State Of Maharashtra Through The ... vs Learned Judge, Labour Court And ...
2017 Latest Caselaw 795 Bom

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         IN THE HIGH COURT OF JUDICATURE AT BOMBAY:
                    NAGPUR BENCH : NAGPUR
                   First Appeal No. 335 of 2016
[State of Maharashtra, through the Plantation Officer, Social
Forestry, Buldana & another Vs. Judge, Labour Court &
Commissioner for Workmen's Compensation, Buldana & others]

Office Notes, Office Memoranda of
Coram, appearances, Court's orders                         Court's or Judge's orders
or directions and Registrar's orders.

                                 Mrs. Mrunal Naik, Asstt. Govt. Pleader for Appellants.
                                 Mr. N.B. Kalwaghe, Adv., for respondent nos. 2 to 5.

                                                                ----
                                 CORAM                 : A. S. CHANDURKAR, J.

Date on which arguments were heard : 02nd March, 2017

Date on which the Order is pronounced : 17th March, 2017

01. Admit. Shri N.B. Kalwaghe, learned counsel, waives notice on behalf of respondent nos. 2 to 5.

02. Following Substantial Question of Law arises for consideration in this appeal filed under Section 30 of the Employees' Compensation Act, 1923 :-

"Whether the provisions of Section 7 (2) (xiv) of the Maharashtra Employment Guarantee Act, 1977, would override the provisions of the Employees' Compensation Act, 1923, in the matter of grant of compensation so as to dis-entitle the claimants from seeking compensation under provisions of Section 22 of the Employees' Compensation Act, 1923?"

03. Facts giving rise to the present appeal are that it is the case of respondent nos. 2 to 5 that Ganesh Kakar, husband of respondent no.2, was employed with the Social Forestry Division, Buldhana. He was engaged for doing the work of planting trees, digging pits, watering plants etc. at Taluka Motala. He was paid wages at the rate of Rs.127/- per day. On 20th December, 2011, said Ganesh during the course of employment met with an accident when the tractor in which he was travelling fell in a pit and overturned. Said Ganesh succumbed to the injuries sustained in the said accident. This gave rise to filing of proceedings for grant of compensation under Section 22 of the Employees' Compensation Act, 1923 [for short, "the Act of 1923"]. In the reply filed by the appellants, it was stated that deceased Ganesh was employed as a labour by the Social Forestry Department under the Mahatma Gandhi National Rural Employment Guarantee Scheme. It was then stated that the family of the deceased was paid Rs.50,000-00 as ex gratia amount on 17th May, 2012 and, therefore, the

application for compensation under Section 22 of the Act of 1923 was not maintainable.

04. The learned Commissioner for Employees Compensation considering the evidence led by the parties held that deceased Ganesh was employed by the appellants as a labour. The amount of compensation was thereafter determined at Rs.4,19,004.75. The amount of Rs.50,000-00 paid as ex gratia compensation and Rs.10,000/- towards urgent economic help were deducted from the aforesaid amount and the claim for compensation came to be allowed on 31st July, 2013. The application for review filed by the appellants came to be dismissed. Being aggrieved, the present appeal has been filed.

05. Mrs. M. Naik, learned Asstt. Govt. Pleader for the appellants, submitted that as the respondent nos. 2 to 5 were paid an amount of Rs.60,000-00 being ex gratia compensation, the claim for compensation under the Act of 1923 was not maintainable. It was submitted that the ex gratia payment was made in view of provisions of Section 7 of the Maharashtra Employment Guarantee Act, 1977 [for short, "the Act of 1977"]. Section 16 of the Act of 1977 had an overriding effect over the provisions of the Act of 1923 and hence the learned Commissioner was not justified in awarding compensation under the Act of 1923. It was, therefore, submitted that the impugned judgment was liable to be

set aside.

