Legal obligation on employer to pay compensation

The Workmen Compensation Act, 1923 was one of the social security legislation. This act was enacted to put legal obligation on employer to pay compensation if any accident happens to workmen and injures him while working in the premises of the workplace [1] 

Section 3 (1) of the Workmen Compensation Act, 1923 says that-

“If personal injury is caused to a workman by accident arising out of and in the course of his employment, his employer shall be to pay compensation in accordance with the provision of Chapter (II)….."

There are three components in the definition [2] which are – (1) personal injury (2) accident (3) arising out of and in the course of the employment. This last point is the key of this section. More over these two phrases has been subjected to different kind of judicial interpretation and in varieties of cases the court has given their opinion about the meaning of these two phrases. The originality of these two phrases is an English Act of 1897 which was followed in different countries legislation including India. [3] The term “scope of employment" was replaced by “in the course of employment" in nineteenth century. [4] With advancement in the field of industry workmen have become more insecure with regard to their employment and as a result of that many social security legislation has come up. This Act is also among them. [5] The judiciary has also realized this purpose of the act and interpreted the terms widely and gave birth to doctrine of notional extension.

The objective of this paper is to explore the meaning of the term “out of employment" in this act given by the judiciary and the development of theory of “notional extension" by the judiciary taking the help of different cases laws.

Meaning of “arising out of Employment":

It is not easy to determine the scope of this term and lay down the test to determine what is “arising out of employment". There were many attempts to construct a meaning of this term. It has been tried to explain by nature, condition, objects and incidents of employment. [6] To understand it we need to look at it from very beginning taking the help of English cases as well as Indian cases.

Test of “nature employment"

In Simpson v. Sinclair [7] a workman was injured because of a wall fall which has no connection with her employment. But this wall fall resulted into fall of a shed where she was working. Lord Shaw observed that “arising out" of is not limited to the nature of the employment but applies to the employment as such, to its nature, its condition, its obligation and its incidents. If because of these a workmen is expose to special danger than that can be brought under the preview of “arising out of employment". [8] In this case court has given a wider meaning of the term and did not stick to any specific condition to fulfill.

Casual Connection between employment and accident test

There should be a casual connection between the work and the accident which is explained in Charles R. Davidson v. M. Robb [9] . Lord Dunedin said that the term “in the course of" further explain the term “arising out of". It is difficult to visualize that there can be any accident which is arising out of employment but not in the course of employment. Workmen should be doing something as part of his service and it is not important that he has to do actual work but something connected to the work. Lord Haldane said that there need to show casual relation between the work and an order, express or implied by the employer. [10] The employment is the cause and accident is the effect [11] 

In Mackinnon Mackenzie and Co. (P) Ltd. v. Ibrahim Mahmmed Issak [12] court has supported the above judgment and said that there should be ‘’casual connection’ and only ‘nature of employment’ is not a judging factor. Justice V. Ramaswami explained the meaning and said that

“The words "in the course of the employment" mean "in the course of the work which the workman is employed to do and which is incidental to it." The words "arising out of employment" are understood to mean that during the course of the employment, injury has resulted from some risk incidental to the duties of the service, when, unless engaged in the duty owing to the master, it is reasonable to believe the workman would not otherwise have suffered.

In other words, there must be a causal relationship between the accident and the employment. The expression "arising out of employment" is again not confined to the mere nature of the employment. The expression applies to employment as such-- to its nature, its conditions, its obligations and its incidents. To put it differently, If the accident had occurred or account of a risk which is an incident of the employment, the claim for compensation must succeed, unless of course the workman has exposed himself to an added peril by his own Imprudent act."

Following the above judgment in State of Rajasthan v. Ram Prasad and another [13] supreme court said that the accident must a casual connection with employment and arise out of it. It was also said that even if the workman has died because of natural forces he can get compensation showing that his employment exposed him to such hazard.

