Chapter VII - Employees compensation

73. Reports of fatal accidents and serious bodily injuries.—(1) Where, by any law for the time being
in force, notice is required to be given to any authority, by or on behalf of an employer, of any accident
occurring in his premises which results in death or serious bodily injury, the person required to give the
notice shall, within seven days of the death or serious bodily injury, send a report to the competent authority
giving the circumstances attending the death or serious bodily injury:

    Provided that where the State Government has so specified, the person required to give the notice may
instead of sending such report to the competent authority send it to the authority to whom he is required to
give the notice.

    Explanation.—For the purposes of this sub-section, “serious bodily injury” means an injury which
involves, or in all probability will involve the permanent loss of the use of, or permanent injury to, any
limb, or the permanent loss of or injury to the sight or hearing, or the fracture of any limb, or the enforced
absence of the injured person from work for a period exceeding twenty days.


    (2) The State Government may, by notification, extend the provisions of sub-section (1) to any class of
premises other than those coming within the scope of that sub-section, and may, by such notification,
specify the persons who shall send the report to the competent authority.

    (3) Nothing in this section shall apply to establishments to which Chapter IV, relating to Employees'
State Insurance Corporation, applies.

74. Employer’s liability for compensation.—(1) If personal injury is caused to an employee by
accident or an occupational disease listed in the Third Schedule arising out of and in the course of his
employment, his employer shall be liable to pay compensation in accordance with the provisions of this
Chapter:

    Provided that the employer shall not be so liable—

        (a) in respect of such injury which does not result in the total or partial disablement of the employee
    for a period exceeding three days; and

        (b) in respect of such injury, not resulting in death or permanent total disablement caused by an
    accident which is directly attributable to—

          (i) the employee having been at the time thereof under the influence of drink or drugs, or

           (ii) the wilful disobedience of the employee to an order expressly given, or to a rule expressly
    framed, for the purpose of securing the safety of employees, or

           (iii) the wilful removal or disregard by the employee of any safety guard or other device which he
   knew to have been provided for the purpose of securing the safety of employee.

    (2) An accident or an occupational disease referred to in sub-section (1) shall be deemed to arise out of
and in the course of an employee's employment notwithstanding that he is at the time of the accident or at
the time of contracting the occupational disease, referred to in that sub-section, acting in contravention of
the provisions of any law applicable to him, or of any orders given by or on behalf of his employer or that
he is acting without instructions from his employer, if—

        (a) such accident or contracting of such occupational disease would have been deemed so to have
    arisen had the act not been done in contravention as aforesaid or without instructions from his employer,
    as the case may be; and

        (b) the act is done for the purpose of, and in connection with, the employer's trade or business.

    (3) If an employee employed in any employment specified in the Second Schedule contracts any disease
specified in the Third Schedule, being an occupational disease peculiar to that employment whilst in the
service of an employer in whose service he has been employed for a continuous period of not less than six
months, then, such disease shall be deemed to be an injury by accident within the meaning of this section
and unless the contrary is proved, the accident shall be deemed to have arisen out of and in the course of
the employment.

    (4) An accident occurring to an employee while commuting from his residence to the place of
employment for duty or from the place of employment to his residence after performing duty, shall be
deemed to have arisen out of and in the course of employment if nexus between the circumstances, time
and place in which the accident occurred and his employment is established.

    (5) The Central Government or the State Government, after giving, by notification, not less than three
months' notice of its intention so to do, may, by a like notification, modify or add any description of
employment to the employments specified in the Second Schedule, and occupational diseases specified in
the Third Schedule and shall specify in the case of employments so modified or added, the diseases which
shall be deemed for the purposes of this section to be occupational diseases peculiar to those employments
respectively, and thereupon the provisions of sub-section (2) shall apply, in the case of a notification by the
Central Government, within the territories to which this Code extends or, in case of a notification by the
State Government, within that State as if such diseases had been declared by this Code to be occupational
diseases peculiar to those employments.



    (6) Save as provided by sub-sections (2), (3) and (4), no compensation shall be payable to an employee
in respect of any accident or disease unless the accident or disease is directly attributable to a specific injury
by accident or disease arising out of and in the course of his employment.

    (7) Nothing herein contained shall be deemed to confer any right to compensation on an employee in
respect of any accident or disease if he has instituted in a civil court a suit for damages in respect of the
accident or disease against the employer or any other person; and no suit for damages shall be maintainable
by an employee in any Court of law in respect of such accident or disease—

        (a) if he has instituted a claim to compensation in respect of the accident or disease before a
    competent authority; or

        (b) if an agreement has been made between the employee and his employer providing for the
   payment of compensation in respect of the accident or disease in accordance with the provisions of this
    Chapter.

75. Compensation in case of death of or injury in plantation.— If death or injury is caused to any
worker or a member of his family as a result of the collapse of a house provided by the employer in a
plantation, and the collapse is not solely and directly attributable to a fault on the part of any occupant of
the house or to a natural calamity, the employer shall be liable to pay compensation under section 76 and
the Sixth Schedule, so far as may be applicable.

