Section 94: Power of officers to impose penalty

The Occupational Safety, Health and Working Conditions Code, 2020 (Act No. 37 of 2020) • Official Statutory Text & Plain English Practice Guide

Statutory Mandate
Chapter XI: Offences and Penalties
Competent Labour Forum
Act No. 37 of 2020

Legal Commentary & Landmark Judgments: Section 94

Section 94 of the Code empowers designated administrative officers to impose financial penalties for specified non-compliances through an administrative adjudication framework, decoupling minor penalties from criminal judicial proceedings.

  • In-House Administrative Adjudication Machinery: Authorizes an officer not below the rank of Under Secretary to the Government to conduct inquiries and impose monetary penalties for designated contraventions.
  • Adherence to Principles of Natural Justice: Requires the adjudicating officer to issue a formal show-cause notice and provide a reasonable opportunity of hearing before imposing any financial penalty.
  • Objective Assessment Criteria: Directs the adjudicating officer to evaluate the size of the establishment, repetitive nature of default, and economic benefit derived while determining the penalty quantum.
Key Landmark Precedents:
  • SEBI v. Shriram Mutual Fund (2006) 5 SCC 361: Supreme Court affirmed that administrative civil penalties are strictly non-penal; once a statutory breach is established, penalty follows as a matter of course without requiring mens rea.
  • Union of India v. CERC (2010) 4 SCC 603: Affirmed that administrative adjudicators must act quasi-judicially, giving reasoned orders supported by tangible evidence.
  • Consumer Education & Research Centre v. Union of India (1995) 3 SCC 42: Affirmed that administrative fines must be proportionate and channelled toward systemic worker health improvement.
Courtroom Practice & Strategic Litigation Guidance:

During administrative penalty hearings, submit detailed financial audits showing zero economic gain from the alleged default, along with proof of prompt voluntary rectification, to argue for minimal penalty imposition under Section 94.