Gujarat High Court
Jamnagar vs Rajesh on 23 February, 2010
Author: H.K.Rathod
Bench: H.K.Rathod
Gujarat High Court Case Information System
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FA/78/2010 18/ 20 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL No. 78 of 2010
With
CIVIL
APPLICATION No. 555 of 2010
In
FIRST APPEAL No. 78 of 2010
For
Approval and Signature:
HONOURABLE
MR.JUSTICE H.K.RATHOD
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1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To be
referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
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JAMNAGAR
MUNICIPAL CORPORATION - Appellant(s)
Versus
RAJESH
LALJIBHAI KABIRA THROUGH PRABHABEN RAJESHBHAI & 6 - Defendant(s)
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Appearance
:
MR
PREMAL R JOSHI for
Appellant(s) : 1,
MR TR MISHRA for Defendant(s) : 1 - 3,5 -
7.
None for Defendant(s) :
4,
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CORAM
:
HONOURABLE
MR.JUSTICE H.K.RATHOD
Date
: 23/02/2010
ORAL
JUDGMENT
Heard learned Advocate Mr. Premal R.Joshi for appellant Jamnagar Municipal Corporation and learned Advocate Mr. UT Mishra for respondents claimants.
By filing this appeal, appellant corporation has challenged judgment and order passed by WC Commissioner Jamnagar in WC (Fatal) Application NO. 20 of 2001 Exh. 28 dated 31st July, 2009 wherein WC Commissioner has awarded Rs.62,909.00 with 6 per cent interest in favour of claimant.
Learned Advocate Mr. Premal R.Joshi appearing for appellant corporation has raised only one contention before this court that WC Commissioner has committed gross error in not considering payment of Rs.50,000.00 which was made to widow towards ex-gratia payment but not included in total amount of compensation. In short, his submission is that the moment, accident had taken place on 3rd August, 2001, appellant Corporation had paid Rs.50,000.00 to wife of deceased namely Prabhaben Rajeshbhai and thereafter, further amount of Rs.1,57,237.00 was paid as per office order dated 6th November, 2001. SO, in all, it comes to Rs.2,20,146.00. He submitted that out of Rs.2,20,140.00, WC Commissioner has given credit of amount of Rs.1,57,237.00 which was paid vide cheque to widow of deceased and not given credit of amount of Rs.50,000.00 which payment was made to widow of deceased by way of ex-gratia payment and, therefore, remaining amount of Rs.62,909.00 was directed to be paid by Corporation to respondent claimant which is contrary to law and, therefore, present appeal is preferred by Corporation. Except that, no other contention is raised by learned Advocate Mr. Joshi before this Court. Appellant Corporation has deposited Rs.77,412.00 before WC Commissioner on22.9.2009.
Learned Advocate Mr. Mishra appearing for respondents claimants has made his submissions while supporting impugned judgment and order passed by WC Commissioner.
I have considered submissions made by both learned advocates. I have also perused impugned judgment and order passed by WC Commissioner, Jamnagar. Aforesaid question has beene xamined by WC Commissioner, Jamnagar in paragraph 14 while considering section 8 of WC Act and came to conclusion that no direct payment made by employer is to be given credit to employer while determining an amount of compensation. In view of observations made by WC Commissioner in paragraph 14, section 8(1) of WC ct is relevant, therefore, section 8(1) of WC Act is reproduced as under:
8(1) No payment of compensation in respect of a workman whose injury has resulted in death, and no payment of a lump sum as compensation to a workman or a person under a legal disability shall be made otherwise than by deposit with the Commissioner, and no such payment made directly by an employer shall be deemed to be a payment of compensation.
Provided that, in the case of a deceased workman, an employer may make to any dependent advances on account of compensation not exceeding an aggregate of one hundred rupees, and so much of such aggregate as does not exceed the compensation payable to that dependent shall be deducted by the Commissioner from such compensation and repaid to employer.
