Premature initiation of certificate proceeding under Section 45A of the Employees' State Insurance Act and the requirement for cooperation of the petitioner in determining the contribution payable.

JUDGMENT

Indrajit Mohanty, J.

1. Heard S. Mishra, learned Counsel for the petitioner-Orissa Olympic Association and P.P. Ray, learned Counsel for Employees’ State Insurance Corporation.

2. The learned Counsel for the petitioner submits that petitioner-Association is a registered society in the name and style Orissa Olympic Association. This writ petition has been filed, inter alia, challenging Annexure-4, which is an intimation initiating a certificate proceeding. Further prayer of the petitioner is for a direction to the State to consider its application for granting exemption from the purview of the coverage of the Employees’ State Insurance Act, 1948 (hereinafter referred to as the "Act"). Application for the said purpose has been submitted by the petitioner since February, 2005.

3. Learned Counsel for the petitioner further submits that the impugned certificate proceeding under Annexure-4 is without jurisdiction, inasmuch as, no certificate proceeding should have been initiated without first determining the contribution required to be deposited in terms of Section 45A of the Act. He further submits that although a proceeding, under Section 45A of the Act has been initiated, no final order has yet been passed and therefore, without first determining the contribution required to be deposited as required under Section 45A of the Act, no certificate proceeding to enforce any demand could have been initiated.

4. Ray, learned Counsel for the Employees State Insurance Corporation (in short "Corporation") fairly admits that the final orders in the proceeding initiated against the petitioner under Section 45A of the Act have not yet been passed. But the delay in disposal is due to the non-co-operation of the petitioner. The petitioner has not produced the necessary registers, books of accounts etc. Ray further submits that the quantum of demand in the certificate proceeding is based only on the statements made by the officers and staff of the petitioner-Association.

5. Section 45A of the ESI Act, 1948 reads as follows:

45A. Determination of contributions in certain cases.-(1) Where in respect of a factory or establishment no returns, particulars, registers or records are submitted, furnished or maintained in accordance with the provisions of Section 44 or any Inspector or other official of the Corporation referred to in Sub-section (2) of Section 45 is (prevented in any mariner) by the principal or immediate employer or any other person, in exercising his functions or discharging his duties under Section 45, the Corporation may, on the basis of information available to it, by order, determine the amount of contributions payable in respect of the employees of that factory or establishment:

(Provided that no such order shall be passed by the Corporation unless the principal or immediate employer or the person in charge of the factory or establishment has been given a reasonable opportunity of being heard.)

(2) An order made by the Corporation under Sub-section (1) shall be sufficient proof of the claim of the Corporation under Section 75 or for recovery of the amount determined by such order as an arrear of land revenue under Section 45B (or the recovery under Sections 45-C to 45-1).

6. As stipulated hereinabove, the proviso to Section 45A of the Act stipulates that no order determining the amount of contribution payable in respect of the employees shall be passed by the corporation unless the employer has been given a reasonable opportunity of being heard. Sub-section (2) of Section 45A of the Act further clarifies that an order of the Corporation under Sub-section (1) shall be sufficient proof of the claim of the Corporation under Section 75 or for recovery of the amount determined by such order as an arrear of land revenue under Section 45B or recovery under Sections 45-C to 45-1.

7. On a plain reading of the aforesaid provisions of law it is clear that there has to first be a determination of the amount of contribution payable in respect of