JUDGMENT - (1) This reference has been made under Section 81 of the Employees State Insurance Act, 1948 by the Employees Insurance Court, Bombay, for the decision of two questions of law. The questions submitted by the Employees Insurance Court are:

"(1) Whether rule 17 of the Employees State Insurance Rules is ultra vires the rule making power of the State Government under Section 96 (1) of the Employees State Insurance Act?

(2) The circumstances which have led to these questions are very simple The Employees State Insurance Corporation (hereinafter referred to as the Corporation) filed an application) in the Employees Insurance Court , Bombay, against the Opponents who are a manufacturing company for the recovery of the employees contributions payable under Employees State Insurance Act, 1948 for the period from 1st September 1957 to 31st July 1963. The application was filed on 7th October 1963. Rule 17 of the Bombay Employees Insurance Courts Rules, 1959 made by the Government of Bombay in exercise of the powers conferred by section 96 (1) of the said Act purports to prescribe, a period of limitation for every application which may be filed in the Employees Insurance Courts. Rule 17 is in these terms:

"17. Limitation: (1) Every application to the Court, shall be brought within twelve months from the date on which the cause of action arose or as the case may be the claim became due:

Provided that the Court may entertain an application after the said period of twelve months if it is satisfied that the applicant had sufficient reasons for not making the application within the said period.

(2) Subject as aforesaid the provisions of Parts II and III of the Indian Limitation Act 1908 (IX of 1908), shall so far as may be apply to every such application."

This rule barred the claim of the Corporation in respect of the contributions which became due more than 12 months before t he date of the application, i.e. prior to 7th October 1962. The Corporation, however, urged that Rule 17 is ultra vires the rule making powers of the State Government under Section 96 of the Act. A rule similar to rule 17 quoted above has been made by other State Governments under Section 96 (1) of the Act, and there is a conflict of decisions on the validity of that rule. In Employees State Insurance Corpn. v. Madhya Pradesh Government, Air 1964 Madh Pra 75 a Division Bench of the Mandhya Pradesh High Court held that Rule 17 of the Madhya Pradesh Rules was outside the rule making power conferred on the State Government by Section 96 (1) and is inconsistent with the provisions of the Act. A corresponding rule made by the Madras Government was held invalid by a Division Bench of the Madras High Court in Solar Works Madras v. Employees State Insurance Corporation, Air 1964 Mad 376. In doing so the Division Bench overruled a previous decision to the contrary of a single Judge of that Court. The same question came up before a Division Bench of the Allahabad High Court in A. K. Brothers v. Employees State Insurance Corporation, Air 1965 All 410. The Division Bench of the Allahabad High Court had before it the aforesaid decision of the Madhya Pradesh High Court, but not the one of the Madras High Court. The Allahabad High Court disagreed with the Madhya Pradesh view and held that the Rule 17 of the U. P. Rules is covered by the rule making power of the State Government. At the time when the present reference was made to this Court by the Employees Insurance Court , Bombay a Division Bench of the Punjab High Court had held that the Corresponding rule made by the Punjab Government was intra vires the Governments powers. Subsequently, however, that view was disapproved and the rules was held ultra vires by a Full Bench of that Court in its decision F. A. F. O. NO. 74 of 1963 Division Bench/- 31-1-1966; (reported in Air 1967 Punj 166 (FB)). The Full Bench of the Punjab High Court had before it the aforesaid decision of the Division Bench of the Allahabad High Court. The pres

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