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2019 DIGILAW 1939 (BOM)

State of Maharashtra, Through Plantation Officer v. Director, Social Forestry Division

2019-08-19

R.K.DESHPANDE, VINAY JOSHI

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JUDGMENT : R.K. DESHPANDE, J. 1. This is the reference by the learned Single Judge (Shri A.S. Chandurkar, J.) of the following question of law for consideration by the Larger Bench. "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?" 2. The factual position, as is narrated in the order of reference, can be reiterated. One Ganesh Kakar, the husband of the 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 and was paid wages at the rate of Rs.127/- per day. On 20-12-2011, the said Ganesh met with an accident during the course of employment when the tractor in which he was travelling, fell in a pit and overturned. Ganesh succumbed to the injuries sustained in the accident. 3. The respondent Nos.2 to 5 are the claimants, who filed the proceedings for grant of compensation under Section 22 of the Workmen's Compensation Act, 1923 [for short, "the Act of 1923"]. In the reply filed by the appellate- State Government, it was the stand taken that the deceased Ganesh was employed as a Labour by the Social Forestry Department under the Mahatma Gandhi Rural Employment Scheme. It was stated that the family of the deceased was paid Rs.50,000/- as ex gratia amount on 17-5-2012 as per the provision of Section 7(2)(xiv) of the Maharashtra Employment Guarantee Act, 1977 [for short, "the Act of 1977"] and, therefore, the application for compensation was not maintainable. 4. In the decision of the learned Single Judge of this Court in the case of Executive Engineer, Ujani Canal Division No.6, Pandharpur and another vs. Tukaram Pandurang Dedhe, (1991) 1 MhLJ 783 , the same question of maintainability arose for consideration. 4. In the decision of the learned Single Judge of this Court in the case of Executive Engineer, Ujani Canal Division No.6, Pandharpur and another vs. Tukaram Pandurang Dedhe, (1991) 1 MhLJ 783 , the same question of maintainability arose for consideration. After taking into consideration the provisions of Section 7(2)(xiv) of the Act of 1977, which provided for ex gratia payment in case of the death of any person employed under the Scheme by accident arising out of and in course of employment, it was held that the provisions of the Act of 1977 shall have overriding effect by virtue of Section 16 therein and, therefore, the compensation provided under the provisions of Section 22 of the Act of 1923 would not be available. Para 4 of the said decision being relevant, is reproduced below : "4. The Act of 1977 has been introduced with an object for securing right to work by guaranteeing employment to all adult persons who volunteer to do unskilled manual work in rural area. The entire scheme of the Act has a special drive unlike those employments which are known in a common parlance. In this special scheme of the Act one of the aspects has been incorporated as discussed above, regarding payment of amount in case of disablement as contained under clause (xiv) of section 7. The payment in case of disablement is to be made as per the scheme, without there being any rider as provided under the Act of 1923. The payment is envisaged by the provisions of the Act 1977 is to mitigate the agnony of a person who suffered injury while working under the Scheme. 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." 5. 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." 5. The learned Single Judge in the order of reference did not agree with the view - (i) that even if the Legislature has used the nomenclature of ex gratia payment, that is analogous and at par with the compensation which is awarded under the Act of 1923, (ii) that the provisions are in conflict and inconsistent with those provided under the Act of 1977, and (iii) that Section 16 of the Act of 1977 giving overriding effect will prevail over the provisions of the Act of 1923, and hence the compensation under Section 22 of the Act of 1923 would not be available. Therefore, the question of law, reproduced earlier, is referred to for the consideration of the Larger Bench. 6. The learned Single Judge in the order of reference has proceeded with certain jurisdictional facts held to be proved. The finding of the Commissioner as to engagement of deceased 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. The finding is also recorded that Ganesh was receiving Rs.127/- per day as wages. The order of reference holds that these findings are based on the material available on record and hence do not call for any interference. It further holds that 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. 7. The claimants were in fact paid ex gratia amount of Rs.60,000/- under the provisions of Section 7(2)(xiv) of the Act of 1977. 7. The claimants were in fact paid ex gratia amount of Rs.60,000/- under the provisions of Section 7(2)(xiv) of the Act of 1977. In addition to it, the claim is made for compensation under Section 22 of the Act of 1923 and it is granted by an order dated 31-7-2013 passed by the Commissioner for Workmen's Compensation/Labour Court, Buldhana, for an amount of Rs.4,19,004.75, from which an amount of Rs.60,000/- already paid to the claimants under the provisions of Section 7(2)(xiv) of the Act of 1977 as ex gratia payment has been deducted and the claimants are held entitled to an amount of Rs.3,59,004.75 along with interest at the rate of 12% per annum from the date of application, i.e. 9-4-2012, till its realization. It is thus apparent that the provisions of the Act of 1977 and the Act of 1923 are attracted. 8. The very object of the Act of 1977 is to make effective provisions for securing the right to work by guaranteeing employment to every household, whose adult member volunteers to do unskilled manual work in the Employment Guarantee Scheme implemented in the rural areas of the State, in terms of Section 3 of the said Act, in order to achieve the directive principles of the State policy enshrined under Article 41 of the Constitution of India. Thus, the right to work carries with it an entitlement of wages for the work done for each day of work. If such employment is not provided within a period of fifteen days of the demand, there is a statutory obligation created under sub-section (1) of Section 3D of the said Act to pay a daily unemployment allowance in accordance with the provisions of the Act. Thus, what is guaranteed is the bare minimum wages for survival. 