FA/515720/2008 1/27 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 5157 of 2008 With CIVIL APPLICATION No. 12677 of 2008 For Approval and Signature: HONOURABLE MR.JUSTICE H.K.RATHOD Sd/- ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? YES 2 To be referred to the Reporter or not ? YES 3 Whether their Lordships wish to see the fair copy of the judgment ? YES 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? NO 5 Whether it is to be circulated to the civil judge ? NO ========================================================= NATIONAL INSURANCE COMPANY LTD - Appellant(s) Versus RAYAJIBHAI VAGHABHAI PATEL (BARIA) & 3 - Defendant(s) ========================================================= Appearance : MR MEHUL SHARAD SHAH for Appellant(s) : 1, None for Defendant(s) : 1 - 4. ========================================================= CORAM : HONOURABLE MR.JUSTICE H.K.RATHOD Date : 27/11/2008 ORAL JUDGMENT 1. Heard learned advocate Mr. Mehul Sharad Shah appearing on behalf of appellant – National Insurance FA/515720/2008 2/27 JUDGMENT Company Limited. 2. The appellant – Insurance Company has challenged the order passed by Workmen Compensation Commissioner, Baroda in Workman Compensation Petition No.58 of 1996 Exh.60 dated 6th February 2008. The Commissioner has awarded Rs.89,044/- as compensation with a direction to appellant to pay the same to the claimant. The Commissioner further directed to opponent Nos.1 and 2 principal employer and contractor to pay amount of penalty Rs.44,522/- and 6% interest from the date it fells due 10th September 1995 to the claimant with the cost of Rs.1,000/-. 3. Learned advocate Mr. Shah raised contention before this Court that learned Commissioner ought to have appreciated the fact that deceased Arvindbhai died due to electrocution while performing his natural evocation in his life i.e. while taking both. He was not died during the course of employment while working with the employer and there was no nexus with the performance of the duties of the deceased and accident occurred not only due to his official duties. On the date of accident, at about 7.00 a.m., his duty hours were not started and prior to point of time, accident occurred. The deceased had gone for bath near water cock of company compound and after taking bath when he tried to take his cloth, he came into contact of live electric cable lying on the grass and met with massive electric shock and due to electric shock, he succumbed to death on the spot in FA/515720/2008 3/27 JUDGMENT the compound of employer. The brother of deceased – Gopalbhai vide Exh.36 had admitted the fact that deceased was not doing the work at the time of accident. One Mr. Maganbhai Narsinhbhai who was examined vide Exh.40 has made clear that he engaged employee and started the work. Thereafter, only attendance of workman was secured and after relieving from the work up till next date, they were not paid wages till the next morning till they report for work. He submitted that deceased has not received any injury during the course of employment or it arose out of the employment. There was no casual connection established between the death and employment of the deceased. He also submitted that following are substantial questions of law raised by appellant as mentioned in Para 9A, 9B and 9C which are quoted as under : “9A. Whether looking to the above said facts and circumstances of the case the learned Commissioner rightly came to the conclusion that there was a relationship as master and servant between the deceased and the opponents ? 9B. Whether looking to the above said facts and circumstances of the case the learned Commissioner rightly came to the conclusion that the deceased died during the course of the employment ? 9C. Whether looking to the above said FA/515720/2008 4/27 JUDGMENT facts and circumstances of the case the learned Commissioner has properly appreciated the provisions of Section 3 of the Act ?