Widowed Sisters as Dependents under Employee's Compensation Act, 1923

Source: Supreme Court 

Why in News? 

The bench of Justices Rajesh Bindal and Manmohan in the case of The New India Assurance Company Ltd. v. Kogga & Ors. (2025) dismissed the appeal but referred the matter to the Law Commission of India for suitable amendment of the definition of 'dependent' under the Employee's Compensation Act, 1923. 

What was the Background of The New India Assurance Company Ltd. v. Kogga & Ors. (2025) Case? 

• The appeal arose from a judgment dated October 5, 2009, passed by the High Court of Karnataka at Bangalore in M.F.A. No.7194 of 2005 (WC). 
• The deceased employee was survived by two widowed sisters (respondent Nos. 3 and 4), who were not minors at the time of his demise but were dependent on him. 
• The Commissioner had treated the widowed sisters of the deceased employee as his dependents under the Employee's Compensation Act, 1923 and awarded compensation in their favour. 
• The appellant-Insurance Company challenged this decision, arguing that the two widowed sisters did not qualify as dependents of the deceased employee as contemplated under the Statute. 
• The Insurance Company contended that according to Section 2(1)(d)(iii)(d) of the Employee's Compensation Act, 1923, only "a minor brother, or an unmarried sister or a widowed sister if a minor" could be treated as dependents. 
• Since the widowed sisters were not minors at the time of the deceased's demise, the appellant argued they should not be entitled to compensation. 
• The High Court of Karnataka had upheld the Commissioner's decision to award compensation to the widowed sisters despite them not being minors. 

What were the Court's Observations? 

• The Court initially reserved judgment on August 17, 2023, but re-listed the matter on August 24, 2023, deciding that appropriate assistance would be required from the Union of India regarding the interpretation of Section 2(1)(d)(iii)(d). 
• The appeal was dismissed, however, leaving the question of law open for future consideration. 
• The Court observed that the Employee's Compensation Act was enacted in 1923, and the definition of 'dependent' in Section 2(1)(d)(iii)(d) means "a minor brother or an unmarried sister or a widowed sister if a minor". 
• The Court noted that "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." 
• The Court was of the view that 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 Court directed that 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. 
• The Court also directed the Registry to send intimation about the dismissal of the appeal to the respondents to enable them to withdraw the amount lying deposited in the Karnataka High Court. 
• In case any of the respondents had expired, their legal heirs were permitted to withdraw the amount along with interest accrued thereon, if any. 

What is the Employee's Compensation Act, 1923? 

About: 

• The Employee's Compensation Act, 1923 (formerly known as the Workmen's Compensation Act, 1923) is a social security legislation designed to provide compensation to employees and their dependents in case of accidents arising out of and in the course of employment. 
• The Act was enacted to provide financial protection to workers and their families in case of work-related injuries, disabilities, or death. 
• The Act defines 'dependent' to include certain relatives of the deceased employee who were wholly or in part dependent on the earnings of the worker at the time of death. 

Definition of 'Dependent' under Section 2(1)(d): 

• Section 2(1)(d) of the Employee's Compensation Act, 1923 defines who qualifies as a 'dependent' of a deceased employee for the purpose of claiming compensation. 
• The definition includes various categories of relatives such as widow, minor legitimate or adopted son, unmarried legitimate or adopted daughter, and widowed mother. 
• Section 2(1)(d)(iii)(d) specifically mentions "a minor brother, or an unmarried sister or a widowed sister if a minor" as dependents. 
• This provision requires that a widowed sister must be a minor to qualify as a dependent, which creates practical difficulties in modern times. 

Practical Challenges with Current Definition: 

• After the enactment of the Hindu Marriage Act, 1955, the minimum age for marriage was regulated, making child marriages illegal. 
• The Hindu Marriage Act, 1955 initially prescribed the minimum age of marriage as 15 years for girls (later raised to 18 years in 1978). 
• Given these legal restrictions on child marriage, the scenario of a "widowed sister who is a minor" has become practically impossible or extremely rare. 
• The outdated provision in the Employee's Compensation Act fails to account for social changes and legal reforms that have occurred since 1923. 

Need for Amendment: 

• The Supreme Court's reference to the Law Commission acknowledges that the law needs to be updated to reflect contemporary social realities. 
• The amendment would ensure that widowed sisters who are genuinely dependent on their deceased brother can receive compensation, regardless of whether they are minors. 
• Such reform would align the Employee's Compensation Act with principles of social justice and the welfare objectives of labour legislation. 
• The Law Commission may consider expanding the definition to include all dependent widowed sisters or revising the criteria for determining dependency.