Considering provisions of section 8 of WC Act, of section 8 of WC Act is designed with an object to protect heirs and legal representatives of deceased workman against any kind of exploitation or fraud likely to be practiced on them by or on behalf of employer or any third party. This Court, in case of Samuben versus Patel Industries and another, 1994 II LLJ pg. 981, held that direct payment to legal heirs of deceased workman not deemed to be any payment. This Court also held that employer should deposit the amount with the Commissioner. Relevant paragraph 4,5,6 and 7 of said judgment of this Court are quoted as under:
4. It would be quite proper to look at the relevant provisions contained in Sec. 8 of the Act. Sub sec.(1) thereof is material for the purpose. It reads :
'No payment of compensation in respect of a workman whose injury has resulted in death, and no payment of a lump sum as compensation to a workman or a person under a legal disability shall be made otherwise than by deposit with the Commissioner, and no such payment made directly by an employer shall be deemed to be a payment of compensation.
Provided that, in the case of a deceased workman, an employer may make to any dependent advances on account of compensation not exceeding an aggregate of one hundred rupees, and so much of such aggregate as does not exceed the compensation payable to that dependent shall be deducted by the Commissioner from such compensation and repaid to employer.'
5. It becomes clear from a bare perusal thereof that no compensation has to be paid in respect of a workman whose injjury has resulted in death except by deposit with the Commissioner and no such payment made directly by an employer shall be deemed to be a payment of compensation. This statutory provision prohibits an employer from making anay payment of compensation in respect of the death of a workman directly to his heirs and legal representatives or to any of them. What the employer has to do is to deposit the amount of compensation with the Commissioner for the purpose. It has also been provided therein that any direct payment made contrary to the said statutory provision would not be deemed to be any payment.
6. This statutory provision is quite clear on the point. It is designed to protect the heirs and legal representatives of the deceased workman against any kind of exploitation or fraud likely to be practiced on them by or on behalf of the employer or any third party. It cannot be gainsaid that workman in our country are by and large illiterate. Their heirs and legal representatives are all the more so. They might not be aware of the amount of compensation they would be entitled to on the death of the bread winner in the family . At times an unscrupulous employer would like to exploit the situation by paying a meagre sum to any of the heirs of the deceased workman. An unscrupulous heir also might bargain with the employer and deprive the other heirs and legal representatives of the deceased workman of their due share in the compensation. In order to avoid any such kind of mischief making on the part of the employer or any of the heirs and legal representatives of the deceased or any third party, the legislature in its wisdom has devised security of payment of compensation to the heirs and legal representatives of the deceased workman. The only exception tot he statutory requirement is an advance payment of less than Rs.100.00. Such advance payment in the sum of less than Rs.100 can be paid by the employer to the heirs and legal representatives of the workman or to any of them. Subject to payment of this small advance money, the employer is not authorized or empowered or entitled to make payment of compensation for the death of a workman otherwise than in accordance with Sec. 8 of the Act.
7. It is a settled principle of law that, when a statute requires anything to be done in a particular manner, it has to be done only in the manner and no other manner. Section 8 of the Act requires the employer to make payment of the compensation for the death of his workman by deposit of the amount thereof with the Commissioner. He has to make payment only in that manner. In order to make the position doubly sure, the legislature has made it clear that any payment of compensation for the death of a workman otherwise than by deposit with the Commissioner would be deemed to be no payment. In that view of the matter, the conclusion reached by the Trial Forum regarding payment of Rs.14000/- to appellant NO.1 herein could not have been accepted as a valid payment.
In case of K. Dias versus H.M. Coria & Sons, 1951 II LLJ page 192,Division Bench of Calcutta High Court considered section 8 of WC Act and observed as under:
The question before us is whether this sum can be deducted from the sum of Rs.3,500/-. Section 8 Workmen's Compensation Act is as follows:-
(1) No payment of compensation in respect of a workman whose injury has resulted in death, and no man or a person under a legal disability, shall be made otherwise than by deposit with the commissioner and no such payment made directly by an employer shall be deemed to be a payment of compensation.
Provided that, in the case of deceased workman, and employer make to any dependant, advance on account of compensation not exceeding an aggregate of on hundred rupees, and so much of such aggregate as does not exceed the compensation payable to that dependant shall be deducted by the commissioner from such compensation and repaid to the employer.
It is quite clear from this section that even if the sum of Rs.3,000/- had been paid to the appellant by way of compensation, that amount could not be deducted from the actual amount of compensation payable, because the section says that such payment shall not be deemed to be payment of compensation. In this case the amount was paid to the appellant not as compensation but as an ex-gratia payment. Therefore the observation I have made applies with greater force. This amount cannot be deducted from the sum of Rs.3,500.
