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2013 DIGILAW 3571 (MAD)

Management SCM Creations Nalligoundampalayam v. N. Aran @ Aaruchamy

2013-10-03

P.R.SHIVAKUMAR

body2013
Judgment : 1. This appeal has been preferred under Section 30 of the Employees Compensation Act, 1923, by the management of SCM Creations (employer of the deceased A.Rajasekaran) against the order of the Commissioner for Workmen's Compensation, Coimbatore, dated 03.03.2012 made in W.C.No.67 of 2010. 2. Regarding the death of A.Rajasekaran, his parents, who are the respondents herein, made a claim before the Commissioner for Workmen's Compensation, against the employer, namely, the appellant herein and the Commissioner for Workmen's Compensation, Coimbatore awarded a sum of Rs.3,96,480/-as compensation and a further sum of Rs.5,000/- towards funeral expenses (total compensation awarded is Rs.4,01,480/-) by the impugned order dated 03.03.2012. The award also directed payment of interest on the above said amount at the rate of 12% per annum from the date of expiry of 30 days from the date of occurrence. However, the Commissioner has not chosen to issue any direction regarding the payment of costs. The above said award passed by the Commissioner for Workmen's Compensation (Deputy Commissioner of Labour), Coimbatore in W.C.No.67 of 2010 is challenged by the employer, namely, the appellant herein, on various grounds set out in the memorandum of Civil Miscellaneous Appeal. 3. Section 30 of the Employees' Compensation Act, 1923 provides that an appeal shall lie to the High Court from the orders of the Commissioner for Workmen's Compensation, either allowing the claim for compensation in a lump sum or disallowing the claim in full or in part. However, the right of appeal is circumscribed by a condition provided in the first proviso to Section 30(1) that no such appeal shall lie against any order of the Commissioner for Workmen's compensation unless a substantial question of law is involved in the appeal. A further condition has been imposed in the third proviso to the effect that no appeal by the employer shall lie unless the memorandum of appeal is accompanied by a certificate by the Commissioner to the effect that the appellant has deposited with him the amount payable under the order appealed against. 4. In this case, the second condition has been sought to be complied with by the production of certificate dated 03.08.2012 issued by the Commissioner. Of course, the certificate simply states that a particular amount (Rs.4,99,112/-) was deposited by the management to the credit of W.C.No.67 of 2010. 4. In this case, the second condition has been sought to be complied with by the production of certificate dated 03.08.2012 issued by the Commissioner. Of course, the certificate simply states that a particular amount (Rs.4,99,112/-) was deposited by the management to the credit of W.C.No.67 of 2010. There is no clear recital that the amount as per the order of the Commissioner has been deposited. In the absence of prescription of specific form in which the certificate has to be issued, such a receipt evidencing deposit of the amount shall be substantial compliance of the requirement of the third proviso to Section 30(1) of the Employees' Compensation Act, 1923. It was held so by the Hon'ble Supreme Court in'EMM Tex Synthetics ..vs.. Om Prakash and another' reported in (2008) 14 SCC 765. The following are the observation made by the Hon'ble Apex Court:- "4.We have heard the learned counsel for the appellant and examined the relevant provisions made under Section 30 of the Act and other materials on record. After a careful examination, we are of the view that in the absence of any specified form of Certificate indicated in the Act or the Rules, it cannot be said that the Certificate produced by the appellant was not in compliance with Section 30 of the Act. It is an admitted fact that the appellant had deposited the awarded amount by way of a Demand Draft duly received by the office of the Commissioner. The Demand Draft was deposited along with a covering letter and the receipt was given on its copy. The High Court had refused to accept it as a Certificate under the Act and therefore, dismissed the appeal. 5. In our view, in the absence of any specified form of Certificate, a proof of deposit of compensation would be a substantial compliance of Section 30 of the Act. Therefore, the appellant could not be thrown out on such a technical ground." A reading of the above said observation will make it clear that substantial compliance can be made by producing proof of deposit of compensation with the Commissioner. The same has been done in this case. 5. Therefore, the appellant could not be thrown out on such a technical ground." A reading of the above said observation will make it clear that substantial compliance can be made by producing proof of deposit of compensation with the Commissioner. The same has been done in this case. 5. So far as the other condition that the appeal should involve a substantial question of law is concerned, though this Court chose to admit the appeal by an order dated 23.08.2012, it has not identified and formulated in precise terms the substantial questions of law involved in the appeal. Such an irregularity is curable and now, this Court has to find out whether the appeal involves a substantial question of law. Though totally four questions have been set out in the grounds of appeal as substantial questions of law involved in the present Civil Miscellaneous Appeal, the learned counsel