Due To Financial Difficulties, The Writpetitioner Was Unable To Pay The Contribution Punctually.under Those Circumstances, The Order Impugned Dated21.03.2014 Wa v. The Deputy Commissioner Of Incometax In W.p

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 18.10.2019CORAMTHE HON'BLE MR.JUSTICE S.M.SUBRAMANIAMW.P.No.10790 of 2014andM.P.Nos.1 to 3 of 2014 M/s.Shree Senthil Enterprises,Registered Partnership Firm, By its Partner,Mrs.Chitra Parimala,Having office at No.753/479B, Avanashi Road,Peelamedu, Coimbatore – 641 029 ..PetitionerVs. 1.Employees State Insurance Corporation, Sub-Regional Office, Coimbatore, by its Recovery Officer, 1897, Trichy Road, Panchdeep Complex, Ramanathapuram, Coimbatore – 641 045 2.The Branch Manager, Bank of Baroda, Coimbatore Main Branch, No.82, Bank Road, Bank of Baroda Building, Coimbatore – 641 018 ..Respondents Prayer : Writ Petition filed under Article 226 of theConstitution of India praying to issue a Writ ofCertiorari, to call for the records pertaining toimpugned order bearing No.CBE/RECY/CP-3/56/60841/19 dated21.03.2014 on the file of the first respondent and quashthe same. The order dated 21.03.2014 passed by the 1[st]respondent, which is in the nature of the Prohibitoryorder is under challenge in the present writ petition. 2. The writ petitioner is M/s.Shree SenthilEnterprises, which is a Registered Partnership Firm. Thepetitioner states that they have applied under the ESIScheme and was admitted accordingly in ESI RegistrationNo as:5600-111791-000-0506/Rev IV. 3. Due to financial difficulties, the writpetitioner was unable to pay the contribution punctually.Under those circumstances, the order impugned dated21.03.2014 was issued and the petitioner has chosen tofile the present writ petition. 4. This Court is not inclined to adjudicate themerits and the demerits in view of the fact that theorder impugned is an Appealable order under Section 75 ofthe ESI Act of the ESI Act. ESI Courts are constitutedpursuant to the statutes and the ESI Court is presidedover by the District Judge and therefore, the petitionerhas to approach the competent Court under Section 75 ofthe Act. 5. The writ petition can be entertained, only afterexhausting the statutory remedies provided under the Act.When the Act contemplates an appeal before the ESI Court,then the petitioner has to exhaust the remedy. Exhaustingthe alternate remedy and its principles were alreadyadjudicated by this Court in the case of M/s.HyundaiMotor India Limited Vs. The Deputy Commissioner of IncomeTax in W.P.No.22508 of 2017 dated 16.07.2018 and therelevant paragraphs are extracted hereunder: “19.Unnecessary or routine invasion intothe statutory powers of the competentauthorities under a statute should berestrained by the Constitutional Courts.Frequent or unnecessary invasions in theexecutive power will defeat the constitutionalperspectives enshrined under the Constitutionof India. Undoubtedly, the separation of “19.Unnecessary or routine invasion intothe statutory powers of the competentauthorities under a statute should berestrained by the Constitutional Courts.Frequent or unnecessary invasions in theexecutive power will defeat the constitutionalperspectives enshrined under the Constitutionof India. Undoubtedly, the separation of powers under the Indian Constitution has beennarrated and settled in umpteen number ofjudgments. Separation of powers demarcated inthe Constitution of India is also to beconsidered, while exercising the powers ofjudicial review in the matter of dispensingwith the appeal remedy provided for anaggrieved person under a statute. If the HighCourts started interfering with such Appellatepowers without any valid and substantiatedreasons, then the very purpose and object ofthe statute and provision of appeal under thestatute became an empty formality and the HighCourts also should see that the provisions ofappeal contemplated under the statutes areimplemented in its real spirit and inaccordance with the procedures contemplatedunder the rules constituted thereon. Whileentertaining a writ petition as narrated bythe Apex Court, the provision of efficaciousalternative remedy under the statute also tobe considered. If the writ petitions areentertained in a routine manner, by notallowing the competent Appellate authority toexercise their powers under the provisions ofthe statute, then this Court is of an opinionthat the power of judicial review has notexercised in a proper manner. Thus, it isnecessary for this Court to elaborate thelegal principle settled in respect of theseparation of powers under the Constitution ofIndia. 1. Madras Bar Association vs. Union of India(UOI) (25.09.2014 - SC) : MANU/SC/0875/2014 If the historical background, thepreamble, the entire scheme of theConstitution, relevant provisions thereofincluding Article 368 are kept in mind therecan be no difficulty in discerning that thefollowing can be regarded as the basicelements of the constitutional structure.