If we look upon the receipt as evidencing a contract between the widow and the employer, then under S. 17 of the Workmen's Compensation Act, a workman cannot contract himself out. The section protects that ignorant workman who may be induced by the employer to agree to less compensation or to abandon something which under the Act he is entitled to claim. If the employer pays of his own to the workman, he does so with the risk that he will not be entitled to get set-off for the sum so paid. Further, as a contract it should have been registered under S. 28. That has not been done. In our opinion the respondent is not entitled to get set-off for the sum of Rs.3,000 paid to the widow as aforesaid.
The learned commissioner thought that there was some sort of equity in favour of the respondent and on that, he deducted this sum from the sum of Rs.3,500. We do not see how any equity arises when the sections of the Act are definite and clear. We are of the opinion that the learned commissioner was wrong in deducting the sum of Rs.3,000 from the sum of Rs.3,500. We therefore allow this appeal. There will be a decree in favor of the appellant for the sum of Rs.3,475 with costs here and below. The hearing fee of this appeal is fixed at three gold mohurs.
In case of Divisional Engineer MP Electricity Board and another And Mantobai, 1990-I-LLJ, 25, Division Bench of MP High Court (Gwalior Bench) held as under in para 9 to 14:
9. Legislature has contemplated payment of compensation by the employer suo motu and it has also specified the modes in which the payment has to be effected. In case of a workman's death, payment by way of deposit with the Commissioner is specified as a mode of payment. Section 4 speaks, subject to the provisions of this Act the amount of compensation shall be as follows and it enumerates in clauses
(a), (b), (c) and (d) the modes of determination of compensation in different cases of injuries resulting in death and in disablements of different degrees. Reference is made in those clauses to the Schedules annexed to the Act and in the Schedules, mechanics of actual determination of the compensation is specified in clear terms. The legislature clearly intended that the injured workman, and in the case of a deceased workman, his dependants, would be provided instant succour in full measure envisaged under the Act.
Who toils and sweats must share the fruit6 of his labour even when he is immobilised and his dependants must be cared for when he has perished. But for him, there would be no national prosperity. This intention of the legislature conforms to the constitutional imperatives underwritten in Articles 41, 42 and 43 of the basic statute of our country. This court had an occasion to interpret the provisions of Sections 3 and 4-A of the Act in the case of Om Prakash v. Ramkali, 1987 ACJ 803 (MP), when it was held that the 'compensation' payable under the Act falls due as soon as the 'accident' takes place and, therefore, it was statutory obligation of the employer to make payment thereof in accordance with the provisions of the Act and his breach of duty in that regard would also visit him with the 'penalty and interest' as statutorily contemplated under sub-section (3) of Section 4-A.
10. What only remains to be referred are Sections 28 and 29 to say that the provisions thereof equally support our view that there is an absolute statutory bar underwritten in Section 8 against any payment to be made 'directly' by an employer against any amount due payable as 'compensation' under the Act. In a case where a claim is not lodged in accordance with the provisions of Section 22 of the Act, in the event of neglect by the employer to act suo motu in the matter of payment of compensation, it is contemplated under Section 28 that parties may settle up the question of compensation by an 'agreement'. The Act vests power in the Commissioner even to refuse to register such an agreement in case he thinks that the agreement was obtained by fraud or undue influence and he is further empowered under proviso (d) of Section 28(1) to make any order he thinks just in the circumstances in respect of any sum already paid under the agreement. Section 29 envisages that when any agreement required to be registered under Section 28 is not so registered, then the employer shall be liable to pay full compensation in accordance with the provisions of Section 4 and unless the Commissioner otherwise directs, the employer shall not be entitled to deduct more than half of the amount already paid to the workman by way of compensation under the agreement or otherwise. Let it however be noted that deduction envisaged under Section 29 is evidently referable to a case of compensation to a 'workman' who is alive and is only injured.
