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2014 DIGILAW 84 (CHH)

Chief Executive Officer v. Ghandrika Bai

2014-02-21

SANJAY K.AGRAWAL

body2014
ORDER Sanjay K. Agrawal, J. 1. The substantial question of law involved and to be answered in this batch of appeals is whether the person employed by the employer under the National Rural Employment Scheme framed under the Mahatma Gandhi National Rural Employment Guarantee Act, 2005 is entitled for compensation under the provisions of Employee's Compensation Act, 1923, over and above the amount of ex gratia payable under the Scheme framed under the Act of 2005, in light of non-obstante Clause enumerated in Section 28 of the Mahatma Gandhi National Rural Employment Guarantee Act, 2005? In order to answer the substantial question of law, so framed, the imperative facts required to be noticed in nutshell, are as under: 2.1 Claimants/respondents filed an application under Section 10 of the Employee's Compensation Act, 1923 (hereinafter called "Act of 1923") stating inter alia that Mr. Malham Kuwar working under the road constructed by the employer, and during course of employment became unconscious and died on 4-1-2007. It was further pleaded that the said work was undertaken by appellants/employer under the National Rural Employment Guarantee Scheme under the Act, 2005 (National Rural Employment Guarantee Act, 2005) i.e. and the construction of Baiga Dharsa Sadak Mitti Marg, sanctioned by Chief Executive Officer, Zila Panchayat, Rajnandgaon by order No. 7524, dated 15-12-2006 and the Gram Panchayat, Belgaon is the agency, which was being executed by Chief Executive Officer, Janpad Panchayat, Dongargaon. It was further pleaded that during the course of employment, in work place, arrangement for primary medical care and other necessary facilities, etc. were not available. On account of negligence of the employer, said Malham Kuwar, aged about 22 years, died on the spot, leading to making of claim application under Section 10 of the E.C. Act, claiming compensation of Rs. 5,00,000 along with interest and penalty. 2.2 Appellants/employer filed its written statement and opposed the claim application of the claimants/employee stating inter alia that the work was done under scheme framed under the National Rural Employment Guarantee Act, 2005. It was further pleaded that death of Malham Kuwar, occurred due to his own negligence and the employer is not liable for payment of any compensation. 2.2 Appellants/employer filed its written statement and opposed the claim application of the claimants/employee stating inter alia that the work was done under scheme framed under the National Rural Employment Guarantee Act, 2005. It was further pleaded that death of Malham Kuwar, occurred due to his own negligence and the employer is not liable for payment of any compensation. 2.3 The learned Commissioner, by its impugned award dated 5-12-2007, after full trial allowed the application of respondent/claimant stating inter alia that the death of Malham Kuwar was occurred during the course of employment under the employer, and awarded total compensation of Rs. 1,65,934 along with interest and penalty. 2.4 Feeling aggrieved against the award of the Commissioner, appellants/employer has preferred these appeals. 2.5 These appeals have been filed under Section 30 of the Employee's Compensation Act, 1923 (for short 'the E.C. Act') challenging the award is dated 5-12-2007 and 30-10-2007 passed by Commissioner for Employee's Compensation, Labour Court, Rajnandgaon (for short 'the Commissioner') in Case Nos. 30/W.C./2007 (fatal) and 20/W.C/2007 (fatal). 2.6 These appeals [M.A. (C) Nos. 94/2008 and 75/2008] were heard analogously and disposed of by this common order, as common question of fact and law are involved. For the sake of convenience, M.A. (C) No. 94/2008 is taken up as the lead case. 2. Mr. Rakesh Sahu, learned counsel appearing for the appellants/employer would submit that the learned Commissioner has fallen into error in entertaining and granting the said application for compensation under the provisions of E.C. Act to the claimants. He would further submit that the employee under the scheme enacted under Schedule-II by virtue of Clause-26 of the Mahatma Gandhi National Rural Employment Guarantee Act, 2005 (for short 'MGNREGA, 2005'), he would only be entitled for ex gratia amount of Rs. 25,000 and the application filed under Section 10 of the E.C. Act, was not maintainable, therefore, the impugned award granting compensation under of E.C. Act deserves to be set-aside. 