Vijay Marie Hospital case: Telangana HC overturns ESI Tribunal order

Justice Sambasiva Rao Naidu of the Telangana High Court allowed the Civil Miscellaneous Appeal (CMA) filed by Employees State Insurance Corporation (ESIC), stating that Vijay Marie Hospital and Educational Society, Khairatabad, cannot claim that there was no delay in “payment of contribution”, when it has already been proven, and that the aspect of mens rea could not be considered, and set aside the order of the ESIC Tribunal.

The ESIC sent a notice to the management of Vijay Marie Hospital for failing to make the contribution on time from April 2010 to September 2010, from December 2010 to March 2021 and from April 2015 to June 2015, intending to impose penalties of `96,630 for the delay in payment of  contributions. The petitioner hospital filed a case before the ESIC Tribunal, challenging the notices. After hearing the parties’ oral arguments and reviewing the evidence, it was concluded that the respondent demonstrated its bona fides by making contributions to the ongoing writ case.

As a result, assessing damages against the respondent hospital is not an option. Furthermore, the ESIC Tribunal determined that the authorised officer imposed damages mechanically, and the consequential recovery notice was dismissed. The current Civil Miscellaneous Appeal was preferred by the appellant Employees State Insurance Corporation. After hearing the CMA’s arguments, the court overturned the ESIC Tribunal’s orders.