C. CHANDRA MOHAN REDDY Vs. UNION OF INDIA

JUDGEMENT

(1.) This petition is filed by the petitioner to declare the action of the respondents in insisting for payment of Rs.5,46,975.00 from the petitioner under Sec. 45A of the Employees' State Insurance Act (for short 'ESI Act') dtd. 16/3/2016 for the period from 1/4/2011 to 30/6/2015, though it was brought to their notice that the partnership firm was closed in the year 2011 itself, as illegal and arbitrary and to set aside the same.

(2.) Heard the learned counsel for the petitioner and the learned Standing Counsel for the respondents 1 to 4.

(3.) The learned counsel for the petitioner submitted that the petitioner joined in partnership with one P. Praveen Kumar to carry on mechanical, electrical and electronic engineering works in the name of Isha Engineering with effect from 22/2/2008 and entered into partnership deed on the said date. One Mr. P. Srinivasa Rao was looking after the affairs of the partnership firm. The petitioner was only a silent (sleeping) partner. As the firm sustained losses, the partnership was closed in the year 2011. Since then, the petitioner had no contacts with the Managing Partner P. Praveen Kumar Reddy. The impugned order would disclose that the show cause notice was given on 24/11/2015 and on the said date the representative of the firm appeared before the 3rd respondent and informed him that the partnership firm was closed in the year 2011. Despite the same, the 3rd respondent passed the impugned order on 16/3/2016 for payment of contributions totaling to Rs.5,46,975.00 and sought to serve notice on the partners. Only because, the address furnished in the partnership deed as well as ESI registration would contain the residential address of the petitioner, the order was addressed to the petitioner. Though, the said order said to have been passed on 16/3/2016, it was not served on the petitioner. Only on 17/11/2021, when the recovery officer approached the petitioner, the petitioner came to know about the said order and collected a copy of the order from the respondents on 18/11/2021. Immediately, the petitioner brought to the notice of the respondents about the closure of the firm and that the consultant person P. Srinivasa Rao died on 26/1/2017 and he was not aware of the said order and produced bank statement to show that the firm stopped business in the year 2011. Despite bringing the said fact to the notice of the respondents, the respondents were insisting for payment of the said amount. As such the petitioner was constrained to file this Writ Petition.