    Explanation.— For the purposes of this section, the expression “worker” means a person employed in
a plantation for hire or reward, whether directly or through any agency, to do any work, skilled, unskilled,
manual or clerical, and includes a person employed on contract for more than sixty days in a year, but does
not include—

          (i) a medical officer employed in the plantation;

           (ii) any person employed in the plantation (including any member of the medical staff) whose
   monthly wages exceed the amount as determined by the appropriate Government, by notification, from
    time to time;

           (iii) any person employed in the plantation primarily in a managerial or administrative capacity,
    notwithstanding that his monthly wages do not exceed the amount as determined by the appropriate
   Government, by notification, from time to time;

         (iv) any person temporarily employed in the plantation in any work relating to the construction,
   development or maintenance of buildings, roads, bridges, drains or canals.

76. Amount of compensation.—(1) Subject to the provisions of  this Chapter, the amount of
compensation shall be,—

        (a) where death results from the injury, an amount equal to fifty per cent. of the monthly wages of
    the deceased employee multiplied by the relevant factor or an amount as may be notified by the Central
   Government from time to time, whichever is more;

        (b) where permanent total disablement results from the injury, an amount equal to sixty per cent.
    of the monthly wages of the injured employee multiplied by the relevant factor or an amount as may be
    notified by the Central Government from time to time, whichever is more:

    Provided that the Central Government may, by notification, from time to time, enhance the amount of
compensation specified in clauses (a) and (b).

    Explanation.—For the purposes of clauses (a) and (b), “relevant factor”, in relation to an employee
means the factor specified in column (3) of the Sixth Schedule relating to factors against the corresponding
entry in column (2) thereof, specifying the number of years which are the same as the completed years of
the age of the employee on his last birthday immediately preceding the date on which the compensation fell
due;

         (c) where permanent partial disablement results from the injury,—



               (i) in the case of an injury specified in Part II of the Fourth Schedule, such percentage of the
       compensation which would have been payable in the case of permanent total disablement as is
        specified therein as being the percentage of the loss of earning capacity caused by that injury; and

                (ii) in the case of an injury not specified in the Fourth Schedule, such percentage of the
       compensation payable in the case of permanent total disablement as is proportionate to the loss of
        earning capacity (as assessed by the medical practitioner) permanently caused by the injury.

    Explanation 1.— For the purposes of this clause, where more injuries than one are caused by the same
accident, the amount of compensation payable under this head shall be aggregated but not so in any case as
to exceed the amount which would have been payable if permanent total disablement had resulted from the
injuries.

    Explanation 2.—In assessing the loss of earning capacity under sub-clause (ii), the medical practitioner
shall have due regard to the percentage of loss of earning capacity in relation to different injuries specified
in the Fourth Schedule;

        (d) where temporary disablement, whether total or partial, results from the injury, a half-monthly
   payment of the sum equivalent to twenty-five per cent. of monthly wages of the employee, to be paid
    in accordance with the provisions of sub-section (4).

    (2) Notwithstanding anything contained in sub-section (1), while fixing the amount of compensation
payable to an employee in respect of an accident which occurred outside India, the competent authority
shall take into account the amount of compensation, if any, awarded to such employee in accordance with
the law of the country in which the accident occurred and shall reduce the amount fixed by him by the
amount of compensation awarded to the employee in accordance with the law of that country.

    (3) The Central Government may, by notification, specify for the purposes of sub-section (1), such
monthly wages in relation to an employee as it may consider necessary.

    (4) The half-monthly payment referred to in clause (d) of sub-section (1) shall be payable on the
sixteenth day—

            (i) from the date of disablement where such disablement lasts for a period of twenty-eight days or
   more; or

            (ii) after the expiry of a waiting period of three days from the date of disablement, where such
    disablement lasts for a period of less than twenty-eight days; and thereafter half-monthly during the
    disablement or during a period of five years, whichever is shorter:

    Provided that—

        (a) there shall be deducted from any lump sum or half-monthly payments to which the employee
     is entitled, the amount of any payment or allowance which the employee has received from the
   employer by way of compensation during the period of disablement prior to the receipt of such lump
   sum or of the first half-monthly payment, as the case may be, and such payment or allowance which
    the employee has received from the employer towards his medical treatment shall not be deemed to be
    a payment or allowance received by him by way of compensation;

        (b) no half-monthly payment shall in any case exceed the amount, if any, by which half the amount
    of the monthly wages of the employee before the accident exceeds half the amount of such wages which
   he is earning after the accident.

    (5) The employee shall be reimbursed, the actual medical expenditure incurred by him for treatment of
injuries caused during the course of employment, by his employer.

    (6) On the ceasing of the disablement before the date on which any half-monthly payment falls due,
there shall be payable in respect of that half-month a sum proportionate to the duration of the disablement
in that half-month.

    (7) If the injury of the employee results in his death, the employer shall, in addition to the compensation
under sub-section (1), deposit with the competent authority a sum of not less than fifteen thousand rupees
or such amount as may be prescribed by the State Government, for payment of the same to the eldest

surviving dependant of the employee towards the expenditure of the funeral of such employee or where the
employee did not have a dependant or was not living with his dependant at the time of his death, to the
person who actually incurred such expenditure:

    Provided that the Central Government may, by notification from time to time, enhance the amount
specified in this sub-section.

77. Compensation to be paid when due and damages for default.—(1) Compensation under
section 76 shall be paid as soon as it falls due.