(These cannot be catalogued but can only beillustrated): (1) The supremacy of the Constitution. (2) Republican and Democratic form ofgovernment and sovereignty of the country. (3) Secular and federal character of theConstitution. (4) Demarcation of power between theLegislature, the executive and the judiciary. (5) The dignity of the individual secured bythe various freedoms and basic rights in PartIII and the mandate to build a welfare Statecontained in Part IV. (6) The unity and the integrity of theNation. 2. HolinessKesavanandaBharatiSripadagalvaru v. State of Kerala andAnr.[MANU/SC/0445/1973: (1973) 4 SCC 225]. That separation of powers between thelegislature, theexecutiveand the judiciaryis the basic structure of the Constitution isexpressly stated by Sikri, C.J. 3. P. Kannadasan and Ors. v. State of T.N. andOrs. [MANU/SC/0650/1996 : (1996) 5 SCC 670]the Supreme Court noted that the Constitutionof India recognised the doctrine of separationof powers between the three organs of theState, namely, the legislature, the executiveand the judiciary. The Court said: It must be remembered that our Constitutionrecognises and incorporates the doctrine ofseparation of powers between the three organsof the State, viz., the Legislature, theExecutive and the Judiciary. Even though theConstitution has adopted the parliamentaryform of government where the dividing linebetween the legislature and the executivebecomes thin, the theory of separation ofpowers is still valid. 4. State of Tamil Nadu and Ors. vs. State ofKerala and Ors. (07.05.2014 - SC) :MANU/SC/0425/2014 It must be remembered that our Constitutionrecognises and incorporates the doctrine ofseparation of powers between the three organsof the State, viz., the Legislature, theExecutive and the Judiciary. Even though theConstitution has adopted the parliamentaryform of government where the dividing linebetween the legislature and the executivebecomes thin, the theory of separation ofpowers is still valid. 4. State of Tamil Nadu and Ors. vs. State ofKerala and Ors. (07.05.2014 - SC) :MANU/SC/0425/2014 121. On deep reflection of the abovediscussion, in our opinion, the constitutionalprinciples in the context of IndianConstitution relating to separation of powersbetween legislature, executive and judiciarymay, in brief, be summarized thus: (i) Even without express provision of theseparationofpowers,thedoctrineofseparation of powers is an entrenchedprinciple in the Constitution of India. The doctrine of separation of powers informsthe Indian constitutional structure and it isan essential constituent of rule of law.In other words, the doctrine of separation ofpower though not expressly engrafted in theConstitution, its sweep, operation andvisibility are apparent from the scheme ofIndian Constitution. Constitution has madedemarcation, without drawing formal linesbetween the three organs- legislature,executive and judiciary. In that sense, evenin the absence of express provision forseparation of power, the separation of powerbetween legislature, executive and judiciaryis not different from the constitutions of thecountries which contain express provision forseparation of powers. (ii) Independence of courts from the executiveand legislature is fundamental to the rule oflaw and one of the basic tenets of IndianConstitution. Separation of judicial power is a significantconstitutionalprincipleundertheConstitution of India. (iii) Separation of powers between threeorgans--legislature, executive and judiciary--is also nothing but a consequence of principles of equality enshrined in Article 14of the Constitution of India. Accordingly,breach of separation of judicial power mayamount to negation of equality Under Article14. Stated thus, a legislation can beinvalidated on the basis of breach of theseparation of powers since such breach isnegation of equality Under Article 14 of theConstitution.(iv) The superior judiciary (High Courts andSupreme Court) is empowered by theConstitution to declare a law made by thelegislature(ParliamentandStatelegislatures) void if it is found to havetransgressed the constitutional limitations orif it infringed the rights enshrined in PartIII of the Constitution.(v) The doctrine of separation of powersapplies to the final judgments of the courts.Legislature cannot declare any decision of acourt of law to be void or of no effect. Itcan, however, pass an amending Act to remedythe defects pointed out by a court of law oron coming to know of it aligned.In other words, a court's decision must alwaysbind unless the conditions on which it isbased are so fundamentally altered that thedecision could not have been given in thealtered circumstances.