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Ex gratia

The State, especially in the wake of Coronavirus stands on the position of a loco parentis(guardian) to the citizens and it is an obligation on the part of the State to express sensitiveness, to do the needful and disallow the impecunious persons to resign to their fate or abandon the downtrodden paupers to yield to the idea of fatalism.

MS. SHREEVIDYA SUDEEP NARGOLKAR, 21 August, 2020 09:05 PM IST

आतुरे व्यसने प्राप्ते दुर्भिक्षे शत्रु-सङ्कटे। राजद्वारे श्मशाने च यस्तिष्ठति स बान्धवः।।

(A true guardian is who stands by, in the period of grave illness, in times of misfortune, during famines or invasions by enemy, in royal court and in death. He will stick through the thick and thin.~1:12 – Chanakya Neeti)

Every person has the right to live, and not merely survive, as contemplated under Article 21 of the Constitution. The economic stability of million families was shattered not only due to unemployment during the lockdown, but also due to the deaths of the sole bread earning persons due to COVID-19. The State, as the guardian, has being tryingto solve these problems by adopting several measures under the National Disaster Management Act of 2005 and Epidemic Diseases Act of 1897.

In March, 2020, the Union of India through its Ministry of Home Affairs (hereinafter referred as ‘MHA’)announced the grant of an Ex-Gratia amount to kins of deceased who suffered death from contracting the novel Coronavirus and thereafter withdrew its promise regarding the grant.  Generally, an Ex-Gratia payment is interpreted to be a voluntary/discretionary act. The Latin term, ‘Ex-Gratia’ literally translates to ‘from favour.’ The dilemma that is then juxtaposed is whether such amount can be claimed as a matter of right or is it on the discretion of the Government to grant/deny such amount?Furthermore, what can be deemed as sufficient/reasonable compensation is another question which ought to be answered in the light of the same. 

For ease of understanding the inaction of MHA shall be referred to in brief.  The Government of India through MHA declared and notified[1] the novel Coronavirus as a ‘National Disaster’, which consequently enabled utilisation of the aid under the State Disaster Response Fund (‘SDRF’). The said notification by Disaster Management Division of MHA set out a list of norms and also promised an amount of Rupees Four Lacs to be paid by the Central Government to kins of the deceased who died due to COVID-19. Within few hours of the announcement the Government withdrew its decision to grant the Ex-Gratia amount and a revised list of norms of assistance from State Disaster Response Fund was issued vide an  ‘Annexure to MHA letter[2]’ (hereinafter referred to as ‘Revised Circular’). Few authorities officially wrote to the Hon’ble Prime Minister[3],  expressing that the Ex-Gratia amount of Rupees Four Lacs was desirable and the government under the garb of ‘partial modification’ had in effect withdrawn the grant of Ex-Gratia amount. Further Orders were thereafter passed by the MHA[4] and National Disaster Management Authority-Policy-and-Plan-Division[5], none of which made a reference to the clarifications sought by the states regarding the grant of Ex-Gratia amount by the Central Government. Consequent to the inaction on part of the Central Government, several state governments have announced the grant of Ex-Gratia amount to the kins of deceased persons dying due to Covid-19. A gamut of concerns is perceived as to whether and when can Indian citizens demand Ex-Gratia compensation as a matter of right?

Also Read: A GLOBAL STORM IN RENTAL RELATIONS

Sanjica & Punya Mehrotra

EX-GRATIA: A COMPENSATION OR DISCRETION?

In a plethora of cases, the Hon’ble Supreme Court has asserted the right to live does not infer merely survival but also includes the right to live a meaningful, safe, secured and dignified life. Indian Jurisprudence suggests that the legal system has expanded the scope of Article 21 as the right to livelihood now stands as an integral part of Article 21. The State, assuming the role of parens patriae, imposes a duty upon itself to protect this right. Failure to do so attracts a liability which can be compensated by means of granting Ex-Gratia compensation to the family of the deceased. The Supreme Court has held[6] that the Preamble of the Constitution read with Directive Principles in Articles 38, 39 and 39-A enjoins the State to take up this responsibility. It is the protective measure to which the social welfare State is committed.

