This Civil Miscellaneous Appeal has been filed against the order, dated 06.09.2012 of the Labour Court (Employee State Insurance Court), Madurai in E.S.I.O.P.No.25 of 2001.

2. The appellant herein is the Employees State Insurance Corporation, arrayed as respondent in E.S.I.O.P.No.25 of 2001, filed by the respondent/employer herein, on the file of the Labour Court, Madurai, designated as Employee State Insurance Court, which allowed the said petition in its order, dated 06.09.2012, setting aside Section 45-A of the order of Corporation, dated 27.08.2000 and also issuance of C-19 Recovery Notice, dated 31.10.2000. The present Civil Miscellaneous Appeal is filed by the ESI Corporation, seeking to set aside the order of the Labour Court (Employee State Insurance Court), Madurai, dated 06.09.2012, passed in ESI.O.P.No.25 of 2001.

3. The admitted case of both sides in ESI.O.P.No.25 of 2001 is as follows:-

(i) The employer/respondent is running a Textile Mill at Palani and covered under the Employees State Insurance Act by assigning Code No.57- 47047-11. Respondent Mill was inspected on 14.12.1995 and 21.12.1995, by the Inspector of ESI Corporation and by spot letter / Ex.P1, dated 21.12.1995 was issued by R.W.1 / ESI Inspector, demanding to pay contributions on 11 items, including contribution on stipend (item 10) and incentives (item 11) for the period from 1992 - 1993 to 1994 - 1995.

(ii) On receipt of the above letter / report, the employer conceded to pay the contribution for items 1 to 9 and disputed the claim of contribution on stipend to the apprentices (item 10) and attendance incentives (item 11) by its letter/Ex.P2. The employer has further stated in Ex.P2 that a case in ESI O.P.No.9 of 1995 is pending on the file of the Labour Court (ESI Court), Madurai, regarding the claim of contribution on 10th Item (stipend to apprentices) and it will be remitted only after the disposal of the said case.

(iii) The ESI Corporation sent C-18 Notice/Ex.P3, dated 08.01.1997, demanding to pay a contributions for the year from 1992-93, 1993 to 1994-1995, totally Rs.96,865/- towards stipend and incentives. Respondent sent a letter / Ex.P4, dated 03.02.1997, reiterating the same objections in respect of contribution on stipend and also incentives, on the basis of the inspection report / Ex.P5, dated 13.05.1997.

(iv) Respondent Mill was demanded to pay contribution on stipend and incentives, for the year 1995-96, by way of C-18 Notice / Ex.P7, dated 26.10.1998, after the letter dated 04.06.1997 / Ex.P6 of the respondent Mill in which also, the respondent is disputing the claim of contribution on stipend and incentives by referring the pendency of ESI O.P.No.9 of 1995 regarding the contribution on stipend and also stated that no contribution need be paid towards incentives, for the year 1995-96.

(v) Both notices, dated 08.01.1997 and 21.10.1998 respectively were taken up for deciding the claim of contribution on stipend and incentives, since no contribution has been paid on the payments. The authorized representative of the employer / respondent was heard on 10.02.1999 and 17.03.1999. On personal hearing, they raised objection regarding the contribution on stipend for earlier periods, since the ESI Court has granted interim injunction in ESI O.P.No.9 of 1995, claiming contribution on stipend.

(vi) On a request made by the employer to defer the question of contribution on apprentice stipend till the disposal of the case in ESI O.P.No.9 of 1995 and on disputing the attendance incentives, the appellant herein/Corporation decided the issue of contribution on incentives alone payable for the period from 04.04.1992 to 3/1996 and directed the respondent Mill to pay the contribution on incentives totally Rs.44,673/- with interest and passed the impugned order under Section 45A of the ESI Act, 1948, on 27.08.2000/Ex.P8 since the contribution on incentives for the year from 04/1992 to 03/1996 as arrived at was not paid by the employer, recovery notice/