    (2) In cases where the employer does not accept the liability for compensation to the extent claimed, he
shall be bound to make provisional payment based on the extent of liability which he accepts, and, such
payment shall be deposited with the competent authority or made to the employee, as the case may be,
without prejudice to the right of the employee to make any further claim.

    (3) Where any employer is in default in paying the compensation due under this Chapter within one
month from the date it fell due, the competent authority shall,—

        (a) direct that the employer shall, in addition to the amount of the arrears, pay interest at such rate
    as may be prescribed by the Central Government, 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 of arrears by way of damages:

       Provided that an order for the payment of damages shall not be passed under clause (b) without
    giving a reasonable opportunity to the employer to show cause as to why it should not be passed.

    (4) The interest and the damages payable under sub-section (3) shall be paid to the employee or his
dependant, as the case may be.

78. Method of calculating monthly wages for purposes of compensation.— For the purposes of this
Chapter, the expression “monthly wages” means the amount of wages deemed to be payable for a month's
service (whether the wages are payable by the month or by whatever other period or at piece rates), and
calculated as follows, namely:—

        (a) where the employee has, during a continuous period of not less than twelve months immediately
    preceding the accident, been in the service of the employer who is liable to pay compensation, the
   monthly wages of the employee shall be one-twelfth of the total wages which have fallen due for
   payment to him by the employer in the last twelve months of that period;

        (b) where the whole of the continuous period of service immediately preceding the accident during
   which the employee was in the service of the employer who is liable to pay the compensation was less
    than one month, the monthly wages of the employee shall be the average monthly amount which, during
    the twelve months immediately preceding the accident, was being earned by an employee employed on
    the same work by the same employer, or, if there was no employee so employed, by an employee
   employed on similar work in the same locality;

         (c) in other cases including cases in which it is not possible for want of necessary information to
    calculate the monthly wages under clause (b), the monthly wages shall be thirty times the total wages
    earned in respect of the last continuous period of service immediately preceding the accident from the
   employer who is liable to pay compensation, divided by the number of days comprising such period.

    Explanation.—For the purposes of this section, “a period of service” shall be deemed to be continuous
which has not been interrupted by a period of absence from work exceeding fourteen days.

79. Review.—(1) Any half-monthly payment payable under this Chapter, either under an agreement
between the parties or under the order of a competent authority, may be reviewed by the competent
authority, on the application either of the employer or of the employee accompanied by the certificate of a
medical practitioner that there has been a change in the condition of the employee or, subject to such
conditions as may be prescribed by the State Government, on application made without such certificate.



    (2) Any half-monthly payment may, on review under this section, subject to the provisions of this
Chapter, be continued, increased, decreased or ended, or if the accident is found to have resulted in
permanent disablement, be converted to the lump sum to which the employee is entitled less any amount
which he has already received by way of half-monthly payments.

80. Commutation of half-monthly payments.—Any right to receive half-monthly payments may, by
agreement between the parties or, if the parties cannot agree and the payments have been continued for not
less than six months, on the application of either party to the competent authority be redeemed by the
payment of a lump sum of such amount as may be agreed to by the parties or determined by the competent
authority, as the case may be.

81. Distribution of compensation.—(1) No payment of compensation in respect of an employee
whose injury has resulted in death, and no payment of a lump sum as compensation to a woman or a person
under a legal disability, shall be made otherwise than by deposit with the competent authority, and no such
payment made directly by an employer shall be deemed to be a payment of compensation:

    Provided that, in the case of a deceased employee, an employer may make to any dependant, advances
on account of compensation of an amount equal to three months' wages of such employee and so much of
such amount as does not exceed the compensation payable to that dependant shall be deducted by the
competent authority from such compensation and repaid to the employer.

    (2) Any other sum amounting to not less than five thousand rupees which is payable as compensation
may be deposited with the competent authority on behalf of the person entitled thereto.

    (3) The receipt of the competent authority shall be a sufficient discharge in respect of any compensation
deposited with him.

    (4) (a) On the deposit of any money under sub-section (1) as compensation in respect of a deceased
employee, the competent authority shall, if he thinks necessary, cause notice to be published or to be served
on each dependant in such manner as he thinks fit, calling upon the dependants to appear before him on
such date as he may fix for determining the distribution of the compensation.

    (b) If the competent authority is satisfied after any inquiry which he may deem necessary, that no
dependant exists, he shall repay the balance of the money to the employer by whom it was paid.

    (c) The competent authority shall, on an application by the employer, furnish a statement showing in
detail all disbursements made.

    (5) The compensation deposited in respect of a deceased employee shall, subject to any deduction made
under sub-section (1), be apportioned by order by the competent authority among the dependants of the
deceased employee or any of them in such proportion as the competent authority thinks fit, or may, in the
discretion of the competent authority, be allotted to any one dependant:

    Provided that the competent authority shall not make any order under this sub-section without hearing
the dependants and shall record reasons in the order for the apportionment of such compensation among
dependants or any of them, as the case may be.

    (6) Where any compensation deposited with the competent authority is payable to any person, other
than a woman or a person under legal disability, the competent authority may pay the compensation to the
person entitled thereto.

