The cause of action for contribution arises only after the decision by the Insurance Court in the proceedings under S.75 of the Employees State Insurance Act.

Mohammed, J.

This appeal is directed against the order of the Employees' Insurance Court, Kollam in Insurance Case No. 51 of 1988 dated 9.2.1990. The applicants before the Insurance Court are the appellants before us. Two important questions-one relates to limitation and the other, jurisdiction-are involved in this appeal.

2. The appellants' father one Narayana Pillai was conducting a toddy shop during the period 1978-'80, 1980-'81 and 1981-'82. He expired on 21.7.1982. The E.S.I. Corporation however issued Ext. Al dated 1.11.1988 directing the appellants to pay the alleged arrears of contribution in respect of all employees for the period from I A.1919 to 31.3.1982 under the provisions of the Employees State Insurance Act (for short 'the Act')- It was objected by the appellants and they filed the above case under S.75 of the Act. After the enquiry the E.I. Court found that the Corporation had demanded the contribution without serving any notice or affording opportunity to the appellants to explain their case. Accordingly Ext. Al notice was set aside. The court below further directed the Corporation to pass fresh orders assessing contribution after affording sufficient opportunity to the appellants to explain their case. They being aggrieved by the said order of the court below, have filed this appeal.

3. Let us first examine the question of limitation urged by the appellants. S.77 of the Act, inter alia, provides the period of limitation for filing application before the Employees Insurance Court. The said provision is extracted hereunder:

77. Commencement of proceedings -

(1) The proceedings before an Employees' Insurance Court shall be commenced by application.

(1-A) Every such application shall be made within a period of three years' from the date on which the cause of action arose.

Explanation- For the purpose of this sub-section -

(a) the cause of action in respect of a claim for benefit shall not be deemed to arise unless the insured person or in the case of dependants' benefit, the dependants of the insured person claims or claim that benefit in accordance with the regulations made in that behalf within a period of twelve months after the claim became due or within such further period as the Employees' Insurance Court may allow on grounds which appear it to be reasonable;

(b) the cause of action in respect of a claim by the Corporation for recovering contributions (including interest and damages) from the principal employer shall be deemed to have arisen on the date On which such claim is made by the Corporation for the first time:

Provided that no claim shall be made by the Corporation after five years of the period to which the claim relates;

(c) the cause of action in respect of a claim by the principal employer for recovering contributions from an immediate employer shall not be deemed to arise till the date by which the evidence of contributions having been paid is due to be received by the

Corporation under the regulations.

(2) Every such application shall be in such form and shall contain such particulars and shall be accompanied by such fee, if any, as may be prescribed by rules made by the State Government in consultation with the Corporation.

Sub-s.(1) mandates that the proceedings before the Employees Insurance Court shall be commenced by the application and sub-s.(1A) prescribes that every such application before the court shall be made within a period of three years from the date on which the cause of action arose. Sub-s.(1-A) was incorporated in the main Act by the Employees State Insurance Amendment Act, 1966 (Act 44 of 1966) with effect from 28.1.1968. Explanation (b) was incorporated later by the Employees State Insurance Amendment Act, 1989 (Act 29 of 1989) with effect from 20.10.1989.

4. The cause of action in respect of a claim is the basis for reckoning the period of limitation for filing an application before the E.I. Court under S.77. Clauses (a), (b) and (c) of the Explanation to sub-s.(1-A) of the