ARIHANT INDUSTRIAL CORPORATION LTDversusREGIONAL DIRECTOR EMPLOYEES STATE INSURANCE CORPORATION AND ORS

                    Sonali Mane                                              10-WP-12969-2026.docx



                                  IN THE HIGH COURT OF JUDICATURE AT BOMBAY

                                          CIVIL APPELLATE JURISDICTION

                                         WRIT PETITION NO. 12969 OF 2026

                    Arihant Industrial Corporation Ltd.                      … Petitioner
                             Versus

                    Regional Director Employees

                    State Insurance Corporation And Ors.                     … Respondents



                    Mr. Vijay P. Vaidya a/w Mr. Mahendra Agvekar for Petitioner.
                    Mr. Anand S. Kulkarni (Through V.C.) for Respondents.


                                                      CORAM        : SANDEEP V. MARNE, J.

                                                      DATE         : 6 OCTOBER 2026.

                    P.C. :


                    1)            The Petition challenges Order dated 17 June 2025 passed by
                    the learned Judge, Employees' Insurance Court, Thane rejecting the
                    Application (ESI) No. 2 of 2014 filed by the Petitioner as barred by
                    limitation. In Application (ESI) No. 2 of 2014, filed under Section 75
                    read with Section 77 of the Employees' State Insurance Act, 1948 ("the
                    ESI Act"), the Petitioner had challenged Order dated 5 September 2006
                    passed under Section 45-A of the ESI Act, as well as Order dated 29 May
                    2014 and the prohibitory Order dated 17 June 2014.


                    2)            I have Mr. Vaidya, the learned counsel appearing for the
                    Petitioner and Mr. Kulkarni, the learned counsel appearing for

       Digitally
                    Respondents.
       signed by
       MANE
MANE SONALI
SONALI DILIP
DILIP  Date:
       2026.10.08
       11:15:04
       +0530
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3)            In the present case, it appears that an amount of
Rs.10,62,935/- was ascertained by the Regional Director on the basis of
report of the Inspector vide Order dated 15 May 2000. The Petitioner
requested for revisit of the Inspector and liberty to produce documents.
Accordingly, it appears that the Inspector revisited the premises and
thereafter, the Deputy Director issued a Corrigendum on 24 February
2003, ascertaining the due amount at Rs.1,002 + 1,421 against the
Petitioner. Petitioner accordingly paid the amount of Rs.2,423/- on
12 May 2003. However, three years later, the ESI once again proceeded
to ascertain the due amount as Rs.10,62,935/- and issued show cause
notice to the Petitioner. Petitioner responded by letter dated 8 May
2006 inviting the attention of the Assistant Director to the re-
verification conducted by the Inspector. Ignoring the Corrigendum
dated 24 February 2003, the Assistant Director proceeded to order
under 45-A of the ESI Act on 7 September 2006, directing the Petitioner
to pay contribution of Rs.10,62,935/- for the period 1995 to 1997.


4)            The Petitioner was apparently not vigilant in immediately
filing an appeal against Section 45-A order dated 7 September 2006. It
is the contention of the Petitioner that it visited the office of the
Assistant Director for bringing to his notice the Corrigendum issued
based on re-verification conducted by the Inspector and believed that
the matter stood closed. I find substance in the said plea raised by the
Petitioner since the Respondent ESI did not initiate any proceedings for
recovery of the amount for next eight long years. The notice of demand
was issued eight years later on 29 May 2014. After receipt of notice of
demand, the Petitioner made a detailed representation dated 4 June
2014 to ESI pointing out the re-verification conducted by the Inspector

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and the Corrigendum issued to the original demand. However, since the
Respondent failed to withdraw the order dated 7 September 2006, the
Petitioner was required to file application under Sections 75 and 77 of
the ESI Act before the Court.


5)            The learned Judge has not appreciated the above chronology
of events and has erroneously rejected the application by holding that
the same was filed eight years after passing of order dated 7 September
2006. In the entire order passed by the learned Judge, there is no
whisper about Petitioner's stand that the original demand raised on 5
May 2000 was reduced vide Corrigendum dated 24 February 2003. The
learned Judge ought to have appreciated the plea raised by the
Petitioner that he had visited the office of ESI after receipt of Section
45-A Order dated 7 September 2006 and had attempted to impress
upon Respondent that the original demand was reduced and that the
reduced amount was already paid by the Petitioner. The learned Judge
has also not appreciated the position that Respondent-ESI itself
maintained silence for over eight years and did not issue notice for
demand.


6)            The learned Judge ought to have made some enquiry as to
why, in respect of Order dated 7 September 2006, demand notice was
issued on 29 May 2014. According to Petitioner, this delay in issuing
notice of demand is essentially attributable to Petitioner impressing
upon the concerned officer the fact that the original demand was
reduced by way of Corrigendum and that the reduced demand amount
had already paid by the Petitioner. In my view, therefore, the impugned
order passed by the learned Judge clearly suffers from the vice of non

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application of mind to the relevant aspects of the case. The case does
not involve a circumstance where Petitioner slept over his remedy. He
did point out to the concerned Officer of ESI that the Corrigendum was
issued. Though the concerned Officer of ESI did not issue any demand
notice after being apprised of the fact of issuance of Corrigendum,
subsequently, notice for demand was blindly issued in the year 2014.
This was the reason for the Petitioner to approach the learned Judge by
filing Application (ESI) No. 2 of 2014. In my view, therefore, delay in
approaching the Employees' Insurance Court has been appropriately
explained in the facts and circumstance of the present case. An
opportunity deserves to be granted to the Petitioner to prosecute the
Application on merits. In the event, the learned Judge arrives at a
conclusion that a Corrigendum was indeed issued and issuance of such
Corrigendum renders Section 45-A Order illegal, the Petitioner may not
be required to pay any further amount. Therefore, adjudication on
merits of the Application (ESI) No. 2 of 2014 would be necessary.


7)            In view of the above discussion, the impugned order dated
17 June 2025 is unsustainable and liable to be set aside.


8)            The Petition accordingly succeeds in part and I proceed to
pass the following order:

                                    ORDER


              i)   Order dated 17 June 2025 passed by the learned Judge,
                   Employees' Insurance Court, Thane is set aside.




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              ii)   The delay in filing Application (ESI) No. 2 of 2014 is
                    condoned.



              iii) Application (ESI) No. 2 of 2014 is remanded to the
                    Employees' Insurance Court to be heard and decided on
                    merits.



9)            With the above directions, the Writ Petition is partly allowed
and disposed of. There shall be no order as to costs.


10)           The interim order granted by this Court on 8 August 2025
shall continue to operate during the pendency of Application (ESI) No.
2 of 2014.



                                                       [SANDEEP V. MARNE, J.]




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