MANAGEMENT OF MAGUS CUSTOMER DIALOG PRIVATE LIMITED Vs. DEPUTY DIRECTOR EMPLOYEES STATE INSURANCE CORPORATION

JUDGEMENT

(1.) The Petitioner is an Employer covered by the provisions of Employees State Insurance Corporation Act (for short ESI Act). They have come forward to file the present writ petition, challenging the notice dated 15.4.08/23.4.08 issued by the Respondent.

(2.) By the impugned notice, the Petitioner was directed to cover the conveyance charges paid to the employees for the purpose of calculating the contribution for the period from April 2005 to March 2006. The amount of contribution worked out to Rs. 3,33,820/-. The Petitioner was advised that if the amount is not covered for the purpose of contribution, further proceedings will be initiated for recovering the amount. Before the issuance of notice, the Petitioner was advised by the Regional Office, ESI that an Insurance Inspector on verifying with the records found that a sum ofRs.30,76,627/- was paid during the year 2004-2005 andRs.51,35,697/- was paid during 2005-2006 as salary conveyance. The Petitioner was asked to explain as to the nature of payment and whether it was re-imbursement or for the actual conveyance incurred. The Petitioner was also asked to give supporting documents for the same.

(3.) The Petitioner in response to the said letter took the plea that the conveyance allowance was not covered for the purpose of computing wages in terms of Section 2(22) of the ESI Act. After referring to certain case laws, in paragraph 2 of the reply dated 14.02.2008,they had stated as follows: