The Competent Authority and Appeals

Section 88(2). If the employer thinks he is liable, he shall make the deposit within thirty days of service of the notice.

Section 88(3). If he thinks he is not, he shall in his statement indicate the grounds on which he disclaims liability.

Section 88(4). Where he has disclaimed, the competent authority, after such inquiry as he thinks fit, may inform any of the dependants that it is open to them to prefer a claim, and may give them such further information as he thinks fit.

Section 88(5), the advocate. Where in the authority's opinion a dependant is not in a position to engage an advocate to file a claim, the competent authority may provide an advocate to that dependant from the panel of advocates maintained by the State Government.

Read section 88 as a sequence and it is a small piece of social engineering. The authority hears of a death, demands an explanation from the employer within thirty days, tells the family, and if the employer denies liability, tells them they may claim and finds them a lawyer if they cannot. None of that depends on the family knowing the law exists.

Section 89: registration of agreements

Section 89(1), what must be registered. Where the amount of a lump sum payable as compensation has been settled by agreement, whether by redemption of a half-monthly payment or otherwise, or where compensation has been settled as payable to a woman or a person under a legal disability, a memorandum shall be sent by the employer to the competent authority, who shall, on being satisfied as to its genuineness, record it in a register, electronically or otherwise.

Three provisos:

• (a) no memorandum shall be recorded before seven days after the authority communicates notice to the parties concerned;
• (b) the competent authority may at any time rectify the register;
• (c) where it appears that an agreement ought not to be registered by reason of the inadequacy of the sum, or by reason of the agreement having been obtained by fraud or undue influence or other improper means, the authority may refuse to record it and may make such order, including an order as to any sum already paid under the agreement, as he thinks just.

Section 89(2), the effect of registration. A registered agreement is enforceable under the Code notwithstanding anything in the Indian Contract Act 1872 or any other law.

Section 89(3), the penalty for not registering. Where a memorandum required to be sent is not sent, the employer is liable to pay the full amount of compensation he is liable to pay under the Chapter and, notwithstanding the proviso to section 76(1), shall not, unless the competent authority otherwise directs, be entitled to deduct more than half of any amount already paid to the employee by way of compensation, whether under the agreement or otherwise.

Proviso (c) to section 89(1) is the important one and it is the answer to the settlement extracted from a bereaved family for a fraction of what the law gives. Inadequacy of the sum is by itself a ground to refuse registration, without any proof of fraud. And section 89(3) makes it expensive to settle privately and not tell the authority: the employer pays the full statutory amount and gets credit for only half of what he already paid.

Section 90: what the authority decides, and the bar on civil courts

Section 90(1). If any question arises in any proceeding under the Chapter as to:

• the liability of any person to pay compensation, including whether a person injured is or is not an employee; or
• the amount or duration of compensation, including the nature or extent of the disablement,

the question shall, in default of agreement, be settled by a competent authority.

Section 90(2), the bar. No Civil Court shall have jurisdiction to settle, decide or deal with any question which under the Chapter is to be settled by a competent authority, or to enforce any liability incurred under this Chapter.

Note both limbs of section 90(2). The civil court cannot decide these questions, and it cannot enforce a liability under the Chapter either.

Section 91: appointment and qualification

Section 91(1). The State Government may by notification appoint as competent authority for a specified area any person who:

• is or has been a member of a State Judicial Service for not less than five years; or
• is or has been an advocate for not less than five years; 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 the appropriate Government prescribes.

Section 91(2). Where more than one authority serves an area, the State Government may regulate the distribution of business.

Section 91(3). A competent authority may choose one or more persons possessing special knowledge of a relevant matter to assist him in holding the inquiry.

Section 92: venue and transfer

Section 92(1), where a matter is done. Before the competent authority for the area in which:

• (a) the accident took place; or
• (b) the employee, or in case of death the dependant claiming compensation, ordinarily resides; or
• (c) the employer has his registered office.