06. Per contra, Shri N.B. Kalwaghe, learned counsel for respondent nos. 2 to 5, supported the impugned judgment. He submitted that Section 7 (2) (xiv) of the Act of 1977 would not have an overriding effect over the provisions of the Act of 1923 in the matter of grant of compensation, inasmuch as there was nothing inconsistent in the Act of 1923 with the provisions of the Act of 1977. According to him, both the said statutes operated in separate fields and hence there was no question of any repugnancy between the provisions of the Act of 1977 and the Act of 1923 in that matter. Referring to the preamble of the Act of 1977, it was submitted that said Act merely intended to make effective provisions for securing the right to work by guaranteeing employment in the State. The Act of 1977 did not contain any provision for grant of compensation to the persons covered by it nor was any forum or mechanism prescribed for redressal of grievances in that regard. Under provisions of Section 7 (2) (xiv) of the Act of 1977, there was merely a provision to make ex gratia payment. On the contrary, it was submitted that the Act of 1923 was specially enacted with a view to provide for payment of compensation by certain classes of employers to their employees in case of injury by accident. Thus, according to him, it was only under the Act of 1923 that compensation could be claimed by an employee as defined by Section 2 (dd) of the Act of

1923. He referred to Schedule-II to the said Act and especially Entry XLI to urge that deceased Ganesh was an employee of the appellants. He then submitted that under Section 3 of the Act of 1923, it was the employer's liability to pay compensation for any injury caused during the course of employment, while the concept of ex gratia payment indicated absence of any legal obligation to make the same and said amount was merely given gratuitously. He referred to the dictionary meaning of the expression "ex gratia" as defined in the Third Edition of Collins Concise Dictionary.

He then fairly brought to the notice of the Court the judgment of learned Single Judge in Executive Engineer, Ujani Canal Division No.6, Pandharpur & another Vs. Tukaram Pandurang Dedhe [1991 Mh.L.J. 783] wherein it was held that a person, who sustains an injury while being engaged under the Employment Guarantee Scheme, would not be entitled to seek compensation under the Act of 1923 by virtue of the provisions of Section 16 of the Act of 1977 as the Act of 1977 has an overriding effect over the provisions of the Act of 1923.

07. I have heard the learned counsel for the parties on the aforesaid substantial question of law. The finding recorded by the learned Commissioner as to engagement of deceased Ganesh with the appellants for doing the work of Social Forestry is based on the stand

taken by them in their Written Statement at Exh.C-9. The muster roll at Exh.U-30 indicated that Ganesh was employed under the Mahatma Gandhi National Rural Employment Guarantee Scheme as a labour. It is on that basis that further finding that Ganesh was receiving Rs.127/- per day as wages has been arrived at. These findings being based on material available on record, the same do not call for any interference. From the provisions of Section 2 (dd) read with Entries-XXIX and XLI in Schedule-II to the Act of 1923, it is clear that Ganesh was an employee of the appellants and that he suffered fatal injuries during the course of employment.

Thus, the jurisdictional facts, on the basis of which compensation could be claimed under the provisions of the Act of 1923, stand duly satisfied.

08. The question, therefore, that is required to be addressed is whether by grant of ex gratia payment to the legal heirs of Ganesh, the appellants would not be liable to pay any compensation under the Act of 1923. The ex gratia payment to the legal heirs has been made in the light of the provisions of Section 7 (2) (xiv) of the Act of 1977. As per said provision, the State Govt. has to prepare a scheme for providing employment to all adult persons residing in rural areas and under said scheme if any personal injury is caused to any person employed under such scheme, ex gratia payment of Rs.50,000-00 or such higher amount as specified is liable to be paid. The expression "ex gratia" has not

been defined under the Act of 1977. Its dictionary meaning as per Collins Concise Dictionary indicates that it is given as a favour or gratuitously where no legal obligation exists. Under Section 16 of the Act of 1977, the provisions of the Act of 1977 would have an overriding effect notwithstanding anything inconsistent stated therewith in any other law for the time being in force.

As per provisions of Section 3 of the Act of 1923, a liability is fastened on the employer to pay compensation for an injury sustained during the course of employment. Section 4 of the Act of 1923 stipulates the amount of compensation that has to be paid depending upon the nature of injuries sustained or whether death has occurred. Under Section 4A of the Act of 1923, compensation under Section 4 is liable to be paid as soon as it falls due. Default in making the payment of compensation can result in a direction to pay penalty by the employer. The Act of 1923 thereafter specifies the mode and manner in which a claim for compensation can be made and the procedure by which such claim has to be adjudicated.