(vi) If the legislature has the power over thesubject-matter and competence to make avalidating law, it can at any time make such avalidating law and make it retrospective. Thevalidity of a validating law, therefore,depends upon whether the legislature possessesthe competence which it claims over thesubject-matter and whether in making thevalidation law it removes the defect which thecourts had found in the existing law.” 20.This Court is of a strong opinion thatinstitutional respects are to be maintained by 20.This Court is of a strong opinion thatinstitutional respects are to be maintained by the constitutional Courts. Whenever there is aprovision for an appeal under the statute,without exhausting the remedies availableunder the statute, no writ petition can beentertained in a routine manner. Only onexceptional circumstances, the remedy ofappeal can be waived, if there is a grossinjustice or if there is a violation offundamentalrightsensuredundertheConstitution of India. Otherwise, all theaggrieved persons from and out of the orderpassed by the original authority is bound toapproach the Appellate Authority. TheConstitutional Courts cannot make an appealprovision as an empty formality. EveryAppellate Authority created under the statuteto be trusted in normal circumstances unlessthere is a specific allegation, which issubstantiated in a writ proceedings. Thus, theinstitutional functions and exhausting theappeal remedies by the aggrieved persons, areto be enforced in all circumstances and writproceedings can be entertained only onexceptional circumstances. Rule is to preferan appeal and entertaining a writ is only anexception. This being the legal principles tobe followed, this Court cannot entertain thewrit petitions in a routine manner by waivingthe remedy of appeal provided under thestatute.21.Now, let us look into the legalprinciples settled by the Apex Court forexhausting the efficacious alternative remedyprovided under the statute.22.When an effective alternative remedy isavailable, a writ petition cannot bemaintained 1. In City and Industrial DevelopmentCorporation v. DosuAardeshirBhiwandiwala andOrs. MANU/SC/8250/2008 : (2009) 1 SCC 168,this Court had observed that:The Court while exercising its jurisdictionunder Article 226 is duty-bound to considerwhether: (a) adjudication of writ petition involves anycomplex and disputed questions of facts andwhether they can be satisfactorily resolved; (b) the petition reveals all material facts; (c) the Petitioner has any alternative oreffective remedy for the resolution of thedispute; (d) person invoking the jurisdiction is guiltyof unexplained delay and laches;of unexplained delay and laches; (e) ex facie barred by any laws of limitation; (f) grant of relief is against public policyor barred by any valid law; and host of otherfactors.or barred by any valid law; and host of otherfactors. 2. KanaiyalalLalchand Sachdev and Ors. vs.State of Maharashtra and Ors. (07.02.2011 -SC) : MANU/SC/0103/2011 It is well settled that ordinarily reliefUnder Articles 226/227 of the Constitution ofIndia is not available if an efficaciousalternative remedy is available to anyaggrieved person. (See Sadhana Lodh v.National Insurance Co. Ltd.; Surya Dev Rai v.Ram Chander Rai and SBI v. Allied ChemicalLaboratories.) 3. Commissioner of Income Tax and Ors. v.ChhabilDass Agarwal, MANU/SC/0802/2013 : 2014(1) SCC 603, as follows: Para 15. while it can be said that this Courthas recognised some exceptions to the Rule ofalternative remedy i.e. where the statutoryauthority has not acted in accordance with theprovisions of the enactment in question, or indefiance of the fundamental principles ofjudicial procedure, or has resorted to invokethe provisions which are repealed, or when anorder has been passed in total violation ofthe principles of natural justice, theproposition laid down in ThansinghNathmal 3. Commissioner of Income Tax and Ors. v.ChhabilDass Agarwal, MANU/SC/0802/2013 : 2014(1) SCC 603, as follows: Para 15. while it can be said that this Courthas recognised some exceptions to the Rule ofalternative remedy i.e. where the statutoryauthority has not acted in accordance with theprovisions of the enactment in question, or indefiance of the fundamental principles ofjudicial procedure, or has resorted to invokethe provisions which are repealed, or when anorder has been passed in total violation ofthe principles of natural justice, theproposition laid down in ThansinghNathmal case, Titaghur Paper Mills case and othersimilar judgments that the High Court will notentertain a petition Under Article 226 of theConstitution if an effective alternativeremedy is available to the aggrieved person orthe statute under which the action complainedof has been taken itself contains a mechanismfor redressal of grievance still holds thefield. Therefore, when a statutory forum iscreated by law for redressal of grievances, awrit petition should not be entertainedignoring the statutory dispensation. 4. Authorized Officer, State Bank ofTravancore and Ors. vs. Mathew K.C.