The first proviso requires that no matter be processed by an authority other than the one having jurisdiction over the area where the accident took place without giving notice, electronically or otherwise, to that authority and to the State Government concerned.

The second proviso deals with accidents abroad: for a master or seaman, a captain or crew member of an aircraft, or an employee in a motor vehicle or a company who meets with an accident outside India, the matter may be dealt with by the authority for the area in which the owner or agent of the ship, aircraft or motor vehicle resides or carries on business, or where the company's registered office is situated.

Section 92(2), calling for records. An authority other than the one with whom money has been deposited under section 81 may call for transfer of records or moneys, and the other shall comply.

Section 92(3), transfer for convenience. Where an authority is satisfied that a matter can be more conveniently dealt with by another competent authority, whether in the same State or not, he may order it transferred for report or for disposal, transmitting the documents and, on a transfer for disposal, any money he holds.

The proviso. Where a party has appeared before him, he shall not make an order of transfer relating to the distribution among dependants of a lump sum without giving that party an opportunity of being heard.

Section 92(4) and (5). The transferee authority inquires and either returns a report or, on a transfer for disposal, continues the proceedings as if they had originally commenced before him. On receiving a report, the referring authority shall decide in conformity with it.

Section 92(6). The State Government may transfer any matter from one competent authority appointed by it to another.

Section 93: the application

Section 93(1). Where an accident occurs in respect of which liability arises, a claim may be made before the competent authority.

Section 93(2), the dispute requirement, and its exception. No application for the settlement of a matter, other than an application by a dependant or a joint application by dependants for compensation, shall be made unless and until some question has arisen between the parties which they have been unable to settle by agreement.

So an injured employee must first have a dispute with his employer. A dependant need not: the exception in section 93(2) lets a dependant go straight to the authority.

Section 93(3). The application may be made electronically or otherwise, in the prescribed form and manner, with such fee as the Central Government prescribes.

Section 93(4). The time limit for disposal and the costs are prescribed by the State Government.

Section 94: further deposit in a fatal case

Section 94(1). Where a sum has been deposited by an employer as compensation for an employee whose injury resulted in death, and in the competent authority's opinion that sum is insufficient, he may by notice in writing stating his reasons call on the employer to show cause why he should not make a further deposit within the time stated.

Section 94(2). If the employer fails to show cause to the authority's satisfaction, the authority may make an award determining the total amount payable and require the employer to deposit the deficiency.

Again the authority acts on its own view, not on a claim. A family which accepted whatever was deposited is protected by section 94 without doing anything.

Sections 95 to 98: powers, appearance, evidence, reference

Section 95, powers. The competent authority has all the powers of a Civil Court under the Code of Civil Procedure 1908 for taking evidence on oath, which he is empowered to administer, enforcing the attendance of witnesses and compelling the production of documents and material objects; and he is deemed to be a Civil Court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure 1973.

Section 96, who may appear. Any appearance, application or act required to be made or done before or to the competent authority, other than the appearance of a party required for his examination as a witness, may be made on his behalf by:

• a legal practitioner;
• an official of an Insurance Company;
• an official of a registered Trade Union;
• an Inspector-cum-Facilitator appointed under section 122(1);
• any other officer specified by the State Government,

authorised in writing by that person, or, with the permission of the competent authority, by another person so authorised.

That list is wider than the equivalent in section 51(2) for the Employees' Insurance Court, because it adds an insurance company official and an Inspector-cum-Facilitator.

Section 97, recording evidence. The authority shall make a brief memorandum of the substance of the evidence of every witness as the examination proceeds, authenticated under his hand or in the prescribed manner, forming part of the record. If prevented from doing so he shall record the reason and have it made from his dictation and sign it. The evidence of any medical witness shall be taken down as nearly as may be word for word.

Section 98, reference on a question of law. 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 that decision.