    (7) Where any lump sum deposited with the competent authority is payable to a woman or a person
under a legal disability, such sum may be invested, applied or otherwise dealt with for the benefit of the
woman, or of such person during his disability, in such manner as the competent authority may direct; and
where a half-monthly payment is payable to any person under a legal disability, the competent authority
may, of his own motion or on an application made to him in this behalf, order that the payment be made
during the disability to any dependant of the employee or to any other person, whom the competent authority
thinks fit to provide for the welfare of the employee.

    (8) Where, on application made to him in this behalf or otherwise, the competent authority is satisfied
that, on account of neglect of children on the part of a parent or on account of the variation of the
circumstances of any dependant or for any other sufficient cause, an order of the competent authority as to

the distribution of any sum paid as compensation or as to the manner in which any sum payable to any such
dependant is to be invested, applied or otherwise dealt with, ought to be varied, the competent authority
may make such orders for the variation of the former order as he thinks just in the circumstances of the
case:

    Provided that no such order prejudicial to any person shall be made unless such person has been given
an opportunity of showing cause as to why the order should not be made, or shall be made in any case in
which it would involve the repayment by a dependant of any sum already paid to him.

    (9) Where the competent authority varies any order under sub-section (8) by reason of the fact that
payment of compensation to any person has been obtained by fraud, impersonation or other improper
means, any amount so paid to or on behalf of such person may be recovered in the manner as specified in
sub-section (10).

    (10) The competent authority may recover as an arrear of land revenue any amount referred to in
sub-section (9), and for such purpose the competent authority shall be deemed to be a public officer within
the meaning of section 5 of the Revenue Recovery Act, 1890 (1 of 1890).

82. Notice and claim.—(1) No claim for compensation shall be entertained by a competent authority
unless notice of the accident has been given in the manner hereinafter provided as soon as practicable after
the happening thereof and unless the claim is preferred before him within two years of the occurrence of
the accident or, in case of death, within two years from the date of death:

    Provided that where the accident is the contracting of a disease in respect of which the provisions of
sub-section (3) of section 74 are applicable, the accident shall be deemed to have occurred on the first of
the days during which the employee was continuously absent from work in consequence of the disablement
caused by the disease:

    Provided further that in case of partial disablement due to the contracting of any such disease and which
does not force the employee to absent himself from work, the period of two years shall be counted from the
day the employee gives notice of the disablement to his employer:

    Provided also that if an employee who, having been employed in an employment for a continuous
period specified under sub-section (3) of section 74 in respect of that employment, ceases to be so employed
and develops symptoms of an occupational disease peculiar to that employment within two years of the
cessation of employment, the accident shall be deemed to have occurred on the day on which the symptoms
were first detected.

    (2) The want of or any defect or irregularity, in a notice given under sub-section (1), shall not be a bar
to the entertainment of a claim—

        (a) if the claim is preferred in respect of the death of an employee resulting from an accident which
    occurred on the premises of the employer, or at any place where the employee at the time of the accident
   was working under the control of the employer or of any person employed by him, and the employee
    died on such premises or at such place, or on any premises belonging to the employer, or died without
    having left the vicinity of the premises or place where the accident occurred, or

        (b) if the employer or any one of several employers or any person responsible to the employer for
    the management of any branch of the trade or business in which the injured employee was employed
   had knowledge of the accident from any other source at or about the time when it occurred:

       Provided that the competent authority may entertain and decide any claim to compensation in any
    case notwithstanding that the notice has not been given, or the claim has not been preferred in due time
    as provided under sub-section (1), if he is satisfied that the failure so to give the notice or prefer the
    claim, as the case may be, was due to sufficient cause.

    (3) Every such notice shall give the name and address of the person injured and shall state the cause of
the injury and the date on which the accident happened, and shall be served on the employer or upon any
one of several employers, or upon any person responsible to the employer for the management of any branch
of the trade or business in which the injured employee was employed.



    (4) The appropriate Government may require that any class of employers as may be prescribed by that
Government shall maintain, at their premises at which employees are employed, a notice-book, in such
form as may be prescribed by that Government, which shall be readily accessible at all reasonable times to
any injured employee employed on the premises and to any person acting bona fide on his behalf.

    (5) A notice under this section may be served by delivering it at, or sending it by registered post
addressed to, the residence or any office or place of business of the person on whom it is to be served, or
where possible, electronically or, where a notice-book is maintained, by entry in the notice-book.

83. Special provisions relating to accidents occurring outside Indian territory.—(1) The provisions
of this section shall, subject to the modifications specified in this section, apply in case of employees who
are—

        (a) masters of ships or seamen; or

        (b) captain and other members of crew of aircraft;

         (c) persons recruited by companies registered in India and working as such abroad;

        (d) persons sent for work abroad along with motor vehicles registered under the Motor Vehicles
    Act, 1988 (59 of 1988) as drivers, helpers, mechanics, cleaners or other employees.

    (2) The notice of the accident and the claim for compensation by a person injured may be served on the
following persons, as if they were the employer—

        (a) in case of accident where the person injured is a seamen, but not the master of the ship, on the
    master of the ship;

        (b) in case of accident where the person injured is a member of crew of an aircraft, but not the
    captain of the aircraft, on the captain of the aircraft;

         (c) in case of persons recruited by companies registered in India and working as such abroad, on
    the local agent of the company;

        (d) in case of persons sent for work abroad along with motor vehicles as drivers, helpers, mechanics,
    cleaners or other employees, on the local agent of the owner of the motor vehicle, in the country of the
    accident:

       Provided that where the accident happened and the disablement commenced on board, the ship or
     aircraft, as the case may be, then, it shall not be necessary for any seaman or members of the crew of
     aircraft to give any notice of the accident.

