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Chhattisgarh High Court · body

2014 DIGILAW 15 (CHH)

Oriental Insurance Co. Ltd. v. Kunjram Sahu

2014-01-20

SANJAY K.AGRAWAL

body2014
JUDGMENT Sanjay K. Agrawal, J. 1. This is an insurer's appeal under Section 30(a) of the Employee's Compensation Act, 1923 (for short "the Act of 1923") against the order dated 15.04.2011 passed by Commissioner, Workmen's Compensation-cum-Labour Court, Rajnandgaon (for short "the Commissioner"), in case No. 42/W.C.Act/2008/non-fatal, thereby granting the application for compensation filed by respondent No. 1/claimant. The facts in nutshell, necessary for adjudication of the appeals, are as under: (1.1.) Respondent No. 1/claimant filed an application under Section 10 of the Act of 1923 stating, inter alia, that on 05.11.2007 while, he was working, under the employment of respondent No. 2, suffered injury in his left eye and also lost vision of that eye thereof. It was further pleaded that he is a Turner by profession, earning Rs. 4,100/- per month and was aged about 46 years on the date of accident. As a result of the loss of vision of one eye, he suffered loss of earning capacity to the extent of 80% and, therefore, claimed a sum of Rs. 3,27,258/- as loss of future income along with penalty and interest. (1.2.) The appellant/Insurance Company filed its written statement alleging breach of terms of the policy of insurance and claimed exoneration from its liability to make payment of compensation, and also pleaded that the compensation claimed by respondent No. 1/claimant is on higher side. (1.3.) The learned Commissioner, after appreciating the oral and documentary evidence, partly allowed the claimant's application holding that the claimant has suffered permanent disability i.e. loss of vision of left eye resulting into reduction of earning capacity to the extent of 70%; he was aged about 47 years on the date of accident and used to earn Rs. 3,100/- per month and is entitled for Rs. 2,12,317/- jointly and severally from the employer and appellant-Company and also imposed penalty of Rs. 15,000/- payable by employer and penal interest @ 7% per annum. 2. This appeal was admitted for hearing on 11.10.2011 on the following substantial question of law: Whether the Commissioner for Workmen Compensation was justified in holding loss of earning capacity of respondent No. 1 as 70% ignoring the fact that injury sustained by him is scheduled injury prescribed in Schedule I, part II, item No. 25 of the Workmen Compensation Act? 3. 3. Shri Sourabh Sharma, learned counsel appearing for the appellant would submit that the injury sustained by the respondent No. 1/claimant is a scheduled injury prescribed in Schedule I, part II, item No. 25 of the Act of 1923 and resultant loss of earning capacity according to said schedule would be only 40% and, therefore, learned Commissioner has committed a legal error in holding the loss of earning capacity of respondent No. 1 as 70% and, therefore, the amount of compensation be suitably reduced holding loss of earning capacity as 40%. 4. Per contra, Shri Santosh Yadu, learned counsel appearing for respondent No. 1 would submit that though the injury suffered by the claimant is scheduled injury but since respondent No. 1/claimant has become unfit to work as Turner, thus, the learned Commissioner has rightly taken loss of earning capacity to the extent of 70% and, therefore, the impugned order deserves to be upheld. 5. I have heard and considered the rival submissions and have carefully perused the record of the Commissioner. 6. Under the provisions of the Employee's Compensation Act, 1923, once it is proved by the workman: (i) that he is a workman, and (ii) that he has suffered injury by accident in the course of his employment, The liability of the employer to pay compensation is established. If the injury received by the workman is a scheduled injury, the minimum amount of compensation which the workman would be entitled to claim would be commensurate with the deemed loss of earning capacity as indicated in the Schedule. In case where the workman received non-scheduled injury, he will have to show by leading evidence as to what is the loss of earning capacity suffered by him on account of the accident. If the employer wants to prove that he was not liable to pay compensation, the onus lies on the employer to establish that there were circumstances in the case which confer immunity against the liability to pay compensation. 