Schedule III




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4A.  Compensation to be paid when due and penalty for default

(1) Compensation under Section 4 shall be paid as soon as it falls due.


(2) In cases where the employer does not accept the liability for compensation to the extent claimed he shall be bound to make provisional payment based on the extent of liability which he accepts and such payment shall be deposited with the Commissioner or made to the workman as the case may be without prejudice to the right of the workman to make any further claim.
(3) Where any employer is in default in paying the compensation due under this Act within one months from the date it fell due the Commissioner shall -
(a) direct that the employer shall in addition to the amount of the arrears pay simple interest thereon at the rate of twelve per cent annum or at such higher rate not exceeding the maximum of the lending rates of any scheduled bank as may be specified by the Central Government by notification in the Official Gazette on the amount due; and
(b) if in his opinion there is no jurisdiction for the delay direct that the employer shall in addition to the amount of the arrears and interest thereon pay a further sum not exceeding fifty per cent of such amount by way of penalty :

Provided that an order for the payment of penalty shall not be passed under clause (b) without giving a reasonable opportunity to the employer to shoe cause why it should not be passed.


Explanation: For the purposes of this sub-Section "scheduled bank" means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act 1934 (2 of 1934).
(3A) The interest payable under sub-Section (3) shall be paid to the workman or his dependant as the case may be and the penalty shall be credited to the State Government.

5.  Method of calculating wages
In this Act and for the purpose thereof the expression "monthly wages" means the amount of wages deemed to be payable for a months' service (whether the wages are payable by the month or by whatever other period or at piece rates) and calculated as follows namely: -
(a) where the workman has during a continuous period of not less than twelve months immediately preceding the accident been in the service of the employer who is liable to pay compensation the monthly wages of the workman shall be one-twelfth of the total wages which have fallen due for payment to him by the employer in the last twelve months of that period;
(b) where the whole of the continuous period of service immediately preceding the accident during which the workman was in the service of the employer who is liable to pay the compensation was less than one month the monthly wages of the workman shall be the average monthly amount which during the twelve months immediately preceding the accident was being earned by a workman employed on the same work by the same employer or if there was no workman so employed by a workman employed on similar work in the same locality;
(c) in other cases including cases in which it is not possible for want of necessary information to calculate the monthly wages under clause (b) the monthly wages shall be thirty times the total wages earned in respect of the last continuous period of service immediately preceding the accident from the employer who is liable to pay compensation divided by the number of days comprising such period.
Explanation: A period of service shall for the purposes of this Section be deemed to be continuous which has not been interrupted by a period of absence from work exceeding fourteen days.
6.  Review
(1) Any half-monthly payment payable under this Act either under an agreement between the parties or under the order of a Commissioner may be reviewed by the Commissioner on the application either of the employer or of the workman accompanied by the certificate of a qualified medical practitioner that there has been a change in the condition of the workman or subject to rules made under this Act on application made without such certificate.
(2) Any half-monthly payment may on review under this Section subject to the provisions of this Act be continued increased decreased or ended or if the accident is found to have resulted in permanent disablement be converted to the lump sum to which the workman is entitled less any amount which he has already received by way of half-monthly payments.

7.  Commutation of half-monthly payments
Any right to receive half-monthly payments may by agreement between the parties or if the parties cannot agree and the payments have been continued for not less than six months on the application of either party to the Commissioner be redeemed by the payment of a lump sum of such amount as may be agreed to by the parties or determined by the Commissioner as the case may be.

8.  Distribution of compensation
(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 directly by an employer shall be deemed to be a payment of compensation:
Provided that in the case of a deceased workman an employer may make to any dependant advances on account of compensation 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) as compensation in respect of a deceased workman the Commissioner 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 dates 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.


