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Daivshala v. The Oriental Insurance Co. Ltd.

Civil Appeal · 2025 INSC 904Decided 29 Jul 2025
Civil Appeal No. 6986 of 2015 (@ SLP (C) No. 16573 of 2012)
Justice Manoj Misra · Justice K.V. Viswanathan

Background

Shahu Sampatrao Jadhavar worked as a watchman at a sugar factory, with a shift starting at 3 a.m. On his way to work by motorcycle, about 5 km from the factory, he was killed in an accident. He left behind a widow, four children, and his mother. His family claimed compensation under the Employees' Compensation Act, which the Commissioner awarded, but the Bombay High Court (Aurangabad Bench) reversed the award, holding that an accident happening on the way to work, before actually reaching the workplace, does not "arise out of and in the course of employment."

Decision Breakdown

The Supreme Court traced how a similar phrase in the Employees' State Insurance Act was clarified by Section 51E, added in 2010, which deems a commuting accident to arise out of and in the course of employment if a nexus between the circumstances, timing, and place of the accident and the employment can be shown. The Court held this 2010 amendment was clarificatory in nature (meant to remove long-standing doubt) and therefore applies retrospectively, and, since both laws share the same core phrase and both are welfare legislations for workers, the same interpretation should extend to the Employees' Compensation Act as well. On the facts, since the watchman was killed while diligently travelling to reach an early 3 a.m. shift, a clear nexus existed. The appeal was allowed, the High Court's order was set aside, and the Commissioner's original compensation award was restored.

Lesson Learnt

A worker (or their family) injured or killed while commuting directly to or from work is entitled to compensation as arising "out of and in the course of employment," so long as a genuine link between the timing, place, and circumstances of the accident and the job can be shown: this protection applies even to older claims predating the clarifying legal amendment.

Official source (sci.gov.in)View Judgment (PDF)

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