To challenge a speaking order under Section 45A of the Employees’ State Insurance (ESI) Act, an employer must first appeal to the designated Appellate Authority within 60 days of the order. This appeal can be filed after depositing 25% of the contribution ordered (or the contribution as per the employer’s calculation, whichever is higher) with the Corporation. Further, if dissatisfied with the Appellate Authority’s decision, the employer may approach the ESI Court under Section 75 of the Act.
The observation of the Hon’ble High Court in the case titled as E.S.I.C Vs. Santhakumar is relevant. The relevant portion is reproduced as under :-
- Section 45A provides for determination of contributions in certain cases. When the records are not produced by the establishment before the Corporation and when there is no cooperation, the Corporation has got the power to make assessment and determine the amount under Section 45A and recover the said amount as arrears of land revenue under Section 45B of the Act. This is in the nature of a best judgment assessment as is known in taxing statutes. When the Corporation passes an order under Section 45A, the said order is final as far as the Corporation is concerned. Under Section 45A(1), the Corporation, by an order, can determine the amount of contributions payable in respect of the employees where the employer prevents the Corporation from exercising its functions or discharging its duties under Section 45, on the basis of the material available to it, after giving reasonable opportunity. But, where the records are produced, the assessment has to be made under Section 75(2)(a) of the Act. Section 45A (2) provides that the order under Section 45A(1) shall be used as sufficient proof of the claim of the Corporation under Section 75 or for recovery of the amount determined by such order as arrears of land revenue under Section 45B. In other words, when there is a failure in production of records and when there is no cooperation, the Corporation can determine the amount and recover the same as arrears of land revenue under Section 45B. But, on the other hand, if the records are produced and if there is cooperation, the assessment has to be made and it can be used as a sufficient proof of the claim of the Corporation under Section 75 before the E.S.I. Court. So, the limitation of three years for filing an application before the Court, introduced by Act 44 of 1966, can only relate to the application under Section 75 read with 77(1A). The order under Section 45A need not be executed by the Corporation before the E.S.I. Court under Section 77.
Appeal to Appellate Authority (Section 45AA):
If an employer disagrees with the order under Section 45A, the first step is to appeal to the Appellate Authority designated under the Act.
Time Limit for filling an Appeal u/s 45AA
The appeal must be filed within 60 days from the date of the order under Section 45A.
Deposit:
The employer must deposit 25% of the contribution ordered in the order (or the contribution as per the employer’s own calculation, whichever is higher) with the Corporation.
IF EMPLOYER NOT SATISFIED WITH THE DECISION WITH APPLATE AUTHORITY OF ESIC , CAN CHALLENGED THE ORDER OF SECTION 45AA BEFORE EI COURT.
ESI Court (Section 75):
If the employer is dissatisfied with the decision of the Appellate Authority, the next step is to approach the ESI Court.
Matters to be decided by Employees’ Insurance Court.
(1)If any question or dispute arises as to
(a)whether any person is an employee within the meaning of this Act or whether he is liable to pay the employee’s contribution, or
(b)the rate of wages or average daily wages of an employee for the purposes of this Act, or
(c)the rate of contribution payable by a principal employer in respect of any employee, or
(d)the person who is or was the principal employer in respect of any employee, or
(e)the right of any person to any benefit and as to the amount and duration thereof, or
( ee) any direction issued by the Corporation under section 55A on a review of any payment of dependants’ benefit, or
(g)any other matter which is in dispute between a principal employer and the Corporation, or between a principal employer and an immediate employer or between a person and the Corporation or between an employee and a principal or immediate employer, in respect of any contribution or benefit or other dues payable or recoverable under this Act, or any other matter required to be or which may be decided by the Employees’ Insurance Court under this Act,
such question or dispute subject to the provisions of sub-section (2A) shall be decided by the Employees’ Insurance Court in accordance with the provisions of this Act.
(2)Subject to the provisions of sub-section (2A), the following claims shall be decided by the Employees’ Insurance Court , namely:
(a)claim for the recovery of contributions from the principal employer;
(b)claim by a principal employer to recover contributions from any immediate employer;
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(d)claim against a principal employer under section 68;
(e)claim under section 70 for the recovery of the value or amount of the benefits received by a person when he is not lawfully entitled thereto; and
(f)any claim for the recovery of any benefit admissible under this Act.
(2A) If in any proceedings before the Employees’ Insurance Court a disablement question arises and the decision of a medical board or a medical appeal tribunal has not been obtained on the same and the decision of such question is necessary for the determination of the claim or question before the Employees’ Insurance Court, that Court shall direct the Corporation to have the question decided by this Act and shall thereafter proceed with the determination of the claim or question before it in accordance with the decision of the medical board or the medical appeal tribunal, as the case may be, except where an appeal has been filed before the Employees’ Insurance Court under sub-section (2) of section 54A in which case the Employees’ Insurance Court may itself determine all the issues arising before it.
(2B)No matter which is in dispute between a principal employer and the Corporation in respect of any contribution or any other dues shall be raised by the principal employer in the Employees’ Insurance Court unless he has deposited with the Court fifty per cent. of the amount due from him as claimed by the Corporation:
Provided that the Court may, for reasons to be recorded in writing, waive or reduce the amount to be deposited under this sub-section.
(3)No Civil Court shall have jurisdiction to decide or deal with any question or dispute as aforesaid or to adjudicate on any liability which by or under this Act is to be decided by a medical board, or by a medical appeal tribunal or by the Employees’ Insurance Court .