The need of casual connection has been the test even in the recent time. In Shakuntala chandrakant Shreshti v. prabhakar Maruti Garveli and Another; [14] Justice S. B Sinha observed that there must be a casual connection between the accident and the work done in the course of employment. [15] 

In Bhagubai v. General Manager, Central Railway [16] the idea of cause of accident was clarified and remote cause was excluded from the ambit. Justice Chagla observed that there must be a casual connection between the accident and employment in order to say that the accident arose out of employment. The court emphasized that cause must be proximate cause and not any remote cause. [17] The peril of injury which the workmen face should be incidental to the employment not anything personal. It must be inherent in the employment or incidental to it. [18] 

Indirect Connection is Sufficient:

Court included indirect connection between employment and injury within the meaning of this term which makes this phrase wider. In this matter Bombay High Court says that “arising out of employment" suggest the point of time means during the time of employment and place. It also says that there should be connection between the employment and the injury but not necessary direct connection. [19] In Public Works Department v. Smt. Kausa [20] Justice P.R Sharma observe that the term “arising out of employment" has been given a wider meaning and can cover a situation where there is no direct connection between injury caused by an accident and the employment. [21] 

Risk of accident is inherent or incidental to the employment:

It is not sufficient to make the employer liable if the injury occurred in the working hour and the place of employment but there need to have some connection between the accident and nature of the duty the workmen has been given. [22] The workman should be doing something which is part of his work though it need not be the actual work. [23] In Munshi & Co. v. Yeshwant Tukaram Teli [24] the workmen was employed in a godown and injured because of explosion. Justice Macklin said that “an accident cannot be said to be arise out of employment unless the risk of such an accident has been, even before the accident, inherent in the employment itself to a greater or lesser extent" [25] In Lancashire & Yorkshire Railway v. Highley [26] Lord Summon observed that is the part of his employment to hazard, to suffer or to do that which caused injury? If yes then it can be said that the accident arose out of employment. [27] Here court examined that whether the danger is part of employment or not.

Test to detect “ arising out of employment"

In Ravuri Kotayya v. Dasari Nagavardhanamma [28] Andhra Pradesh High Court has laid down the test by which is accident has arisen out of and in the course of employment can be established [29] :

The workman was employed on or performing the duties at the time of accident.

That the accident occurred at or about the place where he was performing these duties or where the performance of the duties required him to be present.

That the immediate act which led to or resulted in the accident has some form of casual relation with the performance of these duties, and such casual connection could be held to exist if the immediate act which led to the accident is not so remote from the sphere of his duties or the performance thereof , as to be regarded as something foreign to them.

There are certain exception to the above rule like the accident involve some risk common to general public and if he by his own act expose himself to some added peril and has accident.

Doctrine of Notional Extension:

There is no problem in detecting that the accident occurred in the course of employment when a workman is injured in the working place and in the working hour and doing his duty. The problem arises when these elements do not coincide together. But a workmen if injured just near the work premises or just before joining the work or in the way to work problem arises. To address this kind of problem and giving some kind of relief to the workmen the theory of notional extension evolved. [30] 

“As a rule, the employment of a workman does not commence until he has reached the place of employment and does not continue when he has left the place of employment, the journey to and from the place of employment being excluded. It is now well-settled, however, that this is subject to the theory of notional extension of the employer's premises so as to include an area which the workman passes and repasses in going to and in leaving the actual place of work. There may be some reasonable extension in both time and place and a workman may be regarded as in the course of his employment even though he had not reached or had left his employer's premises. The facts and circumstances of each case will have to be examined very carefully in order to determine whether the accident arose out of and in the course of the employment of a workman, keeping in view at all times this theory of notional extension." [31] 

Wider interpretation of duty

Court has given a wider and popular meaning of “duty" to expand the scope of this section. The court also talks about the service contract to determine which can be come under the preview of this section. Justice Cozens-Hardy M. R. said "......... it was an implied term of the contract of service that these trains should be provided by the employers, and that the colliers should have the right, if not the obligation, to travel to and from without charge." In the next case the court has interpreted the term “duty" in stricter sense. [32] 

In Weaver v. Tredegar Iron Coal Co. [33] House of Lords after examining a large number of authorities given a wider meaning of “duty" but did not negated the duty test. [34] In this case lord Atkin said that there can be no doubt that the course of employment cannot be limited to the time or place of the specific work which the workman is employed to do. It does not necessarily end when the "'down tools" signal is given, or when the actual workshop where he is working is left. In other words, the employment may run on its course by its own momentum beyond the actual stopping place. There may be some reasonable extension in both time and space." [35] Lord Porter further said that if an accident occurs while coming to the workplace or leaving the place can be out of and in the course of employment if he is bound by the way he proceed under the terms of the contract of service express or implied. [36] Here duty test was confirmed.

