AI Structured Summary
Not yet generated for this judgment
Judgment
The respondent herein questioned the order passed by the ESI Corporation in ESI Application No. 21 of 1994 on the file of the Employees'' Insurance Court at Hubli u/s 75 of the Act, wherein among other contentions, the respondent has raised a preliminary objection that the order passed by the ESI Corporation u/s 85B of the Act is not proper and legal as the Regional Director had no power to pass the order in question. The Court after hearing both the parties and following the judgment in Hindustan Monark (Private) Limited v Employees'' State Insurance Corporation and Another, held that the Regional Director could not pass the order u/s 85B of the ESI Act. Therefore, on that only point the application was allowed and the order passed by the respondent was set aside. Being aggrieved by that order, the Corporation has preferred this appeal.
Heard the learned Counsel for the appellant and the learned Counsel for the respondent.
The substantial question of law that is involved in this case is as to whether the Regional Director has power to pass order u/s 85B of the ESI Act.
As stated above, the ESI Court has followed the decision in Hindustan Monark (Private) Limited''s case, supra, wherein it is observed:
"In the absence of enabling provision in Section 94A of the Act the latter part of the resolution empowering the Director General to authorise any other officer to exercise such power is ultra vires Section 94A. Therefore, the Director General''s order authorising other officer to exercise such power is also bad".
However, the learned Counsel for the appellant has produced the resolution passed by the Corporation to delegate fresh power to levy and recover damages from the employers u/s 85B of the ESI Act to the officers of the Corporation which reads:
"Resolved that the power to levy and recover damages from the employees) u/s 85B of the ESI Act, 1948, as amended up-to-date, may be exercised by the Director General, all Regional Directors, Joint Regional Directors, Deputy Regional Directors, Assistant Regional Directors, Director, Sub-Regional Office, Pune and Deputy Regional Director In-charge, Sub-Regional Office, Nagpur.
Authenticated u/s 7 of the ESI Act, 1948 to be true copy".
This resolution was passed on 29-4-1983 and published in Gazette of India, Part III, Section 4, dated 14-5-1983 page No. 2455 a copy of which is made available to this Court by the appellant. From this it is clear that by virtue of the resolution among others, the Regional Director was also empowered to pass order as contemplated u/s 85B of the Act. Subsequently, their Lordships of the Supreme Court in Sovrin Knit Works etc. Vs. Employees'' State Insurance Corpn. and another etc., , held:
"It is seen that u/s 94A of the Act that the Corporation has been empowered to authorise any of its officer. It would be obvious that the Regional Director is one of the officers in the region; necessarily, he is a competent officer to exercise the power under the Act on behalf of the Corporation. It was conceded in the lower Court that he was so authorised. So, the officer has power to pass the order imposing damages and interest thereon for delayed payment".
Even if there is any defect in delegating powers (not questioned by anyone) still in view of the decision of the Supreme Court using the term ''any officer inclusive of Regional Officer'', it is clear that without there being any resolution, also the Regional Director has got the power to pass such orders.
In the case on hand also as stated above, the Regional Director has passed the order by virtue of delegated power levying damages to the extent of Rs. 1,97,850/- for delayed payment and directing to recover the same as land revenue u/s 45B. The said order was questioned by the respondent on the ground that the Regional Director had no powers to pass such orders as the Director had no power to delegate powers, etc. This contention cannot be sustained in view of the decision cited above and the same is liable to be set aside. However, the ESI Court has not considered all the contentions raised by the respondent in the application filed u/s 75 and also the objections filed by the respondent. In other words, the ESI Court has not disposed of the application on merits according to law but the same was rejected solely on the basis of the preliminary objection raised. For the foregoing reasons, the matter will have to be remitted to the ESI Court for consideration of the application on merits.
In the result therefore, I proceed to pass the following:
ORDER
The impugned order is set aside. The matter now stands remitted to the ESI Court with a direction to restore the ESI Application No. 21 of 1994 and proceed with the case in accordance with law giving full opportunity to both the parties.