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Judgment
Govardhan, J.—This appeal is against the order passed by the E.S.I. Judge, Madras dated 13.02.1986 in E.S.I. O.P. No. 47/1985. The
petitioner in his petition contends as follows: The petitioner was remitting contribution as per the Employees State Insurance Act (hereinafter called
as ''the Act''). Since the employees did not come to work properly and due to financial crisis, the establishment itself has been closed. The first
respondent has passed an order for directing the petitioner to pay the contribution on the ground that the petitioner has not remitted the
contribution in time, In spite of request made by the petitioner, to reconsider the same, on the ground that the said order is not valid, the first
respondent did not comply with the request. The respondent has passed an order for recovery of the amount. Hence the petition.
The respondent in their counter contends as follows: The allegation that the enquiry was not conducted properly is not correct. The enquiry has
been held after giving due opportunity to the petitioner. The orders passed are not liable to be set aside.
On the above pleadings, an enquiry was held before the learned Judge. The E.S.I. Judge has given a finding that the delegation of the powers by
the Director-General in favour of the Regional Director is not valid, and hence the impugned order passed by the Regional Director is not valid and
on those findings, allowed the petition.
Aggrieved over the same, the first respondent has come forward with this appeal.
In the grounds of appeal, the appellant has raised grounds to the effect that the impugned order is bad in law and that the lower Court ought to
have held that the ruling of the Division Bench of the Punjab and Haryana High Court reported in 58 F.J.R 408 has correctly laid down the law
regarding the interpretation of Section 94-A of the Act and the resolution passed by the E.S.I Corporation and it has erred in following the
decision reported in ""Shoba Engineering Case"" (59 F.J.R. 342). During the course of the argument, the learned counsel appearing for the appellant
has fairly conceded that the Supreme Court has confirmed the judgment of the Karnataka High Court in Shoba Engineering Case reported in 59
F.J.R. 342, and therefore, it is no longer valid to contend that the trial Court has committed an error in following the decision reported in ""Shoba
Engineering Case"" (59 F.J.R. 342) but would contend that it is a case in which the amount ordered to be remitted by the petitioner has not been
collected by the second respondent and therefore it is a fit case, in which, the order of the lower Court should be set aside and the matter is to be
remitted to the trial Court to pass a fresh order after giving notice to the respondent. The above argument of the learned counsel appearing for the
appellant, even though is appealing, it cannot be accepted since it is not in dispute that the petitioner challenges the order passed by the Regional
Director contending it is not a valid order on the ground that the Regional Director has not been empowered to pass such an order under Rule
16(2) of the Act and therefore, no purpose will be served by remitting the matter to the trial Court in view of the subsequent order passed by the
Supreme Court confirming the judgment of the Karnataka High Court relied by the Trial Court. The latest decision on the subject viz., validity of
the delegation of the powers and duties of the E.S.I. Corporation under Rule 16(2) is the case reported in Director General, E.S.I. v. T. Abdul
Razak (1996 LIC 2037). Rule 16(2) of the Act is as follows:
(2) The Director General may, with the approval of the Standing Committee, by general or special order, delegate any of his powers or duties
under the Rules or Regulations or under any resolution of the Corporation or the Standing Committee, as the case may be to any person
subordinate to him. The exercise or discharge of any of the powers or duties so delegated shall be subjected to such restrictions, limitations and
conditions, if any, as the Director General may, with the approval of the Standing committee impose.
The Apex Court has held in the decision referred above, that Rule 16(2) and the resolution of the Standing Committee to the extent they
empowered the Director General to delegate the powers or duties delegated to him under any resolution of the Corporation or for the Standing
Committee, referable to S. 94-A are invalid and all the rest of the said Rule of the resolution are valid.
In the case on hand, the Regional Director had exercised powers only by virtue of the powers delegated to him by the Director General, and has
passed the impugned order. Such a delegation having been held as invalid by the Supreme Court, the order passed by the E.S.I. Judge has to be
confirmed. Therefore I am of opinion that the argument of the learned counsel appearing for the appellant that the matter requires reconsideration
by remittance to the trial Court is without merits and is liable to be dismissed. In the result, the appeal is dismissed. No costs.