TaxTMI 
TaxTMI 
2009 (3) TMI 581
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....ird respondent herein with interest at the rate of 12 per cent, per annum from the date of the accident if the amount was not deposited within 30 days from the date* of receipt of a copy of the award. The third respondent did not pay the amount. At the instance of the petitioner, the Commissioner for Workmen's Compensation issued a revenue recovery certificate under section 31 of Workmen's Compensation Act, 1923, on September 28, 2005; to the first respondent and the first respondent in turn directed the second respondent, by an order dated September 23, 2006, to recover the amount. The second respondent, thereafter, by his proceeding dated December 8, 2006, directed the, third: respondent to deposit the amount in court. But the third respondent, by its letter dated January 28, 2009, informed the second respondent that the third respondent-company had become sick and the same was so declared by the BIFR by order dated July 9, 2002, under the provisions of the Sick Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred to as "the SICA"). Based on the said letter, the second respondent has expressed his inability to recover the amount from the third respondent. It ....
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....me Court in National Insurance Co. Ltd. v. Mubasir Ahmed [2007] 2 SCC 349, wherein the hon'ble Supreme Court has reiterated that the date of adjudication is the date on which the amount falls due and not the date of accident. In the case on hand, admittedly, the amount fell due on May 3, 2001. Therefore, as per section 4A of the Act, the employer is bound to pay the same on or soon after May 3, 2001. If the employer is aggrieved by the award of compensation, within 60 days from the date of award, he may prefer an appeal to the High Court under section 30 of the Act. But, such an appeal by an employer shall not lie unless the memorandum of appeal is accompanied by a certificate of the Commissioner to the effect that the appellant has deposited with him the amount payable under the order appealed against. 9. The aim of the Act, as could be perceived from the above provisions, is to ensure that the amount of compensation is paid to the workmen as early as possible, in any event, within 30 days from the date of its falling due. If it is not so paid, then under section 31 of the Act, the Commissioner-is empowered to recover the same as arrears of land revenue as per the provisions of t....
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....moting industrial progress. We are quite sure that the Government is fully alive' to the situation and are equally certain that they must be thinking of necessary modifications in the Act. These few observations are meant merely to record the need for changes in the Act. 13. Keeping in mind the above painful observation made by Mr. Justice B. P. Jeevan Reddy, let me now refer to the law laid down by the hon'ble Supreme Court in the said judgment. Speaking for the Bench, his Lordship justice K.S. Paripoornan, has held as follows (page 10 of 89 Comp Cas) : "So we are of the view that though the language of section 22 of the Act is of wide import regarding suspension of legal proceedings from the moment an inquiry is started, till after the implementation of the scheme or the disposal of an appeal under section 25 of the Act, it will be reasonable to hold that the bar or embargo envisaged in section 22(1) of the Act can apply only to such of those dues reckoned or included in the sanctioned scheme. Such amounts like sales tax, etc., which the sick industrial company is enabled to collect after the date of the sanctioned scheme legitimately belonging to the Revenue, can not be and co....
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....p Cas 530 (Ker), while dealing with sales tax recovery proceedings, relying on Corromandal Pharmaceuticals case [1997] 89 Comp Cas 1 (SC); [1997] 105 STC 327, the Kerala High Court has held as follows (page 534 of 133 Comp Cas) : "Only the liability or amount covered by the scheme would be taken in by section 22. Section 22(1) could apply only to such of those dues reckoned or included in the sanctioned scheme. Such amounts like sales tax, etc, which the sick industrial company is enabled to collect after the date of the sanctioned scheme legitimately belonging to the Revenue cannot be and could not have been intended to be covered within section 22 of the Act, The bar under section 22 therefore would apply only to such dues reckoned or included in the sanctioned scheme for rehabilitation." 18. When a question arose as to whether enforcement of notice under section 226(3) of the Income-tax Act, 1961 would be barred by section 22 of the SICA, the Gujarat High Court in EZY Slide Fastners Ltd. v. Joint CIT (Assessment) [2004] 122 Comp Cas 242 ; [2004] 269 ITR 548, after having elaborately dealt with the above said cases of the hon'ble Supreme Court, has distinguished sales tax and t....
