Skip to content


Employees' State Insurance Corporation, New Delhi Vs. Roop Chand and Co., Delhi and Anr. (03.05.1973 - DELHC) - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtDelhi High Court
Decided On
Case NumberFirst Appeal No. 28 of 1967
Judge
Reported in9(1973)DLT402; [1973(27)FLR424]
ActsEmployees State Insurance Act, 1948 - Sections 75
AppellantEmployees' State Insurance Corporation, New Delhi
RespondentRoop Chand and Co., Delhi and Anr.
Advocates: C.L. Talwar and; I.D. Gupta, Advs
Cases ReferredDrum Manufacturting Company Privte Limited v. The Employees
Excerpt:
.....payment of contribution against respondents for period not only of 1964 but also prior to 1964 - claim of corporation for period prior to 01.04.1964 subject matter in dispute - order passed by first court dismissing petition had effect of disposing of claim of appellant in respect of contribution for period prior to 01.04.1964 - claim for same period barred by rule of rest judicata - held, dismissal of application proper. - - pamnundan prusad narayan singh, that the rule of rest judicata is dictated 'by a wisdom which is for all lime,'and his lordship found good reasons to apply and rule to decisions of industrial tribunals. the statement of the inspector of the corporation was that the realisation bad been effected. these rules lend support to the view that it was open to the..........present application was barred by the principles of resjudicata as well as order 2, rule 2 of the code of civil procedure, this plea of the respondents prevailed wilh the court below which after examining the materal on record held that the present petition was barred on account of the fllure of the appellant to claim the amount in dispute in the instant case in the earlier petition. it also observed that it was har.-ed by order 2, rule 2 of the code, (4) mr. c.l. talwar arpearing for the appellant corporation has assailed the finding of the court below and has commended that the insurance court was a persona designam and not a civil court although officers of the rank of senior subordinate judge were appointed as its presiding officer and, thereforee, the technical rule of order 2,.....
Judgment:

B.C. Misra, J.

(1) This appeal under section 82 of the Employees' Stale Insurance Act 34 of 1948 (hereinafter referred to- as the Act) has been filed by the Insurance Corporation through the Assistant Regional Director against an order of the Employees Insurance Court dated 28th October, 1966 by which it has rejected the application of the appellant.

(2) The fact of the case lie in a narrow compass. It appears that respondent No .1 before me is a partnership concern of which respondent No. 2 is a partner and they constitute a factory within the meaning of clause (12) of section 2 of the Act. The respondents disputed this fact and did not pay the employees' contribution to the appellant which was due under the Act. Eventually, the appellant filed a petition under sec corporation 75(2) of the Act before the Insurance Court on the allegations that the respondents before me had not nude their contribution for the period from 1st January, 1961 to 31st March, 1964, and a sum of Rs 3.170.00 was due from them which may be decreed. The basis of the claim was a percentage of the total wages paid by the respondents to their employees during the said period.

(3) The application was resisted by the respondents on several grounds, the main ground of which was that the appellant before me bad filed a previous application for recovery of contribution for the period from 1st April, 1964 to 31st December, 1964 and also for the period prior to the same on 20th March, 1965 and the said petition had been dismissed by the Insurance Court by order dated 6th August, 1965 and, thereforee, the respondents contended that the present application was barred by the principles of resjudicata as well as Order 2, Rule 2 of the Code of Civil Procedure, This plea of the respondents prevailed wilh the Court below which after examining the materal on record held that the present petition was barred on account of the fllure of the appellant to claim the amount in dispute in the instant case in the earlier petition. It also observed that it was har.-ed by Order 2, Rule 2 of the Code,

(4) Mr. C.L. Talwar arpearing for the appellant Corporation has assailed the finding of the Court below and has commended that the Insurance Court was a persona designam and not a civil Court although officers of the rank of Senior Subordinate Judge were appointed as its Presiding Officer and, thereforee, the technical rule of Order 2, Rule 2 of the Code was not attracted to the proceedings before the Insurance Court. He has also contended that the same was not barred by the rule of rest judicata either.