7. As far as the determination of amount of compensation is concerned, section 4 of the Act makes provision for the same. In case of death resulting from the injury, the amount of compensation is as indicated in first (Sic. second) column of Schedule IV. In case of permanent total disability the amount is also indicated in first (Sic. second) column of Schedule IV. In case of death resulting from the injury, the amount of compensation is as indicated in first (Sic. second) column of Schedule IV. In case of permanent total disability the amount is also indicated in first (Sic. second) column of Schedule IV. Section 4(1)(c) of the Act deals with permanent partial disablement. Here again there are two types of injuries. Injuries specified in Schedule I to the Act and the injuries which are not specified in the Schedule. In both types of cases, basis of determination, of amount of compensation is loss of earning capacity of the workman. Neither the 'earning' nor the 'earning capacity' of the workman is defined in the Act. As far as the injuries falling within the scope of section 4(1)(c)(i) (i.e., scheduled injuries) are concerned, the task of the workman is comparatively made easier by the legislature. In case of injuries specified in the Schedule, the loss of 'earning capacity' is fixed by creating deeming fiction. To claim the compensation commensurate with the percentage of loss of earning capacity fixed in the Schedule, the workman is not required, to lead any further evidence except to show that he has suffered injuries during the course of employment and that particular injury falls within the Schedule. On proof of these facts, the workman would be entitled to claim compensation as fixed in the Schedule. In case of non-scheduled injury falling within the scope of section 4(1)(c)(ii) of the Act the legislature has not fixed any percentage of loss of earning capacity by creating deeming fiction. Therefore, in such type of cases, it will be necessary for the workman to show by leading evidence that as a matter of fact he has suffered loss of earning capacity to a particular extent and that he will be entitled to compensation commensurate with the loss of earning capacity suffered by him. This is essentially a matter of inquiry involving examination of facts and to a great extent guesswork to be made by the Commissioner and the court. However, in both types of cases of injuries, the basic criterion for determination of amount of compensation is the same, i.e., the loss of earning capacity. This is essentially a matter of inquiry involving examination of facts and to a great extent guesswork to be made by the Commissioner and the court. However, in both types of cases of injuries, the basic criterion for determination of amount of compensation is the same, i.e., the loss of earning capacity. In one type of cases, i.e., cases falling within the purview of section 4(1)(c) (i) of the Act (Scheduled injuries) the workman has an added advantage that the minimum loss of earning capacity is fixed by the statute by creating deeming fiction. In cases of non-scheduled injuries falling within the scope of section 4(1)(c)(ii) of the Act, the workman is required to prove the loss of earning capacity by leading appropriate evidence. 8. In this connection it needs to be noted that by providing 'deemed loss' of earning capacity as indicated in Schedule I to the Act, the legislature has fixed the rock-bottom. To claim this much minimum compensation, the workman is not required to lead further evidence. In cases wherein the workman is in a position to establish that the percentage of the loss of earning capacity suffered by him is in far excess of the percentage fixed by the statute, he may lead evidence to establish the loss of earning capacity in excess of the percentage fixed by the statute. In such cases he would certainly be in a position to claim the amount of compensation commensurate with the percentage of loss of earning capacity proved by him. The criterion for determination of the amount of compensation is the loss of earning capacity. Simply because the legislature provided for minimum amount of compensation by creating deeming fiction, the legislature never intended to put the workman at a loss. As indicated hereinabove, the Act is required to be interpreted liberally so that the benefit reach the workman or his dependants in its fullest extent. The provisions of the Act cannot be interpreted so as to minimize or truncate the benefits to the workman or to his dependants. 9. Therefore, irrespective of the fact as to whether the workman has suffered injuries specified in the Schedule or injuries which are not specified in the Schedule, the amount of compensation is to be determined on the basis of the loss of earning capacity suffered by the workman. 