IMPORTANT POINTS
The word “discretion” standing single and unsupported by circumstances signifies exercise of judgment, skill or wisdom as distinguished from folly, unthinking or haste; evidently therefore a discretion cannot be arbitrary but must be a result of judicial thinking. The word in itself implies vigilant circumspection and care; therefore, where the legislature concedes discretion it also imposes a heavy responsibility. “The discretion of a judge is the law of tyrants; it is always unknown. It is different in different men. It is casual, and depends upon constitution, temper and passion. In the best it is often times caprice; in the worst it is every vice, folly, and passion to which human nature is liable.

JUDGMENT :

The Employees’ State Insurance Corporation through its Deputy Director and Recovery Officer has preferred this Original Petition assailing the interim order passed by the Employees' Insurance Court, Thiruvananthapuram in I.C.No.42 of 2018.

2. The petitioners herein are the opposite parties in the above Insurance Case, which was instituted by the 1st respondent herein challenging the recovery notice issued by the petitioners for recovering the dues to the Corporation for the period upto 10/2014 to the tune of Rs.20,02,684/-.

3. It is the case of the petitioners that the 1st respondent had filed the above case by suppressing the fact that the previously instituted cases challenging the coverage of his establishment were dismissed by the Insurance Court.

4. When the case came up for admission before the Employees’ Insurance Court, Thiruvananthapuram, the following ex parte order was passed:

“ORDER

Heard Counsel for petitioner. Stay granted as prayed till the final disposal of the case.”

5. It is contended that the procedure adopted by the Insurance Court is violative of Section 75(2B) of the ESI Act, which mandates pre-deposit of 50% of the amount due from the employer to the Corporation to be deposited by the 1st respondent. It is further contended by referring to Ext.P1 order that the petitioners herein were not even heard before passing the interim order. The failure of the court to assign reasons in writing before waiving or reducing the pre-deposit is also highlighted by the learned counsel to bring home his point that the interim order passed by the Insurance Court is perverse and is liable to be interfered with. The counsel has also produced Ext.P7 series of orders passed by the Insurance Court in similar fashion to bring home his point that the court has been acting irrationally and arbitrarily according to its whims.

6. I have heard Sri.Adarsh Kumar, the learned Standing Counsel appearing for the petitioners and Sri.K.B.Pradeep, the learned counsel appearing for the respondents.

7. To understand the significance of the contention raised by the petitioners, it would be apposite to take note of the statutory prescription in the ESI Act. Section 75 of the Act reads as follows:-

“75. Matters to be decided by Employees' Insurance Court.

(1) If any question or dispute arises as to

(a) xxxxx xxxxx

xxxxx xxxxx

(2) xxxxx xxxxxx

(2A) xxxxx xxxxxx

(2B) No matter which is in dispute between a principal employer and the Corporation in respect of any contribution or any other dues shall be raised by the principal employer in the Employees' Insurance Court unless he has deposited with the Court fifty per cent. of the amount due from him as claimed by the Corporation.

Provided that the Court may, for reasons to be recorded in writing, waive or reduce the amount to be deposited under this sub-section.”

8. Sub-section (2B) of Section 75 of the ESI Act, 1948, which is the bone of contention in this petition, provides that unless the principal employer deposits with the Insurance Court 50% of the amount due as claimed by the Corporation, he will not be entitled to raise a dispute challenging the action taken by the Corporation. The proviso, however, enables the court to waive or reduce the amount to be deposited under section 75 (2B) on condition that adequate reasons to be recorded in writing is given by the court for exercising the said discretion.

9. It is luculent from the statutory provision that the Insurance Courtis bound to insist that the principal employer deposits 50% of the amount unless for exceptional reasons which are to be recorded in writing, the court chooses to exercise its discretion and altogether waives the pre-deposit or reduce the same. In the case on hand, the Insurance Court has chosen to take the easier path. A perfunctory and non speaking one line order has been passed staying the entire proceedings until the disposal of the case. Ext.P7 series of orders also make it clear that similar orders are passed in other cases