    (3) The claim of compensation shall be made—

        (a) in the case of the death of an employee referred to in sub-section (1), one year after the news of
    the death has been received by the claimant;

        (b) in the case where the ship or the aircraft as the case may be, has been or is deemed to have been
     lost with all hands, eighteen months of the date on which the ship or the aircraft was, or is deemed to
   have been, so lost:

       Provided that the competent authority may entertain any claim to compensation in any case
    notwithstanding that the claim has not been preferred in due time as provided in this sub-section, if he
     is satisfied that the failure so to prefer the claim was due to sufficient cause.

    (4) Where an injured employee referred to in sub-section (1) is discharged or left behind in any part of
India or in any foreign country, then, any depositions taken by any Judge or Magistrate in that part or by
any Consular Officer in the foreign country and transmitted by the person by whom they are taken to the
Central Government or any State Government shall, in any proceedings for enforcing the claim, be
admissible in evidence—

        (a) if the deposition is authenticated by the signature of the Judge, Magistrate or Consular Officer
    before whom it is made;



        (b) if the defendant or the person accused, as the case may be, had an opportunity by himself or his
    agent to cross-examine the witness; and

         (c) if the deposition was made in the course of a criminal proceeding, on proof that the deposition
   was made in the presence of the person accused,

and it shall not be necessary in any case to prove the signature or official character of the person appearing
to have signed any such deposition and a certificate by such person that the defendant or the person accused
had an opportunity of cross-examining the witness and that the deposition if made in a criminal proceeding
was made in the presence of the person accused shall, unless the contrary is proved, be sufficient evidence
that he had that opportunity and that it was so made.

    (5) No half-monthly payment shall be payable in respect of the period during which the owner of the
ship is, under any law for the time being in force relating to merchant shipping, liable to defray the expenses
of maintenance of the injured master or seaman.

    (6) Failure to give a notice or make a claim or commence proceedings within the time required by this
section shall not be a bar to the maintenance of proceedings under this Chapter in respect of any personal
injury, if such proceedings under this Chapter are commenced within one month from the date on which
the certificate of the State to that effect Government was furnished to the person commencing the
proceedings.

84. Medical examination.—(1) Where an employee has given notice of an accident, he, shall, if the
employer, before the expiry of three days from the time at which service of the notice has been effected,
offers to have him examined free of charge by a medical practitioner, submit himself for such examination,
and any employee who is in receipt of a half-monthly payment under this Chapter shall, if so required,
submit himself for such examination from time to time:

    Provided that an employee shall not be required to submit himself for examination by a medical
practitioner at more than such frequent interval as may be prescribed by the State Government.

    (2) If an employee, on being required to do so by the employer under sub-section (1) or by the
competent authority at any time, refuses to submit himself for examination by a medical practitioner or in
any way obstructs the same, his right to compensation shall be suspended during the continuance of such
refusal or obstruction unless in the case of refusal, he was prevented by any sufficient cause from so
submitting himself.

    (3) If an employee, before the expiry of the period within which he is liable under sub-section (1) to be
required to submit himself for medical examination, voluntarily leaves the vicinity of the place in which he
was employed without having been so examined, his right to compensation shall be suspended until he
returns and offers himself for such examination:

    Provided that where such employee proves before the medical practitioner that he could not so submit
himself for medical examination due to the circumstances beyond his control and he was also handicapped
to communicate such information in writing, the medical practitioner may after recording such reasons in
writing, condone the delay and his right to compensation shall be revived as if no such suspension was
made.

    (4) Where an employee, whose right to compensation has been suspended under sub-section (2) or sub-
section (3), dies without having submitted himself for medical examination as required by either of those
sub-sections, the competent authority may, if he thinks fit, direct the payment of compensation to the
dependants of the deceased employee.

    (5) Where under sub-section (2) or sub-section  (3), a right to compensation  is suspended, no
compensation shall be payable in respect of the period of suspension, and, if the period of suspension
commences before the expiry of the waiting period referred to in clause (ii) of sub-section (4) of section
76, the waiting period shall be increased by the period during which the suspension continues.

    (6) Where an injured employee has refused to be attended by a medical practitioner whose services
have been offered to him by the employer free of charge or having accepted such offer has deliberately
disregarded the instructions of such medical practitioner, then, if it is proved that the employee has not


thereafter been regularly attended by a medical practitioner or having been so attended has deliberately
failed to follow his instructions and that such refusal, disregard or failure was unreasonable in the
circumstances of the case and that the injury has been aggravated thereby, the injury and resulting
disablement shall be deemed to be of the same nature and duration as they might reasonably have been
expected to be if the employee had been regularly attended by a medical practitioner, whose instructions he
had followed, and compensation, if any, shall be payable accordingly.

85. Contracting.—(1) Where any employer in the course of or for the purposes of his trade or business
contracts with a contractor for the execution by or under the contractor of the whole or any part of any work
which is ordinarily part of the trade or business of the employer, the employer shall be liable to pay to any
employee employed in the execution of the work any compensation, which he would have been liable to
pay if that employee had been immediately employed by him; and that the amount of compensation shall
be calculated with reference to the wages of the employee under the employer by whom he is immediately
employed.

