1 APHC010373242005 IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI (Special Original Jurisdiction) [3603] WEDNESDAY, THE 15th DAY OF JULY 2026 PRESENT THE HONOURABLE SRI JUSTICE D RAMESH THE HONOURABLE SRI JUSTICE ALAPATI GIRIDHAR CIVIL MISCELLANEOUS APPEAL NO: 945/2005 Between: 1. THE STATE OF A.P. HYDERABAD, HYDERABAD SECRETARY THE SECRETARY TO GOVERNMENT, THE STATE OF ANDHRA PRADESH, HEALTH & MEDICAL FAMILY WELFARE DEPARTMENT, ...APPELLANT AND 1. M/S COROMANDAL CEMENT FACTORY EMPLOYEES 2 OTHERS, (REGD. NO. E-435), REP. BY ITS GENL. SEC.,S. SRINIVASA REDDY CHILAMAKUR - 516 310. CUDDAPAH DISTRICT. 2. EMPLOYEES STATE INSURANCE CORPORATION, HYDERABAD REGIONAL DIRECTOR THE REGIONAL DIRECTOR, EMPLOYEES STATE INSURANCE CORPORATION, 5-9-23, HILL FORT ROAD, 3. INDIA CEMENTS LIMITED, CUDDAPAH GENERAL MANAGER THE GENERAL MANAGER, INDIA CEMENTS LIMITED, CHILAMKUR - 516 310, ...RESPONDENT(S): 2 Counsel for the Appellant: 1. GP FOR ARBITRATION Counsel for the Respondent(S): 1. CKR ASSOCIATES 2. U.R.P. SRINIVAS 3. ELEVATED AS JUDGE The Court made the following: 3 THE HONOURABLE SRI JUSTICE D.RAMESH THE HONOURABLE SRI JUSTICE ALAPATI GIRIDHAR CIVIL MISCELLANEOUS APPEAL No.945 of 2005 JUDGMENT: (Per Hon‟ble Sri Justice D.Ramesh) The present appeal is filed by the State aggrieved by the orders dated 20.12.2002 passed in E.I.Case No.107 of 2001 by the Employees Insurance Court and Chairman, Industrial Tribunal-I, A.P., Hyderabad (for short, „the Tribunal‟), wherein the Tribunal allowed the petition filed by the Coromandal Cement Factory Employees Union, the 1st respondent herein. 2. Heard learned Government Pleader for Arbitration appearing for the appellant and learned counsel for the respondents. 3. The Tribunal allowed E.I.Case No.107 of 2001 with the following observations: “It is significant to note that none of the employees unions of the third respondent factory on employees individually came forward to give evidence in support of the second respondent corporation that the benefits under the ESI scheme are far superior to the benefits, the third respondent has been extending to its employees. If really 4 the benefits provided by the third respondent factory to its employees are far inferior to the benefits under the ESI scheme, the employees would have supported the corporation and agitated for the benefits under ESI scheme. From this fact it is also clear that the employees are not satisfied with the benefits extended to them by the corporation, under ESI scheme. Further, the Govt., when having satisfied about the facilities provided by the third respondent factory on merits till 28-2-2001, no reason is assigned as to why the subsequent period cannot be considered for exemption of the third respondent from the ESI Act. In view of the facts and circumstances and the evidence discussed above I have no hesitation to hold that the medical benefits and other benefits being provided by the third respondent factory are far superior to the benefits available under the ESI Act and the scheme there under. The rejection of exemption as per G.O.Rt.No.1043 Dt 17-11-2000 is not true and justified. Hence these two issues are answered accordingly in favour of the petition and the third respondent and against the respondent No.1 and 2. 39. In the result the petition is allowed declaring that the employees of the third respondent factory are not liable to pay employees contribution and that the provisions of the ESI Act cannot be made applicable to the employees of the third respondent factory as the medical facilities and other benefits provided by the third respondent factory are more superior to the benefits provided under ESI Act and consequently it is declared that the third respondent factory 5 is entitled to exemption from the provisions of the ESI Act and third respondent is directed not to deduct wages from the employees as well as petitioner union towards the employees contribution to the second respondent corporation. In view of the facts and circumstances of the case each party is directed to pay its own costs.” 4. Now, learned counsel for the appellant has placed reliance on the judgment of the Hon‟ble Supreme Court in Zuari Cement Ltd. V. Regional Director, ES.I.C., Hyderabad1, wherein the Hon‟ble Apex Court dealt with an identical issue and decided the same against the Zuari Cement Ltd. The Hon‟ble Apex Court in the said judgment at paragrahph Nos.9 and 15 held as follows: “9. As per the scheme of the Act, the power to grant exemption is a plenary power given to an appropriate government. It follows that the ESI Court constituted under Section 74 of the Act has no jurisdiction to take up the question of grant of exemption. The Court constituted under Section 74 of the Act cannot decide such matters including the validity of an exemption notification. The order granting or denying exemption is certainly open to judicial review under Article 226 of the Constitution of India. But the question of exemption under Section 87 cannot be raised under Section 75 of the Act and the ESI Court constituted under Section 74 of the Act, cannot decide the legality or 1 AIR 2015 SC 2764 6 otherwise of an order relating to exemption passed by the appropriate Government. 15. Where there is want of jurisdiction, the order passed by the court/tribunal is a nullity or non-est. What is relevant is whether the Court had the power to grant the relief asked for. ESI Court did not have the jurisdiction to consider the question of grant of exemption, order passed by the ESI Court granting exemption and consequently setting aside the demand notices is non-est. The High Court, in our view, rightly set aside the order of ESI Court and the impugned judgment does not suffer from any infirmity warranting interference.” 5. Considering the above said observations, the Hon‟ble Apex Court has categorically held that the Tribunal has no jurisdiction and declared that the orders passed by the Tribunal were illegal and void. 6. In view of the above, the Civil Miscellaneous Appeal is allowed setting aside the orders dated 20.12.2002 passed in E.I.Case No.107 of 2001 by the Employees Insurance Court and Chairman, Industrial Tribunal-I, A.P., Hyderabad. There shall be no order as to costs. 7 As a sequel, miscellaneous petitions pending, if any, shall stand closed. _______________________ JUSTICE D.RAMESH _________________________________ JUSTICE ALAPATI GIRIDHAR Date: 15.07.2026 Ivd Whether the order is: Speaking Yes Reasoned No Reportable No Non-reportable Yes 8 THE HONOURABLE SRI JUSTICE D.RAMESH THE HONOURABLE SRI JUSTICE ALAPATI GIRIDHAR CIVIL MISCELLANEOUS APPEAL No.945 of 2005 Dated: 15.07.2026 Ivd