Sections 44-47 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Sections 44 to 47 are four separate provisions at the end of the ESI Corporation's benefit scheme. Section 44 lets underused ESI hospitals treat outsiders for user charges. Section 45 allows a notified ESI scheme for unorganised, gig and platform workers. Section 46 lets Government exempt Government or local authority units with equal or better benefits. Section 47 ranks ESI dues as a charge on the establishment's assets with priority under the Insolvency and Bankruptcy Code, 2016.
s.44: the Central Government may notify a scheme for "other beneficiaries" (persons other than employees insured under section 28) to use underutilised Corporation hospitals on payment of user charges. s.45: it may notify a scheme giving Chapter IV benefits to unorganised, gig and platform workers and their families. s.46: the appropriate Government may exempt Government or local authority factories and establishments whose employees already receive substantially similar or superior benefits. s.47: ESI dues are a charge on the assets of the establishment and are paid in priority under the Insolvency and Bankruptcy Code, 2016.
Section 44: hospital scheme for other beneficiaries
If you need to confirm whether your establishment is covered at all, start with ESI and PF registration; the four provisions below sit on top of that.
Section 44 operates "notwithstanding anything contained in this Chapter". The Central Government may, by notification, frame, amend, vary or rescind a scheme under which other beneficiaries and their family members receive medical facility in any hospital established by the Corporation in an underutilised area, on payment of user charges, and prescribe the terms and conditions.
The Explanation defines three terms:
| Term | Meaning |
|---|---|
| Other beneficiaries | Persons other than employees insured under section 28 |
| Underutilised hospital | Any hospital not fully utilised by employees insured under section 28 |
| User charges | The amount charged from other beneficiaries for medical facilities, as specified in the regulations after prior approval of the Central Government |
User charges collected from these beneficiaries are deemed to be contribution and form part of the ESI Fund (proviso to s.25(1); see sections 25 to 27). Rule 28 of the Central Rules, 2026 adds that the terms and conditions of the scheme are as notified by the Central Government from time to time, and user charges are as specified by the Corporation from time to time with the Central Government's prior approval.
Section 45: ESI for unorganised, gig and platform workers
Section 45(1) allows the Central Government, by notification, to frame a scheme for unorganised workers, gig workers and platform workers and their families, to give the benefits admissible under Chapter IV by the Corporation. Section 45(2) says the contribution, user charges, scale of benefits, qualifying and eligibility conditions and other terms are "such as may be specified in the scheme".
Three points to note:
- The Code itself sets no rate and no eligibility test for this scheme. Everything depends on the notified scheme.
- It is an enabling provision. A scheme must be notified before gig and platform workers can rely on it through this route.
- This is separate from the registration and schemes for these workers under sections 113 and 114 and the Social Security Fund; read our articles on gig and platform worker schemes and on the definitions of gig worker and platform worker for the wider picture.
Section 46: exemption of Government and local authority units
Under s.46, the appropriate Government may, after consultation with the Corporation, by notification and on conditions specified in it, exempt any factory or other establishment belonging to the Government or any local authority from Chapter IV, if the employees there are otherwise in receipt of benefits substantially similar or superior to the benefits under the Chapter.
| Element | What the text says |
|---|---|
| Who grants | The appropriate Government, after consulting the Corporation |
| Form | Notification, with conditions |
| Who can be exempted | A factory or establishment belonging to the Government or a local authority |
| Condition | Employees already get substantially similar or superior benefits |
Note what section 46 does not cover: a private employer. Any wider power to exempt is in other provisions of the Code; see our article on sections 143 and 144. Our existing post on ESI exemption for certain establishments discusses the topic under the older law.
Section 47: ESI dues rank in priority
Section 47 begins "notwithstanding anything contained in any other law for the time being in force". Any amount due under Chapter IV is the charge on the assets of the establishment to which it relates, and is to be paid in priority in accordance with the Insolvency and Bankruptcy Code, 2016 (31 of 2016).
The point for lenders, buyers of an undertaking, and resolution professionals is that unpaid ESI dues do not simply rank as an ordinary unsecured debt. They are a charge on assets. For the parallel provision on provident fund dues, see sections 17 to 19. How the Corporation recovers dues is in section 129.
Example
A manufacturing company falls into insolvency owing ESI contributions for several months. Under s.47 the dues are a charge on the company's assets and are paid in priority in accordance with the Insolvency and Bankruptcy Code, 2016. A buyer evaluating the business should therefore treat unpaid ESI dues as a liability that travels with the assets, and ask for proof of payment during due diligence.
Which rules apply
The Code provisions above are in the Code itself. Where a rule is involved, such as rule 28 on user charges, the Central Rules apply where the Central Government is the appropriate Government. Where the State Government is the appropriate Government, the State's own rules apply.
Need help with ESI registration and exposure?
Whether you are a platform business, a company being acquired, or an employer who simply wants clean records, unpaid or unregistered ESI is costly. Our team can assist with ESI and PF registration and review where your establishment stands.
Key takeaways
- s.44: scheme for other beneficiaries in underutilised Corporation hospitals, on user charges; user charges are deemed contribution.
- s.45: an enabling provision for an ESI scheme for unorganised, gig and platform workers; terms come from the notified scheme.
- s.46: exemption only for Government or local authority factories and establishments with substantially similar or superior benefits.
- s.47: ESI dues are a charge on assets and rank in priority under the Insolvency and Bankruptcy Code, 2016.
- Rule 28 leaves scheme terms to notification and user charges to the Corporation with Central approval.
Read next
- Sections 42 and 43: Corporation's recovery rights against employers
- Sections 48 and 49: Employees' Insurance Court and matters it decides
- Sections 113 and 114: Registration and schemes for gig and platform workers
- ESI exemption for certain establishments
Disclaimer: Based on the Code on Social Security, 2020 (as enacted) and, where noted, the Code on Social Security (Central) Rules, 2026 (G.S.R. 344(E), 8 May 2026), as on 30 September 2026. The Code is in force from 21 November 2025; some provisions may be notified later, and State Governments make their own rules for establishments where the State is the appropriate Government. Verify the current position before acting.