Delhi High Court on Overlapping Compensation Claims under EC Act and ESI Act.

Headnote:

The Delhi High Court quashed an order passed by the Commissioner for Employees’ Compensation awarding compensation to a workman who was already receiving disability benefits under the Employees’ State Insurance Act, 1948 (ESI Act). The Court held that in view of Section 53 of the ESI Act, once an employee is covered under ESI and is receiving benefits, a parallel claim under the Employees’ Compensation Act, 1923 (EC Act) is barred. Dual recovery for the same injury is impermissible.

Background:

• The respondent-workman, aged 18, was employed at the petitioner’s factory and suffered an accident on 19.04.2016 while operating a moulding machine, resulting in amputation of his left hand below the wrist.

• He filed a claim under the EC Act, 1923 before the Commissioner, who awarded ₹7,64,506/- with 12% interest per annum from 26.09.2016 and also issued a show-cause notice for penalty under Section 4A(3)(b).

• The petitioner-employer did not initially appear before the Commissioner, and the case proceeded ex parte.

• Later, the petitioner challenged the order before the Delhi High Court, arguing that the workman was already covered under the ESI Act and had been receiving permanent disability benefits from the Employees’ State Insurance Corporation (ESIC).

• The ESIC, through its counsel, confirmed that the respondent-workman had been assessed with 60% permanent disability and was being paid a disability benefit of ₹16,020 per day from 16.06.2016, as reflected in its records and ledger sheet.

Court’s Observations:

• The Court noted that Section 53 of the ESI Act clearly bars employees who are covered under the ESI scheme from claiming compensation under the EC Act for the same injury.

• It observed that the workman was already receiving continuous disability benefits from the ESIC, which were legally sanctioned and disbursed.

• Justice Chandrasekharan Sudha held that the Commissioner had no jurisdiction to entertain a claim under the EC Act once ESI coverage was established.

• Since the workman had already received the compensation amount, the Court clarified that the EC award could not stand, as it was contrary to statutory provisions.

Decision:

The Delhi High Court allowed the writ petition and quashed the Commissioner’s order dated 24.10.2017 passed under the Employees’ Compensation Act, 1923. It held that the compensation claim under the EC Act was barred by Section 53 of the ESI Act, as the respondent-workman was already compensated under the ESI scheme. All pending applications were disposed of.

Legal Provisions Discussed:

• Section 53, Employees’ State Insurance Act, 1948 – Bar against receiving benefits under other enactments when covered by ESI.

• Section 4A(3)(b), Employees’ Compensation Act, 1923 – Power to impose penalty for delayed payment of compensation.

• Employees’ Compensation Act, 1923 – Compensation framework for injury or death arising out of employment.

• Article 226, Constitution of India – High Court’s power of judicial review.

Citation: 2025:DEL:1113

Case: Mukesh v. Sachin & Ors.

Court: High Court of Delhi at New Delhi

Coram: Hon’ble Ms. Justice Chandrasekharan Sudha

Date of Decision: 13 November 2025

Writ Petition (C): 6733 of 2018 & CM APPL. 25613/2018