New Delhi, Oct 29 The Supreme Court has suggested that the legislature reconsider the outdated provisions of the Employees’ Compensation Act, 1923, emphasizing the need to modernize century-old labour laws.
A Bench of Justices Rajesh Bindal and Manmohan observed that certain clauses defining “dependents” in the 1923 Act have lost their relevance in the present socio-legal context.
It pointed out the impracticality of the current wording in Section 2(1)(d)(iii)(d) of the Act, which defines a dependent as “a minor brother, or an unmarried sister or a widowed sister if a minor.”
“The Employee’s Compensation Act was enacted in the year 1923. The definition of word ‘dependent’.....in Section 2(1)(d)(iii)(d) means ‘a minor brother or an unmarried sister or a widowed sister if a minor’. In the present time, no one will normally find a widowed sister who is a minor, especially after enactment of the Hindu Marriage Act, 1955,” observed the Justice Bindal-led Bench.
To address this issue, the Supreme Court directed that a copy of the order be forwarded to the Ministry of Law and Justice for further action.
“In our view, the matter needs to be considered by the Law Commission of India for suitable amendment of the aforesaid provision or any other in the 1923 Act,” the order stated.
“A copy of the order be sent to the Secretary, Ministry of Law and Justice, who may further refer the same to the Chairperson, Law Commission of India,” it added.
The Special Leave Petition (SLP) stemmed from a Karnataka High Court decision which upheld compensation to two widowed sisters of a deceased employee, recognizing them as his dependents under the Act.
The insurance company had challenged the award, arguing that the statute only recognizes a “widowed sister if a minor” as a dependent and two widowed sisters were not minors at the time of his demise.
After hearing arguments from both sides, the apex court said: “Keeping in view the amount involved in the present appeal, we do not wish to interfere with the impugned judgment. The appeal is accordingly dismissed, however, leaving the question of law open.”
The top court registry was directed to inform the respondents, including two widowed sisters, about the dismissal of the appeal to enable withdrawal of the compensation amount deposited in the Karnataka High Court.
“In case any of the aforesaid respondents has expired, his/her legal heirs are permitted to withdraw the amount along with interest accrued thereon,” the Justice Bindal-led Bench clarified.
In an earlier order passed on August 24, 2023, the Supreme Court had sought assistance from the Union government to interpret the term “dependent”, noting then that the deceased worker was survived by two widowed sisters who, though not minors, were financially dependent on him.
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