REGIONAL DIRECTOR,ESI CORPORATION Vs. ALAGAPPA TEXTILES (COCHIN) MILLS A UNIT OF NATIONAL TEXTILES CORPORATION,( APKK & M) LTD.

JUDGEMENT

(1.) The verdict passed by the Employees Insurance Court in I.C. No. 57/2009 preferred by the respondent employer, setting aside the proceedings of the appellant Corporation demanding contribution and interest for the period from 01.04.1992 to 31.10.1992 (nearly six years after declaration of the legal position by the Apex Court) holding that it is beyond reasonable time, is under challenge in this appeal.

(2.) The respondent is a unit of the National Textile Corporation Limited, Bangalore who in fact is a 'sick company' declared by way of appropriate proceedings, pursuant to the recommendation made by the BIFR, and was in the course of revival steps. The Government of India, as per notification dated 27.03.1992, had amended Rules 50, 51 and 54 of the ESI (Gen.) Rules, 1950 w.e.f. 01.04.1992, whereby the wage ceiling/coverage under the Act came to be raised from Rs.1600/ - to Rs.3000/ - per month. By virtue of the very same amendment, the rate of employers' contribution came to be reduced from 5% to 4% of the wages payable to the employees and the employees' contribution was re -fixed as 1 1/2 %, instead of 2 ¼ %. The amendment was to the chagrin of both the Management and Trade unions, who sought to challenge the same by filing different petitions before this Court. O.P. No. 5743 of 1992 was a petition filed by the Alagappa Textiles Employees Union representing the employees of the establishment and by one employee by name K.R. Gopinathan, wherein an interim order of stay was passed by this Court with regard to the implementation of the notification. The O.P. was finally heard and disposed of by this Court as per common judgment dated 20.10.1992 reported in 1992 (2) KLT 910 [Tata Employees Union Vs. Union of India] repelling the challenge against the amended Rules, however, directing that the same will stand implemented only w.e.f 01.11.1992, instead of 01.04.1992. Pursuant to the said verdict, the amended provisions were implemented and contributions were being made to the extent as specified, raising the wage ceiling upto Rs.3000/ - p.m., w.e.f. 01.11.1992.

(3.) The postponement of the date of implementation ordered by the learned Single Judge was subjected to challenge by the appellant Corporation by filing an appeal. But, interference was declined and the appeal came to be dismissed, which made the Corporation to approach the Apex Court by filing S.L.P. Nos. 18897 ­ 920/1994. After hearing, the Apex Court, as per order dated 21.04.1995, held that the above notification should be implemented w.e.f 01.04.1992 itself.