9. Therefore, irrespective of the fact as to whether the workman has suffered injuries specified in the Schedule or injuries which are not specified in the Schedule, the amount of compensation is to be determined on the basis of the loss of earning capacity suffered by the workman. The only difference is that in cases wherein the workman suffered injuries specified in the Schedule, rock-bottom is fixed by the legislature by creating deeming fiction. This deeming fiction entitles the workman to claim the amount of compensation irrespective of the fact as to whether he has actually suffered any loss of earning capacity or not. In such cases, it will not be even open to the employer to lead evidence and say that the workman has not. suffered any loss of earning capacity and therefore he is not entitled to any amount of compensation, even that what is fixed by the legislature. 10. The legislature intended to confer benefit on the workman with an object to see that the workman or his family members are not taken over by a sudden mishap. Therefore, the legislature has seen to it that in such cases without there being further examination, the amount of compensation can be calculated even by the employer and be paid to the workman. By doing so, the employer may avoid the liability of payment of penalty as provided under section 4A of the Act. In case the workman is not satisfied with the payment of amount of compensation as statutorily fixed, the workman is not precluded from claiming in excess of the loss of earning capacity fixed under the statute. This is the only interpretation which can be placed on the provisions of section 4 of the Act. Otherwise it would lead to invidious discrimination between unfortunate employees, one of whom may receive accidental injuries specified in the Schedule and another one who may receive accidental injuries which are not specified in the Schedule. One of them who receives injury specified in the Schedule would be entitled to claim only the minimum amount of compensation as "deemed loss of earning capacity" while the other one who has received injury not specified in the Schedule will be in a position to claim any amount of compensation commensurate with the actual loss of earning capacity by leading appropriate evidence. Such an interpretation cannot be placed on the provisions of the Act which is intended to confer benefit on the workman. The interpretation which is consistent with the object of the Act is that by creating deeming fiction, the legislature has only provided rock-bottom. 11. The amount of compensation commensurate with the loss of earning capacity as deemed loss indicated in the Schedule will be liability of the employer irrespective of the fact as to whether the workman leads any evidence or not or whether there is actual loss of earning capacity or not. In such cases it will not be even open to the employer to lead evidence and establish that the workman has not suffered any loss of earning capacity. But the contrary is not true. Even in such cases it would be open to the workman by leading appropriate evidence to establish that he has suffered loss of earning capacity far in excess of what is fixed by the legislature. On examination of the evidence if the Commissioner for Workmen's Compensation finds that the workman has suffered loss of earning capacity in excess of what is deemed loss of earning capacity under the Act, there is nothing in the Act which would preclude the Commissioner for Employee's Compensation from awarding the compensation in excess of percentage fixed by the legislature in the Schedule. 12. In a more recent decision in Raj Kumar Vs. Ajay Kumar and another JT 2010 (13) SC 38, the Supreme Court considered in great detail the correlation between the physical disability suffered in an accident and the loss of earning capacity resulting from it. In paragraphs 10, 11 and 13 of the judgment in Raj Kumar, the Supreme Court made the following observations: 10. Where the claimant suffers a permanent disability as a result of injuries, the assessment of compensation under the head of loss of future earnings would depend upon the effect and impact of such permanent disability on his earning capacity. The Tribunal should not mechanically apply the percentage of permanent disability as the percentage of economic loss or loss of earning capacity. In most of the cases, the percentage of economic loss, that is, the percentage of loss of earning capacity, arising from a permanent disability will be different from the percentage of permanent disability. The Tribunal should not mechanically apply the percentage of permanent disability as the percentage of economic loss or loss of earning capacity. In most of the cases, the percentage of economic loss, that is, the percentage of loss of earning capacity, arising from a permanent disability will be different from the percentage of permanent disability. Some Tribunals wrongly assume that in all cases, a particular extent (percentage) of permanent disability would result in a corresponding loss of earning capacity, and consequently, if the evidence produced show 45% as the permanent disability, will hold that there is 45% loss of future earning capacity. In most of the cases, equating the extent (percentage) of loss of earning capacity to the extent (percentage) of permanent disability will result in award of either too low or too high a compensation. 