ORDER :

1. This Special Leave Petition is against a judgment and order dated 8th October 2020 passed by the High Court of Judicature at Madras, dismissing the appeal being C.M.A. No.1527 filed by the Employees State Insurance Corporation, hereinafter referred to as the ‘Petitioner Corporation’, under Section 82(2) of the Employees State Insurance Act, and affirming the order dated 31st July 2020 passed by the Employees State Insurance Court, Coimbatore allowing E.S.I.O.P No. 1/2016 filed by the Respondent Company under Section 5 of the Employee State Insurance Act, 1948 (for short, ‘ESI Act’).

2. The Respondent Company manufactures different kinds of agricultural pumps and other products and has ten branches in Coimbatore, Tamil Nadu. The ESI Act is applicable to the factories and establishments of the Respondent Company, and the employees of the Respondent Company are required to be insured in the manner provided by the ESI Act.

3. The Respondent Company is liable to pay Employees’ State Insurance Contribution in respect of its employees, as provided in Section 39 of the ESI Act. Section 44 of the ESI Act requires the Respondent Company to maintain a register, containing particulars of its employees, and to submit Returns to the Petitioner Corporation, in the manner prescribed by the Regulations framed under the ESI Act.

4. On or about 23rd January 2015, officials of the Petitioner Corporation inspected the records of the Respondent Company for the period from December 2010 to December 2014 and detected discrepancies in the wages, and consequential short payment by the Respondent Company, towards Employees State Insurance contributions, totalling Rs.21,52,829/-, out of which Rs.9,48,517/-was towards Conveyance Allowance, paid by the Respondent Company to its employees.

5. By an order dated 19th March, 2015, the Corporation called upon the Respondent Company to pay its outstanding contributions totalling Rs.21,52,829/-, with interest, within 15 days from the date of the order, failing which the same would be recovered as arrears of land revenue.

The Respondent Company was, however, given the opportunity of personal hearing, if it disputed the claim of the Corporation.

6. The Respondent Company made a representation against the claim, pointing out that the Corporation had erroneously computed the salary, by including Conveyance Allowance, leave salary, etc. which did not constitute wages as defined in Section 2(22) of the ESI Act.

7. Thereafter the Petitioner Corporation passed an amended order dated 6th July, 2016 under Section 45A of the ESI Act, determining the differential contribution payable by the Respondent Company at Rs.19,38,300/-as per the break up given in the said amended order, that is, Rs.9.89,783 towards difference in wages and Rs.9,48,517/-towards Conveyance Allowance. The Respondent Company duly remitted Rs.9,89,783/- towards difference in wages.

8. The Respondent Company instituted proceedings in the Employees State Insurance Court being E.S.I.O.P No.1 of 2016 in respect of the claim of the Corporation of Rs.9,48,517/-in respect of the Conveyance Allowance paid by the Respondent Company to its employees.

9. By a judgment and order dated 31st July, 2020, the Employees’ State Insurance Court allowed the E.S.I.O.P No.1 of 2016, and set aside the claim of Rs.9,48,517/-in respect of Conveyance Allowance, paid by the Respondent Company to its employees.

10. Being aggrieved by the judgment and order dated 31st July, 2016 of the Employees State Insurance Court, the Corporation filed an appeal therefrom in the High Court under Section 82(2) of the ESI Act. The said appeal has been dismissed by the judgment and order impugned in this Special Leave Petition.

11. The short question involved in this Special Leave Petition is whether ‘wages’, as defined in Section 2(22) of the ESI Act, would include Conveyance Allowance paid by the Respondent Company to its employees.

12. Section 22(2) of the ESI Act is set out hereinbelow for convenie