3. Per contra, Mr. Anand Shukla, learned counsel appearing for the respondent/claimant would support the award and submit that the compensation granted by the learned Commissioner under the provisions of E.C. Act is just and proper. He would further submit that E.C. Act is beneficial legislation and right guaranteed thereunder cannot be taken away under provisions of MGNREGA, 2005. According to Mr. Anand Shukla, learned counsel appearing for the respondent/claimant would support the award and submit that the compensation granted by the learned Commissioner under the provisions of E.C. Act is just and proper. He would further submit that E.C. Act is beneficial legislation and right guaranteed thereunder cannot be taken away under provisions of MGNREGA, 2005. According to Mr. Shukla, the right of workmen to claim compensation under the E.C. Act has neither being taken away not abrogated by the MGNREGA, 2005 and Section 28 of MGNREGA, 2005, cannot have overriding effect over the provision of the E.C. Act. The workman is not disabled to claim compensation under the E.C. Act, in additional to ex gratia amount granted under the Act and scheme framed under the MGNREGA, 2005. He would further submit that two statues deal with different subject, therefore, Section 28 of the MGNREGA, 2005 has no overriding effect over the provision contained in the E.C. Act. 4. I have heard learned counsel for the parties and considered the rival submission and perused the record of the Commissioner carefully. 5. It is not in dispute that the labourers in both the cases, were working under the scheme floated under National Rural Employment Guarantee Act, 2005, known as National Rural Employment Guarantee Scheme. The said Act has been amended vide letter dated 7-10-2010, and known as the Mahatma Gandhi National Rural Employment Guarantee Act, 2005 ('MGNREGA'), which reads thus: "Vide an amendment in the NREG Act, called the National Rural Employment Guarantee (Amendment) Act, 2009. The name of the NREG Act has been changed to "The Mahatma Gandhi National Rural Employment Guarantee Act". The corresponding Act shall be deemed to have come into force on 2nd October, 2009." 6. Section 5 of MGNREGA, 2005 provides, conditions for providing guaranteed employment, which reads as under: "5. Conditions for providing guaranteed employment--(1) The State Government may, without prejudice to the conditions specified in Schedule II, specify in the scheme the conditions for providing guaranteed employment under this Act. (2) The persons employed under any scheme made under this Act shall be entitled, to such facilities not less than the minimum facilities specified in Schedule II." 7. Conditions for providing guaranteed employment--(1) The State Government may, without prejudice to the conditions specified in Schedule II, specify in the scheme the conditions for providing guaranteed employment under this Act. (2) The persons employed under any scheme made under this Act shall be entitled, to such facilities not less than the minimum facilities specified in Schedule II." 7. A bare perusal of Section 5 of MGNREGA, 2005 would show that the persons employed under any scheme made under this Act shall be entitled to such facilities not less than the minimum facilities specified in Schedule II. Schedule II of Section 5 of MGNREGA, 2005 provides conditions for guaranteed rural employment under a scheme and minimum entitlements of labourers. 8. Clause-26 of Schedule II of Section 5 of MGNREGA, 2005 provides thus: "26. If a person employed under a scheme dies or becomes permanently disabled by accident arising out of and in the course of employment, he shall be paid by the implementing agency an ex gratia payment at the rate of twenty-five thousand rupees or such amount as may be notified by the Central Government, and the amount shall be paid to the legal heirs of the deceased or the disabled, as the case may be." 9. The Government of India, Ministry of Rural Development has issued a clarification dated 17-10-2011, clarifying the 'payment of compensation' under the MGNREGA, 2005. It provides that compensation under the Employee's Compensation Act cannot be claimed over and above the amount of ex gratia payment provided under MGNREGA. The said clarification reads as under: "To, All Principal Secretary/Secretary of State Rural Development Departments. Subject: Clarification on the provision of 'payment of compensation' under Mahatma Gandhi NREGA. Sir, I am directed to state that few references from State Governments were received on the provision of 'payment of compensation' under Section 26 of Mahatma Gandhi NREGA. The matter was examined in the Ministry in consultation with Integrated Finance Division and advice was also taken from Department of Legal Affairs. Based on the advice of Department of Legal Affairs and recommendation of Integrated Finance Division, following clarifications are made in this regard. 