Employees State Insurance Corporation vs Mangalam Publications (I) Private Limited
Employees State Insurance Corporation & Anr. v. Mangalam Publications (I) Private Limited - Supreme Court Important Judgment 2017 -
On 21st September, 2017, in the case of Employees State Insurance Corporation & Anr. v. Mangalam Publications (I) Private Limited [Civil Appeal No. 4681 of 2009], while referring to the definition of “wages” contained in Section 2(22) of the Employees State Insurance Act, 1948, the Supreme Court observed that “the inclusive part and exclusive portion of the definition of “wages” clearly indicate that the expression “wages” has been given wider meaning”. It was held that “under the definition, firstly whatever remuneration is paid or payable to an employee under the terms of the contract of the employment, expressed or implied, is “wages”.
Secondly, whatever payment is made to an employee in respect of any period of authorized leave, lock-out etc. is “wages”. Thirdly, other additional remuneration, if any, paid at intervals not exceeding two months is also “wages”. Observing that any ambiguous expression should be given a beneficent construction in favour of employees, the Court held that “if the definition of “wages” is read in its entirety including the inclusive part as well as the exclusive portion, it appears that inclusive portion is not intended to be limited only of items mentioned therein, particularly, having regard to the objects and reasons for which the Employees’ State Insurance Act is enacted. The Act has to be necessarily so construed as to serve its purpose and objects.”
Accordingly, in the facts and circumstances of the case, it was held that the payment made by respondent by way of interim relief to its employees was not a “gift” or “inam”, but was a part of wages, as defined under Section 2(22) of the ESI Act, and the respondent was liable to pay ESI contribution on the amount of interim relief paid to its employees.