REGIONAL DIRECTOR E.S.I. CORPORATION Vs. MANAGEMENT OF ALBUQUERQUE & SONS

JUDGEMENT

(1.) THE order of the Presiding Officer, Labour Court -cum -ESI Court, Mangalore in ESI Application No. 13/2002 filed under Section 75 of the Employees' State Insurance Act, 1948 ('ESI Act' for short) is called in question in this appeal.

(2.) THE respondent is Tiles manufacturing industry and the same is covered under the ESI Act. The respondent establishment is paying contribution on the wages of its employees. The Insurance Inspector of the Corporation visited the establishment of the respondent on 13.1.1999 and 14.1.1999 and served the observation slip indicating various expenditures incurred by the establishment under different heads, treating them as 'wages' and calling upon the respondent to pay the contribution on the amount covered under those heads. The respondent questioned the observation slip. Based on the report of the Inspector, the ESI Corporation called upon the respondent establishment to pay contribution on the ground that they have omitted to pay the contribution. Against the order of the ESI Corporation, the respondent approached the Regional Director praying for setting aside the order dated 22.3.2001 passed by the Deputy Director of ESI Corporation under Section 45 -A of the ESI Act directing the respondent to pay the contribution amount of Rs. 2,30,475/ -. They have also sought for setting aside the subsequent notice issued by the Corporation calling upon the respondent to pay Rs. 2,84,716/ -, which is inclusive of interest. Ultimately, the respondent approached the ESI Court for setting aside the order passed by the Corporation. At an earlier point of time, an order came to be passed by the ESI Court allowing the application filed by the respondent under Section 75 of the ESI Act and set aside the order dated 22.3.2001 passed under Section 45 -A of the ESI Act. Aggrieved by the same, the Corporation preferred an appeal before this Court in MFA No. 2235/2005 which came to be allowed in part. This Court in the said MFA confirmed the said order in respect of consultation charges paid to the Auditor, firewood and clay unloading charges. However, this Court remanded the matter to the ESI Court for reconsideration regarding the liability of the respondent to pay contribution in respect of the (a) production bonus; (b) repair and maintenance charges; (c) wages and salary account. After remand, none of the parties lead their evidence. They argued their case based on the material available on record. The ESI Court once again concluded against the ESI Corporation by holding that the respondent is not liable to pay contribution in respect of the amount involved in production bonus, repair & maintenance charges, wages, salary etc., The said order is called in question in this writ petition.

(3.) IN the matter on hand, admittedly the repairs and maintenance items consisted of building, electrical, ceramics and machinery. The repair of those involve skilled and technical work. The respondent's main avocation is manufacture of tiles. Naturally respondent will have to get the repair works done from the outside contractors with whom skilled workers are available. If the respondent was engaged in primary business of repair and maintenance of buildings, electrical, ceramics, machinery etc., then the contention of the appellants would have been accepted and the respondent would have been liable to make contribution. In the instant case, admittedly the repair and maintenance work was got done by the respondent through outside contractor. The respondent did not have direct control or supervision over the said repair and maintenance work. On the other hand, the Contractor who had undertaken the said work of repair and maintenance has control and supervision over his workers. Therefore the respondent is not liable to contribute in respect of repair and maintenance charges.