(30.01.2018 - SC) : MANU/SC/0054/2018 The petitioner argued that the SARFAESIAct is a complete code by itself, providingfor expeditious recovery of dues arising outof loans granted by financial institutions,the remedy of appeal by the aggrievedunder Section 17 before the Debt RecoveryTribunal, followed by a right to appeal beforethe Appellate Tribunal under Section 18. TheHigh Court ought not to have entertained thewrit petition in view of the adequatealternate statutory remedies available to theRespondent. The interim order was passed onthe very first date, without an opportunity tothe Appellant to file a reply. Reliance wasplaced on United Bank of India vs. SatyawatiTandon and others, 2010 (8) SCC 110,and GeneralManager,SriSiddeshwaraCooperative Bank Limited and another vs. Ikbaland others, 2013 (10) SCC 83. The writpetition ought to have been dismissed at thethreshold on the ground of maintainability.The Division Bench erred in declining tointerfere with the same. The Supreme Courtagreed to the arguments and held the same alsonoted that the writ petition ought not to havebeen entertained and the interim order grantedfor the mere asking without assigning special reasons, and that too without even grantingopportunity to the Appellant to contest themaintainability of the writ petition andfailure to notice the subsequent developmentsin the interregnum. 5. State of Himachal Pradesh v. Gujarat AmbujaCement Ltd. reported at AIR 2005 SC 3856, theSupreme Court explained the rule of 'alternateremedy' in the following terms Considering the plea regarding alternativeremedy as raised by the appellant-State.Except for a period when Article 226 wasamended by the Constitution (42nd Amendment)Act, 1976, the power relating to alternativeremedy has been considered to be a rule ofself imposed limitation. It is essentially arule of policy, convenience and discretion andnever a rule of law. Despite the existence ofan alternative remedy it is within thejurisdiction of discretion of the High Courtto grant relief under Article 226 of theConstitution. At the same time, it cannot belost sight of that though the matter relatingto an alternative remedy has nothing to dowith the jurisdiction of the case, normallythe High Court should not interfere if thereis an adequate efficacious alternative remedy.If somebody approaches the High Court withoutavailing the alternative remedy provided theHigh Court should ensure that he has made outa strong case or that there exist good groundsto invoke the extraordinary jurisdiction. 6. K.S. Rashid and Sons v. Income TaxInvestigation Commission and Ors., AIR (1954)SC 207; Sangram Singh v. Election Tribunal,Kotah and Ors., AIR (1955) SC 425; Unionof India v. T.R. Varma, AIR (1957) SC 882;State of U.P. and Ors. v. Mohammad Nooh, AIR(1958) SC 86 and M/s K.S. Venkataraman and Co.(P) Ltd. v. State of Madras, AIR (1966) SC1089, Constitution Benches of the Supreme Courtheld that Article 226 of the Constitutionconfers on all the High Courts a very widepower in the matter of issuing writs.However, the remedy of writ is an absolutelydiscretionary remedy and the High Court hasalways the discretion to refuse to grant anywrit if it is satisfied that the aggrievedparty can have an adequate or suitable reliefelsewhere.The Court,inextraordinarycircumstances, may exercise the power if itcomes to the conclusion that there has been abreach of principles of natural justice orprocedure required for decision has not beenadopted. 7. First Income-Tax Officer, Salem v. M/s.Short Brothers (P) Ltd., [1966] 3 SCR84 and State of U.P. and Ors. v. M/s.Indian Hume Pipe Co. Ltd., [1977] 2 SCC 724. There are two well recognized exceptions tothe doctrine of exhaustion of statutoryremedies. First is when the proceedingsare taken before the forum under a provision oflaw which is ultra vires, it is open to a partyaggrieved thereby to move the High Court forquashing the proceedings on the ground thatthey are incompetent without a party beingobliged to wait until those proceedings runtheir full course. Secondly, the doctrine hasno application when the impugned order has beenmade in violation of the principles of naturaljustice. We may add that where the proceedingsitself are an abuse of process of law the HighCourt in an appropriate case can entertain awrit petition.” 6. In view of the principles laid down in the abovejudgment, the petitioner has to approach the appropriateCourt under Section 75 of the Act and a liberty isgranted to that effect. The delay, if any, also shall becondoned by the ESI Court for the purpose of entertainingthe appeal and accordingly, adjudicate the appeal, if anyfiled by the writ petitioner on merits and in accordance with law. 7. With these observations, the writ petition standsdismissed. However, there shall be no order as to costs.Consequently, connected miscellaneous petitions areclosed. Sd/- Assistant Registrar(CS) //True Copy// Sub Assistant Registrar kakTo1.The Recovery Officer, Employees State Insurance Corporation, Sub-Regional Office, Coimbatore, 1897, Trichy Road, Panchdeep Complex, Ramanathapuram, Coimbatore – 641 045 2.The Branch Manager, Bank of Baroda, Coimbatore Main Branch, No.82, Bank Road, Bank of Baroda Building, Coimbatore – 641 018+1cc to Mr.S.Siva shanmugam , Advocate SR.No. 87483+1cc to Mr.T.N.C.Kausik , Advocate SR.No. 82652W.P.No.10790 of 2014A.SK(26/11/2019) https://hcservices.ecourts.gov.in/hcservices/