Santoshi Nirmalkar vs Rup Singh

Pritinker Diwaker, J.

Heard on I.A. No. 1, application for condonation of delay in filing the appeal as the same has been preferred with a delay of 203 days. For the reasons mentioned in the above application, I am of the opinion that the appellants have been able to explain the delay in filing the appeal satisfactorily. Accordingly, the application (I.A. No. 1) is allowed and delay in filing the appeal is hereby condoned.

Heard on admission.

The appeal is admitted for hearing on the following substantial question of law:

Whether the Commissioner for Workmen''s Compensation has erred in law in not awarding interest on the amount of compensation @ 12% per annum as provided u/s 4A of the Workmen Compensation Act, 1923 (in short "the Act, 1923")?

With the consent of the parties, the matter is heard finally.

This appeal arises out of the award dated 7.5.2012 passed by the Commissioner for Workmen''s Compensation-cum-Labour Court, Drug (CG) (for brevity hereinafter referred to as "the Commissioner") in Case No. 137/WC Act/2007/Fatal.

Brief facts of the case are that on 1.6.2007 deceased Suresh Nirmalkar while travelling in a truck as labour fell down from the said truck as all of a sudden driver of the truck increased the speed of the truck. As a result, Suresh Nirmalkar sustained grievous injuries on his head, he was hospitalized but was declared dead.

In a claim case filed by the claimants, who are widow and minor son of the deceased respectively, before the Commissioner, vide impugned award dated 7.5.2012, the Commissioner has awarded a sum of Rs. 2,81,983/- to the claimants as compensation. However, the order regarding grant of interest thereon is not clear. It is this order which has been challenged by the appellants/claimants before this Court in the present appeal.

Learned counsel for the appellants submits that there is apparent ambiguity in the award passed by the Commissioner as the same does not clarify as to from which date the claimants would be entitled to get interest on the award amount. He further submits that the Commissioner has erred in law in awarding interest @ 9% p.a. on the awarded sum and in fact, as per provisions of Section 4A of the Act, 1923, interest @ 12% p.a. should have been awarded from the date when it fell due i.e. the date of accident.

He further submits that though in the memo of appeal, he has raised certain other points, but he is confining his prayer only to the point of interest on the awarded sum and not pressing the other grounds urged in the memo of appeal.

On the other hand, supporting the award impugned it has been argued by learned counsel for respondents No. 1 & 2 that the award passed by the Commissioner is strictly in accordance with law and calls for no interference.

Learned counsel for respondent No. 3/insurance company submits that the compensation including the interest awarded by the Commissioner being just and proper needs no interference by this Court and the same is strictly in accordance with law.

Heard learned counsel for the parties and perused the material on record.

The operative portion i.e. para-11 of the impugned award reads as under:

From the above finding as recorded by the Commissioner, it is not clear as to from which date the claimants would be entitled to get interest on the awarded amount if the same has not deposited by the insurance company within 30 days. Further, the Commissioner has awarded only 9% interest and that too, by not clarifying as to from which date and when the claimants would be entitled to receive the interest on the amount of compensation.

Section 4A of the Act, 1923 reads as under:

4A. Compensation to be paid when due and penalty for default--

Compensation u/s 4 shall be paid as soon as it falls due.

In cases where the employer does not accept the liability for compensation to the extent claimed, he shall be bound to make provisional payment based on the extent of liability which he accepts, and, such payment shall be deposited with the Commissioner or made to the workman, as the case may be, without prejudice to the right of the workman to make any further claim.

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 par 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--For the purposes of this sub-section, "scheduled bank" means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934).

3A. The interest and the penalty payable under sub-section (3) shall be paid to the workman or his dependant, as the case may be.]]

A bare look of the above provision makes it clear that the claimants would be entitled for 12% interest on the awarded amount from the date it fell due.

So far as the point as to from which date the claimants would be entitled to get interest @ 12% p.a. is concerned, law in this respect has been expounded by the Apex Court in the matters of The Oriental Insurance Company Ltd. Vs. Siby George and Others, ; Saberabibi Yakubbhai Shaikh and Others Vs. National Insurance Co. Ltd. and Others, , and by this Court in the matters of Smt. P. Narayanamma Vs. General Manager, South Eastern Central Railway, . Thus, keeping in view the principles of law laid down in the aforesaid judgments, the claimants are entitled for interest @ 12% per annum on the awarded sum from the date of accident i.e. 1.6.2007.

Considering the facts and circumstances of the case, the impugned award passed by the Commissioner is modified to the extent that the appellants/claimants would be entitled to get interest @ 12% per annum on the awarded amount from the date of accident i.e. 1.6.2007. The Commissioner is directed to calculate the interest in the light of aforesaid observations made by this Court and pass a separate order in this regard. The additional amount of interest so computed shall be deposited within a period of three months from today. In the result, the appeal is allowed in part to the extent indicated above. No order as to costs.