IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 29/10/2004
CORAM
THE HONOURABLE MR. JUSTICE P.K. MISRA
WRIT PETITION No.8013 OF 1997
1. Masilamani, S/o.Kuppan
2. Poongavanam,
S/o. Masilamani .. Petitioners
-Vs-
1. The Deputy Commissioner of Labour-I, Madras 6.
2. Annammal,
W/o. Manavalan .. Respondents
Petition filed under Article 226 of the Constitution of India for
the issuance of Writ of declaration as stated therein.
For Petitioner : Mr.P. Mani
For Respondent-1 : Mr.P. Rathinavelu
Govt. Advocate
Respondent-2 : No Appearance
Mr.P.V.S. Giridhar
Amicus Curiae
:J U D G M E N T
In the present writ petition, the petitioners have prayed for a
declaration that Section 4-A(3) of the Workmens Compensation Act, 1923
(hereinafter referred to as the Act) is ultra vires against public interest
and offends Article 19(1)(g) of the Constitution of India and the order dated
3.7.1996 passed by the Deputy Commissioner of Labour-I (Respondent No.1)
pursuant to the aforesaid Act is illegal, void and unenforceable.
2. The facts in brief are as follows :Respondent No.2 herein had
filed W.C.No.83 of 1995 before the Respondent No.1 claiming compensation for
the death of her husband alleging that the latter had died in an accident
arising out of and in course of his employment under the petitioners on
24.4.1993. The first respondent under the impugned order, allowed the claim
and directed : to remit the amount of Rs.65,541/- (Rupees sixty five thousand
five hundred and forty one only) within 30 days from the date of receipt of
the order by way of Demand Draft in favour of the Deputy Commissioner of
Labour-I, Madras 6, failing which 50% penalty and 6% interest from the date of
accident on the amount of Rs.65,541/- would be ordered to be recovered.
3. In the present writ petition, the validity of the provisions
contained in Section 4-A(3) of the Workmens Compensation Act, 1923 has been
challenged. Since there was no appearance on behalf of Respondent No.2, Thiru
P.V.S. Giridhar was appointed as Amicus Curiae.
4. Even though in the writ petition the legality of the order of the
Commissioner has been challenged on merits by contending that the accident had
not arisen out of and in course of employment, learned counsel for the
petitioners has not pursued such a submission at the time of hearing of the
writ petition, obviously because such question cannot be raised in the writ
petition and has to be challenged only in the regular appeal as contemplated
under Section 30 of the Act. Learned counsel for the petitioners has raised
the question of the validity of Section 4-A(3) of the Act. In the
alternative, he has submitted that at any rate, the Commissioner should not
have directed payment of 50% of the compensation amount as penalty, without
giving opportunity of hearing to the present petitioners on that aspect as
envisaged under 4-A(3) of the Act.
5. The provisions contained in Section 4-A(3) of the
Act are as follows :-
4-A. Compensation to be paid when due and penalty for default. (1)
… (2) … (3) Where any employer is in default in paying the
compensation due under this Act within one month from the date it fell due,
the Commissioner shall (a) direct that the employer shall, in addition to the
amount of the arrears, pay simple interest thereon at the rate of twelve per
cent per annum or at such higher rate not exceeding the maximum of the lending
rates of any scheduled bank as may be specified by the Central Government, by
notification in the Official Gazette, on the amount due; and (b) if, in his
opinion, there is no justification for the delay, direct that the employer
shall, in addition to the amount of the arrears and interest thereon, pay a
further sum not exceeding fifty per cent of such amount by way of penalty:
Provided that an order for the payment of penalty shall not be passed
under clause (b) without giving a reasonable opportunity to the employer to
show cause why it should not be passed.
Explanation.- For the purposes of this sub-section, scheduled bank
means a bank for the time being included in the Second Schedule to the Reserve
Bank of India Act, 1934 (2 of 1934). (3-A) The interest payable under
sub-section (3) shall be paid to the workman or his dependant, as the case may
be, and the penalty shall be credited to the State Government.
