The definition of 'wages' under the Employees State Insurance Act restricts liability for contributions to amounts explicitly categorized as wages, emphasizing the need for statutory authorities to substantiate claims with credible evidence.

JUDGMENT :

RAMACHANDRA D. HUDDAR, J.

1. This Miscellaneous First Appeal is preferred by the Employees State Insurance Corporation (hereinafter referred to as the appellant or "ESI Corporation") under Section 82 (2) of the Employees State Insurance Act, 1948, (hereinafter referred to as "the Act") challenging the legality and correctness of the order dated 04.06.2015, passed by the Employees Insurance Court at Mysore in ESI Application No.08/2009. By the said order, the ESI Court allowed the application filed under Section 75 of the Act by M/s Bhima and Brothers Jewellers, (hereinafter referred to as "respondent") and set aside the contribution demand of Rs.77,139/- raised by the appellant under Section 45 -A of the Act.

2. The facts leading to the appeal, in brief, are that:

The respondent is the Registered Commercial Establishment carrying on the business of gold jewellery and covered under the provisions of the ESI Act. The premises were inspected by Insurance Inspector on 26.08.2008, who alleged that the respondent had failed to pay contributions on various components of salary and expenses for the year 2002-03. Based on the Inspection Report, a show cause notice was issued by the Corporation, culminating in the passing of an order dated 10.07.2009 under Section 45 -A of the Act, demanding Rs.77,139/- as a contribution on so called committed wages. The respondent, aggrieved by this order initiated proceedings before the ESI Court under Section 75 of the Act.

3. The learned ESI Court, after recording the evidence of both the sides and considering the documents placed on record, found that the impugned contribution demand was unsustainable and accordingly set aside the order passed by the Corporation. Aggrieved by the same, the Corporation has filed the present appeal.

4. Learned counsel for the appellant contended that, the Court below failed to properly appreciate the statutory presumption under Section 45 -A(2) of the Act which mandates that, the order passed by the Competent Authority is sufficient proof of dues unless rebutted by the employer. It was submitted that, the respondent had failed to produce comprehensive documentary evidence such as ledger accounts, cash books, invoices or employee's registers to rebut the Corporation's claims. The appellant contended that, the Court erred in relying primarily on oral testimony and selectively marked documents, which were insufficient to rebut the statutory findings. Reiterating the grounds urged in the appeal memo and also the documentary evidence, so also oral evidence adduced by the Corporation, it is prayed by the counsel for the appellant to allow this appeal and set aside the impugned order.

5. Per contra, the learned counsel appearing for the respondent supported the order of the Court below and submitted that, the Corporation had acted mechanically and arbitrarily in demanding the contribution on the amounts that clearly did not fall within the definition of "Wages" under Section 2 (22) of the Act. It was argued that, several payments included by the Corporation, such as bonus, ex-gratia, charges to security agencies, repair and maintenance costs, and payments to unrelated vendors, were not liable to attract contribution. It was further contented that, there was no nexus or financial and functional integration between Bhima & Brothers Jewellers and Bhima & Brothers Diamonds, and the Corporation had wrongly aggregated transactions of the two independent entities. He further submits that, in view of the circulars issued dated 28.01.2020, the employer is not supposed to keep the records for more than 5 years.

6. Having heard the respective counsels and having perus