11. What requires to be assessed by the Tribunal is the effect of the permanent disability on the earning capacity of the injured; and after assessing the loss of earning capacity in terms of a percentage of the income, it has to be quantified in terms of money, to arrive at the future loss of earnings (by applying the standard multiplier method used to determine loss of dependency). We may however note that in some cases, on appreciation of evidence and assessment, the Tribunal may find that the percentage of loss of earning capacity as a result of the permanent disability is approximately the same as the percentage of permanent disability in which case, of course, the Tribunal will adopt the said percentage for determination of compensation. (See for example, the decisions of this Court in Arvind Kumar Mishra v. New India Assurance Company Ltd., [JT 2010 (10) SC 254] and Yadava Kumar v. National Insurance Company Ltd. [JT 2010 (9) SC 91]). 13. Ascertainment of the effect of the permanent disability on the actual earning capacity involves three steps. The Tribunal has to first ascertain what activities the claimant could carry on in spite of the permanent disability and what he could not do as a result of the permanent disability (this is also relevant for awarding compensation under the head of loss of amenities of life). The second step is to ascertain his avocation, profession and nature of work before the accident, as also his age. The second step is to ascertain his avocation, profession and nature of work before the accident, as also his age. The third step is to find out whether (i) the claimant is totally disabled from earning any kind of livelihood, or (ii) whether in spite of the permanent. disability, the claimant could, still effectively carry on the activities and functions, which he was earlier carrying on, or (iii) whether he was prevented or restricted from discharging his previous activities and functions, but could carry on some other or lesser scale of activities and functions so that he continues to earn or can: continue to earn his livelihood. 13. The aforesaid decision of Supreme Court in case of Raj Kumar JT 2010 (13) SC 38 (supra) has been recently followed by Supreme Court in case of Syed Sadiq etc. Vs. Divisional Manager, United India Ins. Co. JT 2014 (1) SC 569. 14. In a decision in Pratap Narain Singh Deo Vs. Shrinivas Sabata and Another AIR 1976 SC 222 , the Carpenter suffered amputation of left hand above elbow. The Supreme Court held therein loss of earning capacity to the extent of 100 percent by the following findings: 5. The expression "total disablement" has been defined in Section 2(1)(1) of the Act as follows: (1) "total disablement" means such disablement, whether of a temporary or permanent nature, as incapacitates workman for all work which he was capable of performing at the time of the accident resulting in such disablement". It has, not been disputed before us that the injury was of such a nature as to cause permanent disablement to the respondent, and the question for consideration is whether the disablement incapacitated the respondent for all work which he was capable of performing at the time of the accident. The Commissioner has examined the question and recorded his finding as follows: The injured workman in this case is carpenter by profession.........By loss of the left hand above the elbow, he has evidently been rendered unfit for the work of carpenter as the work of carpentry cannot be done by one hand only. This is obviously a reasonable and correct finding. Counsel for the appellant has not been able to assail it on any ground and it does not require to be corrected in this appeal. This is obviously a reasonable and correct finding. Counsel for the appellant has not been able to assail it on any ground and it does not require to be corrected in this appeal. There is also no justification for the other argument which has been advanced with reference to Item 3 of Part II of Schedule I, because it was not the appellant's case before the Commissioner that amputation of the arm was from 8" from tip of acromion to less than 41/2 below the tip of olecranon. A new case can not therefore be allowed to be set up on facts which have not been admitted or established. 