Section 99: appeal to the High Court

Section 99(1), the six appealable orders. An appeal lies to the High Court from an order of a competent authority:

Three provisos, and every one of them is a bar:

1. no appeal unless a substantial question of law is involved; and, except for an order under clause (c), unless the amount in dispute is not less than ten thousand rupees, or such higher amount as the Central Government notifies;
2. no appeal where the parties have agreed to abide by the decision of the competent authority, or where the order gives effect to an agreement arrived at by the parties;
3. no appeal by an employer under clause (a) unless the memorandum of appeal is accompanied by a certificate of the competent authority that the appellant has deposited with him the amount payable under the order appealed against.

Section 99(2), limitation. Sixty days from the date of passing of the order.

Section 99(3). Section 5 of the Limitation Act 1963 applies, so delay may be condoned on sufficient cause.

Note the difference between the third proviso here and the pre-deposit rules elsewhere in the Code. Section 23(3) requires twenty-five per cent for the Tribunal; section 49(2) requires fifty per cent, waivable, for the Employees' Insurance Court. Here an appealing employer must deposit the whole amount payable under the order, and no waiver is provided.

A worked example

Vinod is killed at a workshop on 5 January. The competent authority reads about it in a local newspaper.

Can he act before anyone claims? Yes. Section 88(1) lets him act on information from any source and send the employer a notice requiring a statement within thirty days of the circumstances and of whether the employer accepts liability. A copy goes to the dependants he ascertains.

The employer disclaims liability. He must state the grounds: section 88(3). The authority may then, after such inquiry as he thinks fit, inform the dependants that it is open to them to claim: section 88(4).

Vinod's widow cannot afford a lawyer. The competent authority may provide her an advocate from the panel maintained by the State Government: section 88(5).

Must she first have a dispute with the employer before applying? No. Section 93(2) requires a prior unresolved question for other applications but excepts an application by a dependant or a joint application by dependants for compensation.

Where does she apply? To the authority for the area where the accident took place, or where she ordinarily resides, or where the employer has his registered office: section 92(1). If she chooses somewhere other than the place of the accident, that other authority must first notify the authority for the accident area and the State Government.

The employer instead offers her 1,50,000 rupees, she signs, and he sends the memorandum for registration. The authority shall not record it before seven days after notice to the parties: proviso (a) to section 89(1). If it appears to him that the agreement ought not to be registered by reason of the inadequacy of the sum, he may refuse to record it and make such order, including as to sums already paid, as he thinks just: proviso (c).

Suppose the employer had simply paid her and never sent a memorandum. Section 89(3) makes him liable for the full statutory compensation, and he may not deduct more than half of what he already paid, unless the authority directs otherwise.

The employer had deposited 2,00,000 rupees and the authority thinks it too little. Under section 94(1) he may, by notice in writing stating his reasons, call on the employer to show cause, and if not satisfied may award the total amount and require the deficiency to be deposited: section 94(2).

The award is 9,00,000 rupees and the employer wants to appeal. He may appeal to the High Court under section 99(1)(a), but only if a substantial question of law is involved and the amount in dispute is not less than ten thousand rupees, within sixty days, and only if the memorandum of appeal carries a certificate that he has deposited the amount payable under the order.

A pure question of law arises before the authority decides. He may submit it to the High Court and must then decide in conformity with that decision: section 98.

What this does NOT mean

The civil court is not merely inconvenient; it is barred. Section 90(2) removes its jurisdiction both to decide these questions and to enforce liabilities under the Chapter.

Registration of an agreement is not a formality. The authority must be satisfied of its genuineness, must wait seven days, and may refuse for inadequacy alone.

An appeal is not available on the facts. All six heads in section 99(1) are subject to the first proviso, which requires a substantial question of law.

Not every claimant must first have a dispute. A dependant is excepted by section 93(2).

The authority need not be a judge. Section 91(1) also admits an advocate of five years' standing and a Gazetted Officer of five years with the stated qualifications.

Limits and criticism

The employer's appeal deposit is the whole award, with no power of waiver stated, which is heavier than anything else in the Code and may put an appeal out of reach of a small employer with a genuine point of law.

The ten thousand rupee threshold in the first proviso to section 99(1) will exclude very few appeals in practice but is a figure fixed in the statute rather than indexed.