for the appellant relies on the second and third questions shown under the caption 'substantial questions of law' in the grounds of Civil Miscellaneous Appeal as the substantial questions of law involved in this Civil Miscellaneous Appeal. Upon considering the rival contentions made by the parties before the Commissioner for Workmen's Compensation and the decision rendered by the Commissioner for Workmen's Compensation, this Court is convinced that such substantial questions of law are involved in the present Civil Miscellaneous Appeal. They are as follows:- (1) Is the application filed by the respondents herein before the Commissioner for Workmen's Compensation maintainable in view of the bar provided under Section 53 of the Employees' State Insurance Act, 1948 ? (2) Whether it is permissible to hold that an accident has arisen out of and in the course of employment for the purpose of provisions of Employees' Compensation Act, 1923 and not so, for the purpose of Employees' State Insurance Act, 1948 ? 6. The arguments advanced by Mr.S.Ravindran, learned counsel appearing for the appellant and Mr.B.Nedunchezhiyan, learned counsel for the respondents are heard. The materials available on record are also perused. 7. It is not in dispute that the deceased A.Rajasekaran was an employee under the appellant and he was drawing daily wages of Rs.118/-. 6. The arguments advanced by Mr.S.Ravindran, learned counsel appearing for the appellant and Mr.B.Nedunchezhiyan, learned counsel for the respondents are heard. The materials available on record are also perused. 7. It is not in dispute that the deceased A.Rajasekaran was an employee under the appellant and he was drawing daily wages of Rs.118/-. It is also an admitted fact that the appellant company comes under the purview of the Employees' State Insurance Act,1948 and it has also been registered under the Employees' State Insurance Act, with code No.56-64386-16F and that late Rajasekaran was also covered by Employees' State Insurance Act, 1948 under Insurance No.56-03861259. Despite the admitted fact that the deceased was an insured person with Insurance No.56-03861259, his parents, namely, respondents herein chose to make a claim before the Commissioner for Workmen's Compensation, Coimbatore, praying for an award directing the appellant herein to pay a lump sum as compensation for the death of A.Rajasekaran on the strength of the plea that he died of injuries sustained in an accident arising out of and in the course of employment under the appellant management. 8. The first and foremost objection raised by the appellant management before the Commissioner for Workmen's Compensation was that the deceased was an insured person, i.e. an employee covered by the Employees' State Insurance Act, 1948 and hence, no claim could be validly made under any other statute including the Employees' Compensation Act, 1923 by virtue of the bar provided under Section 53 of the Employees' State Insurance Act, 1948. The next objection raised by the appellant management before the Commissioner for Workmen's Compensation was that since the accident took place after his duty time while he was staying in the hostel, such an accident could not be construed to be an accident arising out of and in the course of employment and hence, the claim made under the Employees' Compensation Act, 1923 should be rejected. 9. The Commissioner for Workmen's Compensation overruled both the objections and held the appellant herein / employer liable to pay compensation as directed in the order of the Commissioner. In order to arrive at such a conclusion the Commissioner has relied on a reply sent by the Employees' State Insurance Corporation to a communication made by the Commissioner. 9. The Commissioner for Workmen's Compensation overruled both the objections and held the appellant herein / employer liable to pay compensation as directed in the order of the Commissioner. In order to arrive at such a conclusion the Commissioner has relied on a reply sent by the Employees' State Insurance Corporation to a communication made by the Commissioner. In the said reply, the Deputy Director (legal) Employees' State Insurance Corporation, Coimbatore has clearly admitted that the company was covered by the Employees' State Insurance Act, 1948 with code No.56-64386-16F and the deceased Rajasekaran was also an insured person with Insurance No.56-03861259. However, he had disowned the liability of the Employees' State Insurance Corporation stating that the accident occurred not in the course of and out of the employment under the appellant management, as he had fallen from the third floor of the hostel and sustained fatal injuries while he was staying in the hostel after his duty hours. The said reply indicates two aspects. They are:- (i) the deceased A.Rajasekaran was an insured person and was covered by the Employees' State Insurance Act, 1948 at the time of the accident; and (ii) the Employees' State Insurance Corporation was of the view that the accident did not arise in the course of and out of the employment under the appellant. 10. It transpires, the Commissioner for Workmen's Compensation accepted the above said report of the Deputy Director (legal), Employees' State Insurance Corporation, Coimbatore on its face value regarding both the aspects. That being so, the necessary consequences, according to the contentions of the learned counsel for the appellant, are as follows:- (i) The claim under the Employees' Compensation Act, 1923 shall stand barred by virtue of Section 53 of the Employees' State Insurance Act, 1948; and (ii) Having accepted the report, which stated that the accident was not one arising out of and in the course of the employment under the appellant, the Commissioner ought not to have arrived at a contrary conclusion that the accident in which the deceased Rajasekaran died arose out of and in the course of employment under the appellant. 