JUDGMENT
Narayan Chandra Sil, J.
1. This revisional application under Article 227 of the Constitution of India is directed against Order No. 5 dated 16th December, 2003 passed by Shri M.P. Srivastava, the learned Judge, Employees’ Insurance Court, Calcutta, West Bengal in Tender Case No. 102 of 2003.
2. It appears from the order impugned that a petition under Section 75(2B) of the ESI Act along with a petition for temporary injunction were taken up for consideration. The petitioner in that case prayed for exemption from depositing 50% of the demanded sum of Rs. 27,98,718/-. The applicant there filed a case under Section 75(1)(g) of the ESI Act (hereinafter referred to as an “Act” only). It is observed by the learned Judge that depositing of 50% demanded sum is a condition precedent for filing a case under Section 75(1)(g) of the Act. The learned Judge appears to have dealt with the proviso to Section 75(2B). It is clearly observed by the learned Judge, “The points raised in the main application are to be decided after evidences (sic) are (sic) adduced by the parties. The learned Judge directed the applicant to deposit a sum of Rs. 1,00,000/- by 16.1.04 with the O.P.-E.S.I. Corporation directing the Corporation to hold the same in trust and ultimate appropriation thereof shall abide by the final decision of the case”. The learned Judge was also pleased to allow the prayer for temporary injunction. This order is challenged in the present revisional application under Article 227 of the Constitution of India.
3. The petitioner i.e. Employees’ State Insurance Corporation (hereinafter referred to as “Corporation” only) has stated in this revisional application that the O.P. No. 1 is a private limited company carrying on hotel business. The principal employers of the O.P. No. 1 failed to pay ESI contribution and other dues under the Act despite repeated demands for such payment made by the Corporation and thus the amount of dues including the arrears came up to Rs. 27,98,718/-. For such repeated demands the O.P. No. 1 filed the application under Section 75(1)(g) of the Act before the Employees’ Insurance Court, West Bengal. In that application another application under Section 75(23) of the Act was filed by the O.P. No. 1 as petitioner before the Insurance Court for waiver of the amount required to be deposited.
4. It is stated in the petition that the learned Judge acted illegally with material irregularity in directing the O.P. No. 1 to deposit a sum of Rs. 1,00,000/-by fixing the said amount arbitrarily, and without any basis at all and without recording any proper reason. It is also taken in the petition that the learned Judge also failed to exercise his discretion lawfully, judiciously and fairly and thereby made the mandatory provision of Section 75(2B) of the Act a nugatory by passing the order impugned.
5. The O.Ps. have contested the application by filing an affidavit-in-opposition wherein all the material allegations are denied. In paragraph 11 of the affidavit-in-opposition it is stated that the demands of the Corporation were not tenable mainly on the following grounds :
“(a) The demand Notices have been issued in violation of the principle of natural justice.
(b) Since the demands have been determined in violation of principles of natural justice, the same are nullity in the eye of law.
(c) Recovery Notices have been issued violating first proviso to Section 45A of the Employees’ State Insurance Act, 1948.
(d) Since the demands have been made in violation of first proviso to Section 45A and in violation of the principles of natural justice, all the notices demanding payment are nullity in the eye of law.
(e) The demand Notices dated 27th June, 2003, 1.08.2003, [as in the copy] 1.08.2003 6.08.2003 petitioners have failed to appreciate that as per Share Purchase Agreement-A read with Balance-sheet for the accounting year 2000-2001 leaves no manner of doubt that no liability prior to the closing date i.e. 8th July, 2002 cannot devolve upon the Opposite Party No. 1.
(f) Vindictiveness on the part of the petitioners would appear from the fact that in spite of having been intimated about the absence of liability, petitioners have threatened with coercive action.
(g) Notices are band in law since the same are arbitrary without having any statutory authority and the whole action suffers from the infirmity of non-application of mind.’
6. It is also stated that the plea of arrear of Rs. 27,98,718/- is totally arbitrary and not sustainable in the eye of law. It is also stated that as the notices of demand are nullity in the eye of law, there does not arise any question of giving any direction to deposit the entire sum or at lease 50% of the claimed amount as wrongly contended.
