. It is relating to levy of interest and the period from which it is to be levied. Learned counsel for the appellant would contend initially an action was moved by the Corporation u/s 85B for exemption of damages and it was found in that case that there was no delay and therefore the E.S.I. Corporation was prevented from enforcing any damages u/s 85B of the Act and that has become final. So the learned counsel would contend that the payment of interest also has to be governed by the same principles and so the matter requires interference at the hands of this Court. 2. S.85B of the E.S.I. Act and S.39(5) of the Act are operating on two different fields. Under S.39(5) of the Act the power is absolute and mandatory and no discretionary jurisdiction is given to the E.S.I Corporation regarding any Ins. Appeal 13 OF 2008 -:2:- waiver of interest. So far as S.85B of the Act is concerned it is imposition of damages where the word used is only 'may' and it has been settled by a line of decisions that there must be deliberate, willful evadement coupled with contumacious conduct to impose damages. Regarding the liability to impose interest the matter has been considered by a Division Bench of this Court in Cannanore Drug Lines v. E.S.I. Corporation (2007 (1) KLT 880). This Court held that “the bonafide 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.” A reading of the said decision would make it crystal clear that the liability to pay interest starts Ins. Appeal 13 OF 2008 -:3:- from the date of commencement of the coverage and non payment of contribution within 21 days of the expiry of the relevant wage period. Therefore, this is a case where there is no jurisdiction at all for the E.S.I. Corporation to consider the factum of waiving the interest. It is rather statutory and obligatory and so I do not find any mistake committed by the Court below in imposing interest. So the appeal lacks merit and it is dismissed. M.N. KRISHNAN, JUDGE. ul/-