“ 4. I have considered the submissions made by learned advocate Mr. Shah and also perused the order passed by Commissioner. The accident occurred on 11th August 1995 and deceased was workman under the provisions of Workmen's Compensation Act. The salary was Rs.1,800/- per month. The respondents were dependents of deceased who was bread winner of the family. The deceased was doing contract work in opponent No.1 company. The deceased was residing in the said company under the instructions of opponents by erecting temporary shed and he was under employment of both the opponents since last two months prior to the date of accident. Section 10 notice was served to both by claimant. Opponent has filed reply Exh.10 before the Commissioner. Vide Exh.12 and Exh.10 – written statements filed by opponent No.2 and Opponent No.1 respectively. After receiving the reply from respondent No.1, 2 and 3 including Insurance Company, issues were framed vide Exh.22 and certain decisions have been relied upon by both the learned advocates. Exh.33 is a deposition of Rayjibhai Patel. Exh.36 is a deposition of Gopalbhai Patel. Exh.40 is a deposition of Maganbhai Chouhan. Exh.26/1 is a complaint registered at Varnama Police Station, Exh.26/2 is a copy of panchnama, Exh.26/3 is a PM report and Exh. 26/7 is a school leaving certificate of deceased which were placed on record. FA/515720/2008 5/27 JUDGMENT Exh.44/1 being a xerox copy of insurance policy. Exh.49/1 is a xerox copy of bank statement regarding premium. Exh.55/1 is a xerox copy of Form No.64 VB of Insurance Act. Except that, no evidence was led by either party. Exh.51/1 is a xerox copy of policy with Form No.64 VB of Insurance Act. The parties have produced written arguments before the Commissioner. After considering the submissions made by all the learned advocates, the Commissioner has come to conclusion that accident occurred during the course of employment applying notional extension theory in facts of this case. The Commissioner has considered Rs.1800/- per month salary after deducting Rs.800/- which comes to Rs.1,000/- and thereafter, on that basis, looking to the age of deceased 21 years, a compensation has been worked out which comes to Rs.2,22,710/- and 40% which comes out Rs.89,044/-. Therefore, applicant is entitled to compensation of Rs.89,044/-. The relevant discussions have been made in Para 17 to 25, therefore, the same are quoted as under : “17. I have carefully gone through the pleading and oral and documentary evidence placed on record. There is no dispute by and between the parties for the following facts. – The deceased was died due to electrocution. – The deceased died when he gone to take his cloth after bath which were lying on the grass. – The deceased was residing in the compound at the site where the construction work was FA/515720/2008 6/27 JUDGMENT going on. – The deceased had been provided accommodation for residence/rooms by the Opponent : 1 & 2 at the work place. 18. There is most material dispute by and between the parties is with regard to death of deceased. As per case of the applicants, the death had been occurred while deceased was on his duty, where as per case of opponents, the deceased was not upon his duty and bath was natural event. 19. The Applicant:1 has deposed vide Exh.:33 and corroborated the pleading of his petition. He deposed that the deceased has gone to bath near water tap in the company and where he died to get cloth, he met with an intense electric shock and succumbed to death. This witness was cross examined by the Ld. advocate for the Opponent:1. He has admitted that, the incident had occurred at 7-30 AM. The Ld. advocate for the Opponent:1 had tried to establish that, in which shade number, either in shade No.:445-A or 445-B, the incident had been occurred, but the witness did not know the shade number and name of its owner. The witness was cross examined by the Ld. advocate for the insurance company, wherein, he has admitted that, at the time of accident, he was at Godhra and he came to know that his son was died due to electric shock while he was taking bath and his corpse brought to his FA/515720/2008 7/27 JUDGMENT nature. 20. The applicant has examined witness Gopalbhai, brother of deceased, who was with the deceased at the time of incident. He has also narrated the facts of incident as stated earlier. This witness was cross examined by the Ld. advocate for the Opponent:1. He has deposed that, his brother wads residing in the company and construction work was going on. He deposed that, the work of construction and company was to begun at 8-00 AM. The witness was cross examined by the Ld. advocate for the Opponent:2, wherein he has deposed that, his brother was not doing work at the time of accident, but he was to go on his work after taking bath. He deposed that, the accident had not been occurred during construction work. This witness was cross examined by the Ld. advocate for the insurance company. He has deposed that, he has no evidence that, his brother was working in the Shirish Construction Co. He had denied on asking that he and his deceased brother were residing 50-100 feet away of construction work of construction hut. This witness has deposed that, they were residing in the company compound. 