Labour Commissioner Competent To Review Ex-Parte Awards Passed Under Workmen's Compensation Act: J&K High Court

A bench of Justice M.A Chowdhary clarified that given the applicability of Order IX Rule 13 of the Code of Civil Procedure(CPC), as provided under Rule 31 of the J&K Workmen's Compensation Rules of 1972, the Labor Commissioner is competent to review ex-parte awards.

These observations were made while hearing a plea whereby the petitioner Sahil Gupta, proprietor of M/S B. D. Security Pvt. Ltd. had challenged an ex-parte Award passed by the Assistant Labour Commissioner (ALC) under the Workmen's Compensation Act, 1923 and his refusal to set aside the same.

Background:

The case stemmed from a dispute between the petitioner and Respondent/Claimant Masooda, whose son died while working as a guard for Gupta's company. The Labour Commissioner had awarded compensation to Masooda in an ex-parte proceeding after Gupta failed to appear in court due to a procedural irregularity with the summons. Subsequently, the petitioner has moved an application seeking the setting aside of the ex parte order but that also came to be dismissed.

The petitioner through counsel Farhat Zia Soharwardy challenged the award, arguing that the Commissioner lacked jurisdiction and that the deceased's case should have been covered by the Employees' State Insurance Corporation (ESIC). He claimed that the summons were not properly served, rendering the Commissioner's jurisdiction questionable. Additionally, he argued that the order rejecting the application for setting aside the ex-parte Award was non-speaking and passed on a wrong legal premise.

Court's Observations:

While dealing with the challenge to the award the bench observed that under the Employees Compensation Act, 1923, the Order passed by the Commissioner is appealable before the High Court within a period of 60 days on a substantial question of law, after obtaining a certificate from the Commissioner to the effect that the Appellant has deposited the amount payable under the order appealable against.

Spotlighting the Petitioner's attempt to circumvent the statutory provision requiring the deposit of the contested award with the Commissioner the bench recorded,

“It appears that the Appellant, in order to circumvent the provision of deposit of the award impugned with the Commissioner, has, instead of filing the appeal, invoked the Writ jurisdiction of this Court by filing the instant Writ Petition…When an alternate efficacious remedy is available through the statutory Appeal, the High Court normally does not invoke the writ jurisdiction to decide the matter, which can be decided in appeal”.

Justice Chowdhary acknowledged that while the petitioner technically could have appealed the ex-parte award directly, his arguments raised concerns about procedural flaws. Crucially, the court focused on Rule 41 of the J&K Workmen's Compensation Rules which incorporates specific provisions of the Code of Civil Procedure, including Order IX Rule 13, which allows setting aside ex-parte decrees under certain conditions.

The bench observed that the Commissioner had erroneously dismissed Gupta's application to set aside the award without considering its merits. He emphasized that Rule 41 clearly empowers the Commissioner to review ex-parte decisions in light of relevant provisions of the Code of Civil Procedure. This ensures parties have the opportunity to be heard and potential procedural errors can be rectified, the court underscored.

“..the learned Commissioner appears to have committed an error by holding that the Commission has no powers of review and, thus, rejected the application for setting aside the ex-parte Award, though with the applicability of Order IX Rule 13 of the Code of Civil Procedure, which provides for setting aside of the ex-parte Decree/ Award, the Commissioner, in view of Rule 41 of the J&K Workmen's Compensation Rules of 1972, was competent enough and had jurisdiction to consider the application for setting aside the ex-parte Award”, the bench recorded.

The Court partially allowed the petition, setting aside the Commissioner's order rejecting the application to set aside the ex-parte award. The court directed the Commissioner to reconsider the application on its merits. Additionally, the recovery notice issued against petitioner was stayed until the Commissioner reached a final decision.

Case Title: Sahil Gupta Vs UT of J&K

Citation: 2024 LiveLaw (JKL) 1

Counsel For Petitioner: Mr Farhat Zia, Advocate.

Counsel For Respondent: Ms Rasheeda Shaheen and Mr A. Hanan.

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