9. In order to consider the question of law under reference, we shall first turn to the provision of Section 7 of the Act of 1977, which deals with the preparation and publication of Scheme. Sub-section (1) therein states that for the purpose of giving effect to the employment guarantee mentioned in Section 3, the State Government shall prepare a Scheme for providing employment to all adult persons residing in the rural areas, who volunteer to do unskilled manual work, subject to the conditions laid down by or under this Act or in the Scheme. Sub-section (1) therein states that for the purpose of giving effect to the employment guarantee mentioned in Section 3, the State Government shall prepare a Scheme for providing employment to all adult persons residing in the rural areas, who volunteer to do unskilled manual work, subject to the conditions laid down by or under this Act or in the Scheme. Sub-section (2) deals with the essential features to be incorporated under the Scheme, and Item (xiv), as it stood on the relevant date of the death of deceased in question, being relevant, is reproduced below : Item (xiv) of Section 7(2) of the Act of 1977 : "(xiv) If any personal injury is caused to any person employed under the Scheme by accident arising out of and in the course of his employment he shall be entitled, free of charge, to such medical treatment as is admissible under the Scheme, and where hospitalisation is necessary, the State Government shall arrange for such hospitalisation including accommodation, treatment and diet. During the period he is undergoing treatment in the hospital, he shall be entitled to daily wages at the rate of half of the minimum wages referred to in clause (vii). In case of death of such person, an ex-gratia payment at the rate of rupees fifty thousand or such higher amount, as may be determined by the State Government, by general order issued in this behalf, from time to time shall be made to his legal heirs in the manner laid down in the Scheme. In case of disablement, such person shall be entitled to such ex-gratia payment as may be determined in accordance with the Scheme, but the amount of such payment shall not exceed the amount determined by the State Government as aforesaid for ex-gratia payment in case of death." The aforesaid provision deals with the entitlement of a person employed under the Scheme, free of charge, to such medical treatment as is admissible under the Scheme, if any injury is caused to such person employed under the Scheme by accident arising out of and in course of employment. In such a case where hospitalization is necessary, the State Government is also required to arrange such hospitalization, including accommodation, treatment and diet. In such a case where hospitalization is necessary, the State Government is also required to arrange such hospitalization, including accommodation, treatment and diet. During the period such person is undergoing treatment in the hospital, he is also made entitled to daily wages at the rate half of the minimum wages referred to in clause (vii). In case of death of such person, an ex gratia payment at the rate of Rs.50,000/- or such higher amount, as may be determined by the State Government, by general order issued in this behalf from time to time, is made payable to his legal heirs in the manner laid down in the Scheme. In case of disablement of such person, the entitlement is also in respect of ex gratia payment, as may be determined in accordance with such Scheme, which shall not exceed the amount of ex gratia payment in case of death. 10. In this matter, we are concerned with the amount of ex gratia paid to the legal heirs of an employee, who died in the accident arising out of and in the course of employment with the appellants under the Employment Guarantee Scheme. The learned Single Judge in his order of reference considers that the expression 'ex gratia' has not been defined under the Act of 1977. Therefore, the meaning of 'ex gratia', as per Collins Concise Dictionary, is considered. It indicates that ex gratia payment is given as a favour or gratuitously, where no legal obligation exists. The order, therefore, holds 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, and the payment is made by the State on its own volition, to tide over an emergent situation. 11. No doubt, that the object of ex gratia payment is to mitigate the agony or to tide over the emergent situation arising out of the personal injury or the death caused in the accident arising out of and in the course of employment while working under the Employment Guarantee Scheme. 11. No doubt, that the object of ex gratia payment is to mitigate the agony or to tide over the emergent situation arising out of the personal injury or the death caused in the accident arising out of and in the course of employment while working under the Employment Guarantee Scheme. However, in our view, Section 7 of the Act of 1977, which deals with the preparation and publication of Scheme, makes such Scheme statutory in nature, and clause (xiv) under sub-section (2) of Section 7 therein, creates not only a statutory obligation/duty but it is a guarantee to provide free of charge the medical treatment with the charges of hospitalization, including accommodation, diet, etc., and the minimum bare wages for survival or sustenance of life in terms of the said provision and the Scheme framed thereunder. It cannot be said that no legal obligation exists. It is not the gratuitous payment or the payment by way of favour by the State Government on its own volition. The dictionary meaning of ex gratia payment, as is imported in the order of reference, is unfit in the light of the object, context and background of the said provision. 