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Karnataka High Court · body

2011 DIGILAW 1029 (KAR)

National Insurance Co. , Ltd. v. M. Chinnaswamy

2011-10-21

S.N.SATYANARAYANA

body2011
Judgment : 2nd respondent Insurance company in NF.57/2003 on the file of Commissioner for Workmen’s Compensation, Chikmagalur, has come up in this appeal impugning the order passed therein so far as it pertains to taking salary of injury/claimant at Rs.3,000/-pm., and in saddling liability on insurance company to pay interest portion on it. 2. Brief facts leading to this appeal are as under: Claimant before Commissioner was workman in 1st respondent estate. It is not in dispute that 1st respondent estate before Commissioner had taken insurance policy to cover its liability towards its employees working in the said estate. It is also not in dispute that on 11.2.2002 claimant while discharging his duties in the course of his employment met with an accident resulting in permanent disability to his left eye. Hence, he filed claim petition seeking compensation for the said injury which has taken place within the precincts of his employer/estate and in the course of his employment. In the proceedings before Commissioner 1st respondent entered appearance and filed statement of objections admitting relationship of employee and employer between claimant and estate. However, regarding wages payable to claimant, it took specific stand that wages that were paid to claimant was Rs.257.35 p.m. 3. In the said proceedings after recording oral evidence on behalf of claimant and on appreciation of oral and documentary evidence available on record Commissioner proceeded to allow the claim petition partially taking loss of earning capacity of claimant at 50% due to permanent disability caused to his left eye and taking wages at Rs.3,000/-pm. Accordingly, awarded compensation to claimant in a sum of Rs.1,15,497/-payable with interest at 12% p.a., from 30th date of the order. Being aggrieved by the same, insurance company has come up in this appeal challenging said order so far as it pertains to taking wages of claimant at Rs.3,000/-p.m. and also saddling liability to pay interest on it. 4. On going through the grounds of appeal the following substantial questions of law arise for consideration in this appeal. 1) Whether Commissioner was justified in taking wages of claimant at Rs.3,000/-per month contrary to the admission of 1st respondent estate and also documentary evidence available on record in Ex.R2? 2) Whether Commissioner was justified in saddling liability to pay interest on insurance company contrary to decision rendered by Apex Court in 2004 ACJ 452? 4. 1) Whether Commissioner was justified in taking wages of claimant at Rs.3,000/-per month contrary to the admission of 1st respondent estate and also documentary evidence available on record in Ex.R2? 2) Whether Commissioner was justified in saddling liability to pay interest on insurance company contrary to decision rendered by Apex Court in 2004 ACJ 452? 4. Though this appeal has come up for admission with the consent of learned counsel for parties, it is taken up for final disposal after framing the substantial questions of law as above. Heard the learned counsel appearing for parties. On perusal of grounds of appeal and also pleadings, oral and documentary evidence available on record, this Court answer the aforesaid substantial questions of law in the negative for the following : REASONS .5. In the instant case relationship of employee and employer between 1st respondent 2nd herein and 2nd respondent herein is not in dispute. It is not in dispute that respondent herein is insured and appellant herein is insurer. It is also not in dispute that in an accident that has taken place on 11.2.2002 1st respondent herein has suffered injury in the course of his employment with 2nd respondent herein resulting in total loss of vision in his left eye. On appreciation of evidence available on record Commissioner has rightly taken loss of earning capacity of 1st respondent herein at 50% and proceeded to award compensation. However, while doing so contrary to the pleadings and evidence available on record in the form of Ex.R2 i.e., wage register Commissioner proceeded to take wages of 1st respondent herein at Rs.3,000/-pm., which is contrary to oral and documentary evidence available on record. 6. As could be seen from Ex.R2, wage register, pay that was paid to 1st respondent herein was Rs.60. 70 per day as on that day. If that is taken into consideration, monthly wages of 1st respondent herein would be Rs.1821/-as against the admission of 2nd respondent herein at Rs.1,257.35 and also that of wages taken by Commissioner at Rs.3,000/-pm. Therefore, material evidence available on record clearly disclosing wage of 1st respondent herein at Rs.60.70 per day or Rs.1821/-per month cannot be ignored. The right wage that is required to be taken for the purpose of calculating compensation payable to 1st respondent herein would be Rs.1821/-pm. Therefore, material evidence available on record clearly disclosing wage of 1st respondent herein at Rs.60.70 per day or Rs.1821/-per month cannot be ignored. The right wage that is required to be taken for the purpose of calculating compensation payable to 1st respondent herein would be Rs.1821/-pm. If same is taken into account for the purpose of calculating quantum of compensation payable to 1st respondent/claimant, he would be entitled to Rs.70,106.67 (1821 x 60/100 = 1092.60 x 12 x 50/100 = 1, 4021.35/2), rounded off to Rs.70,107/-with interest at 12% pa., from 30th date of order. 7. So far as payment of interest is concerned, 1st respondent herein would be entitled to interest on the compensation awarded in terms of Section 4A(iii)(a) of Workmen’s Compensation Act 1923. In view of decision rendered by Apex Court in P.J. Narayan Vs. Union of India and Ors., reported in 2004 ACJ 452 since policy of insurance does not cover liability to pay interest portion to claimant. Claimant would be entitled to receive only compensation from insurance company and so far as liability to pay interest would be on employer. In the instant case, it is 2nd respondent herein who has to pay interest awarded by Commissioner at 12% on the compensation awarded from 30th date of order till date of deposit of compensation amount, 8. In view of the above, appeal filed by insurance company is allowed in part. The impugned ordered is modified as above. 9. The 2nd respondent herein, who is employer of claimant is liable to pay interest on the compensation amount of Rs.70.107/-from 30th date of the order till date of deposit of compensation amount by the insurance company as observed by this Court supra. It is stated by the counsel for 2nd respondent that a sum of Rs.43.178/-was deposited by 2nd respondent before the Commissioner in NF.No.57/2003. Though the said amount was not required to be released in favour of claimant, the Commissioner for Workmen’s Compensation, Chikmagalur, has already released the same in favour of claimant. Therefore, 2nd respondent employer is entitled to refund of said amount of Rs.43.178/-from out of compensation amount deposited by insurance company. 10. The counsel for 2nd respondent also submitted that the 2nd respondent is not entitled to refund of entire amount of Rs.43.178/-. Therefore, 2nd respondent employer is entitled to refund of said amount of Rs.43.178/-from out of compensation amount deposited by insurance company. 10. The counsel for 2nd respondent also submitted that the 2nd respondent is not entitled to refund of entire amount of Rs.43.178/-. Out of the said amount the interest portion which 2nd respondent is liable to pay from 30th date of the order passed in NF.No.57/2003 till date of deposit of entire compensation amount by insurance company will have to be deducted and paid to the claimant. The balance amount will have to be paid to 2nd respondent herein. This Court is in agreement with the said submission. 11. Accordingly, it is ordered that from out of the amount deposited by insurance company the amount of Rs.43178/-deposited by 2nd respondent before the Commissioner and released in favour of claimant shall be repaid to 2nd respondent after deducting interest that 2nd respondent is liable to pay on Rs.70,107/-from 30th date of order i.e., 2.4.2007 till date of deposit of aforesaid compensation amount by insurance company. After payment of said amount in favour of 2nd respondent, the remaining amount shall be released in favour of claimant in the following manner: A sum of Rs.40,000/-is ordered to be deposited in any nationalized bank for a period of three years with right to receive interest to claimant and the balance amount shall be released in favour of claimant.