(5) Compensation deposited in respect of a deceased workman shall subject to any deduction made under sub-Section (4) be apportioned among the dependants of the deceased workman or any of them in such proportion as the Commissioner thinks fit or may in the desecration 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.
(8) Where on 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 of for any other sufficient cause an order of the Commissioner as to the distribution of any sum paid as compensation or 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 order 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 and case in which it would involve the repayment by a dependant of any sum already paid to him.
(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.
9.  Compensation not to be assigned attached or charged
Save as provided by this Act no lump sum or half-monthly payment payable under this Act shall in any way be capable of being assigned or charged or be liable to attachment or pass to any person other than the workman by operation of law nor shall any claim be set off against the same.

10.  Notice and claim
(1)   No claim for compensation shall be entertained by a Commissioner unless notice of the accident has been given in the manner hereinafter provided as soon as practicable after the happening thereof and unless the claim is preferred before him within two years of the occurrence of the accident or in case of death within two years from the date of death:
Provided that where the accident is the contracting of a disease in respect of which the provisions of sub-Section (2) of Section 3 are applicable the accident shall be deemed to have occurred on the first of the days during which the workman was continuously absent from work in consequence of the disablement caused by the disease:
Provided further that in case of partial disablement due to the contracting of any such disease and which does not force the workman to absent himself from work the period of two years shall be counted from the day the workman gives notice of the disablement to his employer:
Provided further that if a workman who having been employed in an employment for a continuous period specified under sub-Section (2) of Section 3 in respect of that employment ceases to be so employed and develops symptoms of an occupational disease peculiar to that employment within two years of the cessation of employment the accident shall be deemed to have occurred on the day on which the symptoms were first detected:
Provided further that the want of or any defect or irregularity in a notice shall not be a bar to the entertainment of a claim -
(a) if the claim is preferred in respect of the death of a workman resulting from an accident which occurred on the premises of the employer or at any place where the workman at the time of the accident was working under the control of the employer or of any person employed by him and the workman died on such premises or at such place or on any premises belonging to the employer or died without having left the vicinity of the premises or place where the accident occurred or

(b) if the employer or any one of several employers or any person responsible to the employer for the management of any branch of the trade or business in which the injured workman was employed had knowledge of the accident from any other source at or about the time when it occurred :


Provided further that the Commissioner may entertain and decide any claim to compensation in any case notwithstanding that the notice has not been given or the claim has not been preferred in due time as provided in this sub-Section if he is satisfied that the failure so to give the notice or prefer the claim as the case may be was due to sufficient cause.
(2) Every such notice shall give the name and address of the person injured and shall state in ordinary language the cause of the injury and the date on which the accident happened and shall be served on the employer or upon any one of several employers or upon any person responsible to the employer for the management of any branch of the tread or business in which the injured workman was employed.
(3) The State Government may require that any prescribed class of employers shall maintain at these premises at which workmen are employed a notice book in the prescribed form which shall be readily accessible at all reasonable times to any injuries workman employed on the premises and to any person acting bona fide on his behalf.
(4) A notice under this Section may be served by delivering it at or sending it by registered post addressed to the residence or any office or place of business of the person on whom it is to be served or where a notice book is maintained by entry in the notice-book.
10A.  Power to require from employers statements regarding fatal accident
(1) Where a Commissioner receives information from any source that a workman has died as a result of an accident arising out of and in the course of his employment he may send by registered post a notice to the workman's employer requiring him to submit within thirty days of the service of the notice a statement in the prescribed form giving the circumstances attending the death of the workman and indicating whether in the opinion of the employer he is or is not liable to deposit compensation on account of the death.
(2) If the employer is of opinion that he is liable to deposit compensation he shall make the deposit within thirty days of the service of the notice.
(3) If the employer is of opinion that he is not liable to deposit compensation he shall in his statement indicate the grounds on which he disclaims liability.
(4) Where the employer has so disclaimed liability the Commissioner after such inquiry as he may think fit may inform any of the dependants of the deceased workman that it is open to the dependants to prefer a claim for compensation and may give them such other further information as he may think fit.

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