6. A mere perusal of the aforesaid provision makes it
clear that before passing any order regarding penalty, the Commissioner is
required to give a reasonable opportunity to the employer to show cause as to
why such an order regarding payment of penalty should not be passed. This is
very clear from the proviso to Section 4-A(3). As a matter of fact, this
position has also been emphasised by Justice K.P. Sivasubramaniam in 2000 (1)
LLJ 137 (MANAGEMENT OF DEVI PRESS, MADRAS v. S. SELVARAJ). The said
decision of the learned single Judge has also been cited with approval by a
Division Bench of this Court reported in 2004(2) L.L.N. 401 (MANAGEMENT OF
M/s. MAHALAKSHMI BUILDERS, MADRAS v. A. GOVINDASAMY).
7. In the present case, admittedly before giving the
direction in the main order itself, no opportunity to show cause, as already
indicated, has been given. The direction regarding payment of penalty is
therefore unsustainable.
8. Mr.P.V.S. Giridhar, the learned Amicus Curiae,
has submitted that the writ petition itself is not maintainable. Law is well
settled that a writ petition may not be entertained when an alternative remedy
is available. In the present case, there being alternative remedy available,
it is the contention of the learned Amicus Curiae that the writ petition
itself is not maintainable.
9. Even though, as a matter of fact, as a general
rule, the writ petition is not maintainable as there is an alternative remedy
in the present case, because of two special features, I am not dismissing the
writ petition on the ground that the alternative remedy has not been availed.
10. First of all, learned counsel appearing for the
petitioners has challenged the validity of Section 4-A(3) of the Act. Such a
question obviously could not have been raised in the appeal. Therefore,
filing of the writ petition cannot be faulted. It is another matter that at
the time of hearing of the writ petition, learned counsel for the petitioners
was not able to point out any valid reason as to why the provision contained
in Section 4-A(3) should be declared as ultra vires. The legislative
competence to enact the provision is not in dispute. Even though it is
contended that such a provision is a restriction on fundamental right under
Article 19(1)(g), I do not think such a sweeping submission can be accepted.
The Act has provided sufficient guidelines for exercise of power in the matter
relating to imposition of penalty. Such order itself is made appealable. The
provision does not give any arbitrary or unguided power to the Commissioner.
Challenge on the ground of invalidity of the provision has to be negatived.
11. A similar view has been expressed by the Punjab &
Haryana High Court in 1984 LAB.I.C. 80 (BARU RAM v. THE LABOUR OFFICER,
SONEPAT AND OTHERS) and it is not necessary to replicate the reasons indicated
in the said decision.
12. The other reason for not dismissing the writ
petition on the ground of availability of alternative remedy is that the writ
petition itself has been entertained and kept pending for all these years. If
such an objection would have been raised at the threshold, the petitioners
would have thought of availing the alternative remedy. Moreover, in the
present case, the main contention is that the first respondent had not given
opportunity to show cause as envisaged in the Statute itself. Where the
principles of natural justice, particularly enshrined in the Statute itself
are not followed, existence of an alternative remedy is not considered as an
absolute bar and the High Court in its discretion, can entertain such matters
notwithstanding the availability of alternative remedy. Moreover, for
considering the question, no factual dispute is involved and on the admitted
facts, appearing from the impugned order itself, the order of penalty is
passed without complying with the statutory provision.
13. Learned Amicus Curiae has suggested that the
matter relating to payment of penalty can be reconsidered by the first
respondent after complying with the provisions of the Act. It is apparent
from the provision itself that penalty if any, is to be collected and credited
to the State Government and the claimant would not be the beneficiary. Since
the defect relating to the imposition of penalty has been committed by a
quasi-judicial authority and the claimant would not be benefited in any
manner, I do not think it proper at this distant point of time to remand the
matter for fresh enquiry into the matter. It is however made clear that if
the amount is not deposited by the petitioners within four weeks, it would be
open to Respondent No.1 to initiate proceeding for imposition of penalty.
14. For the aforesaid reasons, the writ petition is allowed in part
and the direction regarding payment of penalty is quashed. The other
direction regarding compensation amount, including payment of interest, as
observed by the first respondent, is confirmed. The petitioners shall deposit
the necessary amount before the appropriate authority within four weeks.
16. I must place on record my appreciation for the valuable
assistance rendered by Mr.P.V.S. Giridhar, Advocate.
17. The office is directed to communicate the result of this writ
petition to Respondent No.2. Respondent No.1 shall take steps to implement
the order, if the compensation is not paid by the petitioners.
Internet: Yes
To
The Deputy Commissioner of Labour-I,
Madras 6.