Judgment :-

H.L. Dattu, J.

1) These appeals are directed against the judgment and order passed by the High Court of Karnataka at Bangalore, in Misc. First Appeal No.4152 of 2001 and Misc. First Appeal No.1954 of 2002 dated 17.07.2003.

2) Briefly stated the facts are as follows:-

The appellant in Misc. First Appeal is a proprietorship concern and is engaged in the activity of making and selling coffee, tea and other beverages, and also sweets and savories. It is registered under Shops and Commercial Establishments Act. Sometime in the year 1997 and 1998, the appellant had purchased a bottle cooler and also a coffee roaster. According to the appellant, even after such purchase, it had not employed more than 10 or more employees.

3) The appellant also states, that power is being used for operating coffee roaster and bottle cooler. It is its further case, that, since it has not employed 10 or more employees, the provisions of the Employees State Insurance Act, 1948 (hereinafter referred to as `ESI Act) are not attracted to the appellants establishment.

4) The insurance inspector of the ESI corporation had visited the business premises of the appellant on 11.12.1998 and 07.01.1999, and inspected the records from April 1994 and had recorded that the appellant had employed more than 10 employees as on 01.04.1994, as per the records and was using power for the coffee roasting machine and the bottle cooler and as such the appellants restaurant stood covered under the ESI Act with effect from 01.04.1994, and therefore, the appellant should have started complying with the mandatory provisions of ESI Act.

5) The Deputy Director of ESI corporation, by incorporating the report of the insurance inspector by his letter dated 18.02.1999, had directed the appellant to pay contributions from April, 1994, and submit Form-01 at the earliest. In response to the aforesaid letter, the appellant by its reply letter dated 08.03.1999, had brought to the notice of the Deputy Director of the Corporation, that, after purchase of bottle cooler and coffee roaster, had not employed more than 10 employees and, therefore, they are not covered under the provisions of the ESI Act and, therefore, they are not obliged to pay any contribution under the ESI Act.

6) The Deputy Director of the Corporation by his subsequent letter dated 09.04.1999, had informed the appellant, that, on verification of the records produced before the insurance inspector, it was observed that the appellant is using LPG gas for preparation of coffee, tea and other beverages and, therefore, covered under the ESI Act and therefore, appellant has to comply with the statutory provisions of ESI Act, failing which contributions would be recovered by resorting to coercive measures as provided under the ESI Act. The proposal so made was objected to by the appellant, inter-alia, contending that the use of LPG gas cannot be equated with the use of power and as per the provisions of the ESI Act, it is only when electric power is used in manufacturing process with 10 or more employees, then alone ESI Act could be made applicable and, therefore, requested the authorities to drop the proceedings, as proposed in their letter dated 09.04.1999.

7) Since the explanation offered by the appellant was not satisfactory, the authorities under the ESI Act, issued a demand notice, inter-alia directing the appellant to pay contribution for the entire period, i.e. from April, 1994 till the date of inspection. Since the appellant did not comply with the demand so made, the Deputy Director of ESI Corporation, passed an order under Section 45-A of the ESI Act, ordering the payment of contribution under the ESI Act for the aforesaid period.

8) The appellant, being aggrieved by the aforesaid order, had filed an appeal before the ESI Court and Additional Industrial Tribunal, Bangalore, as provided under Section 75 of the ESI Act. The ESI Court dismissed the application/appeal, on the ground that use of LPG gas also amounts