11. We may now refer to the authorities cited to submit that other courts have taken a view contrary to what this court had expressed in Usha Bai's case (supra). A division Bench in the case of Kathleen Dias v. H. M. Coria & Sons, (AIR) 195 Cal 513, construed Section 8 of the Act to hold that no deduction on account of an ex gratia payment is permissible because the section says that such payment shall not be deemed to be payment of compensation . We are also in respectful agreement with the view expressed by the Calcutta High Court that equity has not place in a statutory provision and that no equity can be read in Section 8 in favour of the employer so as to entitle him to make or seek deduction of any kind of payment made by him. The same view prevailed with a learned single Judge of the Gujarat High Court in the case of Chanchalben v. Burjorji Dinshawji Sethna, (1969-II-LLJ-357). He referred to and relied on the decision in Kathleen's case, (supra). In the case of Ram Dulari Kalia v. H. P. State Electricity Board, 1987 ACJ 258 (HP), P. D. Desai, C. J. of Himachal Pradesh High Court, also reached the same conclusion in a similar case of a deceased employee of Electricity Board of that State holding that the ex gratia payment to the claimant made soon after the accident had no nexus whatsoever to the compensation which was payable under the provisions of the Act because that ex gratia payment would have been made even if the deceased had not met with the accident.
12. In the the instant case, it appears from Exh.P-6 that on February 6, 1985, an order was made sanctioning grant of ex gratia payment of Rs.2,500/- to the deceased workman's widow , namely, the respondent, on account of her husband's death. Reference in the order is made to Board's Notification which, counsel for the appellants submits, conforms to the decision of the State Government projected in Memorandum No.2355-IV-R-II-72, dated November 14, 1972, included in the Compilation of Regulations and Standing Orders in Establishment Matters of M. P. Electricity Board. At page 76 of Part XXXII-A of the said Compilation, the Memorandum aforesaid is reproduced of which we extract the opening paragraph:
While considering the report of the Madhya Pradesh Pay Commission, 1972, Government felt that for mitigating the hardship and suffering caused to the family of a Government servant who dies while in service, a substantial ex gratia payment should be made to the dependants of the deceased. To implement this decision, the following order are passed....
It is clear that as in the case of Ram Dulari Kalia v. H. P. State Electricity Board (supra), the ex gratia payment is similarly contemplated in this case also to dependants of a deceased employee without any reference to the cause of his death and it is meant for mitigating the hardship and suffering caused to the family of a person employed by the Board.
13. Whatever may be the view held by the Himachal Pradhes High Court, we do not feel disposed to take a narrow view of the provisions of Section 8 of the W. C. Act. On the other hand, we are inclined to agree with the Calcutta High Court, albeit for the reasons we have given above, that there is a total bar to be read in Section 8 against any deduction to be made by the employer or by the court for any payment made by the employer out of court, under any circumstance, so as to reduce the corpus of the compensation determined by the Act itself, i.e., payable in case of death of a workman. We have no doubt that a case of death and a case of an injury only are not treated on the same footing by the legislature and that Section 8 deals specifically with a case of death and there is no scope thereunder for any employer to make any payment 'directly', for whatsoever reason, for which he would be able to claim deduction when he has deposited the compensation suo motu or even when awarded against him by the Commissioner or this court in appeal.
14. We would, therefore, answer in the negative, the question referred to us. We hold that neither the Workman's Compensation Commissioner nor this court, in appeal, has any jurisdiction to give any credit for any 'direct' payment of any nature made to deceased workman's dependants, including any payment in the nature of ex gratia compensation, whether made under any other statutory provision or under contract. We further hold that the compensation which is determined payable to the workman under the Act is not reducible on account of such payment though 'deduction' or 'repayment' contemplated statutorily under Section 8 only, can be made. We also hold, therefore, that law was not correctly stated in Usha Bai's case, (supra) wherein a contrary view was taken.
In case of Naseera Nazir & Others And Executive Engineer, 1999-III-LLJ (Supp.) page 1122, Jammu & Kashmir High Court observed as under in para 11 to 16 :
11. Workman's Compensation Act is a welfare legislation and has been enacted only to see that the workmen are being paid compensation for the injury or the accident which they have suffered in discharge or their duties of their master and it is the Central Workmen's Compensation Act, 1923 which is applicable to the State of Jammu and Kashmir.
The Act provides that the compensation to be paid and deposited not directly to the workman or his depandent, but it is to be deposited with the Commissioner and the Commissioner has to ensure that the amount has been disbursed between rightful claimants. This has only been done in order to ensure that the employer does not show a fictitious receipt or an instrument to evidence that the compensation has been made or paid by him to the workman or to the next of the kin by him outside the court. So the compensation shall be made not otherwise than by deposit with the Commissioner and no such payment which has been made directly by the employer shall be deemed to be a payment of compensation.
