WA/1436/2026 of Sacred Heart Matriculation Higher Secondary School Vs The E.S.I.Corporation on 1 September 2026

COMMON JUDGMENT

(COMMON JUDGMENT OF THE COURT WAS MADE BY DR.G.JAYACHANDRAN,J.) The Appellant is an Educational Institution, which falls within the definition under the Employee’s State Insurance Act, 1948 (in short “ESI Act”), after the amendment brought into force in the year 2010. However, the notice of recovery issued to the appellant-Institution by the ESI Corporation for a period, commencing from May 2018 and thereafter was challenged by the appellant in a batch of writ petitions. Meanwhile, the common question as to whether Educational Institution will fall within the definition of establishment, was tested before the Courts and finally, the Full Bench by Judgment dated 29.07.2020, held that the Educational Institution will fall within the definition of

“Establishment”. As a result, the appellant/Institution was brought under the purview of the Act.

2. In the said circumstances, the writ petition filed by this appellant was dismissed and writ appeal also confirmed the order of the learned Single Judge. While so, the Government has thought fit to introduce the new Amnesty Scheme to reduce litigation and as a sign of goodwill among the stakeholders, thereby permitting the litigants to avail the Amnesty Scheme. The scheme came into force in 24.07.2025 with the cut-off date for identifying the cases fixed as on 31.03.2025. After filing the writ appeal, the Appellant-Institution thought fit to approach the learned Single Judge for review of the earlier order so that it can exercise the option of availing the Amnesty Scheme. The request made before the learned Single Judge for reviewing the earlier order dated 16.06.2025 was dismissed with the following observations:-

2. The very title of the amnesty scheme reads that it is a scheme for withdrawal of criminal cases filed against insured persons and employers and settlement of cases by employers under Sections 75 & 82 of the ESI Act, 1948.

3. This implies that the scheme relates to matters that are pending on the date of the issue of amnesty scheme. This has further confirmed by a reading of the following:- “Keeping in view above factors, the New Amnesty Scheme 2025 provides the opportunity for the withdrawal of prosecution cases filed under Section 84 and 85 of ESI Act and court cases under Section 75 and 82 of the ESI Act and Article 226 upto 31.03.2025 subject to following terms and condition”.

4. This clearly nails the fact that the scheme is applicable to all the cases that have been filed up to 31.03.2025 and which was pending as on 24.07.2025.

5. Admittedly, the writ petitions filed by the petitioner came to be dismissed on 16.06.2025. The writ appeals have also been filed only in the month of October 2025, when the amnesty scheme had come to an end. Therefore, the contention that the petitioner would fall within the scheme as their writ petitions were pending on 31.03.2025 cannot be accepted.”

3. Being aggrieved, the present Intra-Court appeal filed on the ground that the appellant was excluded from availing the Amnesty Scheme citing that the writ petition has been dismissed on 16.06.2025 and the same was challenged by way of the writ appeal in the month of October, 2025 and that the said writ appeal was closed on 27.10.2025, recording the New Amnesty Scheme, 2025, which was introduced on 24.07.2025, apparently after the order, that was passed by the learned Single Judge in W.P.No.18183 of 2021, dated 16.06.2025. Therefore, if at all any review is to be made, it can only be made before the learned Single Judge, who had dismissed the writ petition on 16.06.2025. The Amnesty Scheme came into force by then. The learned Single Judge further observed that the New Amnesty Scheme is applicable to all the cases, that have been filed up to 31.03.2025 and was pending as on 24.07.2025.

4. The learned counsel appearing for the appellant-Institution submitted that the object of the scheme is to reduce the number of litigation by providing a mechanism for resolution of disputes outside the Court, to earn the goodwill of stakeholders and thereby enhance the brand image of the Corporation. The timeline for referring the matters under the Amnesty Scheme commenced from 01.10.2025 and the cases which are identified and found fit for reference, were cases filed up to 31.03.2025. The scheme had encompassed the disputes regarding the determination of contribution under Section 45A or under Section 45AA or recovery of contribution, cases, which fall under Section 75 of the ESI Act and the appeal under Section 82 of the Act and also prosecution initiated under Section 84 and 85 of the ESI Act.