21. The applicant has examined another witness Maganbhai at Exh.40, who has deposed that, prior to 7-8 months of accident, they were working in Jay Bharat Steel Co., there was contract of Shirishbhai who was building FA/515720/2008 8/27 JUDGMENT contractor. They were residing in the hut during their working hours which was built up by the contractor. He was on his way to room after taking bath, at that time, other labourers have shouted, so he came to know about the incident. The deceased Arvindbhai met with electric shock, decesaed was made got free from the electric wires. The deceased was shifted to civil hospital, Vadodara. He has deposed that, their working hours normally begun at 7-30 AM and upto 18- 00 and lunch hours are 13-00 to 14-00. Further, he deposed that as and when contractor called them beyond working hours, then they usually attend. The water tap was 3-4 feet and their hut was 15-20 feet from the construction work. The deceased Arvindbhai had t go on his duty, this witness wsa cross examined by the Ld. advocate for the Opponent:1, wherein, he has deposed that, Shirishbha had engaged them in construction work in Jay Bharat Steel Co. He had deposed that, they were informed to use the water tap by Shirishbhai. The Ld. advocate for the Opponent:2 was not present, therefore, right to cross examination of Opponent:2 was closed. The Ld. advocate for the insurance company had cross examined, wherein, he had deposed that, he was head (mukadam) of all labourers, there is no card for the presence of labourers. If it is available, then he has to verify. He deposited that, he secures the present of workmen after starting work. They are not paying the charges to workman who are FA/515720/2008 9/27 JUDGMENT getting charges after relieving from the duty till the next day reporting on their duty. He has deposed that, there is no evidence that deceased was reported on his duty prior to bath and his present was secured. 22. Therefore, considering the evidence placed on record, it is an admitted fact that, the deceased and others were residing in the company compound where the construction work was going on. It is admitted that, the labourers of the construction work, were/are from the tribal area like Panchmahal and Godhra. The residence accommodation was provided to the labourers in the company premises at the site. It is important to note that, as well as one can taken judicial notice that, labourers of the construction work belonging to tribal areas and remote places. The builder/contractor provide them residence accommodation at the site for the multi purpose reason like; (1)to secure their attendance everyday regularly (2)to preserve raw material like cement, sand, bricks, steel, etc., which are lying at the work place. (3)For watering newly constructed structures. The prudent man can think that, the construction work usually starts at 8-00 AM, FA/515720/2008 10/27 JUDGMENT and secure presence of all the workmen at site for the above mentioned activities and no prudent man can deny the same. The applicants have not stated the same facts in petition and in evidence, but the real fasts prevailing, is no reason to discard. The applicants are poor and illiterate people, obviously they could not have stated this fact, merely on that ground, it is not to say that, the deceased was not on his duty at the time of accident. For the above mentioned work, the labourers must have to reside at site and builder and contractor are providing accommodation for above mentioned work round the clock. Therefore, opponents have tried to prove that, the incident had not occurred during the course of his employment. But, looking to the facts and circumstance as stated above, it is not tenable. The incident had apparently nexus with the duty of the deceased, there was relationship as master and servant between deceased and Opponent:1 & 2 (The Opponent:1 is principal employer and Opponent:2 is contractor). The applicants have proved that the accident had occurred during the course of employment of deceased. Therefore, argument and case put forwarded by the opponent, is not tenable. 23. The applicants are father and minor brother of the deceased. The name of deceased had been mentioned in the FIR, inquest and in PM Note. The applicants have also provided zerox copy of leaving certificate vide FA/515720/2008 11/27 JUDGMENT Mark:26/7. The name of Applicant:1 had been shown behind the name of deceased as father. Further, it was proved by the oral evidence on record that, the son of Applicant:1 had died in accident and they are dependent. Therefore, considering overall evidence placed on record, it is proved that, the applicants are dependent of the deceased, hence I decide Issue No.:1 to 3 in affirmative. 