1. Heard. With the consent of learned counsels appearing for the respective parties, the matter is taken up for final disposal.
2. The appellant being aggrieved by the judgment and award dated 03.10.2023 passed by the learned Commissioner under the Employees Compensation Act, 1923 and Judge, Labour Court, Akola, in W.C.A. Application No.09/2020, thereby, directing reimbursement of amount of medical expenditure to respondent No.1 in the matter, has filed the present appeal.
3. In the present appeal, the facts which are not disputed are that respondent No.1 was working with appellant as a driver of Luxury Bus bearing Registration No.MH-30/AA-5559. On 21.07.2018 at around 05:30 pm, when the Luxury Bus was moved from Burhanpur to Washim, an accident took place in which respondent No.1 i.e. Driver sustained serious injuries. In view of the same, he was hospitalised and undergone medical treatment. After hospitalisation and recovery, the medical certificate was issued stating that respondent No.1 had suffered permanent disability of 17.66%, due to the accident. Respondent no.1 has filed the proceeding before the learned Commissioner under the Employees Compensation Act, 1923 and Judge, Labour Court, Akola, and thereby, claimed compensation of Rs.7,00,000/-.
4. The present appellant as well as respondent No.2-Insurance Company appeared before the Learned Commissioner. The appellant has took a specific stand that the offending vehicle was duly insured with respondent No.2-Insurance Company and therefore, the responsibility to make a payment to respondent No.1-employee is of the respondent No.2-Insurance Company.
5. The respondent No.2-Insurance Company, has contested the proceedings and made a submission before the Learned Commissioner that as per the provisions of Sections 4 (2) and (2A), of the Employees Compensation Act, 1923 (for short “the Act”), they are liable to pay only compensation and not medical expenditure incurred by respondent No.1, for his treatment to injuries caused in the accident.
6. In the light of this submissions of the appellant and the respondents, the Learned Commissioner has decided the application by the judgment and award dated 03.10.2013 and thereby, directed respondent No.2 to pay the entire compensation of Rs.2,37,885/-. The learned Commissioner further directed that the present appellant to reimburse the amount of medical expenditure of Rs.92,026/- to respondent No.1.
7. The appellant who approached before this Court by way of the present appeal, has restricted his challenge only to the extent of direction of the learned Commissioner against the appellant to reimburse the amount of medical expenditure to the employees-respondent No.1. In view of grounds raised by the appellant, this Court has framed following questions of law as per the order dated 21.08.2026, as under:-
“(1) Whether under Section 4 (2-A) of the Employee’s Compensation Act, 1923, the Insurance Company is responsible to compensate the amount towards the medical expenditure which were incurred towards the medical treatment of the employees.?
(2) Whether the Commissioner under Employee’s Compensation Act is justified to exonerate the Insurance Company to the extent of payment of medical expenditure as incurred by the employee.?
(3) Whether the reimbursement can be done by the Insurance Company.”
8. It is submitted that the learned Commissioner, has committed a manifest error by interpreting the Section 4(2) and (2A) of the Act. According to him, Section 4(2) of the Act, is applicable only in the cases which falls in Clause (d) of the Sub-Section 1, where temporary disablement is caused to the employee. The said provision is not applicable in the case where injury is of a permanent partial disablement. He further submits that the case of the employee-respondent No.1, falls under the category of permanent partial disablement i.e. Section 4(1)(c). Therefore, direction issued against appellant are liable to be quashed and set-aside.
9. In support of this submission, the appellant has further relied upon the medical certificate which was duly exhibited as Exh.U-19 before the learned Commissioner, whereby, it is held that respondent No.1 has suffered permanent disability of 17.66%. According to him, the said document is not disputed in the matter. Therefore, he stated that as the respondent No.1 caused permanent partial disability, his case required to be considered under the category of Section 4(1)(c) of the Act and not under 4(1)(d) of the Act. Hence, Section 4(2) of the Act, is not applicable in the matter.
10. Learned counsel for respondent No.2 has strongly opposed the present appeal. According to him, the explanation of Section 4(2) of the Act, is very clear that any payment or allowance which is received from the employer by the employee towards the medical treatment shall not be deemed to be a payment or allowance received by him by way of compensation. Therefore, according to him, the medical expense in the present matter are to be borne by the employer and not by respondent No.2-Insurance Company. Learned counsel for respondent No.2 has further stated that as per the policy of the vehicle, the employer has not paid the additional premium to include the liability of the driver. As such, considering these aspects of the matter, the learned Commissioner has rightly appreciated the controversy and accordingly, there is no need of any interference of this Court in the present appeal.
11. Learned Counsel for the respondent No.1-employee stated that it is a dispute between the appellant and respondent No.2-Insurance Company. The learned Commissioner has held respondent No.1 entitled for the medical expenses, the same may be directed to be paid to him either by the appellant or by the respondent No.2.
