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2017 Supreme(Mad) 3073

IN THE HIGH COURT OF JUDICATURE AT MADRAS
M. DURAISWAMY, J.
The Regional Director, ESI Corporation & Others – Appellant
Versus
Sun Global Logistics Pvt. Ltd. & Another – Respondent
C.M.A. No. 1560 of 2015 & M.P. No. 1 of 2015
Decided On : 17-11-2017

Advocates Appeared:
For the Appellants :G. Bharadwaj, Advocate.
For the Respondents:Syed Jaffer Admed, C. Senapathi, Advocates.

Headnote:

Employees State Insurance Act - Section 45 - Insurance - Before communicating the order to the petitioner, the appellant Corporation issued a notice to the Banker - It is the case of the 1st respondent that they filed E.I.O.P - Challenging the order passed determining the contribution - Employees State Insurance Court, Principal Labour Court, granted an order of interim stay and directed the 1st respondent to deposit 25% of the disputed amount and posted the matter - Held, From the judgments relied upon by the learned counsel for the 1st respondent, it is clear that the Authority concerned should give 15 days’ clear notice prior to the recovery of the amount under Rules 2 & 3 of the Second Schedule of the Income Tax Act - In the case on hand, the appellant Corporation has not given any notice to the 1st respondent as contemplated under Rules 2 & 3 of the Second Schedule of the Income Tax Act - Appellant Corporation has not produced any evidence to show that the said notice was given to the 1st respondent complying with the provisions of the Rules - Ratio laid down in the judgments relied upon by the learned counsel for the 1st respondent squarely applies to the facts and circumstances of the present case - Appeal dismissed.

JUDGMENT :

1. The Employees' State Insurance Corporation has filed the above appeal challenging the order passed in I.A.No.237 of 2012 in E.I.O.P.No.66 of 2012 on the file of the Employees' State Insurance Court, Principal Labour Court, Chennai.

2. The 1st respondent filed a petition in I.A.No.237 of 2012 in E.I.O.P.No.66 of 2012 to direct the 3rd respondent to re-transfer the balance amount of Rs.57,089/- to the petitioner's account, after adjusting both the deposit amounts of Rs.16,739/- and Rs.644/-, totalling Rs.17,383/-.

3. It is the case of the 1st respondent that they filed E.I.O.P.No.66 of 2012. Challenging the order dated 21.05.2012 passed under Section 45-A of the Employees' State Insurance Act determining the contribution of Rs.66,955/- for the period from 04/2007 to 03/2011 and another order dated 21.05.2012 passed under Section 45-A of the Employees' State Insurance Act determining contribution of Rs.2,574/- of the period 2009-10. The Employees' State Insurance Court, Principal Labour Court, Chennai granted an order of interim stay and directed the 1st respondent to deposit 25% of the disputed amount on or before 18.10.2012 and posted the matter on 19.10.2012. Before communicating the order to the petitioner, the appellant Corporation issued a notice to the Banker under Section 45-G of the Act on 12.09.2012 and the Banker has transferred an amount of Rs.74,472/- to them, when actually 25% of the amount, which comes to Rs.17,383/-, only was to be transferred. The appellant Corporation had attached the entire contribution amount mentioned in the two orders dated 21.05.2012. In these circumstances, the 1st respondent filed a petition to re-transfer a sum of Rs.57,089/- to their account. The appellant Corporation contended that they have not received any orders from the Labour Court and therefore, the contribution amount transferred to their account is just and legal. The Labour Court, taking into consideration the case of both parties, allowed the application and directed the Corporation to pay Rs.57,089/- from the attached amount of Rs.74,472/- to the petitioner, after adjusting the pre-deposit amount of Rs.17,383/-. Challenging this order, the Corporation has filed the above appeal.

4. Heard Mr.G.Bharadwaj, learned counsel appearing for the appellants, Mr.Syed Jaffer Admed, learned counsel appearing for the 1st respondent and Mr.C.Senapathi, learned counsel appearing for the 2nd respondent.

5. Mr.G.Bharadwaj, learned counsel appearing for the appellant Corporation submitted that since the order passed by the Principal Labour Court was not communicated to the Corporation, the transfer of a sum of Rs.74,472/- from the account of the 1st respondent is just and legal. Further, the learned counsel submitted that under Section 45 - G of the Act, the Corporation has powers to attach the bank account for recovery of dues, notwithstanding the issuance of certificate under Section 45 - C of the Act.

5.1. In support of his contentions, the learned counsel relied upon a judgment of a Division Bench of Jharkhand High Court reported in 2005-II-L.L.J. 916 [Ranchi Refractories Vs. Regional Director, Employees' State Insurance Corporation, Patna and others], which reads as follows:

“A recovery proceeding was initiated against the appellant for the recovery of Rs.89,601/- under the Employees' State Insurance Act, 1948. In execution of the said order, certain attachments were made under Section 45-C of the Act. However, the authority took recourse under Section 45-G of the Act and attached the bank account. The said order of the attachment of bank account was challenged by the appellant in WWJC No.287 of 2001. The learned single Judge dismissed the Writ Petition on February 21, 2003 holding that the respondents were justified in applying Section 45-G of the Act in issuing the order of attachment of bank account.

2. Mr.Rajiv Ranjan, learned counsel appearing on behalf of the appellant assailed the judgment of the learned single Judge on the g























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