R. JAYASIMHA BABU, J.

The appellant before us who is an employer filed an application before the E.S.I. Court for a declaration that the HRA and conveyance allowance are not 'wages' within the meaning of Section 2(22) of the Employees State Insurance Act, 1948, and that the claim made for contribution in respect of house rent assistance and conveyance allowance from July 1981 is illegal. The appellant is the owner of the Taj Coromandel Hotel which commenced its operation with effect from April 1, 1974. By a notification dated December 22, 1976, issued by the Government of Tamil Nadu, the application of the Employees' State Insurance Act was extended to wages and the contributions cannot be claimed in respect of those two items.

The appellants application was allowed by the E.I. Court. The order of the Court having been challenged by the Corporation, the appeal of the Corporation has been allowed by a learned single Judge. The appellant being aggrieved is now before us, in this appeal.

It was contended by the learned counsel for the appellant that the house rent allowance is not 'wages' as the workmen and the employer have agreed not to treat it as wages for the purpose of calculating the wages under Section 2(22) of the ESI Act.

It was submitted by the counsel for the appellant that in view of the clause in the agreement, providing for exclusion of house rent allowance and conveyance allowance from the calculation of wages for the purpose of ESI Act, the contribution cannot be claimed in respect of those items. In respect of conveyance allowance it was further contended that having regard to the exclusion of the definition of 'wages' in Section 2(22) of the ESI Act, "any travelling allowance or the value of the travelling concession" the conveyance allowance which is in the nature of travelling allowance or concession cannot be included in the computation of wages.The argument that the employer and workmen can contract out of the provisions of the ESI Act is wholly an untenable argument. The Employees' State Insurance Act was enacted with a view to provide certain benefits to the employees in case of sickness, maternity, injury as also to make provision for certain other matters in relation thereto. The Act contemplates contribution being made by the employees and employer based on the wages paid to employees to a fund from out of which facilities required to be provided under the Act, to the workmen eligible to claim such benefits, are to be provided. The Act does not contemplate and no employer or workman has a right to insist that he be given benefits in direct proportion to the amount of contribution paid or that in the event of facility not being utilised the contribution will not be collected and if collected is to be refunded. All the contributions made by all the employees and or workmen governed by this Act go into a common pool from out of which facilities and benefits are provided to those eligible for the same. Needless to say, the persons who come forward to avail of the facilities, the facilities are made available. There is however no insistence that facilities must be availed. The employee or employer however has no option in the matter of payment of contribution. Neither can withhold the amount on the ground that he does not wish to avail the facilities provided under the Act.

There is no doubt at all in this case that the terms of the employment does contemplate and require the employer to pay HRA and conveyance allowance. The very settlement relied upon by the employer obliges the employer to make such payment. It creates a right in the employee to insist on the payment being made. It cannot therefore be said that HRA and conveyance allowances are not amounts which are required to be paid in terms of the contract of employment. They are clearly wages required to be paid having regard to the terms of employment.Even if these HRA and conveyance allowance had not been made, specific term in the contract