Case Note & Summary
The appellants, being the dependents of deceased Paigambar Mulla, filed a claim petition under the Employees Compensation Act, 1923, contending that the deceased was employed as a lineman by the respondent and died due to electrocution during the course of employment. The Commissioner partly allowed the claim, awarding compensation of Rs.5,19,950/- but deducted Rs.5,00,000/- as ex-gratia already paid, resulting in a net award of Rs.19,950/- with interest at 12% per annum. Aggrieved, the appellants filed this appeal seeking enhancement. The High Court examined the issue of whether ex-gratia payment can be deducted from statutory compensation. It held that ex-gratia is a voluntary payment and cannot be set off against the compensation payable under the Act. The Court also noted that the Commissioner had not computed the compensation correctly as per Schedule IV. Accordingly, the appeal was allowed, the impugned award was modified, and compensation was enhanced to Rs.14,80,050/- with interest at 12% per annum from the date of accident.
Headnote
A) Employees Compensation - Deduction of Ex-Gratia Payment - Section 4, Employees Compensation Act, 1923 - The Commissioner deducted Rs.5,00,000/- ex-gratia from the compensation amount of Rs.5,19,950/- and awarded only Rs.19,950/-. The High Court held that ex-gratia payment is voluntary and cannot be set off against statutory compensation. The appeal was allowed and compensation enhanced to Rs.14,80,050/- with interest at 12% per annum from the date of accident. (Paras 1-5)
Issue of Consideration
Whether the ex-gratia amount paid by the employer can be deducted from the compensation awarded under the Employees Compensation Act, 1923
Final Decision
The appeal is allowed. The impugned judgment and award dated 09-01-2017 in ECA No.249/2014 is modified. The appellants are entitled to compensation of Rs.14,80,050/- with interest at 12% per annum from the date of accident till realization. The respondent is directed to deposit the enhanced compensation within six weeks.
Law Points
- Ex-gratia payment cannot be deducted from compensation under Employees Compensation Act
- 1923
- Compensation must be computed as per Schedule IV of the Act
- Interest at 12% per annum from date of accident
Case Details
2020 LawText (KAR) (06) 1
Miscellaneous First Appeal No.200839/2017(WC)
Shri B.K. Patil (for appellants), Sri Ameet Kumar Deshpande (for respondent)
Nusrat Jahan, Baby Arsha, Mahaboob Bee
The Managing Director, Kalaburagi Electrical Supply Co. Ltd.
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Nature of Litigation
Appeal against the judgment and award of the Commissioner for Employees Compensation, Kalaburagi, in ECA No.249/2014, seeking enhancement of compensation.
Remedy Sought
Appellants sought modification of the award to enhance compensation to Rs.14,80,050/- with interest at 18% per annum.
Filing Reason
The Commissioner deducted Rs.5,00,000/- ex-gratia from the compensation amount, resulting in a net award of only Rs.19,950/-.
Previous Decisions
The Commissioner partly allowed the claim petition and awarded Rs.5,19,950/- but deducted Rs.5,00,000/- as ex-gratia, awarding Rs.19,950/- with interest at 12% per annum.
Issues
Whether the ex-gratia amount paid by the employer can be deducted from the compensation awarded under the Employees Compensation Act, 1923
Submissions/Arguments
Appellants argued that ex-gratia payment is voluntary and cannot be deducted from statutory compensation.
Respondent contended that the deduction was proper as the ex-gratia was paid voluntarily.
Ratio Decidendi
Ex-gratia payment is voluntary and cannot be set off against the compensation payable under the Employees Compensation Act, 1923. The compensation must be computed as per Schedule IV of the Act without deducting any ex-gratia amount.
Judgment Excerpts
The Commissioner partly allowed the claim petition, thereby awarding compensation for Rs.5,19,950/- but deducted Rs.5,00,000/- as ex-gratia amount and awarded a sum of Rs.19,950/- with interest at the rate of 12% per annum.
Ex-gratia payment is voluntary and cannot be deducted from the compensation awarded under the Employees Compensation Act, 1923.
Procedural History
The appellants filed a claim petition before the III Addl. Civil Judge (Sr.Dn.) & Commissioner for Employees Compensation, Kalaburagi, in ECA No.249/2014. The Commissioner partly allowed the claim on 09-01-2017, awarding Rs.5,19,950/- but deducting Rs.5,00,000/- as ex-gratia, resulting in a net award of Rs.19,950/-. Aggrieved, the appellants filed this Miscellaneous First Appeal under Section 30(1) of the Employees Compensation Act, 1923.
Acts & Sections
- Employees Compensation Act, 1923: Section 4, Section 30(1)