11. The first contention of the learned counsel for the appellant is sound and cannot be discountenanced. Section 53 of the Employees' State Insurance Act, reads as follows:- "53. 11. The first contention of the learned counsel for the appellant is sound and cannot be discountenanced. Section 53 of the Employees' State Insurance Act, reads as follows:- "53. Bar against receiving or recovery of compensation or damages under any other law:- An insured person or his dependents shall not be entitled to receive or recover, whether from the employer of the insured person or from any other person, any compensation or damages under the Workmen's Compensation Act, 1923 (8 of 1923) or any other law for the time being in force or otherwise, in respect of an employment injury sustained by the insured person as an employee under this Act." 12. In fact, the Hon'ble Apex Court in "National Insurance Company Limited ..vs.. Hamida Khatoon and others" reported in 2010 (2) LLN 54 has made it clear that the bar provided under Section 53 of the Employees' State Insurance Act, 1948 in respect of an accident to an insured person is total and no claim under any other Act could be entertained. While interpreting Section 53 of the Employees' State Insurance Act, 1948, the Hon'ble Apex Court has made the following observation:- "11. In this background and context, we have to consider the effect of the bar created by Section 53 of the ESI Act. Bar is against receiving or recovering any compensation or damages under the Workmen's Compensation Act or any other law for the time being in force or otherwise in respect of an employment injury. The bar is absolute as can be seen from the use of the words shall not be entitled to receive or recover, 'whether from the employer of the insured person or from any other person,' 'any compensation or damages' and 'under the Workmen's Compensation Act, 1923 (8 of 1923), or any other law for the time being in force or otherwise.' The words 'employed by the Legislature' are clear and unequivocal. When such a bar is created in clear and express terms it would neither be permissible nor proper to infer a different intention by referring to the previous history of the Legislation. That would amount to bypassing the bar and defeating the object of the provision. When such a bar is created in clear and express terms it would neither be permissible nor proper to infer a different intention by referring to the previous history of the Legislation. That would amount to bypassing the bar and defeating the object of the provision. In view of the clear language of the section, we find no justification in interpreting or construing it as not taking away the right of the workman, who is an insured person and an employee under the ESI Act, to claim compensation under the Workmen's Compensation Act. We are of the opinion that the High Court was right in holding that in view of the bar created by Section 53, the application for compensation filed by the appellant under the Workmen's Compensation Act was not maintainable." 13. A reading of Section 53 of the Employees' State Insurance Act, 1948 and the consideration of the language used therein, in the light of the interpretation made by the Hon'ble Apex Court in the above said judgment, will make it abundantly clear that no compensation is receivable and no claim can be made for compensation in respect of an employment injury, leading to temporary disablement or permanent disablement or death of the employee, if such employee is / was an insured person i.e., covered by the Employees' State Insurance Act, 1948, as on the date of accident. The only remedy available to such an employee or the dependents of the employee is to make a claim for the benefits under the Employees' State Insurance Act, 1948. 14. In this case, it is not in dispute that the appellant company has been registered under the Employees' State Insurance Act, 1948 with code No.56-64386-16F and the deceased Rajasekaran was also an insured person with Insurance No.56-03861259 as on 03.06.2010 the date of accident. As such, any employment injury caused to him arising out of and in the course of the employment of the appellant would give raise to a claim for the benefits under the Employees' State Insurance Act, 1948 alone and not under any other Act. As such, any employment injury caused to him arising out of and in the course of the employment of the appellant would give raise to a claim for the benefits under the Employees' State Insurance Act, 1948 alone and not under any other Act. The Commissioner for Workmen's Compensation has chosen to hold the appellant liable to pay the compensation to the respondents on the basis of his finding that the accident occurred out of and in the course of employment since the deceased was staying in the hostel run by the appellant company for its employees, even though the fatal fall had occurred after his duty hours in the factory. The said finding ought to have lead the Commissioner for Workmen's Compensation to hold that the denial of liability by the Deputy Director (legal) of the Employees' State Insurance Corporation that the accident did not occur out of and