24. The applicants have pleaded and deposed that, the deceased was having monthly salary of Rs.1800/-. The incident had occurred on 11/8/95. At the relevant point of time of accident, the salary limit was Rs.1000/- PM. When the salary exceeding Rs.1000/- PM, then it would be considered Rs.1000/- PM. Hence, I decide, the deceased was having monthly salary Rs.1000/-. The applicants had pleaded that, the deceased was having 21 years of age at the time of accident. The applicant had not deposed about age, but produced zerox copy of leaving certificate of deceased vide Mark : 26/7. On perusing the same, the birth date of deceased was shown 3/5/1974. The accident had occurred on 11/8/95, therefore, on the date of accident, the deceased was having 21 years, 3 months and 8 days of age. Therefore, I decide that the deceased was having 21 years of age on the date of accident. In it a fatal case. As per statute, 40% of the salary FA/515720/2008 12/27 JUDGMENT would be considered of the calculation of compensation as per statue. As per age of deceased, the relevant factor 222.71 would be applicable for the purpose of computing compensation. The detailed calculation is as under : Salary : Rs.1000/- PM Factor : 222.71 x 100=Rs.2,22,710/- 40% Entitlement: Rs.89,044/- Therefore, applicants are entitled to get compensation of Rs.89,044/-. 25. The Opponent:2 had produced copy of insurance policy & 64 VB Form vide Mark:44/1 and 5/1 respectively. The insurance company has produced copy of policy and 64 VB Form vide Mark:51/2. On carefully perusing the same, the policy in the name of Shirish Construction, Opponent:2. The policy is under the provision of WC Act, 1923. The policy was issued from 27/12/94 to 26/12/95. The incident had occurred on 11/8/95. Therefore, on the day of accident, the policy was in force. Therefore, insurance company is liable for compensation. The Opponent:1 is principal employer and deceased was servicing with Opponent:1 under the contract of Opponent:2. Therefore, as per provision of WC Act, the insurance company is liable for the amount f compensation. The Opponent:1 & 2 have not deposited the amount of compensation nor paid to the applicants in time. Therefore, as per FA/515720/2008 13/27 JUDGMENT provision of WC Act, they are liable for the interest and penalty. The applicants have served notice to Opponent:1 & 2 through their lawyer, is produced vide Mark:26/4 & 26/5 respectively. Therefore, it is crystal clear that, the Opponent:1 & 2 had information and knowledge of accident, in spite of they have not paid the amount of compensation in time. Therefore, Opponent:1 & 2 are liable to pay penalty and interest. It is the duty of contractor employer-Opponent:2 to pay compensation r forward necessary and relevant claim papers to insurance company. There is nothing on record to show and establish that, Opponent:2 had forwarded claim papers to insurance company for releasing the claim. It is an admitted fact that the history of the incident is well within the knowledge of Opponent:1 & 2, if the Opponent:2 had forwarded relevant and necessary papers to insurance company, then insurance company ought to have been released the same at appropriate time. Therefore, according to my view, the Opponent:1 & 2 are liable to pay penalty. It is important to note that, the discretion had been given to court for imposing penalty, but it shall not be exceeding of 50% of compensation amount. Therefore, as per Sec.4(A), the Opponent:2 failed to pay and get it released, therefore, liable to pay penalty 50% of compensation amount i.e. Rs.44,522/-. As per the terms and conditions of the policy, the insurance company is liable to pay compensation and FA/515720/2008 14/27 JUDGMENT Opponent:1 & 2 have to pay the interest on the amount of compensation at the rate of 6% p.a. from the date it fells due.“ 5. The Commissioner has considered certain decisions of Apex Court in case of; (1) General Manager, B.E.S.T. Undertaking, Bombay V/s. Mrs. Agnes reported in AIR 1964 SC 193, (2) General Manager, Western Railway Bombay and another V/s. Chandrabai alias Narayanibai and another reported in 1992 SCJ 496 MP High Court, (3) General Superintendent, Talcher Thermal Station V/s. Bijuli Naik reported in 1994 ACJ 1054 High Court of Orissa, (4) United India Insurance Co. Ltd. V/s. Philo reported in 1996 LLR 521 Kerala High Court, (5) TNCS Corporation V/s. S. Poomali reported in 1995(I) LLJ 378 Madras High Court, (6) Ahmed Harun Gori V/s. Abbas Ibrahim Kara and Anr. reported in 1994(2) LLJ 1013 Gujarat High Court. 