It is imperative to advert to Part XII- Chapter I of the Constitution making provisions regarding ‘Finance’. Article 266 provisions for the Consolidated Fund of India whereas Article 267 provides for Contingency Fund. Article 282 of the Constitution states that the Union/state may make grants for any public purpose, notwithstanding that the purpose is not one with respect to which Parliament or the State Legislature, as the case may be, may make laws. Hence, it is clear that in the absence/revision of any policy framed under Article 282, one cannot claim the same quantum of compensation which he could have availed of during the existence of such policy. A person however may claim compensation computed on a subjective basis. The question of whether a reasonable compensation can be claimed by citizens as a matter of right thus, gains vital importance. For answering the same, the Principle of Public Law Remedy needs to be perused.

PRINCIPLE OF PUBLIC LAW REMEDY:

The Hon’ble Apex Court has opined[7] that an obligation is cast on the State to preserve the right to live a safe and protected life.  The failure of this duty of the State amounts to an infringement of Article 21 especially if it leads to the death of a citizen or permanently incapacitates him/her. It is worth appreciating that public law proceedings serve a different purpose than private law proceedings.  Award of compensation for established   infringement   of   the indefeasible   rights  is a remedy available   in   public law   since   the   purpose of   public   law   is   not   only   to   civilise public   power   but   also   to   assure   the citizens   that   they   live   under   a legal system   wherein   their   rights   and   interests     shall      be protected and preserved.   The   first judgment on this aspect is Neelabati Behera v/s. State[8] which was upheld in the case of D.K. Basu v/s. State of West Bengal[9]. Appreciating the law thus propounded, it is apparent that a public law remedy for seeking compensation is always available if Article 21 is infringed. A remedy by grant of compensation can be sought by filing a petition under Articles 32 or 226 of the Constitution. This is an exercise of the Courts under the public law jurisdiction for fixing the liability for the public wrong arising out of the State’s failure to discharge its public duty. The underlying principle being ‘Ubi Jus Ibi Remedium.’ 

The compensation is hence, to be granted a matter of right, the quantum of which may be computed at the discretion of the State. Now it becomes pertinent to ascertain the reasonableness of the amount computed to be paid as compensation. 

COMPENSATION: WHETHER PALTRY OR PLENTIFUL?

Before dwelling into the nitty-gritty of compensation laws it is to be clarified that the object sought by compensating the kin of deceased persons is to balm the wounds by effectively and adequately compensating. Currently in India, the Workmen’s Compensation Act of 1906, Motor Vehicles Act of 1988 and Minimum Wages Act of 1948 are the codified laws pertaining to compensation.

According to the revised Minimum Wages, the minimum wages that are payable to a person in India are Rs.12,400/month for unskilled work and Rs.14,725/month for skilled work. Applying the algorithm provided vide the judgment in case of Sarla Verma (Smt.)[10], and assuming the income to be Rs.5000 per month (which is a highly conservative amount) the compensation payable amounts to Rs.5 lakhs. In this regard we may conclude that the amount promised by the central government on 14.03.2020 was paltry, unreasonable, and insufficient. The object sought to be achieved by such compensation would have also failed. 

CONCLUDING REMARKS:

In conclusion, it can be said that it is the duty of the State to protect the lives of its citizens and an obligation is cast if it fails to do so. A person can claim compensation as a matter of right. The quantum of compensation, however, is to be computed on the discretion of the Government. A remedy vests with the individual to claim the compensation as aforementioned and if he/she perceives the compensation to be insufficient/irrationally computed, may challenge the vires of the policy on grounds of it being arbitrary, irrational, issued without application of mind, etc. However, it is well known that the scope of judicial review as regards policy decisions is very narrow. Nevertheless, all rights of the persons have thus, been protected under the prevailing laws and the Sovereign continues to protect its citizens by being their first guardian.


[1]Vide Office Letter No. 33-4/2020-NDM-I dtd. 14.03.2020

[2]No. 33-4/2020-NDM-I dtd. 14.03.2020.

[3]Office Letter bearing number D.O. No. 378/2020/CM Dated 14.03.2020

[4]Order bearing No. 40-3/2020-DM-I(A) dated 24th  March, 2020

[5]Order bearing No. 1-29/2020-PP (Pt. II) dtd. 24th March, 2020

[6]Bipinchandra J. Diwan v. State of Gujarat, AIR 2002 Guj 99

[7]Pt. Parmanand Katara vs. Union of India and others

[8]1993 AIR 1960

[9](1997 ) 1 SCC  416.

[10]Sarla Verma (Smt.) &Ors. v/s Delhi Transport Corporation and Anr.AIR2009SC3104

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