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2010 DIGILAW 1199 (AP)

Shaik Murthuza v. Nadella Kutumba Rao

2010-11-29

SAMUDRALA GOVINDARAJULU

body2010
Judgment 1. The Claimants who are parents of the deceased filed this appeal aggrieved by order dated 27.11.2006 in W.C.M.P.No.12 of 2005 in W.C. No.18 of 2002 passed by the Commissioner for Workmen’s Compensation-cum-Assistant Commissioner of labour, Vijayawada, by which compensation of Rs.3,35,600/- was awarded to the claimants against owner of the accident vehicle who is the insured and not against the insurer who is the 2nd respondent herein. The appellant’s counsel contended that the Commissioner should have awarded compensation as against the insurer also and that the Commissioner should have awarded interest from the date of accident or at least from the date of making the claim before the Commissioner. 2. One G.Balayya was driving the accident vehicle viz., tipper bearing No.AP 16 U 9176 at the time of accident. The question whether the accident vehicle was having any national permit or not assumes little importance in this case because the accident took place at Vijayawada only within the State of Andhra Pradesh. There is also no dispute that the deceased was working as driver under the 1st respondent/owner of the accident vehicle, though in fact he was not actually driving the accident vehicle at the time of accident. There is no dispute that the deceased was in employment and died during the course of employment under the 1st respondent; and for that reason only the Commissioner awarded compensation to the dependants of the deceased as against the 1st respondent. The policy/certificate of insurance reads that specific premium was paid covering risk of non-fare paying passenger and that pecific premium was paid covering risk of persons employed in connection with the operation and/or loading, unloading of motor vehicle. According to the claimants, the deceased was spare driver travelling in the accident vehicle at the time of accident. It is contended by the appellants’ counsel that for each tipper, there will be two drivers and for some time one driver would drive the vehicle and after some time the 1st driver takes rest and the 2nd driver takes the steering for driving the vehicle and for that reason the deceased was in the vehicle at the time of accident. Therefore, presence of the deceased in the accident vehicle was neither unauthorised nor unwarranted. Therefore, presence of the deceased in the accident vehicle was neither unauthorised nor unwarranted. In any event, as pointed out earlier specific premia was paid not only for non-fare paying passenger and also persons employed in connection with operation, loading and unloading in the motor vehicle. Therefore, the 2nd respondent/insurance company cannot avoid payment of compensation in this case by way of indemnifying the 1st respondent/injured. 3. The Commissioner disallowed liability against the insurance company on the ground that six persons were travelling in the tipper as against permissible limit of three persons. It is not for the Commissioner under the Workmen’s Compensation Act or for the Motor Accident Claims Tribunal to find out whether there are any violations of the provisions of Motor Vehicles Act. In case there are any violations like overloading of the vehicle etc., which overloading is punishable, it is for the appropriate authorities to take action against driver and owner of the vehicle as the case may be for such violations. It will not absolve the insurance company from paying compensation in respect of claims arising out of any accident of such vehicle resulting any injury to persons or death of persons. In case there are more claims than the number of persons covered by the policy, it is open to the insurance company to plead its non-liability to pay compensation in respect of more number of persons over and above the number of persons covered by the policy. In the present accident, there are no such number of claims over and above the number covered by the policy. Viewed from any angle, the insurance company cannot avoid its liability to pay compensation to the claimants in this case. 4. While awarding compensation of Rs.3,35,600/- to the claimants/appellants, the Commissioner did not award any past or future interest on the compensation amount. Section 4A(3) of the Workmen’s Compensation Act, 1923 (in short, the Act) postulates awarding of interest as well as penalty. As per Section 4A(1) of the Act, compensation under Section 4 shall be paid as soon as it falls due. Under Section 4A(3), the compensation amount shall be paid within one month from the date it fell due. Section 4A(3) of the Workmen’s Compensation Act, 1923 (in short, the Act) postulates awarding of interest as well as penalty. As per Section 4A(1) of the Act, compensation under Section 4 shall be paid as soon as it falls due. Under Section 4A(3), the compensation amount shall be paid within one month from the date it fell due. There are divergent views of the Apex Court on starting point of payment of interest on the compensation amount, whether interest is payable from one month after its adjudication by the Commissioner or from the date of cause of action i.e., from the date of death or suffering injuries during the course of employment. In Ved Prakash Garg V. Premi Devi ((1997)8 Supreme Court Cases 1), 2 Judge bench of the Supreme Court held that the insurance company is liable to pay compensation amount together with interest though insurance company is not liable to pay penalty for default in payment of compensation amount. 5. In Pratap Narain Singh V. Srinivas Sabatha (1976 ACJ 141) , 4 Judge bench of the Supreme Court upheld award relating to payment of compensation with interest for the period prior to adjudication by the Commissioner. In Oriental Insurance Company Limited V. Md.Nasir (2010(1)ALD 74(SC)), the Supreme Court held that the Workmen’s Compensation Act does not prohibit grant of interest at a reasonable rate from the date of filing of the claim till an order is passed. The Supreme Court further opined that interest is payable at the rate of 7.5% per annum from the date of filing of the application till the date of award and that rate of interest thereafter shall be payable in terms of the order passed by the Commissioner. Following the said case law, this Court in K.Madhu V. Brij Kumar Pandiya (2010(3)ALD 159) awarded interest at 7.5% per annum from the date of filing of the petition claiming compensation. 6. In that view of the matter, there cannot be any dispute of the fact that interest at 7.5% per annum is payable on the compensation amount from the date of filing of claim petition before the Commissioner by the claimants/appellants until the date of award. 7. 6. In that view of the matter, there cannot be any dispute of the fact that interest at 7.5% per annum is payable on the compensation amount from the date of filing of claim petition before the Commissioner by the claimants/appellants until the date of award. 7. In the result, the appeal is allowed with costs holding that the 2nd respondent/insurance company is jointly and severally liable to pay the compensation amount along with the 1st respondent as determined by the Commissioner together with interest at 7.5% p.a. on the compensation amount from the date of filing the claim petition before the Commissioner till one month after the date of award and at the rate of 12% p.a. on the compensation amount for the period subsequent to one month after the award.