Case: Employees State Insurance Corporation Vs. Hindustan Milkfood Manufacturers Ltd. and Ors

The High Court by its order dated 08.03.2006 in FAO No. 236 of 1982 reversed the order dated 04.03.1982 passed by the Employees Insurance Court, Patiala whereby it was held that the Atta Mohammad Ram Swarup, Behari Ram, Ram Dev, Deep Chand, Bansi Lal, Mohinder Ram, Harnam Singh, Bani Ram and Hari Singh are the employees of the Appellant within the meaning of Section 2(9) of the E.S.I. Act and challenge to the notice dated 18.09.1976 made by the Appellant has been repelled. The ESI Court has considered the evidence in detail. It has considered evidence of several witnesses i.e. PW 1 to PW 8 particularly the Executive Officer of the Appellant. His statement clearly indicate that the payment was made by the employer. However, the workman were employed through a contractor. As per the work done, the bill submitted by the employees were paid by the employer. Photo state copies of the bills have been submitted. It was also admitted that all these persons have worked during the year 1972-1983 and they worked for several years on contract basis. The ESI inspector has also given a report that they were found working at the time of inspection made on 14/15 January, 1994 under the direct supervision of the employer. And they worked in supervising employer. The Inspector ESI had also been Postal Page No. 29 examined in the case. His statement has also been considered by the ESI court. He has also stated as found by the ESI Court that the employer had made payment for the work which was done. He stated that Atta Mohammad and Ram Swarup were washing clothes at the time of inspection on the Bank of company in the premises of the factory. However, the High Court without examining the evidence and the reasoning employed by the ESI Court in a perfunctory manner reversed the findings of the ESI Court which could not have been done within ken of the appellate jurisdiction.

Court's reasoning:
In our view, a reading of the entire order of the High Court and that of the ESI Court make it clear that the proper reasons have not been employed by the High CourtIn our opinion as the work had been done for more than 10 years. The mode of such payment is covered under definition of wages in Section 2(22) of the Act. The findings recorded by the High Court are clearly perverse and cannot be said to be in accordance with law.