1. Compensation under the Workmen's Compensation Act cannot be claimed over and above the amount of ex gratia payment provided under MGNREGA. 2. Based on the advice of Department of Legal Affairs and recommendation of Integrated Finance Division, following clarifications are made in this regard. 1. Compensation under the Workmen's Compensation Act cannot be claimed over and above the amount of ex gratia payment provided under MGNREGA. 2. Payment of ex gratia payment in case of death or becoming permanently disabled by accident arising out of and in the course of employment under this scheme shall be met within the fund availability of 6% for administrative expenses. All the State Rural Development Departments are advised to bring to the notice of all the concerned agencies for information and necessary action. Yours Sincerely, P.N. Shukla Under Secretary to the Government of India 1. PPS to JS (MGNREGA-J)/JS (MGNREGA-M) for information please. 2. All Deputy Secretary, Joint Director and Directors of MGNREGA Division for information please." 10. Section 28 of MGNREGA, 2005 which is non-obstante-clause provides that provisions of the Act or scheme made thereunder shall have overriding effect over any other law for time being in force, which is inconsistent therewith contained in any other law for time being in force. It provides as under: "28. Act to have overriding effect--The provisions of this Act or the schemes made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of such law: Provided that where a State enactment exists or is enacted to provide employment guarantee for unskilled manual work to rural households consistent with the provisions of this Act under which the entitlement of the households is not less than and the conditions of employment are not inferior to what is guaranteed under this Act, the State Government shall have the option of implementing its own enactment: Provided further that in such cases the financial assistance shall be paid to the concerned State Government in such manner as shall be determined by the Central Government, which shall not exceed what the State would have been entitled to receive under this Act had a scheme made under this Act has to be implemented." 11. The Supreme Court has considered the nature and effect of no-obstante clause and held that non-obstante clause is legislative device, which is employed to give overriding effect to certain provisions, which may be found either in same enactment or some other enactment in following cases:-- 12.1 In case of Union of India and another v. G.M. Kokil and others 1984 (Supp.) SCC 196, the Supreme Court held as under: "11. Section 70, so far as is relevant, says "the provisions of the Factories Act shall, notwithstanding anything contained in that Act apply to all persons employed in and in connection with a factory." It is well-known that a non-obstante clause is a legislative device which is usually employed to give overriding effect to certain provisions over some contrary provisions that may be found either in the same enactment or some other enactment, that is to say, to avoid the operation and effect of all contrary provisions. Thus the non-obstante clause in Section 70, namely, "notwithstanding anything in that Act" must mean notwithstanding anything to the contrary contained in that Act and as such it must refer to the exempting provisions which would be contrary to the general applicability of the Act. In other words, as all the relevant provisions of the Act are made applicable to a factory notwithstanding anything to the contrary contained in it, it must have the effect of excluding the operation of the exemption provisions. Just as because of the non-obstante clause the Act is applicable even to employees in the factory who might not be 'workers' under Section 2(1), the same non-obstante clause will keep away the applicability of exemption provisions qua all those working in the factory. The Labour Court, in our view, was therefore, right in taking the view that because of the non-obstante clause Section 64 read with Rule 100 itself would not apply to the respondents and they would be entitled to claim overtime wages under Section 59 of that Act read with Section 70 of the Bombay shops and Establishments Act, 1948." 