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raviv11
A contractor had rendered his service of providing manpower for a principal employer which is Govt of India organization. The contract ran for a span of 11 months, wherein the principal employer bill payment was not continuous had paid fewer wages than the prescribed minimum wages paid only 4 months' bill to the contractor and had stopped payment stating irrelevant reasons due to which the contractor was able to pay only salary to employees as per applicable wages even though the contract employees were given ESI number under contractor code no. Later principal employer wrote a letter to ESI for which ESI had conducted an inspection of the contractor. Based on the Inspection, the ESI officer had issued an inspection report wherein for recovery of the ESI amount, the ESI inspection officer had obtained a letter from the contractor to collect the ESI recovery amount from the contractor bill held up at the principal employer and had obtained all ESI challans from the contractor and the matter was closed. But after 6 years ESI has issued a notice to the contractor to pay ESI due for the said period without taking the Principal employer into consideration.

The contractor upon verification came to know that, out of 11 months of ESI contribution, the ESI department had collected only 4 months of ESI amount from the principal employer from the Contractors bill due at the principal employer and had not recovered 7 months' amount even though Contractors bill is still held up at Principal employer. Now after 6 years, the same ESI which had received a letter from the contractor for recovery of the ESI amount from the Principal employer from his due bill has issued a notice to the contractor to pay contributions. Kindly help us and let us know who shall be responsible for payment of ESI contribution as the Contractors bill is held up at the principal employer. ESI has recovered only 4 months of ESI Contribution from the principal employer from the bill of Contractor and has left 7 months of ESI contribution even though till date principal employer has held up the bill. Kindly specify under which act, ESI can recover only part payment from the principal employer.

Also who shall be held responsible for the part recovery of the ESI amount as the ESI dept has obtained challans and letter for recovery from the contractor bill held up at the principal employer but failed to collect the entire ESI contribution due to reasons unknown? Now the contractor also cannot claim for ESI amount from the principal employer as there has been a lapse of 6 years. How to solve this matter as now contractor has stopped his business due to his ill-health for 6 years which was also brought to the knowledge of ESI authorities.

From India, Mysore
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