Andhra Pradesh High Court
Judges : C.Y.SOMAYAJULU
E.I.D.Parry (India) Ltd., Vijayawada - Appellant
Versus
Employees State Insurance Corporation - Respondent
Decided On : 10-01-01
Employment and service - Employees State insurance Act - contention - Stockiest and distributor - Demanded appellant to produce - Appellant who is a manufacturer stockiest and distributor of its goods throughout India has a branch at Vijayawada also officials of E. S. I. Corporation respondents visited establishment of appellant on several dates and verified its records and since they found that appellant paid handling freight and forwarding charges involving labor elements during periods - Demanded appellant to produce evidence regarding labor element in freight and forwarding charges shown in its ledgers – Since appellant failed to produce vouchers respondent by two notices - Central/state warehousing Corporation where its stocks were stored, and that they did not engage any persons or labor to handle their goods and that the Central/state Ware- housing corporation where its goods are stored only engaged labor and paid charges to labor engaged - Thereafter respondents issued two notices claiming a total as contribution from appellant Act before Tribunal - Questioning said notices appellant filed - Respondents filed a counter contesting claim of appellant - Held, It is no doubt true that Act is a beneficial piece of legislation for welfare of employees -Merely because it is beneficial legislation appellants cannot be called upon to pay Contribution to all the homilies who are not its employees within meaning of act - For Corporation to make a claim for contribution from an employer it should first establish that persons asked to be covered by the employer are his employees within meaning of Act - To elaborate assume that appellant received its stock by rail and stored it in railway and later distributed stocks to its dealers by engaging railway coolies or porters as they are popularly called or known can appellant be asked to pay contribution to railway porters treating them as its employees of Act because it paid charges to them - Answer without any hesitation would and should be an emphatic no because a casual labor - Appeal allowed(Para 16)
( 1 ) APPELLANT who is a manufacturer, stockist and distributor of its goods throughout India, has a branch at Vijayawada also. The officials of E. S. I. Corporation (Corporation), i. e. , respondents visited the establishment of the appellant on several dates, and verified its records, and since they found that appellant paid handling, freight and forwarding charges involving labour elements during the periods april, 1990 to March, 1991, April 1991 to january, 1992, February, 1992 to December, 5 1993 and January, 1994 to March, 1994 to a tune of Rs. 9,18,977. 98 ps. they demanded the appellant to produce evidence regarding the labour element in the freight and forwarding charges shown in its ledgers. Since the appellant failed to produce the vouchers, respondent, by two notices dated February 27, 1998, demanded (i) Rs. 19,948. 00, i. e. , rs. 17,114/-, for the period February 1990 to december 1993 and Rs. 2,834/- for the period january 1994 to March 1994, and (ii) rs. 47,778/-i. e. , Rs. 19,773. 00 for the period april 1990 to March 1991 and Rs. 26,005. 00 for the period April 1991 to January 1992, as its contribution under the Employees State insurance Act (the Act), for which appellant sent a reply denying its liability, alleging that those amounts were paid to the Central/state warehousing Corporation, where its stocks were stored, and that they did not engage any persons or labour, to handle their goods and that the Central/state Ware- housing corporation, where its goods are stored, only engaged the labour and paid charges to the labour engaged. Thereafter, respondents issued two notices dated November 27, 1998 and december 11, 1998, claiming a total of rs. 70,239/- as contribution from the appellant under the Act before the Tribunal. Questioning the said notices, appellant filed E. I. C. No. 2 of 1999. Respondents filed a counter contesting the claim of the appellant.
( 2 ) IN support of its case, appellant examined one witness as" P. W. 1 and marked exs. P-1 to P-16. In support of their case respondents examined 5 witnesses R. Ws. 1 to 5 and marked Exs. R-1 to R-ll. The Tribunal, negativing the contention of the appellant that hamalies were not engaged by them, and that a part of the claim in any event is barred by time, dismissed the petition by the order under appeal. Hence, this appeal.
( 3 ) THE point for consideration is whether the appellant is not liable to pay the contribution demanded?
( 4 ) THE main contention of Mr. Sridharan, learned counsel for the appellant, is that the appellant is not the employer of the Hamalies who handled the stocks in the various godowns, and they are also not the employees of the appellant within the meaning of Section 29 of the Act for it to pay contribution under the Act. It is his contention that the warehouse where the goods of the appellant are stored is the bailee, and appellant is the bailor of those goods and since either the stockists of the appellant who lift the stocks, or the Warehousing corporation, would engage the hamalies and pay coolie charges to them, and since appellant pays the Warehousing Corporation the amount as demanded, appellant cannot be made liable to pay contribution under the Act for the hamalies. He contended that in any event since hamalies working in the Warehouses would work not only for the appellant but several others also, by no stretch of imagination can it be said that the hamalies are the employees of the appellant. Relying on Henry Wolsey and company v. Regional Director, Employees state Insurance Corporation, 1995 (1) LLN 165, he contended that as per Section 77 (1-A) of the Act claim for contribution beyond five years prior to the demand notice is barred, and since consolidated claim without details of breakup, is made, the whole demand is liable to be set aside. He contended that the Tribunal without noticing that the claim in Transport corporation India Limited v. Employees State insurance Corporation and Anr. , 19
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