15. In a decision in S. Suresh Vs. Oriental Insurance Co. Ltd. and another 2010 ACJ 487, the driver of truck suffered amputation of right leg just below knee, the Supreme Court held, loss of earning capacity would be 100 percent by following findings:- In our view, the ratio of the said judgment is squarely applicable to the facts at hand. We are of the opinion that on account of amputation of his right leg below knee, he is rendered unfit for the work of a driver, which he was performing at the time of the accident resulting in the said disablement. Therefore, he has lost 100 per cent of his earning capacity as a lorry driver, more so, when he is disqualified from even getting a driving licence under the Motor Vehicles Act. 16. In a decision in K. Janardhan Vs. United India Insurance Co. Ltd. and another 2008 ACJ 2039 , the Supreme Court held that Tanker driver suffered amputation of right leg up to knee joint and loss of earning capacity would be 100 percent by following findings:- Applying the ratio of the cited judgment to the facts of the present case, we are of the opinion that the appellant herein has also suffered a 100 per cent disability and incapacity in earning his keep as a tanker driver as his right leg had been amputated from knee. Additionally, a perusal of Sections 8 and 9 of the Motor Vehicles Act, 1988, would show that the appellant would now be disqualified from even getting a driving licence. 17. Thus having ascertained the legal position, I shall revert back to the facts of the present case. Additionally, a perusal of Sections 8 and 9 of the Motor Vehicles Act, 1988, would show that the appellant would now be disqualified from even getting a driving licence. 17. Thus having ascertained the legal position, I shall revert back to the facts of the present case. Respondent No. 1/claimant was Turner by profession and he has lost vision of his left eye in the accident. 18. It is the stand of the respondent. No. 1/claimant that on account of permanent disability suffered by him arose out of and during the course of employment, percentage of loss of earning capacity is 80 as he has been terminated from the service after the permanent disability, the question which arises for determination is whether due to permanent disability suffered by the claimant, what would be the percentage of loss of his earning capacity, whether it would be as provided in the Schedule or more than what has been provided in the schedule as claimed by the respondent No. 1/claimant. 19. In order to determine the question, it would be proper to refer the statement of Dr. M.L. Jaiswal (AW-1)-Eye Specialist, who issued the medical certificate (Ex. P-16). He has clearly opined that the respondent No. 1/claimant would be unable to perform job of a Turner as he has no vision in the left eye, which is permanent in nature. 20. Employer - Mahaveer Surana has also been examined. He has clearly deposed that the respondent No. 1/claimant cannot work as a Turner after loss of vision in his one eye. 21. On the basis of the aforesaid evidence available on record, it appears that the loss of vision of one eye (left eye) of respondent No. 1/claimant resulted into total loss of earning capacity as he has been rendered unfit for the job of a Turner. 22. Learned Commissioner, in the impugned order, has clearly recorded a finding that after suffering permanent disability, resulting into loss of earning capacity, the clamant was unable to work as a Turner and thereby according to the Commissioner the loss of earning capacity would be 70%. 23. 22. Learned Commissioner, in the impugned order, has clearly recorded a finding that after suffering permanent disability, resulting into loss of earning capacity, the clamant was unable to work as a Turner and thereby according to the Commissioner the loss of earning capacity would be 70%. 23. The appellant/Insurance Company has not challenged that loss of earning capacity, as held by the Commissioner to the extent of 70%, is bad or contrary to law but has simply raised a plea that since the injury is a scheduled injury, therefore, loss of earning capacity would be 40% as per schedule, it has also been held in foregoing paragraphs that 'deemed loss' of earning capacity as indicated in Scheduled I to the Act, the legislature has fixed the rock-bottom. In the instant case, the percentage of loss of earning capacity established by the claimant is excess of the percentage fixed by the Act, 1923, therefore, the claimant is entitled to claim amount of compensation commensurate with the percentage of loss of earning capacity proved by him. 24. Thus, in the instant case, the respondent No. 1/claimant has proved that on account of loss of vision of left eye, which is a scheduled injury prescribed in Scheduled I, part II, item No. 25 of the Act of 1923, resultant loss of earning capacity would be 70%. Therefore, the learned Commissioner is justified in granting the compensation holding loss of earning capacity as 70%. Thus, the substantial question of law is answered accordingly in favour of respondent No. 1/claimant. In the result, the appeal deserves to be and is hereby dismissed. No order as to costs.