(Petition under Art.226 of the Constitution of India, praying for a Writ of Certiorari and call for the records connected with the order No.TN/INS.II 51-4766-21 dated 8-3-1993 on the file of the respondent ESI Corporation and quash the same.)

Elipe Dharma Rao, J.

On an order of reference dated 11-04-2000 passed by a learned single Judge in the above writ petition, the matter is placed before us for consideration of the following issue:

"Whether in an enquiry initiated under Sec.45-A of the Employees State Insurance Act, the contractors of the principal employer should be made as parties or not?"

2. The reference arose under the following fact situation:

Employees State Insurance Corporation (in short ESI Corporation') issued a notice dated 3-9-1992 to Bharat Heavy Electricals Limited (in short 'BHEL') pointing out that they had not till then paid the employer's as well as the employees' contribution as per the provisions of the Employees State Insurance Corporation Act (in short 'the Act') and that the Corporation is proposing to determine the contribution payable under Sec.45-A of the Act. The notice also afforded an opportunity to BHEL to explain their stand. The notice also made clear that in the event of any explanation not forthcoming from BHEL, then the Corporation will proceed with the case on merits and an order would be passed under Sec.45-A of the Act. The period of claim was shown to be 19-7-1981 till 30-9-1991.

2.1 BHEL, on receipt of the said notice, instead of filing their explanation had filed a petition before the authority concerned to implead the contractors named in the annexure to the affidavit filed in support of the petition stating that in their absence it will not be possible for them to submit an effective explanation. The petition for impleadment was dismissed by order dated 8-3-1993 stating that impleadment was not necessary. The order further stated that it was always open to the BHEL to bring those contractors with them to explain their stand. Assailing the said order, BHEL had filed W.P. No.5030 of 1993. The said writ petition was admitted and interim relief was also granted.

2.2 Before the learned single Judge, learned counsel for the petitioner vehemently relied upon a judgment of this Court in MADRAS GYMKHANA CLUB v. E.S.I. CORPORATION (1990-2-LLN 777) and contended that impleading of the contractors is permissible. It was also contended that the respondent authority was exercising quasi-judicial function under the Act and, therefore, the proceedings are also governed by the principles of natural justice. The enquiry to be conducted against the writ petitioner in the absence of their contractors would amount to denying them a reasonable and effective opportunity and therefore the authority went wrong in rejecting the request.

2.3 On the other hand, learned counsel appearing for the Corporation contended that there was no privity between the Corporation and the contractors and that the Act does not recognise a situation of hearing the contractors of the writ petitioners before the writ petitioner's liability was determined. Learned counsel in support of his contention, relied upon the decision in EMPLOYEES' STATE INSURANCE CORPORATION v. M/s. HARRISON MALAYALAM PVT. LTD. (AIR 1993 SC 2655).

2.4 Learned single Judge after hearing the rival contentions of the parties and on perusal of the entire material made available on record, was of the view that the question whether in an enquiry initiated under Sec.45-A of the E.S.I. Act the contractors of the principal employer should be made as parties or not appears to be covered by the judgment of this Court in Gymkhana Club Case, cited supra, in favour of the principal employer, i.e. BHEL. Learned Judge further observed that the judgment in Gymkhana Club Case, cited supra, was rendered solely on the basis of the judgment of the Hon'ble Supreme Court of India in FOOD CORPORATION OF INDIA v. PROVIDENT FUND COMMISSIONER AND OTHERS (1990 (1) SCC 68), w