State Insurance Corporation Vs. M/S Overseas Metal  INSC 155 (26 March 1993)
Singh (J) Kuldip Singh (J) Yogeshwar Dayal (J)
1994 SCC Supl. (2) 510
Special leave granted.
Respondents 1 to 4 defaulted, as employers, in the payment of employees' State
Insurance Corporation dues.
under Section 45-B of the Employees' State Insurance Act, the
appellant-Corporation initiated recovery proceedings under the Revenue Recovery
Act, 1890 (Central Act). In the proceedings before the Certificate Officer, an
objection was raised that the necessary court fee was not paid by the
Corporation and proper verification of the claim was not made. Faced with the
objections, the Corporation requested the Certificate Officer to allow the
recovery to be made under the Bengal Public Demands Recovery Act, 1913 (State
Act). The Certificate Officer disallowed the request of the Corporation in the
following terms :
ESI Corporation begins with the Revenue Recovery Act to avoid ad valorem court
fees and verification and then enjoys the switch over to the Bengal Public
Demands Recovery Act. This comes under the category of 'fraud upon the
Corporation challenged the order of the Certificate Officer by way of writ
petition before the High Court which was dismissed. This appeal by the
Corporation is against the judgment of the High Court.
have heard learned counsel for the appellant- Corporation. We have been taken
through the judgment of the High Court and the relevant part of the order of
the Certificate Officer as reproduced in the special leave petition. We are of
the view that the Certificate Officer was patently in error in rejecting the
request of the Corporation to initiate recovery proceedings under the State
Act. The Corporation could initiate recovery proceedings either under the
Central Act or under the State Act. The requisition under the Central Act being
a public demand, there was no legal difficulty in allowing the Corporation's request
to switch over the proceedings under the State Act.
of the view that the Collector should have exercised its discretion to allow
the proceedings to be continued under the State Act.
therefore allow the appeal, set aside the order of the High Court, allow the
writ petition of the Corporation filed before the High Court and set aside the
order of the Certificate Officer. No costs.