Oriental Insurance Company vs Siyabai and Others

Subhash Kakade, J.—This appeal u/s 13 of the Workmen''s Compensation Act, 1923, in short" W.C. Act" has been filed on behalf of the appellant/Insurer against the order dated 5.1.2010 passed by learned Court of Commissioner for Workmen Compensation/Labour Court, Jabalpur under W.C. Act in case No. 90/Fatal Act/2004. In brief, the case of the respondent Nos. 1 & 2, parents of the workman Mahendra Singh is that he was employed as a Driver on Truck No. CG-04 ZC-5371 by the employer/respondent No. 3 owner of the said Truck and was insured by the appellant Insurance Company vide policy Ex. P/9 for the period from 28.1.2003 to 27.1.2004 and both were arrayed as respondent Nos. 1 and 2 before the learned Commissioner. Mahendra Singh was getting a sum of Rs. 4,000/- per month as salary from his employer. At the time of incident this age was 22 years. It is further pleaded that on 23.4.2003, the said Truck loaded with the goods and was proceeding from Nagpur towards Amrawati collided with another vehicle No. KA-01 A-6171 in the jurisdiction of police Station Mana, District Akola (Maharashtra) at about 6:30 AM. In this incident, Mahendra Singh sustained grave injuries and ultimately succumbed to the injuries. A criminal case was registered and after completion of due investigation, challan was filed in the competent Court with all relevant documents i.e. F.I.R., medical report, spot map, driving licence, policy documents etc. The parents of the deceased workman Mahendra Singh preferred an application u/s 22 of the W.C. Act claiming Rs. 5.00 lacs towards compensation.

Despite service of notices, the employer neither contesting the case, nor attended proceedings before learned Commissioner, therefore, learned Commissioner proceeded ex-parte against the employer.

The written statement filed on behalf of the appellant is of total denial of the pleadings of the application filed by respondent Nos. 1 & 2. It is pleaded that Mahendra Singh was not employed with the employer and since no such accident took place on 23.4.2003 of the said Truck, neither Mahendra Singh sustained any injury while driving the said Truck during course of employment, the Insurance Company is not liable for payment of any compensation amount.

Learned Commissioner after taking into consideration all the pleadings of the parties framed necessary issues and after recording evidence of respondents as well as documentary evidence filed by both the parties passed the impugned award, against which this appeal.

Shri S.K. Rao, Senior Advocate for the appellant submitted that learned Commissioner has completely failed to see that the Insurance Company is not employer within the meaning of W.C. Act, hence, the simple interest @ 12% per annum cannot be awarded against the Insurer Company from the date of accident, it will start on completion of one month from the date of award, therefore, awarding interest from the date of accident is totally illegal, bad and deserves to be set aside. In support of his arguments learned Senior Counsel has placed heavy reliance on the two decisions of the Apex Court (i) National Insurance Co. Ltd. Vs. Mubasir Ahmed and Another, , and (ii) Kamla Chaturvedi Vs. National Insurance Co. and Others, .

Shri Narendra Chouhan, learned Counsel for the respondent Nos. 1 & 2 has vehemently opposed the arguments advanced by learned Counsel for the appellant contending that learned Commissioner has rightly directed the appellant to pay the amount of compensation with simple interest @ 12% per annum from the date of accident, therefore, the appeal is liable to be dismissed. Learned Counsel also raised preliminary objection that this appeal has been filed by the Insurer without depositing the amount of interest, therefore, appeal is not maintainable under the clear provisions of section 30 of W.C. Act. In support of his arguments learned Counsel for the respondents No. 1 & 2 has placed reliance on the decision of Full Bench of this Court in the case of New India Assurance Co. Ltd. Vs. Smt. Savita Sen and Others, , and also Single Bench decision in case of Tulsiram Vs. Daryaobai, .

Considered the rival submissions made by learned Counsel for the parties and after perusal of oral as well as documentary evidence filed by the parties and after going through the impugned award, this appeal deserves to be dismissed.

Substantial question of law for determination of this appeal:--

Whether, under the provisions of the W.C. Act the Commissioner has committed an apparent error of law in awarding the simple interest @ 12% per annum against the insurance company from the date of accident?

If yes, then what will be the relevant period of time, for which, the interest would be payable?

But firstly, I will decide the preliminary objection:

Whether, this appeal is barred under the IIIrd proviso to section 30 of W.C. Act?

Learned Commissioner in para 18 of the award dated 5.1.2010 clearly directed that:--

Learned Commissioner applying the provisions of section 4(1)(a) of the W.C. Act and taking into consideration 50% of the wages i.e. Rs. 2000/- per month and on applying the age factor of 209.22 for age of Mahendra Singh 29 years awarded compensation amount of Rs. 4,19,840/- with the directions that the Insurance Company to deposit the said amount with simple interest @ 12% per annum from the date of accident and deposit the amount within a period of 30 days from the date of award. By the order of learned Commissioner, it is crystal clear that amount of compensation Rs. 4,19,840/- shall carry interest at the rate of 12% per annum from the date of accident.