(5) I have heard the learned counsel for the parties. The previous application filed by the appellant is Annexture R.3. ln this application the appellant before me had stated that the opposite party had not paid the employees' contribution for the period from 1st April, 1964 to 31stDecember,l964 amounting to Rs. 1115.57. It was, however, prayed In the petition as follows:-

(A)That a decree for Rs 1,115.57 due to the Corporation in respect of Employees contribution for the period from 1st April, 1964 to 31st December, 1964 may please be passed against the opposite party with interest at the rate of 6 per cent per annum. (b) The employer may be directed to produce his account books wage register and all other relevant documents to establish his coverage prior to 1st April, 1964 under the Employees State Insurance Act and also a decree may be passed for the amount of contribution which may be found due as a result of scrutiny of the records'

A persual of the petition shows that the appellant Corporation had in their petition not only asked for a decree for the period from 1st April, 1964 to 31st December, 1964 but had also requested it for directions to call for the relevant records for the period prior to 1st April, 1964 and then pass a decree for the amount of contribution which may be found due as a result of the scrutiny of the records. The claim for. the prior period was. thereforee, expressly made subject matter of the said petition and the relies claimed therein. it appears that the. respondents before me did not contest the said petition and they paid some amount in the office of the Corporation out of Court. On 6th August, 1965, Shri T.N. Sharma, Inspector of the Corporation made the following,statement which in Urdu language is Exhibit R. 1 and translated it reads as follows;-

'Stated that the realisation has been effected and so the application be dismissed.'

On this statement, the Court passed an order on 6th August, 1965 (Exhibit R. 2) to the effect that as per statement the application had been dismissed and it ordered consignment of the case file to the recordroom.

(6) It appears that the payment in fact made by the respondents was only for Rs. 1,118.32 vide receipt Exhibit R.4and very probably no payment had bean made for the period prior to the application. The question for determination, however, is whether in view of this state of the record, the previous petition is barred by any rule of law.

(7) In view of my following finding it is not necessary for me to determine whether Insurance Court is or is not a civil Court, nor is it necessary to decide whether Order 2, Rule 2 of the Code would be. attracted to the proceedings before the Insurance Court. The appeal must, however, fall on another ground which had been duly taken in the Court below and which is apparent on the face of the record. It is the rule of resjudicata. So far as section 11 of the Code is concerned, Explanationn V provides that any relief claimed in the plaint which is not expressly granted by the decree, shall, for the purposes of this section, be deemed to have been refused. Apart from section 11 of the Code, the applicability of which is being dispuled by the appellant, the same rule Will still apply. The reason is the rule of rest judicata is not confined only to Code. In Daryao v. Stale of U.P. it was observed that the rule of rest judicata embodied insection 11 of the Code of Civil Procedure was founded on considerations of public policy and it was in the interest of the public at large that a finality should attach to the binding decisions pronounced by Courts of compelent jurisdiction, and it was also in the public interest that individuals should not be vexed twice over with the same kind of litigation These two principles which were the foundation of the doctrine were applied to the writ petitions in the said decision. In Gulabchand Chhotalal Parikh v. State of Gujarat, it was observed that the provisions of section 11 of the Cods of Civil Procedure were not exhaustive and on the general principles of rest judicata., the decision of the High Court on a writ petition under Acrticle 226 on the merits was only to operate as rest judicata in a subsequeat regular suit between the same parties with respect to the same matter. The Supreme Court applied be rule of resjudicata to awards of the Industrial Tribunals also in Burn and Company v. Their Employees. Venkatarma Ayyar J. speaking for the Court observed that although section 11 of the Civil Procedure Code was to terms inapplicable to the matter of awards by Industrial Courts, the principle underlying it expressed in the maxim interest rei Publicae up sit finis litium was founded, on sound public policy and was of universal application. His lordship quoted a line from the observations of Sir Lawrence Jenkins, C.J. in Sheoparsan Singh v. Pamnundan Prusad Narayan Singh, that the rule of rest judicata is dictated 'by a wisdom which is for all lime,' and his lordship found good reasons to apply and rule to decisions of Industrial Tribunals. In Raj Lakshmi Dasi v. Banamall Sen, the Supreme Court applied the rule of rest judicata to the land acquisition proceedings and in Shankar Sitaram v. Balkrishan Sitaram, that the compromise closed once for all the controversy and a consent decree was as binding upon the parties thereto as a decree passed by invitum.

