Regular daily allowances paid consistently as employment emoluments constitute “wages” under the Employees’ Compensation Act.

Respondent No. 1, Md. Siddique Ali, claimed compensation under Section 22 of the Workmen’s Compensation Act, 1923, for injuries sustained in a motor-vehicle accident on 04.04.2004 while employed as a cleaner and helper in vehicle No. AS-02-7392 owned by Respondent No. 2.

The vehicle, allegedly insured by the appellant, met with an accident following a tyre burst, causing multiple injuries to the claimant.

The claim proceedings before the Commissioner for Workmen’s Compensation, Nagaon, proceeded ex parte against the opposite parties.

The claimant and the treating doctor were examined, and the medical evidence assessed 25% physical disability and 35% loss of earning capacity.

By judgment and award dated 21.06.2007 in NWC Case No. 69/2004, the Commissioner awarded Rs.1,37,636/- with interest at 9% per annum against the insurer.

The insurer preferred the present appeal under Section 30 of the Employees’ Compensation Act, 1923.

1. Whether a regular daily allowance paid to a workman forms part of “wages” under Section 2(m) of the Employees’ Compensation Act, 1923.

2. Whether the Commissioner’s award required interference on the ground that the daily allowance should be excluded from the claimant’s wages.

The Court applied Sections 22 and 30 of the Workmen’s Compensation Act, 1923, concerning claims for compensation and appeals on substantial questions of law, respectively.

It also applied Section 2(m), which defines “wages” for the purposes of the Act.

Relying on Mohd. Ameeruddin v. United India Insurance Co. Ltd., (2011) 1 SCC 304, the Court held that a daily allowance paid regularly and consistently as part of the terms of employment, and forming an integral component of the workman’s regular earnings, may be included within “wages”.

A daily allowance cannot be excluded merely because it is described as “batta” or paid on a daily basis where the evidence establishes that it is regularly received as part of the employee’s earnings.

The insurer’s counsel conceded that the substantial question regarding daily allowance had already been settled by the Supreme Court and that regular daily allowance could constitute wages.

Applying Mohd. Ameeruddin, the Court found that the claimant received Rs.100/- per day as allowance, resulting in monthly earnings of Rs.3,000/-.

Since the allowance was treated as a regular component of the claimant’s earnings, it was properly includible in wages under Section 2(m).

The Commissioner’s assessment and award therefore did not disclose any legal error warranting appellate interference.

It found no justification to interfere with the Commissioner’s judgment and award of Rs.1,37,636/- with 9% interest and accordingly dismissed the appeal.

The record was directed to be returned to the Office of the Commissioner for Workmen’s Compensation, Nagaon, along with a copy of the judgment.