Section 30 of the W.C. Act reads as under:--

Appeals.--(1) An appeal shall lie to the High Court from the following orders of a Commissioner, namely:--

(a) xxxxx;

(aa) an order awarding interest or penalty u/s 4A;

(b) xxxxx;

(c) xxxxx;

(d) xxxxx; or

(e) xxxxx;

Provided that no appeal shall lie against any: order unless a substantial question of law is involved in the appeal, and in the case of an order other than an order such as is referred to in Clause (b), unless the amount in dispute in the appeal is not less than three hundred rupees:

Provided further that no appeal shall lie in any case in which the parties have agreed to abide by the decision of the Commissioner, or in which the order of the Commissioner gives effect to an agreement come to by the parties:

Provided further that no appeal by an employer under Clause (a) shall lie unless the memorandum of appeal is accompanied by a certificate by the Commissioner to the effect that the appellant has deposited with him the amount payable under the order appealed against.

(2) xxxxx.

(3) xxxxx.

Section 4A of the W.C. Act reads as under:--

Compensation to be paid when due and penalty for default.--(1) Compensation u/s 4 shall be paid as soon as it falls due.

(2) xxxxxxxx

(3) Where any employer is in default in paying the compensation due under this Act within one month from the date it fell due, the Commissioner shall--

(a) direct that the employer shall, in addition to the amount of the arrears, pay simple interest thereon at the rate of twelve per cent per annum or at such higher rate not exceeding the maximum of the lending rates of any scheduled bank as may be specified by the Central Government by notification in the Official Gazette, on the amount due; and

(b) if, in his opinion, there is no justification for the delay, direct that the employer shall, in addition to the amount of the arrears and interest thereon, pay a further sum not exceeding fifty per cent, of such amount by way of penalty:

Provided that an order for the payment of penalty shall not be passed under Clause (b) without giving a reasonable opportunity to the employer to show cause why it should not be passed.

Explanation,--xxxxxxxx,

**[(3A) xxxxxxxxxx

On bare perusal of section 30 of the W.C. Act coupled with the wordings of the third proviso "amount payable under the order appealed against" would also include the interest awarded upon the lump sum, indeed the interest is also a part of award and it is also to be payable to the workman and therefore if an appeal is to be filed against the award of the Commissioner, the same is to be filed after depositing not only the against principal amount but also the interest.

This appeal has been filed by the Insurer on 23.2.2010 an amount of compensation Rs. 4,19,840/- was deposited prior to it on 15.2.2010 as it appears from the photocopy of the receipt. However, there is no evidence on record which satisfied that the amount of interest has also been deposited by the appellant Since the amount of interest has not been deposited, looking to the bar envisaged in third proviso to section 30 of the W.C. Act, this appeal is not maintainable. In this regard, the decision of Full Bench of this Court in the case of Savita Sen (supra) and also Single Bench decision in case of Tulsiram (supra), on which learned Counsel for the respondents No. 1 and 2 has placed reliance, are squarely applicable.

On the other hand, it cannot be presumed that this Clause is only applicable to employer and not the Insurer. Indeed, because the offending vehicle was insured with the Insurer, whatever the liability was fastened upon the employer was also fastened upon the Insurer. The Insurer has been found liable to pay compensation. In these state of affairs, this appeal is not maintainable and is to be dismissed on account of its maintainability.

So far as the merit of the case is concerned, certified copies were filed by respondents No. 1 & 2 in support of their claim duty obtaining from the Court of Judicial Magistrate First Class, Murtizapur, District Akola, Maharashtra. From the perusal of these documents; Final Report Ex. P/1, First Information Report Ex. P/2, post-mortem Report Ex. P/3 of Mahendra Singh, inquest memo Ex. P/4, Spot Map Ex. P/5, Document Ex. P/6 related with the treatment given to injured Mahendra Singh, his valid driving licence Ex. P/7, Fitness Certificate of the Truck Ex. P/8, Policy Document Ex. P/9, Permit Ex. P/10 and Motor Vehicle Apghat Form Ex. P/11, it is proved beyond doubt that the accident took place on 23.4.2003, when two trucks were collided and in that accident Mahendra Singh got injuries and ultimately succumbed to the injuries. From the above record, age 29 years of Mahendra Singh is also proved. This fact is not rebutted by any reliable evidence that Mahendra Singh was not getting salary of Rs. 4,000/- per month from his employer.

In the present case since learned Commissioner has marshalled and considered the evidence of the parties vis-a-vis to each other and on the basis of evidence came on record has given a categorical finding that Mahendra Singh sustained injuries and succumbed to the injuries which were caused due to the accident happened on 23.4.2003.

Therefore, I do not find any substance in the pleadings of the Insurer that Mahendra Singh was not employed by the employer, nor the accident took place on 23.4.2003, Mahendra Singh sustained injuries while driving the said Truck during the course of employment, therefore. Insurance Company is not liable for payment of compensation amount. Resultantly, this appeal fails on its maintainability as well as on merits and the same is hereby dismissed. No order as to costs.