UNITED BLEACHERS, LTD., COIMBATORE (BY ITS SECRETARY, R VENKATARAMANI) Vs. REGIONAL DIRECTOR, EMPLOYEES STATE INSURANCE CORPORATION

JUDGEMENT

(1.) By the impugned order, the respondent has levied damages against the petitioner in a sum of Rs. 2,00,762 under S. 85B of the Employees' State Insurance Act, 1948 (hereinafter referred to as the Act). There was a show-cause notice issued to the petitioner on 19 Dec. 1978, proposing damages to the tune of Rs. 2,33,885. That was cancelled and a fresh show-cause notice was issued to the petitioner on 20 Dec. 1979, proposing damages to the tune of Rs. 2,58,318. The petitioner on 30 May 1980 offered an explanation to this show-cause notice in the following terms :

(2.) In the impugned order, the basis for levying damages and the dealing of the contentions raised by the petitioner are exposed as follows :

(3.) On the ground that the delay was marginal, the respondent has chosen to waive the proposed damages for certain periods. Even though the delay was negligible, namely, 7 or 8 days, with regard to other periods, yet the respondent has chosen to reduce the proposed damages only by 50 per cent. The plea of non-availability of stamps during 1976, put forth by the petitioner is stated to have been taken note of, while issuing the revised show-cause notice. But a comparative reading of the two show-cause notices discloses that there has been inflation of the proposed damages in the revised show-cause notice for most of the periods in 1976, For periods ended 24 Sept. 1977, 26 Nov. 1977, 28 Jan. 1978 and 25 March 1978, 100 per cent damages have been proposed and imposed and no reason whatsoever has been given for imposing 100 per cent damages. I find that the delay for these periods was not uniform but varying, and the maximum delay was one month and six days for the period ended 24 Sept. 1977. In contrast, for periods of longer delay, 100 per cent damages have not been imposed. No uniform and reasonable ratio has been followed by the respondent in imposing damages, and an element of arbitrariness is apparent on the face of the record. In my view, there has not been also a proper application of the mind on the part of the respondent to the relevant aspects on the question of imposition of damages under S. 85B of the Act, taking note of the principles to govern the same. The provision invoked is penal in nature and the determination is quasi-judicial and it should be done in a judicious manner and not in a casual or arbitrary or summary manner, as has been apparently done in the present case. I can in this connection refer to the following pronouncements :