Section 88 is discretionary throughout. The authority "may" send the notice, "may" inform the dependants and "may" provide an advocate. A family's access to the scheme depends on how energetically the office is run.

No time limit for disposal appears in the Code. Section 93(4) leaves it to State rules, so the promise of a quick forum rests on delegated legislation.

Quick revision

• Section 88: on information from any source of a death, notice to the employer for a statement in thirty days, copy to dependants; deposit within thirty days if he admits liability; grounds if he disclaims; the authority may then tell the dependants they may claim and provide an advocate from the State panel.
• Section 89: memorandum of a settled lump sum, or of compensation to a woman or person under legal disability, to be registered; not before seven days; register rectifiable; refusal for inadequacy, fraud, undue influence or other improper means; registered agreement enforceable notwithstanding the Contract Act 1872; failure to send it means the full amount is payable with credit for not more than half of what was paid.
• Section 90: the authority decides liability, whether a person is an employee, and the amount, duration, nature and extent of disablement; civil courts barred from deciding and from enforcing.
• Section 91: appointed by the State Government; five years as a judicial officer, an advocate, or a Gazetted Officer with the stated qualifications; may co-opt experts.
• Section 92: venue is the area of the accident, the claimant's residence or the employer's registered office; notice to the accident-area authority if elsewhere; transfer for report or disposal, with a hearing before transferring a distribution matter.
• Section 93: a prior unresolved question is needed, except for a dependant's application; electronic filing allowed; time limit and costs prescribed by the State Government.
• Section 94: the authority may require a further deposit in a fatal case after a show cause.
• Sections 95 to 98: Civil Procedure Code powers and deemed a Civil Court for section 195 and Chapter XXVI CrPC; appearance by a legal practitioner, insurance official, registered trade union official, Inspector-cum-Facilitator or specified officer; a memorandum of evidence, with medical evidence word for word; reference of a question of law to the High Court, binding on the authority.
• Section 99: appeal to the High Court from six orders; only on a substantial question of law and, except for clause (c), where the amount is not less than ten thousand rupees; no appeal where the parties agreed to abide or the order gives effect to their agreement; an employer appealing under clause (a) must certify he has deposited the whole amount; sixty days, with section 5 of the Limitation Act 1963 applying.

Test yourself

1. Can a competent authority act before anybody makes a claim? Yes. Under section 88(1), on receiving 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 require the employer to submit a statement within thirty days, and send a copy of the notice to the dependants.

2. What may the authority do for a dependant who cannot afford a lawyer? Under section 88(5) he may provide an advocate to that dependant from the panel of advocates maintained by the State Government.

3. On what grounds may registration of a settlement agreement be refused? Where it appears to the competent authority that the agreement ought not to be registered by reason of the inadequacy of the sum or amount, or by reason of its having been obtained by fraud or undue influence or other improper means: proviso (c) to section 89(1). He may also make an order as to any sum already paid.

4. An employer settles privately and never sends the memorandum. What follows? Under section 89(3) he is liable to pay the full amount of compensation payable under the Chapter, and, notwithstanding the proviso to section 76(1), may not deduct more than half of any amount already paid to the employee unless the competent authority otherwise directs.

5. Must an injured employee first have a dispute with his employer before applying? Yes, by section 93(2), unless the application is by a dependant or a joint application by dependants for compensation, which is excepted.

6. State the conditions for an appeal to the High Court under section 99. A substantial question of law must be involved; except for an order refusing redemption of a half-monthly payment, the amount in dispute must be not less than ten thousand rupees or such higher amount as is notified; no appeal lies where the parties agreed to abide by the decision or the order gives effect to their agreement; an employer appealing against a lump sum award must produce a certificate that he has deposited the amount payable; and the appeal must be filed within sixty days, section 5 of the Limitation Act 1963 applying.

7. How is the evidence of a doctor recorded? As nearly as may be word for word: the second proviso to section 97. Other witnesses' evidence is recorded as a brief memorandum of its substance.