09. When the provisions of Section 7 (2) of the Act of 1977 and the provisions of Section 3 of the Act of 1923 are taken into consideration, it is clear that under Section 7 (2) (xiv) of the Act of 1977, what is payable is only ex gratia amount for which no legal obligation

exists. It is payment made by the State on its own volition. On the other hand, Section 3 of the Act of 1923 creates a liability on the employer to pay compensation and the employer is visited with penalty if there is delay in paying the amount of compensation. Considering the object of making ex gratia payment which is to tide over the emergent situation arising on account of any injury suffered or death caused in distinction with the object of providing statutory compensation under the Act of 1923, prima facie, I am of the view that provisions of Section 7 (2) (xiv) of the Act of 1977 are not inconsistent with the provisions of Section 3 of the Act of 1923 as they seek to achieve different objects. The provisions of Section 16 of the Act of 1977 would have an overriding effect only in case of inconsistency with any other provisions of law for the time being in force.

10. In Executive Engineer, Ujani Canal Division [supra], the question that arose for consideration was whether a personnel engaged under the Employment Guarantee Scheme on suffering disability during the course of employment could claim compensation under the Act of 1923. The learned Single Judge held in para 4 of the judgment that the Act of 1977 provides for a particular forum and that even if Legislature has used the nomenclature of ex gratia payment, the same is analogous and at par with the compensation that is awarded under the Act of 1923. On that basis, it has been held that the provisions of the Act of 1923 in the

matter of grant of compensation were inconsistent and in conflict with the provisions of the Act of 1977. On that basis, by virtue of Section 16 of the Act of 1977, an overriding effect was given so as to prevail over the provisions of the Act of 1923. It was consequently held that the claimant was not legally entitled to approach the Commissioner under the Act of 1923 for claiming compensation.

11. With utmost respect, I am unable to agree with the aforesaid observations made in the said decision. As noted above, the object of the Act of 1977 is merely to make effective provision for securing the right to work by guaranteeing employment to all adult persons who volunteer to do unskilled manual work in rural areas in the State of Maharashtra. The Act of 1977, except for making a provision for ex gratia payment arising out of personal injury as per Section 7 (2) (xiv), does not provide for any particular forum as observed in the judgment of learned Single Judge. There is neither any liability created for making any payment as compensation for any injury suffered nor is any right conferred on such adult person to seek compensation in any case of any personal injury under the Act of 1977. On the other hand, the object of the Act of 1923 is to provide for payment of compensation by certain classes of employers to their employees on account of injury by accident. The distinction between ex gratia payment as contemplated under the Act of 1977 and compensation

as defined by Section 2 (c) of the Act of 1923 is writ large for being ignored. Both would operate in different fields. At the highest, the grant of ex gratia amount granted under the Act of 1977 could be a factor for reducing the amount of compensation to that extent, if granted under the Act of 1923.

The provisions of the Act of 1923 are in the form of beneficient legislation. It is a well settled principle of statutory interpretation that with regard to an exception which curtails the operation of any beneficient legislation, the Court in case of doubt would construe it narrowly so as not to unduly expand the area or scope of exception, as held by the Three-Judge Bench of Honourable Supreme Court in Sheikh Gulfan & others Vs. Sanath Kumar Ganguli [AIR 1965 SC 1839]. Viewed from that angle, in my view, both enactments operate in different fields and it cannot be said that the provisions of the Act of 1923 in the matter of grant of compensation are inconsistent with the provisions of the Act of 1977 under which ex gratia payment is made for any injury sustained.

12. Hence for the aforesaid reasons, the following question arises for consideration:-

"Whether by virtue of provisions of Section 16 of the Act of 1977, an employee who has received ex gratia payment under Section 7 (2) (xiv) of the Act of 1977 is precluded from seeking compensation under Section 22 of the Act of 1923?

13. In view of the disagreement expressed with the view of learned Single Judge in Executive Engineer, Ujani Canal Division [supra], the papers be placed before Honourable the Chief Justice to consider referring said question to a Larger Bench.

Judge

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