Criminal Liability Of Developers And Landowners In Case Of Death Of Worker At Construction Site

Expertise In All Aspects Of Real estate

Generally developers and landowners are persons of civil accords, a criminal liability is thus a far sighted fear of developers and landowners, however in cases when there has been a death of worker at their construction site, the supreme court and courts across India have take a stringent approach and has even imprisoned the developers for such mis happenings, in this small article, I will analysize the criminal liabilities of various stakeholders involved , preventions in accordance to law and various case laws which will give insights about the views taken by the apex court. Furthermore, I will also examine the important case of Ansal's Uphaar Cinema Tragedy, for which the promoters of the company were penalized with a rigorous imprisonment of 7 years along with a heft fine. We will also determine various checks which can be done by promoters in accordance with the Buildings and other Construction Workers ( Regulation of Employment and Conditions of Service ) Act, 1996 to prevent unwanted litigation and related costs.

Analysis of BOCW Act.

The BOCW Act is a social welfare legislation that aims to benefit workers engaged in building and construction activities across the country. The preamble of the BOCW Act explicates the said purpose:

"An act to regulate the employment and conditions of service of building and other construction workers and to provide for their safety, health and welfare measures and for other matters connected therewith or incidental thereto."

The ambit of the BOCW Act is wide, particularly in a country where the infrastructure and construction sectors have seen significant growth. The object of the BOCW Act as well as its framework is analogous to other labor law legislations, but in particular, the BOCW Act is similar to the Factories Act, 1948.

Section 2(9)(i) defines “employers” and includes the Chief Executive officer of any private establishments and contractor in case the work is carried on by or through him. Thus, the BOCW act gives a wide ambit to the term "employer"

Furthermore, Section 7 of the act lays down the procedure for the registration of establishments, it mandates every employer's registration of his establishments with the registering officers, upon inspection the registering officer shall register the establishment and issue a certificate of registration to the employer thereof in the form prescribed under the act. If any change in ownership occurs subsequently the employer has to inform the registering officers regarding the same.

Section 39 states the law relating to accidents at the construction site and the course of action which the employer has to follow-

Where in any establishment an accident occurs which causes death or which causes any bodily injury by reason of which the person injured is prevented from working for a period of forty-eight hours or more immediately following the accident, or which is of such a nature as may be prescribed, the employer shall give notice thereof to such authority, in such form and within such time as may be prescribed.

(2) On receipt of a notice under subsection (1) the authority referred to in that sub-section may make such investigation or inquiry as it considers necessary.

(3) Where a notice given under sub-section (1) relates to an accident causing death of five or more persons, the authority shall make an inquiry into such accident within one month of the receipt of the notice.

Chapter 9 of the Act lays down certain special provisions, Section 44 determines the responsibility of employers,

An employer shall be responsible for providing constant and adequate supervision of any building or other construction work in his establishment as to ensure compliance with the provisions of this Act relating to safety and for taking all practical steps necessary to prevent accidents. Subsection 2 of the same section mandates the employer ( developer) to make the payment of compensation in respect of a building worker employed by him, in case the contractor after exercising all means fails to pay in the case of death or disablement of the building worker, the employer shall be liable to make payment of that compensation in full or the unpaid balance due in accordance with the provisions of the Workmen's Compensation Act, 1923 (8 of 1923), and recover the amount so paid from the contractor either by deduction from any amount payable to the contractor under any contract or as a debt payable by the contractor."

Section 46 of the act states employers to give notice at least 30 days before the commencement of any building or other construction work, to the Inspector having jurisdiction in the area where the proposed building work is to be executed. Chapter 10 is the most important chapter from the builder's perspective, Section 47 of the Act states the penalty for contravention of safety provisions, it penalizes persons with imprisonment for a term which may extend to three months, or with a fine, Failure to give notice of commencement of the building or other construction work is punishable with imprisonment upto three months, or with fine upto two thousand rupees, or with both.

LIABILITY OF DEVELOPERS IN CASE A BUILDING COLLAPSE

Buildings can collapse sometimes due to unforeseeable situations which are inevitable, however, cases regularly come of such nature in which developers and other stakeholders such as contractors etc are made liable, the situation cannot be determined objectively, all vary from case to case.

Recently, in February 2022, a portion of the sixth floor of a building in Gurugram Chintels Paradiso collapsed and lead to the death of two people along with several homes damaged, the police have registered FIRs against the chairman of Chintels, Ashok Solomon, The first FIR (against the chairman) has been registered under Section 304A of the Indian Penal Code, which deals with death by negligence.

The other FIR was made against the builder, this FIR focuses on claims of fraud against the builder, registered under the IPC offenses against Section 420 ( dishonestly inducing delivery of property), 468 ( forgery for the purpose of cheating) and 120B ( Criminal conspiracy).

CONTRACTUAL LIABILITY

A typical construction contract always has a defect liability clause, this has been codified under Section 14(3) of the Real Estate ( Regulation and Development) Act, 2016, it states that In case any structural defect, or any other defect in workmanship, quality or provision of services or any other obligations of the promoter as per the agreement for sale relating to such development is brought to the notice of the promoter within a period of five years by the allottee from the date of handing over possession, it shall be the duty of the promoter to rectify such defects without further charge, within thirty days, and in the event of promoter's failure to rectify such defects within such time, the aggrieved allottees shall be entitled to receive appropriate compensation in the manner as provided under this Act.

The RERA authority also has the power to revoke the registration of a promoter if the Authority finds that the promoter has defaulted in doing anything provided under the Act, the developer in this case can face liability for breach of contract.

TORTIOUS LIABILITY

If the reason for the building collapse emerges as negligence on the part of the developer (for instance if they used substandard materials) then they will be liable for compensation. Likewise, if the blame lies with the municipal corporation (for example if they failed to carry out regular tests) it will be them who may be asked to pay compensation.

CRIMINAL LIABILITY

In certain cases however when there exists prima facie negligence on the part of developers, for eg not getting approvals, licenses etc and when such negligent act becomes a proximate cause for the death of people because of building collapse, the developer can be booked under Section 304B.

In Uphaar Cinema Tragedy, the two promoters, Sushil and Gopal Ansal were booked under Section 304b and are penalized with rigorous imprisonment of 7 years, however, the facts involved other angles as well as tampering with evidence and delaying justice, after all this also people from the legal fraternity has criticized the judgment as being too harsh.

The Supreme Court in the Ansal Judgement also reiterated that for booking developers under section 304B a very proximate cause has to be shown between the rash and negligent act and the subsequent death. In the case of Ansal, the promoters were also found guilty for tampering of evidence and thus were sentenced to such harsh punishment.

CONCLUSION

It can be concluded from the abovementioned discussion that, developers are at an unforeseeable risk with regard to the death of workers at their projects, they can be made vicariously liable under the prevailing law and in certain circumstances even be tried under Criminal Law, therefore, in order to mitigate the risks, it becomes vital for developers to abide by the due process law and diligently undertake all the necessary steps for legal protection.