Wednesday, April 1, 2020

Employees Compensation Act 1923 ~ Supreme Court on Notional extention theory


Misfortunes can occur at any workplace harming those at work. Duty is cast on the  Employer to pay compensation arising out of  personal injury  / death  caused to a workman at such workplace.  Employees Compensation Act 1923  provides for payment of compensation by the employer to his employees (or their dependents in the event of fatal accidents) in respect of personal injury due to accidents arising out of and in the course of their employment.   

Have posted at length the excerpts of  judgment of Apex Court  (13.2.2020) in Civil Appeal no. 9046 of 2019 – now comes yet another interesting interpretation by Supreme Court of India on 6.3.2020, this time on ‘notional extension principle’ – when does worktime begin or end ?.


This is a Civil Appeal preferred by Poonam Devi and others Vs Oriental Insurance and others arising out of a case of 2014.  The appellants are the legal heirs of the deceased. They were granted compensation of Rs.4,45,420/­ with interest at the rate of 12 per cent by the Commissioner, Workmen’s Compensation Act from the date of accident up to the date of deposit in addition to a penalty   imposed   on   the   employer   under   Section   4A(3)(b)   of   the Act. It was agitated before the High Court and this appeal before Apex Court.

The deceased @ 21 was a driver on truck from Ambala to Meerut, a distance of approx. 200 km – in mid noon, when he approached the bridge near village Fatehpur, the deceased went to the Yamuna canal to fetch water and also to have a bath.  Unfortunately, he slipped into the canal and died. The vehicle   was   insured   with the Respondent.  PW2  deposed that the deceased had gone to fetch water in a can along with the cleaner who tried to save   him,   but   both   slipped   into   the   canal.     WC commissioner in 2005 allowed compensation.

Insurers went on appeal and High Court held that the deceased may have died during the course of the employment but death did not arise out of the employment, as bathing in the canal was not incidental to the employment but was at the peril of the workman.  There was no casual connection between the death of the workman and his employment.

More was to follow before the Apex Court.  The learned   counsel   for   the   appellants submitted that there was a causal connection of the death with the employment.  In the extreme heat of the month of June at noon, a presumption would arise that the deceased  had gone to the canal to fetch water not only to cool the truck but also himself to ensure a proper and safe journey of the vehicle belonging to the employer and his own safety.  

Reliance was placed on  Leela  Bai  and  anr.  vs. Seema Chouhan and anr., (2019) 4 SCC 325.  The respondent Insurers opposed the appeal submitting that High Court had rightly held that there was no casual connection between the death of the deceased with the employment.  Merely because death may have occurred in the course of the employment will not suffice unless it is established
that it was incidental and arose out of the employment.  Reliance was placed on  Malikarjuna  G.  Hiremath  vs.  Branch  Manager, Oriental   Insurance   Company   Limited  and  another, (2009) 13 SCC 405.

The Court held that considering the submission on behalf of the parties, impugned orders and case laws – Workmen Compensation Act (now Employee’s Compensation Act 1923) is   a   piece   of   socially beneficial   legislation.     The   provisions   will   therefore   have   to   be interpreted in a manner to advance the purpose of the legislation, rather than to stultify it.   In case of a direct conflict, when no reconciliation is possible, the statutory provision will prevail only then.

The Act under Sec 3 provides that :  (1) 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 this Chapter:

In Manju Sarkar & Ors. vs. Mabish Miah & Ors., the   deceased   was   driving   the   employer’s   truck   from Agartala to Churaibari FCI godown.  When he reached near Dharam Nagar,   he   got   down   to   make   arrangements   for   repairing   some mechanical problems in the truck when he was hit on the road by another vehicle and died in the hospital.  Applying the principle of notional extension, it was held that death occurred in the course of employment.  Courts have agreed that employment does not necessarily end when the “down tool” signal is given or when the workman leaves the actual workshop where he is working.There is a notional extension at both the entry and exit by time and space. The scope of such extension   must   necessarily   depend   on   the circumstances of a given case. As employment may   end   or   may   begin   not   only   when   the employee begins to work or leaves his tools but also when  he used the  means of access and, egress to and from the place of employment.”

In Daya Kishan Joshi & Anr. vs. Dynemech Systems Pvt. Ltd., (2018) the deceased was employed as an engineer for promoting sales and  installation of products which required him to move around in the field.   While returning from field work, he met with an accident resulting in death.  Holding that his being on the road related to the nature of his duties, not only the injury was caused during the currency of the employment but also arose out of the employment.

The Court further added that - coming to the facts of the present case, the deceased was driving   the   truck   of   respondent   no.2   from   Ambala   to   Meerut. Indisputably he was in the course of his employment.  We can take judicial   notice   of   the   fact   that   considering   the   manufacturer’s specification, the cabin of the truck was not air conditioned and would have been a baking oven in the middle of the afternoon in the sultry   monsoon   heat   of   June   2003,   when   the   temperature   was touching 42.60C in Yamunagar (Haryana) (source: weatheronline.in). It was a compulsion for the deceased to stay fresh and alert not only to protect the truck of respondent no.2 from damage but also to ensure a smooth journey and protect his own life by safe driving. We can also take judicial notice of the fact that the possibility of the truck   also   requiring   water   to   prevent   overheating   cannot   be completely ruled out. 

In these circumstances, can it be said that the act of the deceased in going to the canal to fetch water in a can for the truck and to refresh himself by a bath before continuing the journey was not incidental to the employment?  Every action of the driver of a truck to ensure the safety of the truck belonging to the employer and to ensure his own safety by a safe journey for himself has to be considered as incidental to the employment by extension of the notional employment theory.  A truck driver who would not keep himself fresh to drive in such heat would be a potential danger to others on the road by reason of any bonafide errors of judgement by reason of the heat.

The theory of notional extension noticed in the  Agnes  (supra) and followed in  Leela  Bai  (supra) is extracted:   this is subject to the theory of notional extension of the employer’s   premises   so   as   to   include   an   area which   the   workman   passes   and   repasses   in going to and in leaving the actual place of work. There may be some reasonable extension in both time and place and a workman may be regarded as in the course of his employment even though
he had not reached or had left his employer’s premises. The facts and circumstances of each case will have to be examined very carefully in order to determine whether the accident arose out of and in the course of the employment of a workman, keeping in view at all time this theory of notional extension.”

The Hon’ble Court having considered the circumstances of the case held that the order of High Court was found to be unsustainable and was set aside.  It restored the order of WC Commissioner dated 12.12.2005.  Court directed that the payments in terms of the order of the Workmen’s Compensation Commissioner be made to the appellants within a period of six weeks   from  the date of order.  In the proceedings, R2 had been deleted and the question of payment of penalty by her does not arise.

Interesting ! contains many learning for Employer, Employee, Insurer, Intermediaries and others .. ……….

With regards – S. Sampathkumar
19.3.2020.

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