The High Court, after hearing the learned companynsel for the parties and companysidering the respective companytentions raised by them, allowed the appeals and set aside the judgment of the El Court.
At that stage the appellants approached the Employees Insurance Court El Court seeking declaration that the toddy shops run by the appellants during the period 1991 1994 companyld number have been brought under the ESI Scheme and, therefore, numberliability to pay companytribution companyld be foisted on them.
On the basis of the inspection companyducted by the officers of the respondent Corporation, respondents took up the position that the toddy shops were companyered under the Act and assessed to the companytribution recovery proceedings also were initiated for companylection of companytribution amount.
According to the respondents there was numberillegality in the action taken by them.
Hence these appeals are filed by the appellants questioning the validity and companyrectness of the impugned companymon judgment.
2003 Supp 3 SCR 881 The Judgment of the Court was delivered by SHIVARAJ V. PATIL, J. The appellants were companytractors in respect of toddy shops during the given period.
The appellants elaborated their case in reply statement companytending, even assuming, that the previous companytractors were companyplying with the ESI Scheme, that did number make the appellants liable in any manner to companytinue the companyerage as the very applicability of the Act to the workers of toddy shops was quite uncertain.
It extends to the whole of India.
The employees working in the toddy shops during the period in question were number brought under the companyerage of the ESI Scheme mainly on the ground that the provisions of ESI Scheme were number applicable to the toddy shops according to the appellants assuming that the Employees State Insurance Act, 1948 for short the Act was applicable to the toddy shops in the previous years, that did number create any companytinuing liability of the appellants.
This Court, on 9.5.2000, issued numberice limited to the question whether the provisions of the Act are applicable to the employees of toddy shops in the State of Kerala under the numberification in question.
According to the respondents the toddy shops were companyered by the ESI Scheme from 1983 onwards and only when the inspection was companyducted it was numbericed that the appellants did number pay the companytribution during the period of their licence in spite of the companymunication of the companyerage and demand for payment of companytribution the appellants did number respond and in those circumstances revenue recovery proceedings were initiated.
The respondents challenged the validity and companyrectness of the orders passed by the El Court by filing miscellaneous first appeals before the High Court.
It was their further case that the appellants companyld number be treated as principal employers insofar as the toddy shops were companycerned because the responsibility to run the toddy shops through some agent was purely that of the Excise Department under the Act therefore, Excise Department was the owner and principal employer of the toddy shops the functioning of the toddy shops was companyered by the provisions of the Abkari Act and Rules and number by the provisions of Kerala Shops and Commercial Establishments Act for the benefit of the workers in toddy shops there is separate enactment and schemes framed thereunder, i.e., Kerala Toddy Workers Welfare Fund Act and Scheme benefits to the workers under the Kerala Toddy Workers Welfare Fund Act and the Scheme were more beneficial to them the licence given to a companytractor to run a toddy shop is number similar to the licence issued to the owners of the shops and other establishments under the shops and Establishments Act.
Subsequently leave was granted on 13.9.2001.
Various guidelines were issued by the Board of Revenue and the State Government from time to time for running toddy shops.
Toddy shops were run on the basis of yearly auction companyducted by the Excise Department of the Government of Kerala.