12.2 In case of Chandavarkar Sita Ratna Rao v. Ashalata S. Guram (1986) 4 SCC 447 , the Supreme Court held as under: "67. A clause beginning with the expression "notwithstanding anything contained in this Act or in some particular provision in the Act or in some particular Act or in any law for the time being in force, or in any contract" is more often than not appended to a section in the beginning with a view to give the enacting part of the section in case of conflict an overriding effect over the provision of the Act or the contract mentioned in the non-obstante clause. It is equivalent to saying that in spite of the provision of the Act or any other Act mentioned in the non-obstante clause or any contract or document mentioned the enactment following it will have its full operation or that the provisions embraced in the non-obstante clause would not be an impediment for an operation of the enactment. See in this connection the observations of this Court in The South India Corporation (P) Ltd. v. The Secretary, Board of Revenue, Trivandrum and another, AIR 1964 SC 207 at 215 : [1964] 4 SCR 280. 68. It is well settled that the expression 'notwithstanding' is in contradistinction to the phrase 'subject to' the latter conveying the idea of a provision yielding place to another provision or other provisions to which it is made subject. This will be clarified in the instant case by comparison of sub-section (1) of Section 15 with sub-section (1) of Section 15A. We are therefore unable to accept, with respect, the view expressed by the Full Bench of the Bombay High Court as relied on by the learned single Judge in the judgment under appeal." 12.3 In case of Parayankandiyal Eravath Kanapravan Kalliani Amma (Smt.) and others v. K. Devi and others (1996) 4 SCC 76 , the Supreme Court held as under: "77. "Non-obstante clause is sometimes appended to a Section in the beginning, with a view to give the enacting part of the Section, in case of conflict an overriding effect over the provision or Act mentioned in that clause. "Non-obstante clause is sometimes appended to a Section in the beginning, with a view to give the enacting part of the Section, in case of conflict an overriding effect over the provision or Act mentioned in that clause. It is equivalent to saying that in spite of the provision or Act mentioned in the non-obstante clause, the enactment following it, will have its full operation of that the provision indicated in the non obstante clause will not be an impediment for the operation of the enactment." [See: Union of India v. G.M. Kokil, (1984) (Supp.) SCC 196 : AIR 1984 SC 1022 ; Chandavarkar Sita Ratna Rao v. Ashalata S. Gurnam, (1986) 4 SCC 447 (477); R.S. Raghunath v. State of Karnataka, (1992) 1 SCC 335 ; G.P. Singh's Principles of statutory Interpretation]." 12.4 In case of Iridium India Telecom Ltd. v. Motorola INC (2005) 2 SCC 145 , the Supreme Court has followed the earlier decision in case of Chandavarkar Sita Ratna Rao (supra ) and Parayankandiyal Eravath Kanapravan Kalliani Amma (Smt.) (supra). 12.5 In case of JIK Industries Limited and others v. Amarlal V. Jumani and another (2012) 3 SCC 255 , the Supreme Court held as under: "60. The insertion of a non-obstante clause is a well known legislative device and in olden times it had the effect of non obstante aliquo statuto in contratium (notwithstanding any statute to the contrary). Under the Stuart reign in England the Judges then sitting in Westminster Hall accepted that the statutes were overridden by the process but this device of judicial surrender did not last long. 61. On the device of non-obstante clause, William Blackstone in his Commentaries on the Laws of England (Oxford: The Claredon Press, 1st Edn. 1765-1769) observed that the devise was "........effectually demolished by the Bill of Rights at the revolution, and abdicated Westminster Hall when James II abdicated the Kingdom." (See Bennion on Statutory Interpretation, 5th Edition, Section 48). 62. Under the Scheme of modern legislation, no-obstante clause has a contextual and limited application. 63. The impact of a 'non-obstante clause' on the concerned act was considered by this Court in many cases and it was held that the same must be kept measured by the legislative policy and it has to be limited to the extent it is intended by the Parliament and not beyond that. 63. The impact of a 'non-obstante clause' on the concerned act was considered by this Court in many cases and it was held that the same must be kept measured by the legislative policy and it has to be limited to the extent it is intended by the Parliament and not beyond that. [See ICICI Bank Ltd. v. Sidco Leathers Ltd. and others, (2006) 10 SCC 452 para. 37 at page 466]" 12. Thus, having ascertained the nature and effect of no-obstante clause and keeping in view the principles laid down therein, reverting back