    (2) Where the employer is liable to pay compensation under this section, he shall be entitled to be
indemnified by the contractor, or any other person from whom the employee could have recovered the
compensation and where a contractor who is himself an employer is liable to pay compensation or to
indemnify an employer under this section, he shall be entitled to be indemnified by any person standing to
him in relation of a contractor from whom the employee could have recovered the compensation, and all
questions as to the right to and the amount of any such indemnity shall, in default of agreement, be settled
by the competent authority.

    (3) Nothing in this section shall be construed as preventing an employee from recovering compensation
referred to in sub-section (2) from the contractor instead of the employer.

    (4) The provisions of this section shall not apply in any case where the accident occurred elsewhere
than on, in or about the premises on which the employer has undertaken or usually undertakes, as the case
may be, to execute the work or which are otherwise under his control or management.

86. Remedies of employer against stranger.—Where an employee has recovered compensation in
respect of any injury caused under circumstances creating a legal liability of some person other than the
person by whom the compensation was paid to pay damages in respect thereof, the person by whom the
compensation was paid and any person who has been called on to pay an indemnity under section 85 shall
be entitled to be indemnified by the person so liable to pay damages as aforesaid.

87. Insolvency of employer.—(1) Where any employer has entered into a contract with any insurers
in respect of any liability under this Chapter to any employee, then, in the event of the employer becoming
insolvent or making a composition or scheme of arrangement with his creditors or, if the employer is a
company, in the event of the company having commenced to be wound up, the rights of the employer
against the insurers as respects that liability shall, notwithstanding anything in any law for the time being
in force relating to insolvency or the winding up of companies, be transferred to and vest in the employee,
and upon any such transfer the insurers shall have the same rights and remedies and be subject to the same
liabilities as if they were the employer, so, however, that the insurers shall not be under any greater liability
to the employee than they would have been under the employer.

    (2) If the liability of the insurers to the employee is less than the liability of the employer to the
employee, the burden of proof shall lie on the employee for the balance in the insolvency proceedings or
liquidation.

    (3) Where in any case such as is referred to in sub-section (1), the contract of the employer with the
insurers is void or voidable by reason of non-compliance on the part of the employer with any terms or
conditions of the contract (other than a stipulation for the payment of premium), the provisions of that sub-
section shall apply as if the contract were not void or voidable, and the insurers shall be entitled to prove in
the insolvency proceedings or liquidation for the amount paid to the employee:

    Provided that the provisions of this sub-section shall not apply in any case in which the employee fails
to give notice to the insurers of the happening of the accident and of any resulting disablement as soon as
practicable after he becomes aware of the institution of the insolvency or liquidation proceedings.


    (4) There shall be deemed to be included among the debts which under the Insolvency and Bankruptcy
Code, 2016 (31 of 2016) or under the provisions of the Companies Act, 2013 (18 of 2013) are in the
distribution of the assets of an insolvent or in the distribution of the assets of a company being wound up
to be paid in priority to all other debts, the amount due in respect of any compensation, the liability accrued
before the date of the order of adjudication of the insolvent or the date of the commencement of the winding
up, as the case may be, and the provisions of that Code and Act shall have effect accordingly.

    (5) Where the compensation is a half-monthly payment, the amount due in respect thereof shall, for the
purposes of this section, be taken to be the amount of the lump sum for which the half-monthly payment
could, if redeemable, be redeemed if applications were made for that purpose under section 80, and a
certificate of the competent authority as to the amount of such sum shall be conclusive proof thereof.

    (6) The provisions of sub-section (4) shall apply in the case of any amount for which an insurer is
entitled to prove under sub-section (3), but otherwise those provisions shall not apply where the insolvent
or the company being wound up has entered into such a contract with insurers as is referred to in
sub-section (1).

    (7) The provisions of this section shall not apply where a company is wound up voluntarily merely for
the purposes of reconstruction or of amalgamation with another company.

88. Power to required from employers statements regarding fatal accidents.—(1) Where a
competent authority receives information from any source that an employee has died as a result of an
accident arising out of and in the course of his employment, he may send by registered post or where
possible, electronically a notice to the employee's employer requiring him to submit, within thirty days of
the service of the notice, a statement, in such form as may be prescribed by the State Government, giving
the circumstances attending the death of the employee, and indicating whether, in the opinion of the
employer, he is or is not liable to deposit compensation on account of the death and a copy of such notice
shall also be sent by the competent authority in the same manner to the dependants of such employee
ascertained by the competent authority.

    (2) If the employer is of the opinion that he is liable to deposit compensation, he shall make the deposit
within thirty days of the service of the notice.

    (3) If the employer is of the opinion that he is not liable to deposit compensation, he shall in his
statement indicate the grounds on which he disclaims liability.

    (4) Where the employer has so disclaimed liability, the competent authority, after such inquiry as he
may think fit, may inform any of the dependants of the deceased employee, that it is open to the dependants
to prefer a claim for compensation, and may give them such other further information as he may think fit.

    (5) Where in the opinion of the competent authority, a dependant of the deceased employee is not in a
position to engage an advocate to file a claim for compensation, the competent authority may provide an
advocate to such dependant, from the panel of advocates maintained by the State Government.

