ENNORE FOUNDRIES LTD Vs. GOVERNMENT OF INDIA

JUDGEMENT

(1.) SINCE issue raised in these writ petitions is one and the same, they are being disposed of by the following common order. For convenience, I shall refer the case of the petitioner in W. P. No. 5724 of 1998. According to them, the petitioner is a factory situated at Ennore wherein it is engaged in the production of ferrous and non-ferrous castings and employs about 2600 employees. It is covered by the E. S. I. Act in so far as eligible employees are concerned and has all along been making contributions under the Act.

(2.) THE Clause 19 of settlement, dated January 5, 1994, under the provisions of the Industrial Disputes Act between the petitioner and the third respondent-union is to the effect that upon benefits being available under E. S. I. Act, the benefits flowing under the said settlement was stopped. The benefits under that settlement were to be given by the petitioner to its employees in respect of medical reimbursement. Since several of its employees were not covered by the E. S. I. Act consequent to the order of stay by this Court, the petitioner had taken out insurance policies, in respect of coverage for accidents arising out of and in the course of employment which would not have been necessary if the E. S. I. Act was applicable to those employees. With effect from January 1, 1997, the coverage under the Employees' State Insurance Act (in short ESI Act) was increased from Rs. 3,000 monthly salary to Rs. 6,500. While the petitioner herein was ready and willing to comply with the Act, the third respondent-union filed Writ Petition No. 1886 of 1997 before this Court and obtained an interim order in W. M. P. No. 3149 of 1997. The petitioner was restrained from recovering ESI contributions with effect from January 1, 1997 onwards from the employees and staff of the respondent. As a result of these orders made by this Court, the petitioner herein could not recover any contribution from all the employees under the Act. Since the order related to an injunction restraining recovery of E. S. I. contributions for the period from January 1, 1997 onwards from the employees and staff of the petitioner, the management stopped all recoveries with effect from February 1, 1997 from all employees. Because (he ESI Act recoveries had been stayed by this Court, the management continued with its insurance policy premiums in respect of accident arising out of and in the course of employment which would not have been paid if the ESI Act was actually applicable. On this basis, the company had paid out about Rs. 4,16,500 per employee for about 1,700, employees.

(3.) FURTHER, the orders of this Court were made applicable to all employees and staff including employees in the Executive Cadre, covered by the E. S. I. Act, the petitioner-management extended medical reimbursement facilities for the year 1997-98 totalling about Rs. 1,92,000. Ultimately the writ petition was dismissed by this Court on November 21, 1997. Upon the dismissal of that writ petition, the management put up notice, dated December 28, 1997, that it was going to give effect to the E. S. I. Act. Against the orders of dismissal of W. P. No. 1886 of 1997, the employees' union has preferred a writ appeal. In the meanwhile, the union has filed W. P. No. 4186 of 1998 before this Court wherein the prayer is for a writ of mandamus restraining the respondents one of whom the petitioner herein, from demand or deducting ESI contributions from employees and staff of the petitioner with effect from January 1, 1997 to December 31, 1997. Because of orders of this Court made ex parte that the petitioner herein be injuncted from recovering ESI contributions for the period from January 1, 1997 onwards from employees and staff of the petitioner. Now for the same period, if the management is to make payment of its share of the contributions then the management would be put into double jeopardy for no fault of the management. It is now well established in law that no person should be prejudiced by an order of Court and in the present case, now as a result of the dismissal of the writ appeal the petitioner herein if it is asked to pay up contributions under the Act for the period January 1, 1997 to November 30, 1997, it would mean that it has been carefully (sic) prejudiced for no fault of its making but only because the petitioner-union chose to approach this Court challenging extension of coverage under the ESI Act wherein it obtained interim orders restraining payment of contributions from all employees. Presently, the management is covering all its employees under the ESI Act with effect from December 1, 1997 from which period onwards contributions of management and employees have been paid. In such circumstances, the petitioner has prayed for a writ of mandamas restraining the ESI Corporation from making any demands or claims for petitioner's contributions (as employer) under the provisions of the ESI Act in respect of employees covered by that Act for the period January 1, 1997 to November 30, 1997.