ESI Corporation
ESI Corporation

This article is written by Pradipta Nath, a practicing lawyer.

The application of ESIC Act over Employee’s Compensation Act, 1923 can be sub-served in this, ‘BIRD’ model as formulated here-under for its easy projection.

  1. ‘B’ – Barred provision/s under the ESIC for availing benefit/s under other provision/s of other enactment/s.
  2. 53 under the Employees State Insurance Act, 1948 read as: –

Bar against receiving or recovery of compensation or damages under any other law

An insured person or his dependants shall not be entitled to receive or recover, whether from the employer of the insured person or from any other person, any compensation or damages under the Workmen’s Compensation Act, 1923 or any other law for the time being in force or otherwise, in respect of an employment injury sustained by the insured person as an employee under this Act.

  1. 61 under the ESIC Act read as: –

Bar of benefits under other enactments

When a person is entitled to any of the benefits provided by this Act, he shall not be entitled to receive any similar benefit admissible under the provisions of any other enactment.

  1. ‘I’ – Interpretation of S. 53 & 61
  2. To apply the bar created in Section 53 of the E.S.I. Act., the person must be a workman, insured person under the E.S.I. Act. He should have sustained injury, contacted occupational disease or lost his life due to such injury or disease and they must have ‘arose out of and in the course of his employment’. Such injury is statutorily known as employment injury. It need not be occasioned to him only inside the factory premises. By “notional extension of employer’s premises theory” even if such injury is sustained by him outside his factory premises, outside his working hours, it may become employment injury provided it arose out of and in the course of his employment. There must be some connection, nexus between the circumstances under which such injury was sustained by him and his employment/job. It depends on the facts and circumstances of each case. (The New India Assurance Co. Ltd vs S.Govindaraj on 15 June, 2012)

 

  1. Section 61bars claiming of compensation for employment injury under the provisions of any other enactment other than the E.S.I. Act. Section 61 mentions enacted laws, while Section 53 speaks about a particular enacted law, namely, Workmen’s Compensation Act, 1923 and also other laws, namely, uncodified law, namely, Common Law. Reading Sections 53 and 61 of the E.S.I. Act together we see that they bars claiming of compensation for employment injury not only under enacted Laws but also under unenacted, uncodified General Laws also. (The New India Assurance Co. Ltd vs S.Govindaraj on 15 June, 2012)
  1. ‘R’ – Relevant Case Law: –
  1. It was held in A. Trehan vs. Associated Electrical Agencies and Another (1996) 4 SCC 255, that the legal heirs would not be entitled to get compensation under the 1923 Act as he was an insured person.
  1. The aforesaid authorities make it eminently clear that once an employee is an “insured person” under Section 2(14) of the 1948 Act, neither he nor his dependents would be entitled to get any compensation or damages from the employer under the 1923 Act.

(Dhropadabai and Others Vs. M/s. Technocraft Toolings, CIVIL APPEAL NO.8155 OF 2014) http://supremecourtofindia.nic.in/FileServer/2015-03-25_1427268447.pdf

  • In the case of Managing Director and others v. L.Rs. Of Devi Lal and others: 2007 (1) T.A.C. 491 (Raj.), a Division Bench of the Rajasthan High Court took the view that mere negligence on the part of the workman, which may have resulted in the accident does not take away the case from the purview of employer’s liability to pay compensation, if he has suffered injuries in an accident arising out and in the course of employment.
  1. ‘D’ – Distinguish between the ESIC Act and the Employees Compensation Act:-

The aforesaid provision (S. 53 under ESIC Act) came to be interpreted by a two-Judge Bench in A. Trehan’s case, wherein the Court after reproducing the said provision and taking note of the definition of workman as provided under Section 2(1)(n) of the 1923 Act, came to hold as follows: “A comparison of the relevant provisions of the two Acts makes it clear that both the Acts provide for compensation to a workman/employee for personal injury caused to him by accident arising out of and in the course of his employment. The ESI is a later Act and has a wider coverage. It is more comprehensive. It also provides for more compensation than what a workman would get under the Workmen’s Compensation Act. The benefits which an employee can get under the ESI Act are more substantial than the benefits which he can get under the Workmen’s Compensation Act. The only disadvantage, if at all it can be called a disadvantage, is that he will get compensation under the ESI Act by way of periodical payments and not in a lump sum as under the Workmen’s Compensation Act. If the Legislature in its wisdom thought it better to provide for periodical payments rather than lump sum compensation its wisdom cannot be doubted. Even if it is assured that the workmen had a better right under the Workman’s Compensation Act in this behalf it was open to the Legislature to take away or modify that right. While enacting the ESI Act the intention of the Legislature could not have been to create another remedy and a forum for claiming compensation for an injury received by the employee by accident arising out of and in the course of his employment.”

With ending the string of discussion, would like to conclude that in case an employee cannot avail benefit under the ESIC scheme, he can make avail of it under the other enactments.

Special enactments like ‘Employees Compensation Act’ states in its ‘Preamble’;

PREAMBLE.- An Act to provide for the payment by certain classes of employers to their *[Employees] of compensation for injury by accident.

Whereas it is expedient to provide for the payment by certain classes of employers to their workmen of compensation for injury by accident….

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