5. As far as the case of the appellant is concerned, it is in respect of the demand claiming contribution determined under Section 45A of the Act and therefore, it falls within the subject matter covered under the Scheme. The dispute had commenced as early as September 2019 and when the New Amnesty Scheme introduced on 24.07.2025, fixing 31.03.2025 as the cut-off date for cases filed on or before that date (i.e.)31.03.2025, the writ petition was pending before this Court. The order of dismissing the writ petition came to be passed on 16.06.2025, after the cut-off date fixed for cases suitable for reference. So, by all means, the dispute has to be considered as a dispute filed before 31.03.2025.

6. The learned Single Judge had passed the order on merits without any reference to the Amnesty Scheme, obviously for the reason that, on the date of dismissal of the writ petition, the scheme has not seen the light of day. The writ appeal is a continuation of the litigation, which was pending when the scheme came into force. W.A.No.3203 of 2025 challenging the order passed by the learned Single Judge, on 16.06.2025, did not consider the merits of the writ appeal, but referring to the Amnesty Scheme, granted liberty to the institution to seek review of the order within one month.

7. As pointed out earlier, the review applications have been dismissed, without assigning reasons which, in our view, it is not in consonance with the established principles of law and the object of the Amnesty scheme. Though the learned Standing Counsel appearing for the Corporation vehemently opposed the writ appeals on the ground that permitting the default employer to take advantage of the Amnesty Scheme, when it is not eligible will open a Pandora’s box and cause an undue financial burden on the organisation, we are unable to accept the said contention.

8. Considering the submissions and the records available, we find that the demand for contribution raised under Section 45A of the Act was the subject matter of the litigation pending at the time of introduction of the scheme and within the cut-off date (i.e.)31.03.2025 fixed for cases eligible for reference under the scheme. The object of the scheme is to reduce the litigation and gain the goodwill of the stakeholders. On that score also, the appellant-establishment is entitled to take advantage of the scheme.

9. The criteria that the cases filed must have been pending as on 31.03.2025 is also satisfied in the case of the appellant, since the writ petition challenging the notice issued by the ESI Corporation was pending adjudication under Article 226 of the Constitution of India. It is made it clear that the dispute of contribution is fit for scheme, as explained, the scheme includes appeal under Section 82 of the Act or proceedings under Article 226 of the Constitution of India or substantial question of law, involved up to 31.03.2025 subject to the condition mentioned.

10. One of the conditions is that the employer should seek permission of the Court, where the matter is pending, to settle the matter under litigation out of the Court as per the Amnesty Scheme.

11. We find that when the writ appeal was taken up for consideration, the employer who is the appellant herein, had forwarded the proposal and sought permission for referring the matter. Further, the Division Bench has thought fit that such permission must be granted only by the learned Single Judge, who had dismissed the writ petition and directed to approach the learned Single Judge.

12. As pointed out by the learned counsel for the appellant, the appellant has given a representation to the Assistant/Deputy Director, Regional Office (Tamil Nadu), Employees State Insurance Corporation, to avail the scheme and the said representation dated 04.06.2026 was received by the respondent office on 08.06.2026.

13. In view of the above facts and circumstances, we allow the writ appeals, granting permission to the appellant to approach the respondent to undergo the process under the Amnesty Scheme. The respondent shall examine the case on merits and pass appropriate orders. We make it clear that the grant of Amnesty to the appellant Institution in terms of the scheme dated 24.07.2025 shall not, in any way, cause any financial liability to the ESI Corporation for the period in dispute which is the subject matter of the Amnesty.

14. In the result, these Writ Appeals are allowed. No order as to costs. (Dr.G.JAYACHANDRAN,J.) (E.MANOHARAN,J.) 01.09.2026 ari Index:yes/no Neutral citation:yes/no To

1. Mr.Panchadeep Bhavan, Regional Director, The E.S.I.Corporation, Regional Office (T.N.) No.143, Sterling Road, Nungambakkam, Chennai 600 034.

2. The Assistant/Deputy Director, Regional Office (Tamil Nadu), Employees State Insurance Corporation, No.143, Sterling Road, Nungambakkam, Chennai 600 034.

3. The Recovery Officer, E.S.I., Panchadeep Bhavan, No.143, Sterling Road, Nungambakkam, Chennai 600 034.

Dr.G. JAYACHANDRAN,J. AND E.MANOHARAN,J. ari W.A.Nos.1436 and 1442 of 2026 01.09.2026