THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON’BLE SRI JUSTICE B.N.RAO NALLA CIVIL MISCELLANEOUS APPEAL No.1161 of 2009 05.03.2010 Between: Associated Cement Companies Limited … Petitioner AND Government of Andhra Pradesh, Labour, Employment, Training Factories Department Rep.by its Principal Secretary, Hyderabad And another. …Respondents THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON’BLE SRI JUSTICE B.N.RAO NALLA CIVIL MISCELLANEOUS APPEAL No.1161 of 2009 JUDGMENT: (per Hon’ble Sri Justice V.V.S.Rao) The petitioner, Associated Cement Companies Limited (ACC) is in appeal under Section 82 of the Employees’ State Insurance Act, 1948 (the Act, for brevity), aggrieved by an order dated 26.10.2009 in I.A.No.136 of 2009 passed by the Employees’ Insurance Court and Chairman, Industrial Tribunal-I, Hyderabad (ESI Court, for brevity). Whether ESI Court has power and jurisdiction to register and adjudicate a case under Section 75 of the Act without therebeing due compliance with sub-section (2B) of Section 75, which requires the employer approaching ESI Court to deposit 50% of the amount claimed by Employees’ State Insurance Corporation (the Corporation, for brevity). Proviso to Section 75(2B) of the Act no doubt empowers ESI Court to waive or reduce the amount to be deposited under the said sub-section but the difficulty arises when there is no determination of the amount by Corporation or when any employer required to make contribution to ESI seeks exemption and such exemption stands rejected by the Government. The petitioner has cement manufacturing unit at Mancherial in Adilabad District. They submitted an application to the Government of Andhra Pradesh seeking exemptions under Sections 87, 88, 91A and 92 of the Act. Statedly such exemption was granted for the period from 01.04.1979 to 31.03.1993. While doing so, the Government considered the fact that the petitioner sold Mancherial unit to third party and all the workers and employees opted for voluntary retirement scheme from 1993. Further, the petitioner also provided the facility of a dispensary with Doctors, Nurses, Compounders and paramedical staff to cater to the needs of the workers/employees. Be that as it is, the Government issued G.Rt.No.1696, Labour, Employment Training and Factories (IMS) Department, dated 16.09.2004 rejecting the request of the petitioner for exemption for the period from 01.04.1999 to 30.03.2000. As noticed supra, by virtue of various Government Orders, the petitioner was exempted from making contribution to ESI from 01.04.1979 to 31.03.1993. The petitioner also asserts that even for the period from 01.04.1993 to 31.03.1999, they made number of applications but the Government did not pass any orders. It is also the case of the petitioner that G.O.Rt.No.1696 deals with application for exemption only for the period from 01.04.1999 to 30.03.2000. The petitioner challenged G.O.Rt.No.1696, dated 16.09.2004 by filing W.P.No.21016 of 2004. This Court dismissed the writ petition giving liberty to ACC to seek redressal from ESI Court. Accordingly, they filed EIC (Sr) No.1602 of 2009 challenging the rejection of exemption for the period from 01.04.1999 to 30.03.2000. As they were not paying any ESI contribution, from 01.04.1979 they also filed I.A.No.136 of 2009 under Section 75(2B) of the Act praying for waiver of the condition of deposit. By impugned order, the learned ESI Court dismissed the application observing that since the amount has not been determined, the petition filed by ACC for total waiver of 50% payment is premature. This order is in appeal before us. The first respondent filed counter through their Deputy Secretary to Government denying the allegation that ACC made applications seeking exemption from 01.04.1994 onwards. It is further admitted the petitioner made applications seeking exemption for the years 2000- 2001, 2001-2002, 2002-2003, 2003-2004 and 2004-2005 and that these were not examined as the petitioner filed writ petition before the High Court. The second respondent, namely, ESI Corporation filed their counter through the Deputy Director. While denying various contentions of ACC, it is stated that the Corporation issued form C-18 notice, dated 18.12.2009 proposing to assess the contributions due at Rs.1,89,23,850/- for the period from 01.04.1993 to 30.06.2006, that in the said notice the period was wrongly typed as 01.01.1997 to 31.03.1994 when it is actually from 01.01.1997 to 31.03.2004, that a corrected copy of notice was issued on 24.12.2009 and that the petitioner filed ESI case before the Court below. It is also asserted that the petitioner is required to pay 50% of the contributions towards deposit as mentioned in notice dated 18.12.2009. The counsel for petitioner, learned Government Pleader and standing counsel for ESI made elaborate submissions touching upon the interpretation of Section 75(2B) of the Act and the inaction of the Government in not considering the applications of the petitioner seeking exemption commencing from 01.04.1994 till 31.03.2005. There is no dispute nor the relevant provision permits any contra position that the Court competent to adjudicate the matters enumerated under Section 75(1) of the Act is also competent to waive or reduce the amount to be deposited under Section 75(2B). What would be the position in a matter like this? ACC obtained exemptions presumably for the reason that they were providing adequate medical facilities for the workers of Mancherial unit. Such exemption was granted under various Government orders from 01.04.1979 to 31.03.1993. Subsequently there is no exemption. The Government disputes that from 01.04.1993 till 31.03.1999, ACC did not make any application seeking exemption. Counsel for ACC however produced the certified copies obtained by ESI Court to show that such applications were made. This Court cannot record any finding on this aspect because certified copies are obtained from ESI Court and it is for the petitioner to prove the factum of making such applications for the period subsequent to 01.04.1993 till 30.03.2000 because the Government admits that for the period from 2000 to 2005 such applications were made. Therefore, it is not proper to record any finding on this aspect. Insofar as this appeal is concerned, ESI has also issued form C- 18 notice dated 18.12.2009 as modified by notice dated 24.12.2009. An amount of Rs.1,89,23,850/- has been proposed to be determined as the contribution payable by ACC for the period from 01.01.1997 to 31.03.2004. Whether this amount is properly determined or not, which being a subsequent question, if ultimately the ESI Court upholds the action of the Government in not granting exemption for the period claimed by the petitioner. Therefore, we do not agree with the reasoning of the learned ESI Court. We set aside the impugned order. I.A.No.136 of 2009 filed by the petitioner is allowed on condition of the petitioner depositing a sum of Rs.25,00,000/- (Rupees twenty five lakhs only) as a condition and in due compliance with Section 75(2B) of the Act. We further direct that the said amount shall be kept in a deposit by the ESI Court so as to get maximum amount of interest and we also make it clear that if ultimately the petitioner succeeds, the amount shall be refunded to the petitioner. The appeal is accordingly partly allowed. There shall be no order as to costs. _______________ (V.V.S.RAO, J) ____________________ (B.N.RAO NALLA, J) 05.03.2010 Pln