Kailash Timber and Flywoods vs Saritha and Another

Aruna Jagadeesan, J.—This Civil Miscellaneous Appeal is filed against the judgment and decree dated 21.4.2009 made in WC. No. 105 of

2005 by the learned Labour Commissioner for Workmen Compensation, Coimbatore, whereby a sum of Rs. 4,29,547/- as total compensation

was awarded to the claimant/the 1st Respondent herein for the death of her husband Balakrishnan on 1.6.2005. The facts are that the deceased

was working under the appellant Timber Depot as a wood cutter for the past seven years and his last drawn pay was Rs. 175/- per day. He was

working in the premises of the Appellant Timber Depot. On 1.6.2005 at about 9.30 a.m. to 10.30 a.m., when he switched on the electric board in

order to start his work, he was electrocuted and sustained serious injuries. Immediately, he was taken to Abirami Hospital and then, to the

Government Hospital, Coimbatore, where he was reported dead. The wife of the deceased claimed a compensation of Rs. 5,20,584/- before the

Labour Commissioner for Workmen Compensation, Coimbatore.

The claim was resisted by the appellant, stating that the claimant suppressed material and relevant facts. According to the appellant

Management, he was not a worker with the appellant Timber Depot, but on humanitarian grounds, he was offered food and clothes by the

Management of the Appellant Timber Depot. The deceased visited the Depot on 1.6.2005 and voluntarily laid his fingers on the switch board,

which resulted in electrocution. It is further stated that at the instance of the Police, the Management was forced to give ex gratia payment of Rs.

42,000/- as compensation to the claimant.

Before the Labour Commissioner, in the course of enquiry, the appellant produced agreements Exhibit A-6 and Exhibit A-7 said to have been

entered into between the claimant and the management to show that the claimant and her mother-in-law have received a sum of Rs. 42,000/- as

compensation from the Management and have executed the agreements, acknowledging the receipt of the said amount.

Mr. I.C. Vasudevan, the learned counsel for the appellant submitted that the Labour Commissioner ought to have deducted the amount received

by the claimant and her mother-in-law as compensation from the Management immediately after the accident and determination of compensation

without deducting those amount is not proper and Section 8 of the Workmen''s Compensation Act is only directory and not mandatory.

On the other hand, Mr. L. Mouli, the learned counsel for the respondent/claimant drawing attention of this Court to Section 8(1) of the

Workmen''s Compensation Act, 1923, contended that there is a total bar u/s 8 against any deduction to be made by the employer or by the Court

for any payment made by the employer out of the Court under any circumstances, so as to reduce the corpus of the compensation determined by

the Labour Commissioner. The learned counsel in support of his contention relied on the decision of the Madhya Pradesh High Court in Divisional

Engineer M.P. Electricity Board and Another Vs. Mantobai, and also the unreported judgment of this Court made in CMA. No. 1439 of 2009

dated 4.8.2011.

The question that arises for consideration by this Court is as to whether the sum said to have been received by the Respondent claimant can be

deducted from the sum of compensation awarded by the Labour Commissioner.

Section 8 of the Workmen''s Compensation Act reads as follows:-

Distribution of compensation: (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 woman 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 the 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 dependant

shall be deducted by the Commissioner from such compensation and repaid to the employer.

Section 8(1) of the Act lays down in unequivocal terms that no payment of compensation in respect of a workman whose injury has resulted in

death and no payment of lump sum as compensation to a woman or a person under the 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. Under sub section

3, it is the receipt of the Commissioner which is a sufficient discharge in respect of any compensation deposited with him.

From the above provisions, it is clear that the Act does not contemplate a payment of compensation by the employer to any party in person as

discharge of his liability. The reason is fairly obvious. The Labour Commissioner is expected to safeguard the interest of all the dependents of a

deceased workman. The definition of ''dependent'' includes within the meaning of the term several relatives of a deceased workman who may not

be heirs under the law applicable to him. In the Act, the Commissioner is given unfettered discretion to apportion the amount of compensation

among the dependents.

It is quite clear from this Section that even assuming that some amount has been paid to the claimant by way of compensation, that amount

could not be deducted from the actual amount of compensation payable, because this Section says that such payment shall not be deemed to be

payment of compensation. In this case, the amount was paid to the claimant not as compensation, but as an ex gratia payment. Therefore, this

amount cannot be deducted from the sum payable by the appellant.

If we look upon Exhibit A-6 and Exhibit A-7 it shows that an agreement is entered into between the widow and the employer and under

Exhibit A-7 between the mother-in-law of the deceased and the employer. u/s 17 of the Workmen''s Compensation Act, a workman cannot

contract himself out. The Section protects ignorant workman, who may be induced by the employer to agree to a lease, compensation or to

abandon something which he is entitled under the Act to claim. If the employer pays of his own to the workman or to his legal representatives, he

does so with the risk that he will not be entitled to get a set off for the sum so paid. Further, as a contract, Exhibit A-6 and Exhibit A-7 should have

been registered u/s 28 of the Workmen''s Compensation Act, but it has not been done in this case. Therefore, I am of the view that the Appellant

is not entitled to get set off for the sum of Rs. 42,000/- paid to the widow as aforesaid. Therefore, there are no merits in the contentions raised by

the learned counsel for the Appellant and this Civil Miscellaneous Appeal is liable to be dismissed. In the result, this civil miscellaneous appeal is

dismissed. No costs.