The High Court · 2025

Petition under Section 151 CPC praying that in the circtpnstances stated in the affidavit filed in support of the petition, the High Court may be pleased to stay all further proceeding in the Form No.ESl CP2 Dated 01.08.2019 vide issued by the Respondent Corporation, No.52000314950001302iCP/330530 pending disposal of the main C.M.A. Counsel for the Appellant: SRl. D.V. CHALAPATHT RAO Counsel forthe Respondents: SRI M. RAVINDER REDDY The Court made the following ORDER: THE HONOURABLE SRI WSTICE LA)OII NARAYAN,I ALISHETTY CTVIL MISCELLANEOUS APPEAL No.464 ot' 2O23 ORDER: This Civil lVliscellaneous Appeal is hled cl- atienging tl-re Order dated 06.05.2023 in E.l.C.No.105 of 2O19, on rhe file of thc Employees Insurance Court and Chairma n, Industrial Tribunal [, at Hvderabad, wherein and whereby ]lre application filcd bv the appcllant, was dismissed.

2. Heard Sri D.V.Chalapathi Rao, learned Co rnsel for the appellant and Sri M.Ravinder Reddy, learned Oounsel for rcspondents

3. Brief facts o[ the case which led to filing o' the present appeal are that appellant is an educational soci( t.., registered unclcr Societies Rcgistration Act and running a s.cfool in thc name and s[.le of Raman High School from L.l(.(,] to X_class; that initialll appellant-society was allotted rvith Code No.520003149500013O2, and subsequently, the rr:spondents, Corporation altered the Code to Code No.5200620!1000013O2, that appellanl is not aware of the allotment of the rew code to the inslitutron, howcrrer the resporrdents, Corpora[ion without givirrg an opportunity to the appellant_SocieLy, prr;secl Order datt'rl l5.O2.2O1(), rrnder Section 4S,A of the Ii S.l Act, tor I I 2 recovery of Rs. 14,32,8601- for the period from 01.01.2014 ro

31.10.2018, and consequently, issued Cp-2 notice dated O1.08.2019, for recovery of Rs. 19,54,886/- towards contribution, interest and damages for the period from O1.01.2O14 to 31.10.2018. Challenging the Order dated I5.O2.2O19 and CP-2 notice dared O1.08.2019, appellant hled a petition before the Tribunal uide E.l.C.No.105 of 2O19. However, the Tribunal ulde impugned Order dated 06.O5.2023, dismissed the application without considering the pleadings and contentions put forth by the appellant. Aggrieved by the said Order, present appeal is hled.

4. In the affrdavit filed in support of the application, it is averred that appellant-Society regularly paid its contributions to the respondents' Corporation up to the year 2015, and closed its establishment in the year 20 15, and transferrcd all the rights, affairs and liabilities to the Mind Tree Educational Society urde Transfer of Agreement dated 04. 1 1.2015, therefore, appellant-Societ5z is not liable to pay any contribution thereafter, however, the respondent No.2 issued Order dated

15.02.2019, for recovery of Rs.14,32,860/- and consequently, CP-2 notice dated 01.08.2019, for recovery of Rs.19,54,886/-, arbitrarily without any basis, which is per se unsustainable. J

5. Learned Counsel for the appellant would submit that originally, appe[lant-Society was allotted with code No.5200031495O0013O2, and the appellant-Socir tv regularly remitted contributions to the respondents' J trporation, however, impugned Order under Section 45-A, v,as issued under new. Code No.520O62090000 1302, which was allotted to the appellant u,ithout their knowledge. He furth c r submitted that Tribunal has iailcd to consider the principa contention raised by thc appellanL that it has transferred all its rights, affairs and liabilities to the Mind Tree Educational S.l<;ie[,in the year 2015, and thus appellant-Society is not liablc, lo pay any contributions as demanded by the respondents, ()orporation, therefore, thc impugned Order passed by the Tribunal is perverse, unsustzrinablc and liable to be set as dc on this ground alone. Hc also submitted that respondents' Cdrporation has not provided ample opportunity to the appellar t, Society to substantiate their case and proper notices were alsr, not served on the appellanr:rnd thus, the Order under Section 45-A of ESI Act and CP 2 r-rotice arc unsustainable and ,.e tilt k. to be set aside and hence, prayed to allow the appeal.

6. Per contra, Iearned Standing Counsel for the r crspondents u,ould submit thar an ollicial lrom the respondents,(jorporation conducted preliminarv inspection on the appellanr Siocir:[r on & 4

07.O4.2OO9, and submitted report under Ex.R1, in which it was stated that 40 employees were working for wages and R.Sravanthi, Correspondent of Appellant-Society received the inspection report. He further submitted that notices were issued and received by the appeliant-Society and therefore, the contention raised by the appeliant-Society that substantial notices were not given and ample opportunity was not given to the appellant is factually incorrect and in fact, appellant-Socieg did not attend the personal hearing desprte service of notice on [wo occasions. He aiso submitted that appeiiant-society is running two schools, one school at Hanumakonda and another at Warangal. The school at Hanumakonda is transferred in favour of Mind Tree Educational Society, but the school at Warangal still exists with the appellant and thus, they are liable to pay the amount demanded by the respondenCs' Corporation in the Order dated 15.O2.2O1g under Section 45-A and consequently, CP-2 Order dated 01.O8.2019.