6. Then, finally, following observations have been made by Commissioner as under : “I am carefully gone through the citation as discussed above earlier. The deceased and other labourers had been provided residential accommodation by the principal employer as well as contractor at the work site. This was provided for the purpose of; (1) securing their attendance for work everyday regularly (2) to preserve raw material (3) for watering newly constructed structures. The court can FA/515720/2008 15/27 JUDGMENT take judicial note that, the labourers of the construction site are from the tribal areas and remote places. Every person who is in building profession are providing shelter for the above mentioned purpose to the labourer. The Court can take judicial note that construction work to start at 8-00 and ending upto 18-00, but other works are to be done round the clock. The deceased was died due to electric shock after taking bath, but they were given shelter for the preserving raw material and watering newly constructed structures are part of the duty round the clock over and above beyond the construction period. Therefore, the accident had been occurred during the course of his employment, therefore, applicants are entitled to get compensation and accident had nexus and relation with the incident.“ 7. The main contention raised by learned advocate Mr. Shah is that at the time of accident, workman was not on duty and it was not a period of duty hours. Therefore, such accident cannot covered by occurred during the course of employment. This contention is answered on the basis of accepting the theory of notional extension of employment which has been recognised by Supreme Court and other High Courts including Gujarat High Court. 8. The Apex Court has also considered the same in case of Saurashtra Salt Manufacturing Co. v. Bail Valu Raja reported in AIR 1958 SC 881. The relevant FA/515720/2008 16/27 JUDGMENT observation made by Apex Court in Para 7 which is quoted as under : “7. As a rule, the employment of a workman does not commence until he has reached the place of employment and does not continue when he has left the place of employment, the journey to and from the place of employment being excluded. It is now well-settled, however, that 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 re-passes 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 times this theory of notional extension.” 9. The Apex Court has also considered the same in case of General Manager, B.E.S.T. Undertaking, Bombay v. Agnes reported in AIR 1964 SC 193. The relevant observation made by Apex Court in Para 14 which is quoted as under : “14. Bombay is a City of distances. The FA/515720/2008 17/27 JUDGMENT transport service practically covers the entire area of Greater Bombay. Without the said right, it would be very difficult for a driver to sign on and sign off at the depots at the schedule timings, for he has to traverse a long distance. But for this right, not only punctuality and timings cannot be maintained, but his efficiency will also suffer. D. W. 1, a Traffic Inspectors of B. E. S. T. Undertaking, says that instructions are given to all the drivers and conductors that they can travel in other buses. This supports the practice of the drivers using the buses for their travel from home to the depot and vice versa. Having regard to the class of employees it would be futile to suggest that they could as well go by local suburban trains or by walking. The former, they could not afford, and the later, having regard to the long distances involved would not be practicable. As the free transport is provided in the interest of service, having regard to the long distance a driver has to traverse to go to the depot from his house and vice versa, the user of the said buses is a proved necessity giving rise to an implied obligation on his part to travel in the said buses as a part of his duty. He is not exercising the right as a member of the public, but only as one belonging to a service. The entire Greater Bombay is the field or area of the service and every bus is an integrated part of the service. The decisions relating to accidents occurring to FA/515720/2008 18/27 JUDGMENT an employee in a factory or in premises belonging to the employer providing ingress or egress to the factory are not of much relevance to a case where an employee has to operate over a larger area in a bus which is in itself an integrated part of a fleet of buses operating in the entire area. Though the doctrine of reasonable or notional extension of employment developed in the context of