The minimum amount of compensation payable under Employees Compensation Act, 1923 in case of total permanent disablement of a railway servant due to accident is Rs ___.

All India Bar Examination (AIBE) 16-XVI Previous Year Question Papers with Answers

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43.

The minimum amount of compensation payable under Employees Compensation Act, 1923 in case of total permanent disablement of a railway servant due to accident is Rs ___.

A: Rs. 80,000/-

B: Rs. 90,000/-

C: Rs. 1,40,000/-

D: Rs. 1,20,000/-

The answer is: C

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Explanation

The correct option is C: Rs. 1,40,000/-.

According to the Employees Compensation Act, 1923, the amount of compensation payable in case of permanent total disablement is a lump sum equal to 60% of the monthly wages of the injured employee multiplied by the relevant factor, or Rs. 1,40,000/-, whichever is more. The relevant factor is a factor corresponding to the age of the employee on his last birthday as specified in Schedule IV of the Act. For a railway servant, the monthly wages are calculated as the average of the wages earned by him during the previous twelve months. Therefore, the minimum amount of compensation payable under the Act in case of permanent total disablement of a railway servant due to accident is Rs. 1,40,000/-, unless his monthly wages multiplied by the relevant factor exceed this amount.