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Case title: M/S Madras Trading Co v. Ramjeet @ Ramjeet and Anr

Case no: FAO 119/2017 & CM APPL. 9580/2017, CM APPL. 28069/2018

Dated on: February 13th, 2024

Quorum: Hon’ble Mr. Justice Dharmesh Sharma

Facts of the case:

The appellant herein is a proprietorship concern run by Mr. Sukhpreet Singh, and it is engaged in a small business of sale of air conditioners and spare parts. The respondents were the claimants before the Employee Commissioner and are the legal heirs/parents of the deceased. The claimants filed Statement of Claims before the Commissioner on 27.07.2015, stating that that their deceased son Tata, was employed with the appellant as an AC Mechanic at a monthly wage of Rs. 15,000/-. On 30.04.2014, Sh. Tata was sent by the appellant to do AC repair work wherein the AC compressor burst resulting in fatal injuries and his death at the age of 25 years. An FIR was registered on 01.05.2014 at P.S. Kirti Nagar, on statement of coworker Sh. Sanjay Kumar who along with the deceased had gone to carry out work when the accident occurred. He stated that both of them were employed with the appellant firm and are entitled for compensation of Rs. 20,00,000/- along with penalty of 50% and interest @12% per annum, payable from the date of the incident till realization. The appellant on 09.12.2015 replied by denying the “employer-employee‟ relation and objected for non-enclosure of any documents/proofs to prove such employer- employee relationship. The learned Commissioner framed the following issues “(i) whether the employee – employer relationship exists between the parties? – (ii) Whether accident resulting into death of the deceased is caused out of and during the course of employment and if so, to what amount of death compensation, the dependents of the deceased are entitled to? (iii) Relief, if any? The learned Commissioner decided in favor of the claimants/respondents by holding that the claimant’s evidence was reliable and sufficient in proving the events. However, the respondent firm (appellant herein), failed to prove that there exists no employer- employee relationship. The learned Commissioner held that the claimants are entitled to compensation of Rs. 8,67,640/- along with simple interest @12% per annum w.e.f. 29.07.2015. Hence, this appeal.

Contentions of the appellant:

The learned Commissioner finding is perverse. The “employer-employee‟ relation between the deceased and the appellant firm, was decided solely on the FIR by completely ignoring the contradictions in the testimony of the claimants during cross-examination. An FIR is not a piece of substantive evidence as it requires corroboration through documentary, circumstantial or oral evidence. It is contended that apart from the “Control Test‟, “Integration Test‟ also needs to be considered such as the power to select and dismiss, to pay remuneration, deduct insurance contributions and the “mutual obligations‟ between the employer and the employee as well. The only evidence put forth by the respondents/claimants is a photocopy of the visiting card of the appellant. The testimony of respondent No.1 as well as of Sanjay Kumar was inconsistent. The appellant firm is not engaged in the business of AC repair but is a small proprietorship concern engaged in the sale of Air Conditioners and that they have not employed any persons.  

Contentions of the respondent:

The order passed by the learned Commissioner is well reasoned and has been passed after a thorough consideration of the pleadings of the parties and the materials placed on the record. The grounds taken by the appellant in the present appeal are misconceived and baseless. There is no substantial questions of law involved.

Issues:

Whether the Respondents are entitled to claim compensation under the EC Act?  

Legal provisions:

Compensation Claim under EC Act- Workers can file claims for compensation directly with the Commissioner or through a lawyer.  

Courts analysis and Judgement:

An appeal under Section 30 of the EC Act lies to the High Court from the following orders of a Commissioner ie (a) an order awarding as compensation; (aa) an order awarding interest or penalty (b) an order refusing to allow redemption of a half- monthly payment; (c) an order providing for the distribution of compensation among the dependents of a deceased employee, or disallowing any claim of a person alleging himself to be such dependents; (d) an order allowing or disallowing any claim for the amount of an indemnity under Section 12 (2). It is further provided by way of a proviso that no appeal lies against any order unless a “substantial question of law‟ is involved in the appeal. In the case of North East Karnataka Road Transport Corporation vs. Sujatha, the Supreme Court considered the scope and ambit of Section 30 of the EC Act as to what would constitute “substantial question of law‟, the question such as “whether the employee met with an accident, whether the accident occurred during the course of employment, whether it arose out of an employment, how and in what manner the accident occurred, who was negligent in causing the accident, whether there existed any relationship of employee and employer, what was the age and monthly salary of the employee, how many are the dependants of the deceased employee the extent of disability caused to the employee due to injuries suffered in an accident, whether there was any insurance coverage obtained by the employer to cover the incident, etc. are some of the material issues which arise for the just decision of the Commissioner in a claim petition when an employee suffers any bodily injury or dies during the course of his employment and he/his LRs sue(s) his employer to claim compensation under the Act” The aforementioned questions are essentially the questions of fact and, therefore, to be proved with the aid of evidence. Once they are proved either way, the findings recorded thereon are regarded as the findings of fact.” The learned Commissioner has given a categorical finding that the deceased workman suffered fatal injuries during the course of his employment with the appellant. The reliance by the Commissioner on the contents of the FIR and statement of co-worker cannot be faulted. The proceedings under the EC Act are summary in nature and hence strict adherence to provisions the Indian Evidence Act, 1872 cannot be applied. There are grounds by which it can be presumed that the facts were truthfully revealed regarding the circumstances which resulted in the fatal accident and was correctly incorporated by the Investigating Officer. The claimants are from poor background who are illiterate and ignorant. The Visiting card in possession is sufficient to show the connection of the appellant as an employer with the Respondent’s deceased son. Once the Claimants had laid the basic foundation to the claim, the onus then shifted upon the appellant to disprove the fact that there existed no employer-employee relationship between the parties. The appellant could have even summoned and examined the co-worker Sanjay Kumar to disprove the relationship of employer and employee. The plea of respondent No.1 acknowledging that he did not know the proprietor of the appellant can be taken considering the background of the parents. There is no apparent reason for the Investigating Officer to have fabricated the FIR or for the co-worker Sanjay Kumar to have given a false statement soon after the accident. In view of the foregoing discussion, the impugned order does not suffer from any patent illegality, perversity or incorrect approach adopted in law. The present appeal is dismissed with exemplary costs of Rs. 25,000/- which be paid to the respondents No. 1 and 2 in equal share within one month from today, failing which they shall be entitled to claim the same with interest @ 9% per annum from the date of this order till realization. The pending applications also stand disposed of accordingly.  

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Judgement reviewed by- Parvathy P.V.

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