P.D. Sharma, J.
1. The Regional Director, Employses' State Insurance Corporation lodged the present petition under Section 75(2) of the Employees' State Insurance Act, 1948 thereinafter be referred to as the Act) in the Insurance court, Ambala against (1) Kasturi Lal Vinaik principal employer orMessrs Hind Timber Industries, Yamunanagar, and (2) MessrsHind Timber Industries, Yamunanagar, for the recovery orRs. 1,592/- in respect of employees' contribution for theperiod from 1st October, 1958, to 30th June, 1960. thepetitioner alleged that the respondents-did not pay employees'contribution on a sum of Rs. 63,713.33 nP. paid by themas wages to their employees during the above period medetails of their claim are given in schedule 'A'. The omissionof the respondents to make the payment is said to havebeen noticed on the inspection of their factory by the inspector on 26th August, 1960.
2. The respondents controverted the above allegations and added that the petitioner's claim was barred by time.
3. The following issues were framed:--
(1) Whether the respondent is liable to pay Rs. 1592/-to the applicant as contribution from 1st October, 1958, to 30th June, 1960?
(2) Is the application Within time?
(3) Whether the application is validly tiled in the C.E.S.I. Court?
All the issues were found in favour of the applicant and the claim was decreed with costs. The respondents have come up in appeal to this Court under Section 82 of the Act.
4. The learned counsel for the appellants urged that the Insurance Court was not correct in holding that Rule 17 of the Employees' Insurance Courts Rules, 1949, which prescribed a period of limitation for filing applications or the instant category was ultra vires and that Article 120 of the Indian limitation Act governed the case. According to him the amount on which the employee's conttibutlon had been claimed did not represent the wages paid by the appellants to their employees but was the amount paid by them to the contractors for the work done outside the factory premises.
5. M. B. Nanda Manager, Local Office, Employees' State Insurance Corporation, Abdulpur (A. W. 2), inspected the appellants' factory on 26th August and 13th September, 1960, and incorporated the result in his report Exhibit A. W. 2/1. He noticed that employees' contribution had not been paid on the wage amount of Rs. 63,713.33 nP. wnich came to Rs. 1,592/-. He went on to say that on enquiry Kasturi Lal appellant informed him that the work for which the above amount was paid was got done on contract basis and through piecemeal labour and therefore, the employee's contribution was not payable thereon. The witness further-stated that such labour was working at the time of the inspection but no attendance register was shown to him. Madan Lal (R. W. 2), supervisor of the appellants' factory, stated that the factory manufactured packing cases for which wooden planks were prepared inside the factory premises end thereafter handed over to the contractors for preparing the cases outside the factory. He conceded that no account was Kept of the wooden planks so supplied to the contractors, that the packing cases after their manulacture were inspected on the spot where they were made by the contractors and that the defective ones were left there and the rest taken to the railway station for boohing to their cestination. He further admitted that no account of the rejected packing cases was kept.
It is common ground that after the Inspection of the factory by the inspector all the work connected with me manufacture of packing cases etc. Was being conducted inside the premises of the factory and the employee's contribution was being regularly paid. Kasturi Lal appellant deposed in terms of the statement of the above witness.
The Insurance Court on the aforesaid evidence concluded thatthe work by the contractors even outside the factory premises was being done under the supervision of the factoryand that the contractors at the most could be considered asimmediate employers and as such under Section 40 of theAct the appellants were responsible for paying the employee'scontribution. This is a finding of fact based on reliable evidence and supported by cogent reason. Therefore, it cannotbe set aside by this Court in appeal under Section 82 ofthe Act.
6. Rule 17 of the Employees' Insurance Courts Rules, 1949, was held as intra vires by a Division Bench of this Court in case, Chanan Singh v. Regional Director, Employees' State Insurance Corporation, F.A.F.O. No. 17 of 1961 D/-14-12-1962 : (AIR 1963 Punj 422), The rules provided :--
'17. (1) Every application to the Court shall be brought within twelve months from the date on which the cause or action arose or as the case may be the claim became due:Provided that the Court may entertain an application after the said period of twelve months if it is satisfied that the applicant had sufficient reasons for not making the application within the said period.'
There can be no dispute that the period of limitation started from the date the claim became due. Section 39(3) of the Act lays down that a week shall be the unit in respect or which all contributions shall be payable under the Act. According to regulation 31 of the Employees' State insurance (General) Regulations, 1950, an employer who is liable to pay contribution in respect of any employee shall pay those contributions within the following periods:--
(a) within 21 days of the last day of the wage period in which the contribution falls due:
(b) within 14 days of the termination of employment, irrespective of whether the employment is terminated with or without notice;
(c) within 21 days after the termination of the contribution period in respect of every employee, whichever period is earlier. The Corporation's claim became due within 21 days of the last day of the wage period in which the contribution fell due. Therefore such a claim for a period of one year and 28 days only was within limitation. The present petition was instituted on 16th May, 1961, the employee's contribution has been claimed on the amount of wages paid for the period from 1st October, 1958, to 30th June, 1960. The claim is, consequently, in time for the period from 18th April, 1960, to 30th June, 1960, only.
7. For the above reasons, the appeal is accepted to the extent that the Employees' State Insurance Corporation is entitled to employee's contribution on the amount of wages paid for the period from 18th April, 1960, to 30th June, 1960, and no more. The exact amount due to the Corporation for this period will be calculated on the basis of which the entire claim had been assessed by the Insurance Court. The balance of the claim decreed by the Insurance Court is disallowed. The parties are left to bear their, own costs.