ESIC Launches New Amnesty Scheme 2025 To Settle Legal Disputes and Reduce Litigation

ENA Sectors 2025-07-25 13:57:20 New Delhi, Jul 25 (KNN) The Employees' State Insurance Corporation (ESIC) has announced the launch of a comprehensive amnesty scheme aimed at resolving pending legal disputes and reducing litigation burden. The New Amnesty Scheme 2025 will remain operational from October 1, 2025, to September 30, 2026. The scheme is designed to provide a mechanism for resolution of disputes outside the court system while enhancing the Corporation's relationship with stakeholders. It covers withdrawal of prosecution cases filed under sections 84 and 85 of the ESI Act and court cases under sections 75 and 82 of the ESI Act, as well as cases under Article 226 of the Constitution filed up to March 31, 2025. Under the coverage dispute settlement provisions, closed units that have been non-operational for more than five years as of March 31, 2025, with cases pending before courts for more than five years, will be eligible for relief. For such units where no assessment has been made for the disputed period, Regional Directors will initiate withdrawal proceedings. Units closed within five years must provide records to substantiate coverage and pay accepted dues including contribution and interest, with no damages being claimed. For running units disputing coverage, employers must produce records to support their claims regarding non-coverage or coverage from a later date. However, cases where employers have themselves registered by submitting Form-01 on the SSP/ESIC portal are excluded from the scheme. The scheme also addresses contribution disputes where employers have challenged determination under sections 45A or 45AA of the ESI Act. Employers must seek court permission for out-of-court settlement and pay both employee and employer shares of contribution with interest based on their records. Where records are unavailable, alternative documentation such as EPFO and Income Tax records may be used. In cases where no records are available, employers must pay at least 30 per cent of the assessed contribution amount. For damage-related disputes, employers who have contested damage levies after paying contribution and interest can settle by paying 10 per cent of the determined damages. Similarly, where the Corporation has appealed against lower court decisions, damages as ordered by the lower court will be accepted for case withdrawal. Criminal cases filed under sections 84, 85, and 85A of the ESI Act are also covered under the scheme. Cases against insured persons for wrong declarations resulting in excess payments can be withdrawn upon full refund of the excess amount, with no interest claimed. However, cases involving criminal conspiracy and forgery are excluded from the scheme. The scheme has been expanded to include cases under section 85(a&g) where dues have been pending for more than 15 years as of March 31, 2025, with outstanding contributions up to Rs. 25,000 excluding interest and damages. For closed units, withdrawal is possible if the unit is non-operational or employer whereabouts are unknown. Running units must ensure up-to-date compliance and pay 30 per cent of contribution with resultant interest. Cases filed solely for non-submission of contribution returns under section 85(e) can be withdrawn without financial implications, given the digitalization of contribution payments and redundancy of half-yearly return provisions. Additionally, cases involving late submission of declaration forms by employers will be withdrawn if compliance is made, accident cases are settled, and cases have been pending for more than three years. The Corporation has established committees comprising Deputy Directors of Legal and Finance departments along with panel advocates at field office levels to review withdrawal cases. Regional Directors are empowered to sanction settlements without requiring headquarters approval. The scheme includes incentive provisions of Rs. 2,500 per case for matters under sections 75, 82, and 226, and Rs. 1,000 per case for section 85 matters. All cases under the scheme must be settled within six months from the application filing date. The scheme is available to employers and insured persons who have previously availed benefits under earlier amnesty schemes. Regional offices have been directed to provide wide publicity through advertisements, press releases, and stakeholder meetings to ensure maximum outreach and participation in the settlement process. (KNN Bureau) 42937 https://knnindia.co.in/news/newsdetails/sectors/esic-launches-new-amnesty-scheme-2025-to-settle-legal-disputes-and-reduce-litigation 2025-07-25 13:57:20 knnindia.co.in ESIC Launches New Amnesty Scheme 2025 To Settle Legal Disputes and Reduce Litigation