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....strial company under the cover of section 22 of the SICA. Gratuity is nothing but deferred payments as earned during the life time of service and connotes retirement benefits which are nothing but a protection under social security concept in terms of article 41 of the Constitution of India. The same is also protected further under the International Charters of Human Rights being the Universal Declaration of Human Rights, 1948, under article 25 clause (1). Gratuity and retirement benefits are the rights being an emanated fundamental right from article 21 of the Constitution of India in view of the wide amplitude of the meaning of the word "life" as envisaged under article 21. The right to enjoy the retirement benefits at the old age under the social security scheme and social welfare legislation in a democratic State cannot be whittled down and/or negatived by any legislations under the garb of rehabilitation of sick industry. 21. The Delhi High Court had an occasion to examine whether the relief under section 17B of the Industrial Disputes Act, 1947, can be withheld by a sick company in Mideast India Ltd. v. K. M. Unni [2003] 115 Comp Cas 184 (Delhi). After referring to various j....
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....a Davy Ltd. v. State of Orissa [1998] 93 Comp Cas 1 ; AIR 1998 SC 2928. I am unable to accept the submission made by learned counsel for the petitioners. By no stretch of imagination gratuity can be called arrears of wages. The basic minimum which the workman is entitled to get is the wages and the gratuity and other statutory benefits." 25. In Indian Plywood Mfg. Co. Ltd. v. Commissioner of Labour [1999] 1 LLJ 201 (Karn.) ; [2000] 2 LLN 677, it has been held that a recovery certificate issued under section 33(c) of the Industrial Disputes Act cannot be regarded as governed by section 22(1) of the SICA. Similar view has been taken by Uttaranchal High Court in Uptron India Ltd. v. Presiding Officer, Labour Court [2004] 2 LLJ 378 and the Madhya Pradesh High Court in Kedia, Distilleries v. General Secretary, Chhatisgarh Chemical Mill Majdoor Sangh [2001] Lab IC 1815. A Division Bench of the Bombay High Court in Ranjan Bhagwant Kedar v. HMP Engineers Ltd. [2004] 3 LLJ 939, has also held that section 22(1) of the SICA could have no application to the recovery under recovery certificate issued by the industrial court. 26. In Modi Industries Ltd. v. Addl. Labour Commissioner [1993] 2 LL....
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....ustomers and others by the company belong to the State and the sick industrial company cannot withhold the said payment by taking re-course to section 22(1) of the SICA. (vi) Any amount due which does form part of the day-to-day operation of the company are not covered by the embargo under section 22(1) of the SICA. 29. If the above principles are applied to the workmen compensation award, there can be no difficulty in holding that such a compensation payable to a workman is a statutory benefit payable by the employer. The right to get workmen compensation, though a statutory right, in deed, emanates from right to life guaranteed under article 21 of the Constitution of India. So, the embargo under section 22(1) of the SICA cannot be made applicable to proceedings in respect of recovery of workmen compensation. 30. A recovery certificate issued under section 31 of WC Act can be equated to a certificate issued under section 33C of the Industrial Disputes Act. It has been consistently held by various High Courts, that the authorities can enforce such certificates issued under section 33C of the Industrial Disputes Act despite the fact that the company has become sick and so declare....
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....abilitate the workmen who have suffered injuries or the dependents of the workmen who lost their lives. The company, being a big organisation, may find many ways to rehabilitate itself. But, the workmen cannot be expected to find resources other than the resource provided under the Workmen's Compensation Act to rehabilitate. The Workmen's Compensation Act, being a piece of welfare legislation for the benefit of the workmen, should receive a correct interpretation so as to accomplish the welfare of the workmen. If a different interpretation is made, I am sure, it would be to the detriment of the workmen and the same would keep the object of the Workmen's Compensation Act in cold storage. One cannot expect the poor workmen who have lost their limbs to wait for the company getting rehabilitated in due course of time. When it is the question of revival or rehabilitation for the sick industrial company, it is the question of survival for the poor workmen. A workman like the one in the instant case, who has lost his limb, if, made to suffer without compensation amount being paid, then the result would be disheartening. Not only he, but his entire family would be left in the lurch. Such a....