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Andhra Pradesh High Court
Judges : PUNNAIAH
Employees State Insurance Corporation, Hyderabad - Appellant
Versus
State OF A.P., Represented by the Public Prosecutor - Respondent
Decided On : 10-17-82
EMPLOYEES STATE INSURANCE ACT, 1948 - SECTION 45(2)(A) AND (B) - SECTION 85(G) - SECTION 86(3) - FAILURE TO PRODUCE RECORDS - LIMITATION FOR PROSECUTION - INTERPRETATION OF PROVISIONS - SCOPE OF INSPECTOR'S POWERS.
Fact of the Case:
The accused, the proprietor of Messrs Ajantha Transport, failed to produce the establishment's records, including attendance registers, wage registers, cash books, ledgers, and copies of returns, to the Inspector of the Employee's State Insurance Corporation (ESIC) despite multiple requests and visits to the establishment. The Inspector initiated prosecution against the accused under Section 85(g) of the Employees' State Insurance Act, 1948, for failing to produce the records on or after 6-6-1979.
Finding of the Court:
The Magistrate acquitted the accused, holding that the Inspector lacked the authority to demand the production of records at his office and that the accused's failure to produce the records did not constitute an offense under Section 85(g) of the Act.
Issues: 1. Whether the Inspector has the authority to demand the production of records at his office under Section 45(2)(a) of the Act? 2. Whether the accused's failure to produce the records constitutes an offense under Section 85(g) of the Act? 3. Whether the prosecution was barred by limitation under Section 86(3) of the Act?
Ratio Decidendi: 1. Section 45(2)(a) of the Act empowers the Inspector to require an employer to furnish information necessary for the purposes of the Act. However, the information does not include accounts, books, or documents. 2. Section 45(2)(b) of the Act empowers the Inspector to demand the production of accounts, books, and other documents relating to employment and wages during an inspection of the employer's establishment. Failure to produce these records during an inspection constitutes an offense under Section 85(g) of the Act. 3. Section 86(3) of the Act requires that prosecution for offenses under the Act must be initiated within six months from the date of the alleged offense. Failure to launch prosecution within this period renders the prosecution time-barred.
Final Decision: The Court dismissed the appeal, holding that the prosecution was not sustainable under either Section 45(2)(a) or (b) of the Act and was also barred by limitation under Section 86(3) of the Act.
( 1 ) THIS appeal is directed against the order of acquittal passed by the special First Class Magistrate and the chairman, Industrial Tribunal, Andhra pradesh, Hyderabad, in prosecution s. C. No. 45 of 1979, which was initiated on a complaint by the Employee s State insurance Corporation, Hyderabad, represented by its Inspector, for an offence punishable under Section 85 (g) of the Employees State Insurance Act, 1948. hereinafter be referred to as the act, as the accused is said (o have failed to produce the registers, records of his establishment at the complainant s office by or on or after 6-6-1979.
( 2 ) THE accused has an establishment by name Messrs ajantha Transport (Regd) situated at 15-8-514/2, begum Bazar, Hyderabad. The Inspector visited the establishment of the accused on 4-5-1976 and demanded under Section 45 of the Act to produce the records of the establishment i. e. attendance legister, wage register, cash book, ledger and copies of all the returns to be submitted under the Act and any other documents connected with the payment of wages, salaries etc. , for the last 5 \ years i. e. from 1-3-1974 onwards. But the accused failed to produce tha records and hence the prosecution was launched against him.
( 3 ) IN the enquiry a number of documents were brought on record they are all admitted by the accused. It is useful if they are mentioned herein. The Regional Director addressed a letter dated 5-11-1976 to the accused asking him to prcduce all the records maintained by him at their office within 15 days, The accused gave a reply dated 18-1-1976 to the effect that the Proprietor was out of station and he should wait till his return. Again on 18-1-1977 the Regional Director addressed a letter to the accused requiring him to produce the records of his establishment at the Regional Office within 15 days failing which legal action would be initiated. But the accused did not produce the records. Hence the Inspector of the Corporation visited the establishment of the accused on 17-3-1977 for the inspect; on records but the Manager who was actually present in the establishment, did not produce the records on the grourd that he was busy otherwise and that all the records were dumped in the record room and he would arrange to prcduce them on 30-3-1977. Again on 24 3-1977 the Inspector visited the establishment of the accused. Even then the accused did not produce the records on the ground that the office manager, who was in the custody of the registers, was not present and they would be produced after 11 4-1377. It appears on 27-9-1977 the Inspector again visited the establishment of the accused but the accused did not produce the records. On 27-10-1977 the inspector issued a registered letter informing the accused that the records were not produced when he visited on 13-9-1677, 17-9-1977 and also on 27-9-1977 for examination of all the records. As the records were not produced by the accused before the Inspector on those dates when the Inspector visited the establishment, the accused contravened the provisions of section 45 (2) of Act, and the accused is. therefore, liable for punishment under Section 85 of the Act and before recommending for prosecution another chance was given to the accused to produce the required records and the accused was, therefore, asked to produce the records on 8-11-1977 at 11 a. m. at the office of the Regional director. Inspite of this notice the accused did not produce the records. The Inspector, therefore, wrote to the regional Director to initiate proceedings.
( 4 ) ON the receipt of the report from the Inspector recommending for the prosecution against the accused, the regional Director issued a registered letter dated 17-12-1977 to the accused accused requiring him to produce all the records of his establishment for inspection. Inspite of the said notice from the Regional Director the accused did not produce the records.
( 5 ) AGAIN on 3-5-1978 the Inspector visited the establ
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