(8) On the facts of the present ease, it is obvious that the appellant had, in the previous petition, made an express prayer for a decree for payment of the contribution against the respondents for a period not only of 1964 but also prior to 1st April, 1964. The Court by dismissing the application will be deemed to have refused the said relief. The statement of the inspector of the Corporation was that the realisation bad been effected. He did not mention In the statement that the amount received pertained only to a part of the claim in dispule, nor did bereserve any right to claim the balance On the construction of the pleadings, the statement of the facts and the orders of the Court, it is apparent that the claim of the Corporation for the period prior to 1st April, 1964 was also the subject-matter in dispute and had been decided against the appellant. In Vith Income-taX Officer v, K. Y.Pillaiahh and sons, the Supreme Court decided that a plea of relief not pressed by the parly must be deemed to have been decided against it. The decision of the first court in respect of the claim in dispute in the present case would, thereforee, be deemed to have been decided against the appellant and if they were dissatisfied with the said decree, they ought to have taken steps to have the same corrected by way of appeal which they never did.

(9) In this connection, notice may be taken of the rules framed by tbc State Government under section 96 of the Act, by notification dated 22nd August, 1950. By these rules almost all the essential powers and procedure of a civil Court have been conferred and prescribed for the Insurance Court. Rule 47 reads as follows :-

'47.Provisions in the Code of Civil Procedure 1908 (V of 1908) etc., to apply. In respect of matters relating to procedure or admission of evidence for which no specific provision is made in these rules. the provisions of the Code of Civil Procedure, 1908 (V of 1908) including the rules made there under and the Indian Evidence Act, 1872 (I of 1872) shall, 80 far as may be, apply to proceedings under the Act'.

Rule 37 permits compromise or adjudication of the matter. It is to the following effect:----

'37.Compromise of suit. Where it is proved to the satisfaction of the Court that a case has been adjusted wholly or in part , any lawful agreement or compromise, or where the opposite party satisfies the applicant in respect of the whole or any part af the subject- matter of the case, the Court shall order such agreement, compromise or satisfaction to be recorded, and shall pass a final order in accordance there with so far as it relates to the case.'

Rule 38 lays down that save as provided in section 82, the order of a Court shall be final and binding upon the parties. These rules lend support to the view that it was open to the appellant to compromise the matter with the respondents and if they had received satisfaction of their claim out of Court, there was no legal bar to realise the same and make a statement before the Court that the claim in suit had been satisfied and they did not want to press the application. In fact under rule 37, the claim could be adjusted is whole or in part and the insurance Court was, thereforee, entitled to act on the faith of the statement of the Inspector that the realisation had been effected or the payment had been received. Under the circumstances, the order passed by the first Court dismissing the petition had the effect of disposing of the claim of the appellant in respect of the contribution for the period prior to lit April, 1964 and acting on the same the Court dismissed it and its decree has under the law becoma final and is not assailable. As such the finding of the Court below in the instant case was correct that the claim for the same period was barred by the rule of rest judicata and I hold accordingly.

(10) Mr Talwar for the appellant has cited M/s. P. W. M Tent Factory Delhi v. The Assistant Regional Director, for the proposition that Employees Insnrance Court is not a civil Court but a persona designata and he has also cited M/s. Bharat Barrel and. Drum Manufacturting Company Privte Limited v. The Employees' Estate Insurance Corporation, where their lordships construed the provisious of lection 96(l)(b) of the Act and came to the conclusion that rule 17 framed by the Government prescribing limitation for filing applications under section 75 was ultra virea. There lordships also noticed that thereafter the law had been amended and now three years limitation had been prescribed. In the view I am taking, these authorities are not of much assistance, as I am not deciding whether the Insurance Court is a civil Court or not and whether Order 2. Rule 2 of the Code will in terms apply to it or not. I have only held that where either of the parties moves the Insurance Court under section 75 of the Act for adjudication of the dispule, a decision on the same would operate as resjudicata and where the Court has dismissed the petition on the ground that the petitioner had stated that his claim had been satisfied out of Court, the Court would be justified in pissing an order and dismissing the patition and the same would operate as resjudicata in the present proceedings. The appeal, thereforee, fails and is dismissed. There will be no order as to costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //