Download ESCI Form C-18, Actual, Interest, C-19, 20, 22 & 23, D-18 & D-19: Contribution to ESIC.
Section 39 and 40 of THE EMPLOYEES’ STATE INSURANCE ACT, 1948.
39. Contributions. — (1) The contribution payable under this Act in respect of an employee shall comprise contribution payable by the employer (hereinafter referred to as the employer’s contribution) and contribution payable by the employee (hereinafter referred to as the employee’s contribution) and shall be paid to the Corporation.
(2) The contributions shall be paid at such rates as may be prescribed by the Central Government :
Provided that the rates so prescribed shall not be more than the rates which were in force immediately before the commencement of the Employees’ State Insurance (Amendment) Act, 1989 (29 of 1989).
(3) The wage period in relation to an employee shall be the unit in respect of which all contributions shall be payable under this Act.
(4) The contributions payable in respect of each wage period shall ordinarily fall due on the last day of the wage period, and where an employee is employed for part of the wage period, or is employed under two or more employers during the same wage period the contributions shall fall due on such days as may be specified in the regulations.
(5) (a) If any contribution payable under this Act is not paid by the principal employer on the date on which such contribution has become due, he shall be liable to pay simple interest at the rate of twelve per cent. per annum or at such higher rate as may be specified in the regulations till the date of its actual payment :Provided that higher interest specified in the regulations shall not exceed the lending rate of interest charged by any scheduled bank.(b) Any interest recoverable under clause (a) may be recovered as an arrear of land revenue or under section 45-C to section 45-I.
Explanation. — In this sub-section “ scheduled bank ” means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934).]
40. Principal employer to pay contributions in the first instance. — (1) The principal employer shall pay in respect of every employee, whether directly employed by him or by or through an immediate employer, both the employer’s contribution and the employee’s contribution.
(2) Notwithstanding anything contained in any other enactment but subject to the provisions of this Act and the regulations, if any, made thereunder, the principal employer shall, in the case of an employee directly employed by him (not being an exempted employee), be entitled to recover from the employee the employee’s contribution by reduction from his wages and not otherwise :
Provided that no such deduction shall be made from any wages other than such as relate to the period or part of the period in respect of which the contribution is payable] or in excess of the sum representing the employee’s contribution for the period.
(3) Notwithstanding any contract to the contrary, neither the principal employer nor the immediate employer shall be entitled to deduct the employer’s contribution from any wages payable to an employee or otherwise to recover it from him.
(4) Any sum deducted by the principal employer from wages under this Act shall be deemed to have been entrusted to him by the employee for the purpose of paying the contribution in respect of which it was deducted.
(5) The principal employer shall bear the expenses of remitting the contributions to the Corporation.
I have to state that under Section 40, read with Section 39 of the Employees’ State Insurance Act, 1948 (hereinafter referred to as the Act), the Principal Employer of the factory/establishment covered under the Act, is required to pay, in respect of every employee, both the employer’s contribution and the employee’s contribution at the rates specified in Rule 51 of the E.S.I (Central) Rules, 1950 (as amended). The contributions are required to be paid in terms of Regulation 29,31 and 33 of the ESI (General) Regulations 1950 into a bank duly authorized by the Corporation, except where otherwise provided, and within the periods laid down for the purpose.
A return of contributions is to be submitted in Form-6 alongwith receipted copies of challans for the amount deposited in the Bank to the Branch Office of the Corporation at the expiry of each contribution period as specified under Regulation 26 of the Employees’ State Insurance (General) Regulations 1950.
It may also please be noted that in case of failure to pay contributions in accordance with Regulation 29, read with Regulations 31 of the ESI (General) Regulations 1950, interest @ 12% per annum becomes payable under Section 39(5) of the Act on arrears of contributions for each day of default or delay in payment of contributions. Any interest payable under Section 39 (5) of the act may be recovered under Section 45 C to 45 I of the Act.