1 2025:CGHC:52498 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR MA No. 46 of 2016 M/s Harish Industries Proprietor Heeranand Bajaj S/o Lachchhiram, Industrial Area, Tifra, Bilaspur, Chhattisgarh. --- Appellant. versus 1 - Employees State Insurance Corporation, Through Regional Director, Employees State Insurance Corporation, 18 South Avenue, Chowbey Colony, Raipur, Chhattisgarh. 2 - Recovery Officer, Employees State Insurance Corporation, 18 South Avenue, Chowbey Colony, Raipur, Chhattisgarh. --- Respondents. MA No. 47 of 2016 M/s Harish Industries Proprietor Heeranand Bajaj S/o Lachchhiram, Industrial Area, Tifra, Bilaspur, Chhattisgarh. ---Appellant. Versus Employees State Insurance Corporation , Through Regional Director, Employees State Insurance Corporation, Nanda Nagar, Indore M.P. --- Respondent. AVINASH SHARMA Digitally signed by AVINASH SHARMA Date: 2025.10.29 15:18:02 +0530 2 For Appellant : Shri Vinod Deshmukh, Advocate. For Respondent : Shri Pranav Saksena appears on behalf of Shri Pradeep Saksena, Advocates. Hon'ble Shri Justice Deepak Kumar Tiwari Order on Board 28/10/2025 1. Since these two Appeals filed under Section 82 of the Employees’ State Insurance Act, 1948 (hereinafter “the Act, 1948”) involve common question of law, they are being decided by this common order. 2. Both the Appeals were admitted on 01.12.2016 on the following substantial question of law:- “Whether the court below erred for not appreciating the directions of this Court in MA No.1181/1998 dated 21.08.2013?” 3. In the first round of litigation, Employees State Insurance Corporation had challenged the order dated 31.07.1998 passed by the Judge, under the ESI Act, Labour Court, Bilaspur in Case No.1 ESI Act/96 whereby, the Authority has exonerated the appellant herein from payment of contribution towards insurance on the ground that appellant-Institution do not fall within the ambit of the ESI Act. In the said appeal, an argument had been advanced by the Corporation that the appellant concern itself has submitted an application for registration of institution under the Act, 1948, in which, it has been specifically mentioned that number of employees are 9 + 3 (in para 11 of the Form), to whom wages were required to be paid, which shows that more than 10 employees were working in the institution, therefore, the appellant was under 3 obligation to pay contribution for the insurance of their employees, but it has failed to pay, so notice has been served. 4. 4. This Court, while considering that both the parties and the Authority below have not considered the two distinct entry made in Para 8 (d) and para 11 (a) of the Form (Ex.D/1), remanded the matter back to the Authority below for providing an opportunity to explain and to produce evidence. Thereafter, an order was passed in Case No.39/ESI Act/ 2013 and Case No.181/ESI Act/2006 separately dated 16.05.2016 whereby, it has been held by the learned Judge, Employees Insurance Court, Bilaspur (C.G.) that the provisions of the Act, 1948 attract to the appellant concern. Against which, these two different Appeals have been filed. 5. Learned counsel for the appellant-Industry submits that findings recorded by the authority under the ESI Act is perverse to the record and the Corporation has failed to establish that the appellant has engaged more than 10 employees in its industry, therefore, the provisions of the Act is not applicable as the appellant has duly produced the Attendance Register to demonstrate the fact that, at no point of time, employees more than 10 in number, were engaged in the Industry and he prays to allow the Appeals. 6. On the other hand, learned counsel for the Respondent-Corporation would submit that as one of the partners has duly filled the Form, wherein, he has mentioned the details of the employees as 9+3, so the provisions of the Act, 1948 duly attract and the same has rightly been decided by the learned Employees Insurance Court. He submits that the 4 said finding of fact can not be disturbed in instant Appeals. He would place reliance on the judgment passed in the matter of Jain Plaster and Minerals Vs. Regional Director, Employees’ State Insurance Corporation and Another in C.M.A. No.60 of 1995 {(2002) 3 LLJ 141}, decided on 27.08.2001. 7. I have heard learned counsel for the parties and perused the documents annexed with the Appeals with utmost circumspection. 8. Perusal of statement of one of the partners namely Heeranand of the appellant concern, in both the cases, would show that, at no point of time, there were engagement of more than 10 employees in the concern. In the cross-examination, the said fact remained unrebutted. The Corporation has examined one of the Branch Managers namely Smt. Alka Jawalkar, who was not the member of the Inspection team and she has deposed and referred to Ex.D/2 as the said Form has been filled up by the employer himself. Materially, the entry of Ex.D/2 is under challenge, so the Corporation is under the obligation to explain on what basis, it has reached to the conclusion that there are more than 10 employees. 9. Section 45 of the Act, 1948 deals with the duties of the Social Security Officers and to ascertain any such findings. The concerned officer has a duty to inspect and examine relevant accounts, books and other documents relating to the employment of person and payment of wages and also issue notice to furnish information with such regard. Further, the said provision also enables the said Officer to examine the concerned employee, but no such duties have been fulfilled/performed 5 by the concerned Officer of the Corporation. For the sake of brevity, Section 45 reads thus:- “45. Social Security Officers, their functions and duties. (1) The Corporation may appoint such persons as Social Security Officers, as it thinks fit, for the purposes of this Act, within such local limits as it may assign to them. (2) Any Social Security Officer appointed by the Corporation under sub-section (1) (hereinafter referred to as Social Security Officer), or other official of the Corporation authorised in this behalf by it, may, for the purposes of enquiring into the correctness of any of the particulars stated in any return referred to in section 44 or for the purpose of ascertaining whether any of the provisions of this Act has been complied with (a) require any principal or immediate employer to furnish to him such information as he may consider necessary for the purposes of this Act; or (b) at any reasonable time enter any office, establishment, factory or other premises occupied by such principal or immediate employer and require any person found in charge thereof to produce to such Social Security Officer or other official and allow him to examine such accounts, books and other documents relating to the employment of persons and payment of wages or to furnish to him such information as he may consider necessary; or (c) examine, with respect to any matter relevant to the purposes aforesaid, the principal or immediate 6 employer, his agent or servant, or any person found in such factory, establishment, office or other premises, or any person whom the said Social Security Officer or other official has reasonable cause to believe to be or to have been an employee; (d) make copies of, or take extracts from, any register, account book or other document maintained in such factory, establishment, office or other premises; (e) exercise such other powers as may be prescribed. (3) An Social Security Officer shall exercise such functions and perform such duties as may be authorised by the Corporation or as may be specified in the regulations. (4) Any officer of the Corporation authorised in this behalf by it may, carry out re-inspection or test inspection of the records and returns submitted under section 44 for the purpose of verifying the correctness and quality of the inspection carried out by a Social Security Officer.” 10. In view of the aforesaid legal principles and after minutely examining the evidence, this Court is of the view that there is no clinching or cogent evidence to establish the fact that at the time of inspection, there were more than 10 number of employees in the Factory so as to attract the provisions of Act, 1948. 11.In the matter of Jain Plaster (supra), a list has been attached, but in the present case, no such list has been collected by the Social Security Officer during inspection and as such, case law referred by learned counsel for the Respondent-Corporation is distinguishable on facts. 7 12.For the foregoing, both the Appeals deserve to be and are hereby allowed. Impugned orders dated 16.05.2016 passed in Case No.181/ESI Act/2006 and in Case No.39/ESI Act/ 2013 by the Employees Insurance Court are set aside. Sd/- (Deepak Kumar Tiwari) Judge Avinash