7. The learned Advocates for both the parties besides their oral arguments have placed the written notes on arguments. Mr. Subol Moitra, the learned Advocate for the petitioner/Corporation has narrated the different provisions of the Act in his written arguments. While commenting on the provisions of Section 75(2B) of the Act it is stated that the ESI Court may waive or reduce the amount of 50% as claimed by the Corporation but that can only be done after recording the reasons therefore in writing. It is pointed but from the observation of the learned Court that he reduced the amount to Rs. 1,00,000/-from the 50% of the demanded money considering the facts and circumstances of this case and the materials on record, shows that the amount under demand have been substantially reduced from about 28 lakhs to [vision not clear] lakh without any basis or any just cause and also without recording any reason and without any application of mind.
8. Mr. Moitra, the learned Counsel appearing for the petitioner has referred to an unreported case (vide C.O. No. 3033 of 2002, E.S.I. Corporation v. Steel Authority of India Ltd.) in which Mr. Alok Kumar Basu, J. by His order dated 1.4.2004 was pleased to pass the order as follows:
“I have given my anxious consideration to all the points canvassed by both sides. It may be recorded at the outset that alternative remedy is never a bar in entertaining an application under Article 227 of the Constitution of India. On the examination of record, it appears that the subordinate Tribunal exceeded its jurisdiction or failed to exercise jurisdiction under the law.
There is a clear statutory mandate for making 50% deposit of the claim amount before raising and entertaining a claim by the employer, and it is to be borne in mind that the statutory provisions relates to a social security legislation, and there is no scope for making any difference between a private employer and a Government undertaking and this has been a constant observation of the Apex Court delivering its different judgments in the field of labour laws.
Admittedly, the learned Judge has been given statutory discretion in waiving or reducing the amount, but, that discretion is to be exercised by recording cogent and convincing reason.
From the impugned order, it is very much clear that the learned Judge even did not consider this aspect, not to speak of, recording any reason and thereby the learned Judge totally disregarded the mandatory statutory provision which at once takes me to the point that there was total failure on the part of the learned Judge to exercise his jurisdiction and this will certainly attract the extraordinary power of this Court to correct the legal mistake.
When there was a statutory mandate to record a reasoned order and when the learned Judge has failed to do it, the order in question cannot sustain and the same shall be remitted back to the learned Judge to record a reason after hearing both sides either to direct 50% deposit or even to waive or reduce the amount, but only after recording reasons behind such finding.”
9. Mr. Moitra has also referred to the ratio decided in the case of Gurdial Singh Fijji v. State of Punjab and Ors., , in which the Hon’ble Apex Court held that rubber stamp reasons are no reasons and it cannot be said that thereby the mandatory provision for giving reasons have been complied with.
10. It is also stated in the written notes on arguments that by keeping the sum of Rs. 1,00,000/- paid by the O.P. No. 1 under the order passed by the ESI Court it cannot be said that the Corporation had accepted the said amount and so the principle of estoppel cannot be applied thereagainst. In such case where such orders has been passed by the Courts, it is argued, the amount was kept by the Corporation in custody only and that under the order of the Court and, therefore, there is no question of appropriation of the deposited sum in the ESI fund.
11. From the arguments made on behalf of the O.P. No. 1, it is argued, that in terms of provision of Section 82(2) of the Act an appeal shall lie to the High Court from the order of the E.S.I. Court if it involves a substantial question of law. Mr. Moitra has also drawn the attention of this Court to the provision of Section 82(1) of the Act wherein it is provided that save as expressly provided no appeal shall lie from an order of the E.S.I. Court. Mr. Moitra has drawn the similarity of the provisions of Section 82(2) of the Act with the provisions of Section 100 of the Code of Civil Procedure which provides inter alia that appeal shall lie to the High Court from a decree passed in appeal by Subordinate Court to the High Court if the High Court is satisfied that the case involves a substantial question of law. It is also argued that in the instant case only the jurisdictional error and no substantial question of law is involved. Mr. Moitra has drawn my attention to para 8 of the written statement wherein it is stated that the application under Article 227 of the Constitution of India does not involve any important point of law. Thus, admittedly there is no question of law involved in the present petition, Mr. Moitra further submits.
