The brief facts of the case is that M/s Srivilliputhur Co-operative Spinning Mills Ltd, (SCSML for brevity), Srivilliputhur, is covered under the Employees State Insurance Corporation Act, 1948 under code No 57-7545-11 and were required to pay the contributions in accordance with Section 40 of the said Act within the time limit prescribed under the Act. Regulation 31 of the ESI (General) Regulations, 1950 framed under the Act stipulates that an employer is liable to pay the contributions in respect of the employee within 21 days of the last day of the calendar month in which the contributions fall due and to file the returns of contribution within the time stipulated under Regulations 26. The employer is liable to pay interest and damages for any failure to pay the contributions in terms of Regulations 31-A and 31-C of the ESI (General) Regulations 1950, read with Section 39, 40, 41 and 85-B of the ESI Act, 1948.

2. M/s SCSML had failed to pay the contributions in time and a show cause notice dated 06.11.2003 was issued proposing to impose damages amounting to Rs.22,80,493/- for the period 04/1992 to 03/1998 pointing out delay ranging from 93 days to 1623 days. Another not