All the Regional Directors/
Joint Directors I/c
ESI Corporation Regional Offices /
Sub-Regional Offices

Sir,

It has been brought to the notice of this office by a large number of employers’ and their Associations that claims of contributions are raised on expenditure booked under various heads of accounts in respect of factories / establishments, outsourcing its jobs to agencies in a routine manner. It is pointed out that some of these heads of account do not include element of wages / labour charge component on which contribution is claimed.

Attention has also been drawn to the claims raised on heads of accounts under which expenditure booked on jobs outsourced without establishing the factual aspect regarding supervision as brought out in the Hqrs.’ Office letter No.P-12/11/51/9/2000-Rev.II dated 17.08.2006 and S-11/12/2/2000-Rev.II dated 07.03.2007. It has been clearly laid down in these Hqrs.’ Office instructions that the recommendations / findings of the Inspectors / Inspecting Officers while reporting payments made on jobs outsourced by the principal employer should be supported by material information relating to supervision / control, exercised by the principal employer.

In addition, it is observed that the I. Is. are not giving full details in their Inspection Reports and the Branch Officers without going into the details are issuing C-18, 45-A orders and C-19 for claiming substantial amount of contribution.

Keeping the above situation in view, it has been decided to refer the questions involved in respect of these claims to a Group of Senior Officers for looking into all related issues.

It has been decided to withheld action for a period of 3 months upto 30th September, 2007 in respect of cases falling in the categories referred in fore going pans.

This has the approval of Insurance Commissioner / Director General.

Please acknowledge receipt.

Yours faithfully,
(K.MISHRA)
DIRECTOR (REV.)

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