in the course of employment under the appellant was not correct and that hence, the respondents were entitled to claim the benefits under the Employees' State Insurance Act, 1948. The Commissioner for Workmen's Compensation ought to have directed the respondents to make a claim under the Employees' State Insurance Act, 1948. The Commissioner cannot accept the contention of the Employees' State Insurance Corporation that the accident did not occur out of and in the course of employment of the appellant for the purpose of Employees' State Insurance Act, 1948 and at the same time hold that the accident occurred in the course of and out of employment of the appellant for the purpose of the Employees' Compensation Act, 1923. Such a contrary view itself will show the erroneous approach made by the Commissioner for Workmen's Compensation. 15. The learned counsel for the appellant is right in contending that since the deceased was admittedly an insured person with insurance No.56-03861259, Section 53 of Employees' State Insurance Act, 1948 operates as a bar for making a claim for compensation under the provisions of the Employees' Compensation Act, 1923 for the death of the deceased, if the accident has arisen out of and in the course of employment under the appellant. This Court also finds it impossible to reject the contention of the learned counsel for the appellant that if the accident is found to be one not arising out of and in the course of employment under the appellant, then even though the provisions of the Employees' State Insurance Act, 1948 including Section 53 will not be attracted, nevertheless the claim made under the Employees' Compensation Act, 1923 will not be successful and it has got to be rejected. As rightly contended by the learned counsel for the appellant that in either case, the award of Commissioner for Workmen's Compensation cannot be sustained in law and the same deserves to be set aside. For clarity, it is made clear that once an employee is an insured person, no claim can be made for any injury leading to temporary/permanent disablement (either total or partial) if the accident has not arisen out of and in the course of employment, either under the Employees' State Insurance Act, 1948 or under the Employees' Compensation Act, 1923. If at all, the accident is held to be one that has arisen out of and in the course of employment and the employee is admittedly or proved to be an insured person under the Employees State Insurance Act 1948, compensation cannot be claimed under the Employees Compensation Act, 1923 and the only remedy available to the injured employee or the dependents of the deceased employee shall be to claim the benefits under the Employees' State Insurance Act, 1948. Both the substantial questions of law are answered accordingly in favour of the appellant. 16. The learned counsel for the respondents is not in a position to support the award passed by the Commissioner for Workmen's Compensation in the light of the admitted fact that the deceased Rajasekaran was an insured employee with insurance No.56-03861259, coming under the Employees' State Insurance Act, 1948. However, the learned counsel for the respondents has made an attempt to persuade the court to convert the award into one of a direction to the Employees' State Insurance Corporation to pay the benefits under the Employees' State Insurance Act, 1948. However, the learned counsel for the respondents has made an attempt to persuade the court to convert the award into one of a direction to the Employees' State Insurance Corporation to pay the benefits under the Employees' State Insurance Act, 1948. In support of his contention, the learned counsel for the respondents relies on paragraph 12 of the judgment of the Hon'ble Apex Court cited supra, wherein it was observed, "the benefits shall be worked out by the corporation (Employees' State Insurance Corporation) and shall be extended to the eligible persons". Relying on the said observation, learned counsel for the respondents prays for incorporating a similar direction in the judgment by this Court, directing the Employees' State Insurance Corporation to work out the benefits under the Employees' State Insurance Act, 1948 and to extend the same to the eligible persons, namely, the respondents herein. 17. The said observation was made in the peculiar facts and circumstances of the case that went before the Apex Court. In that case, the Employees' State Insurance Corporation volunteered to file an affidavit admitting that the deceased was an insured person and the benefits under the Act would be extended to the persons entitled under the Employees' State Insurance Act, 1948. Only based on that affidavit, the Hon'ble Apex Court chose to make the observation that the benefits under the Employees' State Insurance Act, 1948, should be worked out by the Corporation and should be extended to the eligible persons. Here, in this case there is no such admission or undertaking by the Employees' State Insurance Corporation admitting its liability to extend the benefits under the Act to the eligible persons in respect of the death of the deceased Rajasekaran. The Employees' State Insurance Corporation has taken a stand that it is not liable to extend the benefits as the accident, according to it, was not one arising out of and in the course of employment. When such a denial is there, the proper course for the claimants shall be to make a claim before the Employees' State Insurance Corporation for the benefits under the Employees State Insurance