89. Registration of agreements.— (1) Where the amount of any lump sum payable as compensation
has been settled by agreement, whether by way of redemption of a half-monthly payment or otherwise, or
where any compensation has been so settled as being payable to a woman, or a person under a legal
disability, a memorandum thereof shall be sent by the employer to the competent authority, who shall, on
being satisfied as to its genuineness, record the memorandum in a register, electronically or otherwise, in
such manner as may be prescribed by the appropriate Government:

    Provided that—

        (a) no such memorandum shall be recorded before seven days after communication by the
    competent authority of notice to the parties concerned;

        (b) the competent authority may at any time rectify the register;

         (c) where it appears to the competent authority that an agreement as to the payment of a lump sum
    whether by way of redemption of a half-monthly payment or otherwise, or an agreement as to the
   amount of compensation payable, to a woman or a person under a legal disability ought not to be
    registered by reason of the inadequacy of the sum or amount, or by reason of the agreement having

   been obtained by fraud or undue influence or other improper means, the competent authority may refuse
    to record the memorandum of the agreement and may make such order including an order as to any
   sum already paid under the agreement, as the competent authority thinks just in the circumstances.

    (2) An agreement for the payment of compensation which has been registered under sub-section (1)
shall be enforceable under this Code notwithstanding anything contained in the Indian Contract Act, 1872
(9 of 1872), or in any other law for the time being in force.

    (3) Where a memorandum of any agreement, the registration of which is required under this section, is
not sent to the competent authority as required by this section, the employer shall be liable to pay the full
amount of compensation which he is liable to pay under the provisions of this Chapter, and notwithstanding
anything contained in the proviso to sub-section (1) of section 76, shall not, unless the competent authority
otherwise directs, be entitled to deduct more than half of any amount paid to the employee by way of
compensation whether under the agreement or otherwise.

90. Reference to competent authority.—(1) If any question arises in any proceedings under this
Chapter as to the liability of any person to pay compensation (including any question as to whether a person
injured is or is not an employee) or as to the amount or duration of compensation (including any question
as to the nature or extent of disablement), the question shall, in default of agreement, be settled by a
competent authority.

    (2) No Civil Court shall have jurisdiction to settle, decide or deal with any question which is by or
under this Chapter required to be settled, decided or dealt with by a competent authority or to enforce any
liability incurred under this Chapter.

91. Appointment of competent authority.—(1) The State Government may, by notification, appoint
any person who is or has been a member of a State Judicial Service for a period of not less than five years
or is or has been for not less than five years an advocate or is or has been a Gazetted Officer for not less
than five years having educational qualifications and experience in personnel management, human resource
development, industrial relations and legal affairs or such other experience and qualifications as may be
prescribed by the appropriate Government to be a competent authority for the purposes of this Chapter and
for such area as may be specified in the notification.

    (2) Where more than one competent authority has been appointed for any area, the State Government
may, by general or special order, regulate the distribution of business amongst them.

    (3) Any competent authority may, for the purpose of deciding any matter referred to him for decision
under this Chapter, choose one or more persons possessing special knowledge of any matter relevant to the
matter under inquiry to assist him in holding the inquiry.

92. Venue of proceedings and transfer.— (1) Where any matter under this Chapter is to be done by
or before a competent authority, the same shall, subject to the provisions of this Chapter and in the manner
prescribed in this behalf by the State Government, be done by or before the competent authority for the area
in which—

        (a) the accident took place which resulted in the injury; or

        (b) the employee or in case of his death, the dependant claiming the compensation ordinarily
    resides; or

         (c) the employer has his registered office:

    Provided that no matter shall be processed before or by a competent authority, other than the competent
authority having jurisdiction over the area in which the accident took place, without his giving notice
electronically or otherwise in the manner prescribed by the Central Government to the competent authority
having jurisdiction over the area and the State Government concerned:

    Provided further that, where the employee, being the master of a ship or a seaman or the captain or a
member of the crew of an aircraft or an employee in a motor vehicle or a company, meets with the accident
outside India, any such matter may be done by or before a competent authority for the area in which the
owner or agent of the ship, aircraft or motor vehicle resides or carries on business or the registered office
of the company is situate, as the case may be.

    (2) If a competent authority, other than the competent authority with whom any money has been
deposited under section 81, proceeds with a matter under this Chapter, the former may for the proper
disposal of the matter call for transfer of any records or moneys remaining with the latter and on receipt of
such a request, he shall comply with the same.

    (3) If a competent authority is satisfied that any matter arising out of any proceedings pending before
him can be more conveniently dealt with by any other competent authority, whether in the same State or
not, he may, subject to rules made under this Code relating to this Chapter, order such matter to be
transferred to such other competent authority either for report or for disposal, and, if he does so, shall
forthwith transmit to such other competent authority all documents relevant for the decision of such matter
and, where the matter is transferred for disposal, shall also transmit in the manner as may be prescribed by
the Central Government any money remaining in his hands or invested by him for the benefit of any party
to the proceedings:

    Provided that the competent authority shall not, where any party to the proceedings has appeared before
him, make any order of transfer relating to the distribution among dependants of a lump sum without giving
such party an opportunity of being heard.