12. It is also argued that for alternative remedy Article 227 can be invoked. It is pointed out that the Tribunal is not a Civil Court in the strict sense of the term and, therefore, aggrieved party cannot take the recourse to Section 115 of the Code against the jurisdictional error of the E.I. Court, unless a substantial question of law is involved.
13. Mr. Moitra has cited a number of case laws out of which we shall deal with only relevant ones.
14. Mr. D.K. Ghosh, the learned Senior Advocates appearing with Mr. Ranjay De, the learned Advocate for the O.Ps. has also filed written notes on arguments and it is stated there that in terms of the provisions of “share purchase agreement-A” the O.Ps. have no liability to pay to the Corporation. But still then a notice dated 27.06.2003 was sent by the Deputy Director, ESI Corporation fixing 7.8.2003 for default in payment for the period from 12.06.75 to 31.01.1980 for Rs. 39,411.25. This amount went on increasing and subsequent notices were issued.
15. Mr. Ghosh has challenged the maintainability of the application in view of the fact that since there is provision of appeal against such order, the application under Article 227 of the Constitution of India does not lie. The next point urged by Mr. Ghosh before this Court is as regards the principle of estoppel to have been applied already against the petitioner/corporation as soon as they had accepted and appropriated a sum of Rs. 1,00,000/- paid by the O.P. without objection. The payment of Rs. 1,00,000/- made by the O.P. was of course under the order of ESI Court.
16. Mr. Ghosh has drawn my attention to the provisions of the agreement dated 8.7.2002 along with certificate issued by the India Tourism Corporation Limited. Clause 8.7 of the Agreement of the Share Purchase Agreement-A executed between the President of India, Consortium comprising Modern Publishers and Calcutta Hotel Private Ltd. reads as under :
“With effect from the closing date, all trade and other creditors and liabilities whether secured or unsecured of the Business as detailed in the attached Balance Sheet shall, without any further act or deed, stand transferred to the purchaser. The purchaser undertakes and represents to assume, pay and discharge the aforementioned creditors and liabilities on the same terms and conditions including in relation to the credit period and terms of interest on which these were assumed by the purchaser, as if such creditors liabilities and obligations were originally incurred by the purchaser.”
17. Mr. Ghosh has not pressed the point of limitation. A number of case laws have been cited by the learned Advocates for both the parties and I shall discuss the same a little later if the occasion warrants the same.
18. Thus from the arguments of the learned advocate and the materials on record it appears that the main application filed before the learned Judge, ESI Court is still pending and the disposal of the petition under Section 75(2B) of the Act is mainly the matter for challenge before this Court under Article 227 of the Constitution of India. But the maintainability and the question of liability for payment of the claim and the application of principle of estoppel have been agitated by the learned Advocate for the O.P.
19. Before taking up the matters as agitated by the learned Advocates for both the parties I like to dispose of the question of maintainability to make the payment by the O.P. as agitated in the main application at the very outset. I have already indicated hereinbelow that the main application is pending before the learned Judge, ESI Court since 2002 and in the present application I have no scope to deal with the main application and as such I refrain myself from determining that issue of liability for payment by the O.P. in the instant petition which is in exclusive domain of the learned Judge, ESI Court.
20. The next question is as regards the maintainability of the application. Admittedly, there is provision of filing appeal before the High Court under Section 82 of the Act if it involves a substantial question of law. It is also argued that when there is provision for specific remedy by way of filing appeal in the statute itself, Article 227 of the Constitution of India cannot be invoked only in order to bypass such specific provisions of appeal. And in this connection, Mr. Ghosh has referred to the ratio decided in the case of Seth Chand Ratan v. Pandit Durga Prasad, . The ratio decided in that case reads as under :
“It has been settled by a long catena of decisions that when a right or liability is created by a statute, which itself prescribes the remedy or procedure for enforcing the right or liability, resort must be had to that particular statutory remedy before seeking the discretionary remedy under Article 226 of the Constitution.
