IMPORTANT POINT
Phrase ‘accident arising out of and in course of his employment’ occurring in Section 3 of EC Act will include accident occurring to an employee while commuting from his residence to place of employment.

JUDGMENT :

K.V. VISWANATHAN, J.

1. Shahu Sampatrao Jadhavar was employed as a watchman in the Respondent no. 2-Sugar Factory. His duty hours were from early morning 3 am to 11 am. On 22nd April 2003, he left home on his Motorcycle to report for duty. However, unfortunately, he never reached his place of work. When he was 5 kms away from the factory, his motorcycle was involved in a fatal accident. He left a large family behind. A widow, four children and his mother.

2. In a claim filed under the Employees’ Compensation Act, 1923 (hereinafter the ‘EC Act’) the employer and the insurance company set up the defence that the accident had not arisen out of or in the course of his employment, since the accident occurred outside the precincts of the factory. Overruling the same, the Commissioner for Workmen’s Compensation and Civil Judge, Senior Division, Osmanabad awarded a sum of Rs 3,26,140/- along with interest @ 12 per cent per annum from 22.05.2003 to the family members. The Insurance Company was directed to deposit the amount since there was a valid Insurance Policy. The employer was asked to pay 50 per cent of the awarded amount as penalty. The employer and the Insurance Company were directed to pay the amount of penalty and the awarded compensation within one month from the date of the order.

3. Aggrieved, the Insurance Company filed First Appeal No. 2015 of 2011 before the High Court of Judicature of Bombay, Bench at Aurangabad. The High Court has reversed the findings of the Commissioner and set aside the order holding that since the deceased was on his way to his employment, the accident cannot be said to have its origin in the employment. The aggrieved family members are in appeal by way of special leave.

4. The High Court, to support its conclusion, relied on the judgment dated 11.09.1996 of this Court rendered in Regional Director, E.S.I. Corporation and Another vs. Francis De Costa and Another , (1996) 6 SCC 1. The said judgment arose under the Employees’ State Insurance Act, 1948 (hereinafter the ‘ESI Act’). However, the crucial phrase employed in the operating Section of both the ESI Act and the EC Act, were the same. The Employees’ Compensation Act, 1923 was originally known as the Workmen's Compensation Act, 1923.

5. We have heard Mr. Atul Babasaheb Dakh, learned counsel for the appellants and Ms. Amrreeta Swaarup, learned counsel for the respondent No. 1-Insurance Company. Respondent No. 2 employer, though served, has not entered appearance.

6. Learned counsel for the appellant submitted that looking to the nature of the work of the deceased, the peril which he faced was not something personal rather it was incidental to his employment. Learned counsel contended that there was causal connection between the employment and the accident. Learned counsel relied on the theory of notional extension to support his plea. Learned counsel submitted that the EC Act is a beneficial legislation intended for the welfare of the employees. Learned counsel submitted that after the order of the trial Court, the Insurance Company had deposited the compensation with interest and the appellants were permitted to withdraw the principal amount. Learned counsel submitted that subsequent to the judgment in Francis De Costa (supra), Section 51E has been introduced in the ESI Act and, as such, the judgment in Francis De Costa (supra) can no longer govern the situation.

7. Lear