JUDGMENT

The present appeal has been filed by the E.S.I Corporation challenging an order passed by the Labour Court, Tirunelveli setting aside the order of the Corporation passed under Section 68 of the E.S.I.Act.

2.The respondent in the appeal is an industry covered under the E.S.I.Act. One Thirupathy Venkatachalapathy joined the petitioner industry on 01.09.2012. The said employee sustained an occupational injury on 15.09.2012 and his fingers were crushed. On 17.09.2012, his name was registered under E.S.I.Act in Forum-12. The E.S.I Corporation had disbursed benefits to the said employee and thereafter, passed the impugned order on 20.04.2015 sanctioning to recover a sum of Rs.4,22,242/- as capitalized value given to the employee.

3.The said order under Section 68 of the E.S.I.Act was challenged by the Management in E.S.I.O.P.No.26 of 2015 on the ground that there was a delay on the side of the employee in furnishing the particulars about his family so as to register his name under E.S.I.Act. The contribution have to be deducted from the employee only by end of the calender month namely on 30th September 2012 and accordingly, the same were deducted. As per Regulation 31, the contribution amount has to be deposited within a period of 21 days from the last day of calender month in which the contribution held due. In the present case, the contribution amount was deposited within the said period of 21 days. Therefore, when the employer was not in default with regard to registration of the employee under E.S.I.Act, the question of recovery of the capitalized value of the benefit given to the employees cannot be recovered from the employers.

4.Per contra, the ESI Corporation had contended that the employer has to register the employee within a period of 10 days from the date of employment under E.S.I.Act. The first subscription amount has been paid only after the date of accident. There is a malafide act on the part of the employer and hence, the Corporation is empowered to collect the capitalized value from the management as per Section 68 of the E.S.I.Act.

5.The Tribunal after oral and documentary evidence came to a conclusion that the subscription had been deposited with the Corporation within a period of 21 days from 30.09.2012 and hence, there is no delay in payment of subscription. When there is no delay in payment of subscription, malafides could not be attributed to the employer. The employee should be considered to be an insured person under the E.S.I.Act. The Tribunal further found that the right of the Corporation to recover the capitalized value arises only when the employer fails or neglects to pay any contribution within the time specified. But in the present case, the subscription amount has been paid within the prescribed time as contemplated under Regulation 31 and therefore, Section 68 of the E.S.I.Act cannot be invoked for recovering the capitalized value. Challenging the said order, the present appeal has been filed by the Corporation.

6.The learned counsel appearing for the appellant had contended that though the employee had joined service on 01.09.2012, his name was not registered immediately with the E.S.I.Corporation. The learned counsel had relied upon Regulation 14 to contend that the declaration form shall be sent by the employers to the appropriate office in Form-III within a period of 10 days from the date on which the particulars of declaration form were furnished. But in the present case, the declaration form has not been submitted by the employer within a period of 10 days from 01.09.2012, but the accident has taken place on 15.09.2012.

7.The learned counsel for the appellant had further contended that the employee was sought to be registered under E.S.I.Act only 2 days after the accident has taken place. The post accident registration can confer certain benefits only upon the employee and hence, the same is recoverable from the employer as contemplated under Section 68 of the E.S.I.Act. He had further