12. Section 3 of the Act of 1923 deals with the employer's liability of compensation, and sub-section (1) therein states that if personal injury is caused to a workman by accident arising out of and in the course of his employment, his employer shall be liable to pay compensation in accordance with the provisions of Chapter-II under the said Act. Section 4 therein deals with the amount of determination of compensation. Clause (a) of sub-section (1) of Section 4 deals with the death resulting from injury, and it is reproduced below along with Explanations I and II below it : "4. Amount of Compensation (1) Subject to the provisions of this Act, the amount of compensation shall be as follows, namely :-- (a) Where death results from the injury an amount equal to fifty per cent or the monthly wages of the deceased workman multiplied by the relevant factor; or an amount of eighty thousand rupees, whichever is more. Amount of Compensation (1) Subject to the provisions of this Act, the amount of compensation shall be as follows, namely :-- (a) Where death results from the injury an amount equal to fifty per cent or the monthly wages of the deceased workman multiplied by the relevant factor; or an amount of eighty thousand rupees, whichever is more. Explanation I.-- For the purposes of clause (a) and clause (b), "relevant factor" in relation to a workman means the factor specified in the second column of Schedule IV against the entry in the first column of that Schedule specifying the number of years which are the same as the completed years of the age of the workman on his last birthday immediately preceding the date on which the compensation fell due. Explanation II.-- Where the monthly wages of a workman exceed four thousand rupees, his monthly wages for the purposes of clause (a) and clause (b) shall be deemed to be four thousand rupees only." Schedule IV, referred to in the Explanation I prescribes the factors for working lump-sum equivalent of compensation amount in case of permanent disability and death. This is how the compensation payable on account of death of an employee occurring by an accident arising out of and in course of his employment, is to be calculated. Thus, it is the compensation in real sense for loss of life, which takes into consideration the future prospects of life, loss of income, non-pecuniary loss, etc. 13. It is not the amount of compensation for the loss of life which is determined and becomes payable to his legal heirs under the Act of 1977. The amount of ex gratia paid is not analogous or cannot be equated or treated on par with the amount of compensation paid for the loss of life, awarded under the Act of 1923. The ex gratia payment is in the nature of medical expenses incurred for the treatment of injury, including the charges of hospitalization, diet, and in case of death, it is to provide support to the legal heirs for the sudden distress caused on account of stoppage of income. This is provided to implement or to attain the directive principles of State policy under Article 41 of the Constitution of India. This is provided to implement or to attain the directive principles of State policy under Article 41 of the Constitution of India. As against this, there is a structural formula prescribed for the purpose under the provisions of the Act of 1923, which is not available in the Act of 1977. The compensation determined under the Act of 1923 is the measurement of loss of future income and life, which is pecuniary as well as non-pecuniary. We, therefore, overrule the decision of the learned Single Judge in Tukaram Pandurang Dedhe's case, cited supra, and concur with the view taken in the order of reference to the extent that both the enactments operate in different fields and there is no conflict or inconsistency with each other. 14. The benefits under both the enactments are conferred on an employee suffering an injury or on the legal heirs of an employee, who succumbed to the injuries caused in the accident arising out of and in the course of his employment with his employer. If an employee or his legal heirs is/are entitled to different kinds of benefits under the State and Central enactments, it cannot be denied to him or to his legal heirs, unless there is a provision to exclude the applicability of other enactment or there is a provision to deduct the amount earlier granted in one enactment operating in the field, because both the enactments are beneficial and welfare legislations. 15. Even assuming that there is conflict or inconsistency, it has to be resolved by invoking the provision of 16 of the Act of 1977, which is reproduced below : "16. The provisions of this Act or the Scheme, rules, notifications or orders made or issued 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." The provision of Section 16 operates only in case of conflict or inconsistency between the Act of 1977 and any other law in force on the subject, whether the State or the Central. Our reading of Section 16 is that the provisions of the Act of 1977 are in addition to the provisions contained in any other law for the time being in force, and it is clear from the expression "notwithstanding anything inconsistent therewith contained in any other law for the time being in force or ...", which gives the overriding effect. It neither does exclude the applicability of the provisions of the other enactments in force nor it is in derogation of it. We find that the provision of Section 16 of the Act of 1977 cannot be read to exclude the applicability of any other law for the time being in force and the decision in Tukaram Pandurang Dedhe's case, cited supra, misreads the said provision to exclude such applicability. We, therefore, overrule the said decision. 16. In the light of the aforesaid discussion, we answer the question of law referred to and hold that by virtue of the provision of Section 16 of the Maharashtra Employment Guarantee Act, 1977, an employee, who has received the ex gratia payment under Section 7(2)(xiv) of the said Act, is not precluded in seeking compensation under any of the provisions of the Workmen's Compensation Act, 1923. 17. The learned counsels appearing for the parties submit that the learned Single Judge, in his order of reference, has dealt with the entire controversy on merits and has accepted the findings of fact recorded by the Commissioner for Workmen's Compensation/Labour Court, Buldhana, in his order dated 31-7-2013 in W.C.A.(F.) No.02 of 2012. We, however, find that in the light of what we have held above, the question of deduction of Rs.60,000/- needs to be considered and hence, the matter be placed before the learned Single Judge for decision in accordance with law.