Article (November-2016)


ESI - Accident arising out of and in the course of employment

B. Sai Kumar

Designation : -   HR & IR Consultant

Organization : -  


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Caselet:Chandulal is working in a textile factory. His duty is to carry cotton bales to the weighing machine. One day his other colleague was absent and Chandulal was asked to carry extra load and had to work over time. After finishing his work on that day, he left the factory for home. He had  tea and snacks in the evening and watched TV for some time and then complained of chest pain. He was taken to the hospital where he died of heart attack. His dependents claimed compensation/dependant's benefits  under ESI Act  on the ground that the heart attack was caused by the strenuous work  but the ESI Corporation rejected their claim on the ground that the employee already had a heart condition and the heart attack was not due to any strenuous work. This contention arose because the compensation or the relevant benefit is admissible under the Act only if the injury is an 'employment injury'.

So what is an 'employment injury'? Sec.2 (8) of the ESI Act defines an employment injury as a personal injury to an employee caused by an accident or occupational disease arising out of and in the course of insurable employment whether the accident occurs or the occupational disease is caused within or outside the territorial limits of India.

A close reading of the definition reveals that every injury cannot become employment injury unless it is caused by an accident or the occupational disease arising out of and in the course of employment. While Schedule III to the ESI Act enumerates occupational diseases, it did not define what an 'accident' is. However we are helped by various judgments such as Chandramati V. ESIC 2003 III LLJ 202 to understand 'accident' as a mishap or untoward event not expected or designed. Similarly the Act also did not define the scope of the expression 'arising out of and in the course of employment'. It left it to the courts to define the scope. Consequently, this expression became a field of confusion and conflict between the claimants and the Corporation/employers.

At this juncture, we may note that the language of the expression 'employment injury' under the ESI Act is pari materia with that under Sec.3(1) of the Employees' Compensation Act, 1923 and therefore it is worthwhile to refer to cases decided under the Employees' Compensation Act  to get an understanding of the scope of the expression 'arising out of and in the course of employment'.

The hon'ble Bombay High Court in the case of Trustees, Port of Bombay Vs. Yamuna Bai AIR 1952, page 382 explained the expression 'in the course of employment' as one referring to a point of time which means the currency of employment  and that is to say the accident causing personal injury must occur during the currency of employment.

The  Court observed that the expression 'arising out of employment' suggests both time and place of employment. The expression 'out of' conveys the idea that there must be some sort of connection between the employment and injury caused by the accident. However the Court says that this is the literal and strict interpretation but the words' arising out of employment' are wide enough to cover a case where there may not be necessarily a direct connection between the injury to the employee,  the accident and the employment. It is enough if the circumstance (the hazard) is attending the employment to be one arising out of employment.

Thus the explosion of the bomb near the table of the employee where he was sitting in the work shop in a dock, though placed by someone as a result of which he received injuries, was held to be an accident arising out of employment. It means the expression 'arising out of employment connotes a causal connection between the accident, injury and employment. 
Thereafter the Apex Court in the case of Suarashtra Salt Mfg.Co v. Bai Valu Raja 1958 II LLJ 249 observed that as a rule, the employment of a workman does not commence until he has reached the place of work and does not continue after he left the place of work. However the expression 'arising out of and in the course of employment' extends  employers premises beyond the place of work to cover the area which the workman passes and re-passes in going to and leaving the place of work for home. Thus this case notionally extends the time and place of employment to cover the time and the area of commuting by a workman to and from his place of work if he travels through any mode not as a member of public but by the very nature of his employment.

Accordingly in BEST undertaking, Bombay vs. Mrs. Agness 1963 II LLJ 615, the accident which caused the death of a bus driver who was availing the free transport provided by his employer  for travelling to his home, was held to be an accident arising out of and in the course of employment.

 Thereafter, keeping in view the beneficial nature of the legislation and the principles of 'causal connection' and 'notional extension' defining the scope of the expression 'arising out of and in the course of employment' and to narrow down the area of conflict and confusion, sections 51 A to 51 D have been added to the ESI Act  by way of amendment in 1966.Sec.51 B and 51 C explain the circumstances where in  accidents occurring in the course of employment (during the currency  of employment) are also deemed to be accidents arising out of employment and Sec.51 D terms accidents happening to an employee while travelling in any vehicle but with express and implied permission of the employer as accidents happening to him while travelling by the transport provided by the employer and thus they are deemed to be accidents risong out of and in the course of employment.

But in Regional Director ESIC vs. Francis D'Costa, 1996 II CLR 812, the employer subsidized the travel of the employee from home to work place by bus but the bus stop was distant from his home and the employee had to travel by his cycle to the bus stop during which he met with an accident on the road and died. While the High Court termed the accident as incidental to his travel, such hazards being natural on the roads, the Supreme court negatived the order of the High Court holding that such accident could not be said to be an accident arising out of and in the course of employment within the purview of Sec.51C  as the employee was not travelling as passenger when the accident happened.

Thereafter the Central Legislature passed an amendment in 2010 and added Sec.51 D which terms accidents happening to an employee while commuting to and from his home as accidents arising out of and in the course of employment, thus removing the restriction of travel by the employee as a passenger in a purportedly employer's transport. 

Thus had Francis D' Costa's case been decided after the introduction of sec.51D, probably it would have been decided in his favour.  

Thus  so far as accidents occurring in the course of performing duties or commuting to and fro work place are concerned, the confusion around accidents arising out of and in the course of employment  in the context of employment injury defined under Sec.2(8) of the ESI Act has largely been set at rest. 

But it is worthwhile to spend a little more time to understand the twin principles of 'causal connection' between the accident, injury and employment and the 'notional extension' as the test is applicable in other cases like  work aggravating an existing illness  to result in the injury of the employee.

Elaborating the meaning of the expression arising out of and in the course of employment' the three Judge Bench of the hon'ble Supreme  Court  in Mackinon Mackenzie & Co Private Ltd. V. Ibrahim Mohammad Issak 1970 AIR (SC) 1906 said that the words  'in the course of employment' mean 'in the course of work' which the workman is employed to do and which is incidental to it. 

The words 'arising out of  employment' means that during the course of employment, injury has resulted from some risk incidental to the duties of the service which unless engaged owing to the master, it is reasonable to believe that the workman otherwise would not have suffered. The expression is not confined to mere employment as such but to it's nature, it's conditions, it's obligations and it's incidents. If by reason of any of these factors, the workman is brought within the scene of special danger, the accident would be one that arises out of and in the course of employment.

Thus in Chandramathi v. ESIC 2003 III LLJ 1122 (Ker.HC), the myocardial infarction which caused the death of a milk distributor was traced to the over-exertion and was held to be an accident arising out of and in the course of employment' rejecting the ESIC's contention that the workman died of heart ailment which was not connected with his employment.

In contrast, in ESIC vs. Sainaba, 2006 I LLJ 320 (Ker.DB),  a bus conductor fell down unconscious at the end of his day's work due to dizziness and died. While the Insurance court allowed the claim for dependent's benefit on the ground that strain in work might have accelerated his liver disease and caused death, the High Court rejected on the basis of evidence that the death was natural and was not due to his employment.

Therefore in cases of deaths/injuries caused by illness, the causal connection needs to be established by evidence that the nature or conditions or obligations of the work accelerated the illness resulting in employee's death.

Having said that, what boils down to the ultimate principle is that if the causal connection between the accident, injury and employment is established, it is not material as to where the accident occurred and when it occurred as observed in the case of ESIC vs. L. Rang Rao 1982 I LLJ 29(Karn.DB)