When a builder is hired to repair building; he employs his labour for work. Later he gives invoice of, say, 1 lac.
He is not registered under ESI law. Are we liable under ESI for that labour? And how the liability will be determined and paid?
Please guide.
Thank you,
Manish Kumar
4th December 2017 From India, Noida
Please mention section or rule also for reference.
4th December 2017 From India, Noida
Please reply. Any hint!
.
12th December 2017 From India, Noida
Dear Mr Manish Kumar
In the absence of separate ESI code for the Contractor, as Principal employer - you will have to recover 6.5% on 25% of the Bill amount and remit the same to the ESI authorities. (some case laws mentioned below for your reference).
• When the employer fails to give break up of the amount spent, construction, repair etc., 25% of it will be treated as 'wages' for ESI's contribution purposes.
Shree Sivakami Mills Ltd" Madurai (represented through Managing Director) v ESI Corporation, Madras (through its Regional Director) Madras, 2001 LLR 370 (Mad HC)
• Employees engaged by the contractor in an establishment are liable to be covered under ESI Act.
Employees' State Insurance Corporation v. Vijayamohini Mills, (1990) II LLJ 464: 1990 LLR 305: 1990 (1) LLN 902 (Ker HC).
• The principal employer will be liable to pay the ESI's contributions of the employees employed through contractor.
Standard Fabricators India) (Pvt.) Ltd. v Regional Director, ESI Corporation, Bombay, (1994) 69 FLR 785: 1994 LLR 869 (Bom HC).
• Respondent-company is liable to make contribution at 25 per cent in respect of labour charges of the total cost of the buildings.
Madras High Court - Regional Director, Employees' ... vs Sundaram Clayton Ltd. And Ors. on 10 December, 2003 Equivalent citations: (2004) IILLJ 30 Mad.
N Nataraajhan, Sakthi Management Services (Hp : + 91 94835 17402 ; )
12th December 2017 From India, Bangalore
What is the process of payment for these labours on ESI portal?
12th December 2017 From India, Noida
In the absence of individual coverage of the workers, you will have to remit the contribution to ESI under ' Misc ' head in lumpsum. Regards
N Nataraajhan, Sakthi Management Services (Hp : + 91 94835 17402)
12th December 2017 From India, Bangalore
Thank you for your prompt reply.
So on online portal of ESIC, it should be paid using "Omitted Wages Challan". Right!?
12th December 2017 From India, Noida
Yes. Pl go ahead.
N Nataraajhan, Sakthi Management Services (Hp : + 91 94835 17402)
12th December 2017 From India, Bangalore
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