8. Distribution of compensation.
8. Distribution of compensation.—1[(1) No payment of compensation in respect of a workman whose injury has resulted in death, and no payment of a lump sum as compensation to a woman or a person under a legal disability, shall be made otherwise than by deposit with the Commissioner, and no such payment made directly by an employer shall be deemed to be a payment of compensation:
2[Provided that, in the case of a deceased workman, an employer may make to any dependant advances on account of compensation 3[of an amount equal to three months’ wages of such workman and so much of such amount] as does not exceed the compensation payable to that dependant shall be deducted by the Commissioner from such compensation and repaid to the employer.]
(2) Any other sum amounting to not less than ten rupees which is payable as compensation may be deposited with the Commissioner on behalf of the person entitled thereto.
(3) The receipt of the Commissioner shall be a sufficient discharge in respect of any compensation deposited with him.]
(4) On the deposit of any money under sub-section (1), 4[as compensation in respect of a deceased workman] the Commissioner 5[***] shall, if he thinks necessary, cause notice to be published or to be served on each dependant in such manner as he thinks fit, calling upon the dependants to appear before him on such date as he may fix for determining the distribution of the compensation. If the Commissioner is satisfied after any inquiry which he may deem necessary, that no dependant exists, he shall repay the balance of the money to the employer by whom it was paid. The Commissioner shall, on application by the employer, furnish a statement showing in detail all disbursements made.
6[(5) Compensation deposited in respect of a deceased workman shall, subject to any deduction made under sub-section (4), be apportioned among the dependant of the deceased workman or any of them in such proportion as the Commissioner thinks fit, or may, in the discretion of the Commissioner, be allotted to any one dependant.
(6) Where any compensation deposited with the Commissioner is payable to any person, the Commissioner shall, if the person to whom the compensation is payable is not a woman or a person under a legal disability, and may, in other cases, pay the money to the person entitled thereto.
(7) Where any lump sum deposited with the Commissioner is payable to a woman or a person under a legal disability, such sum may be invested, applied or otherwise dealt with for the benefit of the woman, or of such person during his disability, in such manner as the Commissioner may direct; and where a half-monthly payment is payable to any person under a legal disability, the Commissioner may, of his own motion or on an application made to him in this behalf, order that the payment be made during the disability to any dependant of the workman or to any other person, whom the Commissioner thinks best fitted to provide for the welfare of the workman.]
7[(8)] Where an application made to him in this behalf or otherwise, the Commissioner is satisfied that, on account of neglect of children on the part of a parent or on account of the variation of the circumstances of any dependant or for any other sufficient cause, an order of the Commissioner as to the distribution of any sum paid as compensation to as to the manner in which any sum payable to any such dependant is to be invested, applied or otherwise dealt with, ought to be varied, the Commissioner may make such orders for the variation of the former order as he thinks just in the circumstances of the case:
Provided that no such order prejudicial to any person shall be made unless such person has been given an opportunity of showing cause why the order should not be made or shall be made in any case in which it would involve the repayment by a dependant of any sum already paid to him.
8[(9) Where the Commissioner varies any order under sub-section (8) by reason of the fact that payment of compensation to any person has been obtained by fraud, impersonation or other improper means, any amount so paid to or on behalf of such person may be recovered in the manner hereinafter provided in section 31.]
Andhra Pradesh.—In section 8, after sub-section (4), insert the following proviso, namely:—
“Provided that in respect of a workman belonging to an establishment to which the Andhra Pradesh Labour Welfare Fund Act, 1987 applies, the Commissioner shall pay the said balance of the money into the fund constituted under that Act in lieu of repaying to the employer.”
[Vide Andhra Pradesh Act 34 of 1987, sec. 40 (w.e.f. 1-5-1988).]
Goa.—Same as in Andhra Pradesh except the name of the Act is Goa, Daman and Diu Labour Welfare Fund Act, 1986.
[Vide Goa Act 4 of 1987, sec. 40 (w.e.f. 26-1-1990).]
Employer not to pay compensation directly to the deceased heirs and legal representatives
No compensation has to be paid in respect of a workman whose injury has resulted in death except by deposit with the Commissioner and no such payment made directly by an employer shall be deemed to be a payment of compensation; the employer should not make any payment of compensation directly to the deceased’s heirs and legal representatives or to any of them; Sumuben v. Patel Industries, 1994 LLR 338 (Guj).
Object of section 8
(i) Section 8 of the Act is designed to protect the heirs and legal representatives of the deceased workman against any kind of exploitation or fraud likely to be practised on them by or on behalf of the employer or any third party; Sumuben v. Patel Industries, 1994 LLR 338 (Guj).
(ii) Section 8 of the Act lays down the format for quantum of compensation payable by an employer when an employee meets with an accident. Its object is that unscrupulous employer should not take advantage of the ignorance of the employee in making payment of a paltry sum. Therefore the Act safeguards the interest of the workers and any private payment will not discharge the statutory obligation; May-field Estate Nalhollah Nilgiris v. Krishan, 1984 (48) FLR.
1. Subs. by Act 5 of 1929, sec. 4, for sub-sections (1) to (3).
2. Subs. by Act 15 of 1933, sec. 6, for the proviso.
3. Subs. by Act 30 of 1995, sec. 6, for certain words (w.e.f. 15-9-1995).
4. Ins. by Act 5 of 1929, sec. 4.
5. Certain words omitted by Act 30 of 1995, sec. 6 (w.e.f. 15-9-1995).
6. Subs. by Act 5 of 1929, sec. 4, for the sub-sections (5) to (7).
7. The sub-section (6) re-numbered as sub-section (8) by Act 5 of 1929, sec. 4. 8. Ins. by Act 5 of 1929, sec. 4.