Expanding the preview of Service Contract:

In St. Helens Colliery Co Ltd v. Hewlston [37] the court said that the injury did not occur in the course of employment because the employee was not bound or obliged to travel by that special train and he could have taken other transport. If he were bound by the service contract to travel by that train then it would have been in the course of employment (Lord Buckmaster). It was also added that if the place of work is like that there is no alternative means of transport other than the transport given by the employer then it can be concluded that there is an implied term in the service contract to use that transport (Lord Atkinson). [38] The same view was taken in Mackenzie v. I.M. Issak [39] which says that a workman in a colliery is not in course of his employment while using the transport of the employer if he is not bound by the terms of the contract to travel by that transport. [40] 

There was a particular situation where employee has to take bus service to reach his workplace from home and vise versa. It was necessary for doing his duty efficiently and punctually which was a condition under his service [41] . So, travelling in that bus was an implied condition to his duty. It was also said that this doctrine was developed to cover the factory, workshops and harbors but it can be applied in this kind of situation also. [42] Compensation was granted holding that the accident arising in the course of employment. Though the court said what would be the indicator that when the work starts and ceases that depends on case to case basis. [43] 

In Union of India v. Mrs . Noor Jahan [44] a railway gangman was ordered by his employer to go to another place for cleaning and in the way from one place to another accident happened. Justice Sukla observed that the accident has occurred in the duty hour and when he was going to do his duty on behalf of his employer and he concluded that the accident has occurred in the course of his employment.

Public Place and this Doctrine

There are some situations where this doctrine does not apply. When a workman is on the public road or public place and not there for fulfilling the obligation and his work does not make necessary to be there. The proximity of the work premises and spot of accident become immaterial. The notional extension of the place of work cease when workman come to a public road. [45] There were some clarification made in the next case in this matter.

In Saurashtra Salt Manufacturing Co. v. Valu Raja [46] Justice Jafer Imam said that,

“It is well settled that when a workman is on a public road or a public place or on a public transport he is there as any other member of the public and is not there in the course of his employment unless the very nature of his employment makes it necessary for him to be there. A workman is not in the course of his employment from the moment he leaves his home and is on his way to his work. He certainly is in the course of his employment if he reaches the place of work or a point or an area which comes within the theory of notional extension, outside of which the employer is not liable to pay compensation for any accident happening to him."

Expanding for Social Cause:

In later cases the court took more liberate stand in expanding the definition of notional extension realizing the social view point and objective of the act. The employee died on the way towards his workplace because of communal riot. [47] It was argued by the appellant that the person died before the commencement of his work and outside the work place. [48] There is no connection between the accident and the employment. [49] High court of Madras has negated all this argument and allowed the compensation.

In Superintending Engineer, T.N.S.E.B v. Sankupathy (T. M. T.) [50] an Ardhanari was died when he was coming to his work under appellant. Court said that “Since the Act is a welfare legislation, it is expected that the provisions would receive liberal interpretation so as to advance the object and purpose of the Act." [51] The court also observe that “in the course of employment" talks about the point of time and place of accident and “out of employment" talks about a casual connection between the accident and the employment and which according to the court is very narrow interpretation giving the modern industrial set up. So doctrine of notional extension should be used and even if the workman did not reach the place of work the workmen should get compensation for accident. [52] 


The term “arising out of" has been subjected to judicial interpretation from the very beginning and in most of the times it has been seen that court has tried to give wide meaning to it. This phrase has been most of the time coupled with the “arising out of employment" . Even thought the meaning of these two phrases are different then also there is an inseperable connection between them. Previously it was thought that arising “in the course" is a big circle and “ out of" is a small circle within it. But the new notion is that this two phrases are different circle which intersect somewhere. [53] This two criteria need to fulfill to get compensation. These two phrases are conjunctive under this act. [54] If these terms have been disjunctive a large area could have been covered and more number of workers could have been benefited and fulfill more efficiently the objective of the act as it would have been sufficient to prove only one condition.

Even thought the judiciary has come up with the concept of notional extension which essentially wider the scope of the terms and cover the areas which is not conventionally considered under this terms. This doctrine appeared to be very helpful for workmen to get facility given under this act.