12. Procedure further provides under sub-section (4) of Section 8 of the Act that on the deposit of any money under subsection (1) as compensation in respect of deceased workman, the Commissioner, if he thinks necessary, cause notice to be published or to be served to each dependent in such manner as he thinks fit, calling upon the dependents to appear before him on such date as he may fix for determining the distribution of the compensation. If the Commissioner is satisfied, after any inquiry which he may deem necessary, that no dependent exists, he shall repay the balance of the money to the employer by whom it was paid. The Commissioner shall, on application by the employer, furnish a statement showing in detail all disbursement made.
13. It is further stipulated that the compensation deposited in respect of the deceased workman shall be subject to any deductions made under sub-section (4), be apportioned among the dependents of the deceased workman or any of them in such proportion as the Commissioner thinks fit, or may, in the discretion of the Commissioner, be allotted to any one of dependents.
14. Sub-Section (1) of Section 8 of the Act further stipulates that where any lumpsum deposited with the Commissioner is payable to a woman or a person under a legal disability, such sum may be invested, applied or otherwise dealt with for the benefit of the workman, or of such person during his disability, in such manner as the Commissioner may direct; and where a half monthly payment is payable to any person under a legal disability, the Commissioner may, of his own motion or on an application made to him in this behalf, order that the payment be made during the disability to any dependent of the workman or to any other person, whom the Commissioner thinks best fitted to provide for the welfare of the workman.
15. So the provisions of Section 8 incorporated in the Act are designed to protect the heirs and legal representatives of the deceased workman against any kind of exploitation or fraud likely to be practised on them by or on behalf of the employer or any third party.
16. It may also be noted that neither Workmen's Compensation Commission-nor the appellate Courts have any jurisdiction to give any credit for any payment of any nature made to the deceased's dependents including any payment in the nature of ex-gratia compensation either made under any statutory provision or under a contract. So the contention of the respondents that they have made ex-gratia payment and also employed one of the sons of the deceased workman on compassionate grounds will not absolve them of the liability under the Workmen's Compensation Act and law. So the compensation awarded by the Commissioner under the Workmen's Compensation Act including penalty imposed on the non-applicant for non-payments recoverable and payable through Commissioner under the Workmen's Compensation Act to the next of kin of the deceased and the discretion lies with the Commissioner in exercise of the powers vested in him under the provisions of Order 23 of Civil P. C. If the Commissioner feels and is of the considered opinion that the compensation is being relinquished against the provisions of the Act, he is to ensure that all such agreements and all such contracts are un-cognizable at law and are not to be given any recognition and are ab initio bad. He has not to go through any agreement or consider the same which has been entered into verbally or in writing by the next of kin of the deceased with the employer and is to assure that the agreement having been obtained by fraud or undue influence or through improper means is not taken on record and given any credence.
Therefore, in view of aforesaid decisions considered by this court while considering submissions made by learned Advocate Mr. Premal R. Joshi for appellant, according to my opinion, whatever ex-gratia payment Rs.50000.00 directly made to claimant, widow of deceased, cannot be given credit because such amount is not deposited by appellant before WC Commissioner, therefore, considering object of section 8 (1), and decisions referred to above, contentions raised by learned Advocate Mr.Joshi cannot be accepted. WC Commissioner has rightly examined matter and has rightly directed appellant to pay amount of Rs.62,909.00 with 6 per cent interest with costs of Rs.500.00 and has rightly passed judgment and order. Therefore, there is no substance in first appeal filed by appellant. It is also necessary to note that no substantial question of law is arising and involved in this appeal under section 30 of WC Act and, therefore, on both grounds, this appeal is required to be dismissed.
Accordingly, for reasons recorded above, this appeal is dismissed. Today, this Court has dismissed first appeal. Therefore, no order is required to be passed in civil application for stay. Accordingly, civil application for stay stands disposed of accordingly.
WC Commissioner, Jamnagar is directed to pay Rs.77,412.00 (Rupees seventy seven thousand four hundred twelve only) with accruing interest, if any, by way of an account payee cheque in name of claimant Prabhaben Rajeshbhai after proper verification, without any delay.
(H.K. Rathod,J.) Vyas Top