7. Learned Counsel for respondents further submitted that before the Tribunal respondents' Corporation got examined its officer as R.W. 1 and Exs.R1 to R32, were marked, which clearly established the contention of the respondents' Corporation that notices have been given and ample opportunit5r was also provided to the appellant-Society. He further submitted that 5 appellant-Society has raised the new plea of transf( r of school to Mind Tree Educational Society, for the first tim: during the course of arguments before the Tribunal without there being any pleading in the application filed before the 'L ibunal. The Tribunal on due consideration of oral and d,rcumentary evidence placed on record, came to the conclusion that appellant has failed to prove that society has trai-r;ferred all its rights, affairs arnd habilities of school at Warangal to the Mind Tree Educational Societ1,, therefore, no grounds arr'rnade out to interfere with thc Order passed by the trial Court.

8. Admittt:dly, the appeal is filed mainly on thr l3round that appellant-Society closed its establishment in the y,:eLr 2015 and transferred all rts rights, affairs and liabilities to Mind Tree Educational Socie ty, under Agreement of Trirrrsfer dated

04.11.2015, trnd therefore, the appellant-Society is not liable to pay the amount demanded by the respondents' Oorporation. The further contention ol the appellant-Society is t nat t-l'rey paid contributions till the date of transfer of the school and they are not liable to pay any contributions after transfer, herefore, the amount dcmanded by the respondents' Corporatio-r is :Lrbitrary and illega l. 6

9. Perusal of the impugned Order would disclose that respondents' Corporation examined one of its officers as R.W. i and Exs.R1 to R32, were marked on behalf of the respondents, which includes preliminary survey report and notice orders, whereas, on behalf of appellant-Society, P'W' 1 was examined and Exs.Pl to P6, were marked, which includes agreement of transfer dated O4. I 1.20 15.

10. It is relevant to note that Tribunal has specifically observed that though the appellant-Society taken the plea that their establishment was transferred to Mind Tree Educatiorral Society under Ex.P4, the same was not proved. The Tribunal has also otrserved that ample opportunity was given to the appellant-Society, however the appellant-Societlr did not respond to the notices of personal hearing and did not appear before the Authority, despite receipt of notices. The Tribunal has come to the conclusion that appellant-Society failed to substantiate their contention and thus, dismrssed the application hled by them. In the counterj 'filed by the respondents' Corporation it is specially stated that appellant- Society has established two schools one at Hanumakonda and the other at Warangal, that the school at Hanumakonda has been transferred to the Mind Tree Educational Society, whereas, lhe school at Warangal is still existing in the name of the l 1 appellant-society and the Order dated 15.0!t.:2O19, under Section 45-A and consequently, Cp_2 Order dated 01.0g.2019, pertains to the school at Warangal, and _h erefore, the contention of the appellant_society that they ar,r not liable to pay the amount demanded by the respondents, l,lrporation is untenable and the appellant_society has not filed rejoinder to the counter hled by the respondents,Corporation. 1 1. In the light of the above discussion,. the principal contention of Lhe appellant-Socie ty that appellant,s establishment was closed in the year 2O15, and the same has been transferred to Mind Tree Educational Sr,ciety, is not proved. In considered opinion of this Court, the appellant failed to make out an_y ground to interfere with the iml>ugned Order passed by the Tribunal and thus, holds no water .{ccordingly, the appeal is liable to be dismissed.

72. In the result, the Civil Miscellaneous Appeal is; ciismissed. There shall be no order as to costs. Miscellaneous petitions pending, if any, srhall stand closed. SD/- K.SREE RAMA MURTHY T)EPUTY REGISTRAR I I i //TRUE COPY// SECTION OFFICER To, 'l . The Chairman, lndustrial Tribunal -l at Hyderabad ( wi:h records ) _. ::.il, : atal,'::. rJ n:ri:1,:;.:-

2. One CC to SRl. D.V. CHALAPATHI RAO, Advocate tOpUCl 3. One CC to SRt M. RAVINDER REDDY, Advocate tOpUCj 4. Two CD Copies kul/PSL I 7 -ii k. HIGH COURT DATED:3110712025 I t I ORDER CMA.No.464 ot 2023 / l r Lrf; :i.l-4 1€ \ 2Ettou6 e,i ) i: C) Dp sPA.l'c {+ * i 'r. i \ DISMISSING THE CIVIL MISCF]I,I-ANEOUS APPEAI, WITHOUT COSTS b 3e \\ 2{ \