Act, 1948, and in case of rejection of their claim, to approach the Employees Insurance Court under Section 77 of the said Act. 18. When such a denial is there, the proper course for the claimants shall be to make a claim before the Employees' State Insurance Corporation for the benefits under the Employees State Insurance Act, 1948, and in case of rejection of their claim, to approach the Employees Insurance Court under Section 77 of the said Act. 18. The learned counsel for the respondents has also relied on an unreported judgment of a learned single Judge of this Court dated 18.09.2013 made in CMA.No.2016 of 2010, wherein this Court, after holding that a claim in respect of an insured employee under the Employees' Compensation Act, 1923 was not maintainable, proceeded further to work out the benefits payable under the Employees' State Insurance Act, 1948, quantified it and directed the Employees' State Insurance Corporation to make payment of the same without awaiting for the claimants to file a formal claim application. Relying on the same, learned counsel for the respondents has advanced an argument that in this case also, this Court can workout the benefits and direct the Employees' State Insurance Corporation to do so, no doubt after impleading the Employees' State Insurance Corporation, if necessary. The learned single Judge in the other case, out of sympathy showed indulgence in issuing such a direction, that too, when the Employees' State Insurance Corporation had already been impleaded as a party respondent in that appeal. It is also obvious from paragraph 22 of the said judgment that the Employees' State Insurance Corporation, in that case, did not deny its liability and on the other hand, it simply stated that no claim had been made before the Employees' State Insurance Corporation. Under those circumstances alone, the learned single Judge of this Court, in the said case, chose to work out the benefits under the Employees' State Insurance Act, 1948 and direct the Employees' State Insurance Corporation to extend the benefits. The case on hand is entirely on a different footing. The Employees' State Insurance Corporation does not admit its liability. Under those circumstances alone, the learned single Judge of this Court, in the said case, chose to work out the benefits under the Employees' State Insurance Act, 1948 and direct the Employees' State Insurance Corporation to extend the benefits. The case on hand is entirely on a different footing. The Employees' State Insurance Corporation does not admit its liability. Its view has been reflected in the report submitted to the Commissioner for Workmen's Compensation that the Employees' State Insurance Corporation was not liable to extend any benefit for the death of deceased Rajasekaran, as according to the Corporation, the death occurred due to injuries sustained by him in an accident unconnected with the employment and the said accident did not arise out of and in the course of employment. When such is the case, this Court cannot adopt a short cut method and hold the Employees' State Insurance Corporation liable to extend the benefits under the Act. 19. Above all, this Court hearing an appeal arising from the award of the Commissioner for Workmen's Compensation cannot assume the role of the Forum hearing the appeal arising out of and from the orders of the ESI Court. For adjudicating a claim for the benefits under the Employees' State Insurance Act, 1948, a procedure has been prescribed. First of all, a claim has to be made before the Corporation and in case of rejection of the claim or rejection of part of the claim, then the claimants can approach the ESI Court and in case they are not satisfied with the order passed by the ESI Court, an appeal shall lie to the High Court under Section 82 of the Employees' State Insurance Act, 1948, provided such an appeal involves a substantial question of law. In view of the same, this Court is not in a position to accept the request made by the learned counsel for the respondents to suo motu implead the Employees' State Insurance Corporation and to issue a direction to the Employees' State Insurance Corporation to work out the quantum of benefits to which the respondents are entitled and extend the benefits under the said Act. However, this Court makes it clear that the remedy open to the respondents is to approach the Employees State Insurance Corporation for the benefits and then approach the ESI Court and in doing so, the respondents can also project the prosecution of the proceedings under the Employees' Compensation Act, 1923 as a reason for the delay and seek to justify the belated claim. 20. For all the reasons stated above, this Court comes to the conclusion that the order of the Commissioner for Workmen's Compensation cannot stand the scrutiny of law and the same deserves to be set aside. 21. In the result, the appeal succeeds and the award of the Commissioner for Workmen's Compensation, Coimbatore (Deputy Commissioner of Labour, Coimbatore) dated 03.03.2012 in W.C.No.67 of 2010 is set aside. Consequently, connected Miscellaneous Petition is closed. However, there shall be no order as to costs. The respondents 1 and 2 shall be at liberty to approach the Employees' State Insurance Corporation for extension of the benefits under the Employees' State Insurance Act and then to approach the ESI Court, if necessary. The Commissioner for Workmen's Compensation, Coimbatore is directed to permit the appellant to withdraw the amount deposited to the credit of W.C.No. 67 of 2010.