    (4) The competent authority to whom any matter is so transferred shall, subject to rules made under this
Code relating to this Chapter, inquire therein to and, if the matter was transferred for report, return his report
thereon or, if the matter was transferred for disposal, continue the proceedings as if they had originally
commenced before him.

    (5) On receipt of a report from a competent authority to whom any matter has been transferred for report
under sub-section (3), the competent authority by whom it was referred shall decide the matter referred to
in conformity with such report.

    (6) The State Government may transfer any matter from any competent authority appointed by it to any
other competent authority appointed by it.

93. Form of application.—(1) Where an accident occurs in respect of which  liability to pay
compensation under this Chapter arises, a claim for such compensation may, subject to the provisions of
this Chapter, be made before the competent authority.

    (2) Subject to the provisions of sub-section (1), no application for the settlement of any matter by
competent authority, other than an application by a dependant or joint application by dependants for
compensation, shall be made unless and until some question has arisen between the parties in connection
therewith which they have been unable to settle by agreement.

    (3) An application to a competent authority for claim under sub-section (1) or settlement under
sub-section (2) may be made electronically or otherwise in such form and in such manner accompanied by
such fee, if any, as may be prescribed by the Central Government.

    (4) The time-limit for the disposal of applications under this section and the costs incidental to the
proceedings under this section to be imposed by the competent authority shall be such as may be prescribed
by the State Government.

94. Power of competent authority to require further deposit in cases of fatal accident.—(1) Where
any sum has been deposited by an employer as compensation payable in respect of an employee whose
injury has resulted in death, and in the opinion of the competent authority such sum is insufficient, the
competent authority may, by notice in writing stating his reasons, call upon the employer to show cause
why he should not make a further deposit within such time as may be stated in the notice.

    (2) If the employer fails to show cause to the satisfaction of the competent authority, the competent
authority may make an award determining the total amount payable, and requiring the employer to deposit
the deficiency.

95. Powers and procedure of competent authority.—The competent authority shall have all the
powers of a Civil Court under the Code of Civil Procedure, 1908 (5 of 1908), for the purpose of taking
evidence on oath (which such competent authority is hereby empowered to impose) and of enforcing the
attendance of witnesses and compelling the production of documents and material objects, and the


competent authority shall be deemed to be a Civil Court for all the purposes of section 195 and of Chapter
XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

96. Appearance of parties.— Any appearance, application or act required to be made or done by any
person before or to a competent authority (other than an appearance of a party which is required for the
purpose of his examination as a witness) may be made or done on behalf of such person by a legal
practitioner or by an official of an Insurance Company or a registered Trade Union or by an Inspector-cum-
Facilitator appointed under sub-section (1) of section 122 or by any other officer specified by the State
Government in this behalf, authorised in writing by such person, or, with the permission of the competent
authority, by any other person so authorised.

97. Method of recording evidence.—The competent authority shall make a brief memorandum of the
substance of the evidence of every witness as the examination of the witness proceeds, and such
memorandum shall be authenticated under the hand of the competent authority or in the manner as may be
prescribed by the State Government and shall form part of the record:

    Provided that, if the competent authority is prevented from making such memorandum, he shall record
the reason of his inability to do so and shall cause such memorandum to be made in writing from his
dictation and shall sign the same, and such memorandum shall form part of the record:

    Provided further that the evidence of any medical witness shall be taken down as nearly as may be word
for word.

98. Power to submit cases.— A competent authority may, if he thinks fit, submit any question of law
for the decision of the High Court and, if he does so, shall decide the question in conformity with such
decision.

99. Appeal against order of competent authority.— (1) An appeal shall lie to the High Court from
the following orders of a competent authority under this Chapter, namely:—

      (a) an order awarding as compensation a lump sum whether by way of redemption of a half-monthly
   payment or otherwise or disallowing a claim in full or in part for a lump sum;

      (b) an order awarding interest or damages under section 77;

       (c) an order refusing to allow redemption of a half-monthly payment;

      (d) an order providing for the distribution of compensation among the dependants of a deceased
    employee, or disallowing any claim of a person alleging himself to be such dependant;

       (e) an order allowing or disallowing any claim for the amount of an indemnity under the provisions
    of sub-section (2) of section 85; or

        (f) an order refusing to register a memorandum of agreement or registering the same or providing for
    the registration of the same subject to conditions:

    Provided that no appeal shall lie against any order unless a substantial question of law is involved in
the appeal, and in the case of an order other than an order referred to in clause (c), unless the amount in
dispute in the appeal is not less than ten thousand rupees or such higher amount as the Central Government
may, by notification, specify:

    Provided further that no appeal shall lie in any case in which the parties have agreed to abide by the
decision of the competent authority, or in which the order of the competent authority gives effect to an
agreement arrived at by the parties:

    Provided also that no appeal by an employer under clause (a) shall lie unless the memorandum of appeal
is accompanied by a certificate by the competent authority to the effect that the appellant has deposited with
him the amount payable under the order appealed against.

    (2) The period of limitation for an appeal under this section shall be sixty days from the date of passing
of the order.

    (3) The provisions of section 5 of the Limitation Act, 1963 (36 of 1963), shall be applicable to appeal
under this section.

                            CHAPTER VIII
                  SOCIAL SECURITY AND CESS IN RESPECT OF BUILDING AND

                           OTHER CONSTRUCTION WORKERS