When the party had statutory remedy of assailing the order passed by the District Court by filing an appeal to the High Court itself, he could not bypass the said remedy and take recourse to proceedings under Articles 226 and 227 of the Constitution. Such a course of action may enable a litigant to defeat the provisions of the statute which may provide for certain conditions for filing the appeal, like limitation, payment of Court fee or deposit of some amount of fulfilment of some other conditions for entertaining the appeal.”
21. Mr. Ghosh has further argued that appeal lies against any order under Section 75 of the Act. In this connection Mr. Ghosh has referred to the ratio decided in the case of Modi Steel Unit-A v. Employees State Insurance Court, 1984(48) FLR 499. It was held in that case that there is nothing in language of Section 82 of the Act to limit the right of appeal in any way only to an order of an Employees Insurance Court under Section 75.
22. Mr. Moitra stated in his written notes on arguments that in the present application there is no substantial question of law and as such the recourse under the provisions of Section 82 of the Act was not availed of by the petitioner.
23. Thus in order to determine the question of maintainability of the application it is required to determine what is substantial question of law and whether such substantial question of law is or is not involved in the instant application. The entire dispute between the parties in the instant application is mainly on the disposal of the application under Section 75(2B) of the Act.
Section 75(2B) of the Act reads as under :
“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 his 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.”
24. Thus it appears from the proviso to that Section that the Court has got the right to waive or to reduce the amount of 50% to be deposited under this sub-section. Mr. Ghosh has heavily banked upon the observation of the learned Judge, ESI Court in disposing the application under Section 75(2B). For the purpose of disposal of the said petition the learned Judge has stated the reason as below :
“But considering the facts and circumstances of the case and materials on record, I direct the applicant to deposit a sum of Rs. 1,00,000/-….”
25. This is in compliance with the proviso to Section 75(2B) of the Act what is only written as above. Now whether the mere mentioning of the words as stated above is sufficient to the compliance of the proviso is definitely a substantial question of law. I have no hesitation to express that there is no definite yeadstick to determine as to what is the substantial question of law and what is not. But there cannot be any doubt that any question which prompts the Court to enter into a proof of the applicability of the provisions of statute from the facts and circumstances of a case is a substantial question of law. I have already expressed my views that a substantial question of law in disposing of the present petition under Article 227 of the Constitution of India in respect of an order passed under Section 75(2B) of the Act is very much patent. That apart from the ratios cited by Mr. Ghosh as already discussed it is clear that appeal lies against any order passed under Section 75 of the Act. Accordingly, in my view, the present application under Article 227 of the Constitution of India does not appear to be maintainable. While disposing of this issue I shall eschew myself from dealing with the matter as to whether the learned Judge, ESI Court complied the proviso to Section 75(2B) only by stating that he had considered the facts and circumstances and materials on record without mentioning those mateirals and the facts and circumstances of this case.
26. The only point, now left for determination is as regards the principle of estoppel. In this connection Mr. Ghosh has referred to the ratio decided in the case of Annapoorani Ammal v. Ramaswamy Naicker, , wherein it was held that there could be an exception and that is where the plaintiff has acted or conducted himself in such a manner as to a probate the benefit thereunder and in such a case, it cannot be permitted to reprobate the judgment by appealing against it. But the ratio decided in this case does not appear to have any application in the instant application under Article 227 of the Constitution of India. It is already mentioned that the amount of a sum of Rs. 1,00,000/- was paid firstly for the benefit of the O.P. as the O.P. need not pay 50% of the demanded amount and secondly the said order was passed by the Court. Finally, although no objection was raised at the time of acceptance of that amount by the Corporation that has been cured by filing the instant application against that order. The filing of this application which is under consideration before this Court amounts to objection of the Corporation ventilated against the order impugned. In such case in our view there cannot be any application of the Principle of Estoppel against the Corporation.
27. In view of what has been discussed above the instant application under Article 227 of the Constitution of India is dismissed. The learned Judge, ESI Court is directed to dispose of the application filed before him under Section 75(1)(G) of the Act with all alacrity and not later than a period of one month from the date of communication of this order without allowing any adjournments to either of the parties unnecessarily.
Later:
28. Let urgent xerox certified copy of this order, if applied for, be given to the learned Advocates for the parties as expeditiously as possible.