to the facts of the case, a bare perusal of Section 28 of MGNREGA, 2005 would show that the provisions of this Act or the schemes made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of such law. 13. The MGNREGA, 2005 has been introduced with an object to provide for enhancement of livelihood, security of households in rural areas of the country by providing atleast one hundred days of guaranteed wage employment in every financial year to every household, whose adult members volunteer to do unskilled manual work in rural area. The scheme framed under the Act provisions has been incorporated for minimum features of Rural Employment Guarantee Scheme and conditions for guaranteed Rural employment under a scheme and minimum entitlement of labourers have been laid. The entire scheme of the Act has a special drive unlike those employment's, which are known in a common parlance. In this special scheme of the Act, one of the aspects has been incorporated regarding payment of amount in case of disablement/death. The payment in case of disablement/death is to be made as per the scheme, without there being any rider as provided under the E.C. Act. The payment as envisaged by the provisions of the MGNREGA, 2005 is to mitigate the agony of a person who suffered injury/death while working under the scheme. The MGNREGA, 2005 also provides for a particular forum. As such, even if the legislation has used the nomenclature of ex gratia payment that is analogous and at par with the compensation, which is being awarded under the Employee's Compensation Act. Provisions on the subject of compensation under the E.C. Act, are apparently in conflict and are inconsistent with those provided under the MGNREGA, 2005. As such, even if the legislation has used the nomenclature of ex gratia payment that is analogous and at par with the compensation, which is being awarded under the Employee's Compensation Act. Provisions on the subject of compensation under the E.C. Act, are apparently in conflict and are inconsistent with those provided under the MGNREGA, 2005. In view of Section 28, the provisions in this regard, under the MGNREGA, 2005, due to overriding effect shall prevail over those under the E.C. Act. 14. In case of Executive Engineer, Ujani Canal Division No. 6, Pandharpur and another v. Tukaram Pandurang Dedhe 1991 ACJ 1077 the Bombay High Court while considering identical situation, overriding provision contained in Section 16 of the Maharashtra Employment Guarantee Act, 1977 with that of Workmen's Compensation Act, 1923, and held as under:-- "4.......The Act of 1977 also provides for a particular forum. As such even if the legislation has used the nomenclature of ex-gratia payment that is analogous and at par with the compensation which is being awarded under the Workmen's Compensation Act. Provisions on the subject of compensation under the Act of 1923 are apparently in conflict and are inconsistent with those provided under the Act of 1977. In view of Section 16, the provisions in this regard, under the Act of 1977, due to overriding effect shall prevail over those under the Act of 1923." 15. Thus, in view of the aforesaid discussion, it is held that Section 28 of MGNREGA, 2005 shall have overriding effect over the provision of Employee's Compensation Act, 1923 and by virtue of Clause-26 Schedule-II enacted under Section 5 of MGNREGA, 2005, the workmen/labourers will be entitled only for ex-gratia payment @ Rs. 25,000 in case of death, or such an amount as may be notified by Central Government and the application before the Commissioner under the provisions of Employee's Compensation Act, 1923 claiming compensation over and above the amount of ex gratia payable under the scheme of the Act of 2005 would not be maintainable. Thus, substantial question of law is answered accordingly. Resultantly, the impugned award passed by the Commissioner in M.A. (C) Nos. 94/2008 and 75/2008 are hereby set-aside and their application for compensation under the provisions of Act, 1923 are hereby dismissed. Thus, substantial question of law is answered accordingly. Resultantly, the impugned award passed by the Commissioner in M.A. (C) Nos. 94/2008 and 75/2008 are hereby set-aside and their application for compensation under the provisions of Act, 1923 are hereby dismissed. However, the claimants would be entitled and be paid the amount of ex-gratia as provided and the scheme under the Act of 2005, if the amount has not been paid, it will be paid within one moth from the date of receipt of certified copy of this order. Both the appeals are allowed to the extent indicated herein-above. No order as to costs. Appeal Partly Allowed.