12. In the light of submission of learned counsels for both the parties, Section 4 of the Act, needs to be considered in the matter, which is reproduced as under:
“4. Amount of compensation.- (1) Subject to the provisions of this Act, the amount of compensation shall be as follows, namely:--
(a) where death results an 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 of *[one lakh and twenty thousand rupees], 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; *[one lakh and twenty thousand rupees], whichever is more;
*[Provided that the Central Government may, by notification in the Official Gazette, from time to time, enhance the amount of compensation mentioned in clauses (a) and (b).]
Explanation I.--For the purposes of clause (a) and clause (b), "relevant factor", in relation to a *[employee] means the factor specified in the second column of Schedule IV against the entry in the first column of that Schedule 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.
Explanation II .- Omitted by Act 45 of 2009.
(c) where permanent partial disablement result from the injury:
(i) in the case of an injury specified in Part II of Schedule I, 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 Schedule I, 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 qualified medical practitioner) permanently caused by the injury;
Explanation I.--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 II.--In assessing the loss of earning capacity for the purpose of sub-clause (ii), the qualified medical practitioner shall have due regard to the percentages of loss of earning capacity in relation to different injuries specified in Schedule I;
(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 (2).
(1A) Notwithstanding anything contained in sub-section (1), while fixing the amount of compensation payable to a *[employee] is respect of an accident occurred outside India, the Commissioner 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.]
*[(1B) The Central Government may, by notification in the Official Gazette, specify, for the purposes of sub-section (I), such monthly wages in relation to an employee as it may consider necessary.]
(2) 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 period 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
(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.
Explanation.--Any 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 within the meaning of clause (a) of the proviso.
*[(2A) The employee shall be reimbursed the actual medical expenditure incurred by him for treatment of injuries caused during course of employment.]
(3) 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.
(4) If the injury of the *[employee] results in his death, the employer shall, in addition to the compensation under subsection (1), deposit with the Commissioner a sum of *[not less than five thousand rupees] 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 in the Official Gazette, from time to time, enhance the amount specified in this sub-section.]”
13. From the perusal of the aforesaid provisions, it is clear that the legislature has prescribed the categories as to how the compensation is to be paid in the case of death, permanent total disablement, permanent partial disablement and temporary disablement. After describing the same, the legislature has specifically laid down in Section 4(2) of the Act, that this provision is made applicable only to the cases which falls under the category (d) i.e. the temporary disablement, caused to the employee. Therefore, the explanation therein, is made applicable only to such cases.
14. It is pertinent to note that amended Section 4(2A) of Section 4 the Act, in a very specific words clarified that the employee would be entitled for compensation for the actual medical expenditure incurred by him for treatment of injuries caused during the course of employment. There is no such explanation provided as like Clause 2 of Section 4 of the Act.
15. In the present case, it is an admitted fact that respondent No.1 was the driver of the vehicle owned by the appellant and the vehicle was duly insured with respondent No.2-Insurance Company. So also, the medical certificate at Exh.U-19 specifically states that respondent No.1 has permanent disability of 17.66%. As such, in my considered opinion, the case of respondent No.1-employee, falls under the category of Section 4(1)(c), of the Act. Accordingly, the provisions of Section 4(2) of the Act, are not applicable in the matter. The case of respondent No.1-employee falls under Clause 4(2A) of the Act.
16. It is further pertinent to note that the insurance policy of vehicle, which is not disputed in the matter, has given schedule of premium. As per the said schedule, it is specifically mentioned that the Insurance Company would be legally responsible to pay the compensation to passengers as well as to the paid driver, conductor, cleaner. It is nowhere mentioned in the insurance policy that any extra premium is required to be paid for the compensation of the paid driver. Therefore, respondent No.2 cannot be exonerated from payment of compensation towards medical expenditure of respondent No.1-employee.
17. Accordingly, question of law framed by this Court are answered by passing the following Order:-
O R D E R
(i) The First Appeal No.1163 of 2025 is partly allowed.
(ii) Impugned judgment and award dated 03.10.2023 passed by the learned Commissioner under the Employees Compensation Act, 1923 and Judge, Labour Court, Akola, in W.C.A. Application No.09/2020 is hereby modified to the extent that direction to the appellant to reimburse the amount of medical expenditure of Rs.92,026/- to respondent No.1 is quashed and set-aside and said amount is directed to be paid by the respondent No.2-Insurance Company to respondent No.1-employee.
(iii) Appellant is permitted to withdraw the amount of Rs.92,026/- deposited before this Court along with interest accrued thereupon.
(iv) Respondent No.2 is directed to deposit or pay directly the amount of Rs.92,026/- to the respondent No.1 within a period of four weeks from today.
(v) After deposit of amount by respondent No.2, respondent No.1 shall be entitled to withdraw the said amount.
18. In view of above, the first appeal stands disposed of with above directions. No order as to costs.
