Judgment

JUDGMENT:- The question raised in this appeal concerns the vires of Chapter V-A of the Employees State Insurance Act, 1948. The principal Act was enacted in 1948. Chapter V-A was inserted by Section 20 of Act No. 53 of 1951. The provisions of the Chapter, however, have ceased to have effect on and from July 1, 1973. That is the sequel to a notification issued under S. 73-I of the Act. Chapter V-A is headed "Transitory Provisions" and provides for the payment by the principal employer of a special contribution which shall. be in lieu of the employers contribution payable under Chapter IV in the case of factories or establishments situate in areas in which the provisions of both Chapters IV and V are in force. The special contribution is required to be such percentage, not exceeding five per cent of the total wage bill of the employer, as the Central Government may specify. It is also provided that the employers special contribution in the case of factories or establishments in areas in which the provisions of both Chapters IV and V are in force shall be fixed at a rate higher than that in the case of factories or establishments situate in areas in which the provisions of the said Chapters are not in force.

2. The Employees State Insurance Act, 1948 was enacted to provide for certain benefits to employees in the case of sickness, maternity and employment injury and to make provisions for certain other matters in relation thereto. It is an obvious social welfare legislation in tune with the Directive Principles of State Policy contained -in Articles 41, 42 and 43 of the Constitution. It is a legislation which comes directly under entries 23 and 24 of List III of the VIIth schedule of the Constitution, which are, "social security and social insurance; employment and unemployment", and "welfare of labour including conditions of work, provident funds, employers liability, workmens compensation, invalidity and old age pensions and maternity benefits". The Act extends to the whole of India and comes into force on such date or dates as the Central Government may appoint, different dates being permissible for different provisions of the Act and/or different States or for different parts thereof. It applies to all factories including factories belonging to the Government other than seasonal factories. Chapter II provides for the establishment of the Employees State Insurance Corporation for administering the scheme of Employees State Insurance in accordance with the provisions of the Act. The Corporation is to be a body corporate having perpetual succession and a common seal. There are detailed provisions for the constitution of a Standing Committee and a Medical Benefit Council. Chapter III provides for Finance and Audit. Section 26, in particular, provides for the establishment of a Fund called the Employees State Insurance Fund into which all contributions paid under the Act and all other money received on behalf of the Corporation shall be paid. The Corporation is authorised also to accept grants, donations and gifts from the Central or any State Government, local authority or any individual or body whether incorporated or not for all or any of the purposes of the Act. Section 28 lists the purposes for which the Fund may be expended and it includes among other items,

"(i) payment of benefits and provision of medical treatment and attendance to insured persons and, where the medical benefit is extended to their families, the provision of such medical benefit to their families, in accordance with the provisions of this Act and defraying the charges and costs. in connection therewith; and

(ii) to (iii) ...................

(iv) establishment and maintenance of hospitals, dispensaries and other institutions and the provisions of medical and other ancillary services for the benefit of insured persons and, where the medical benefit is extended to their families, their families;"

Chapter IV provides for the manner of insurance of all the