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2015 DIGILAW 2514 (BOM)

Sri Lalitha Equipments v. Rameshwar Ragho Chauhan

2015-12-01

R.K.DESHPANDE

body2015
JUDGMENT : 1] Admit. Heard finally by consent of learned counsels appearing for the parties. 2] The substantial question of law involved in this matter is, Whether the Commissioner was right in imposing penalty upon the appellant without issuance of show cause notice? 3] The matter is covered by the decision of this Court in the case of Nandi Sahakari Sakhar Karkhana Ltd vrs. Dnyanoba Kashinath Aare and others reported in 2010 (2) Mh.L.L. 267 and also by the decision of Apex Court in the case of Oriental Insurance Company Ltd vrs. Siby George and others, reported in (2012) 12 SCC 540 , in which in para 8 it has been held as under; It is, thus, to be seen that subsection (3) of section 4A is in two parts, separately dealing with interest and penalty in clauses (a) and (b) respectively. Clause (a) makes the levy of interest, with no option, in case of default in payment of compensation, without going into the question regarding the reasons for the default. Clause (b) provides for imposition of penalty in case, in the opinion of the Commissioner, there was no justification for the delay. Before imposing penalty, however, the Commissioner is required to give the employer a reasonable opportunity to show cause. On a plain reading of the provisions of subsection (3) it becomes clear that payment of interest is a consequence of default in payment without going into the reasons for the delay and it is only in case where the delay is without justification, the employer might also be held liable to penalty after giving him a show cause. Therefore, a finding to the effect that the delay in payment of the amount due was unjustified is required to be recorded only in case of imposition of penalty and no such finding is required in case of interest which is to be levied on default per se. In view of the aforesaid position of law, the order passed by the Commissioner under the Workmen's Compensation to the extent it imposes the penalty of Rs.4,78,391/- cannot be sustained. The same will have to be quashed and set aside with liberty to the Commissioner under the Workmen's Compensation Act to issue show cause notice if he deems fit and proper in the facts and circumstances of the case. 4] In the result, the appeal is partly allowed. The same will have to be quashed and set aside with liberty to the Commissioner under the Workmen's Compensation Act to issue show cause notice if he deems fit and proper in the facts and circumstances of the case. 4] In the result, the appeal is partly allowed. The order directing penalty of Rs.4,78,391/- in the order dated 11.02.2015 passed in W.C.A. Case No. 10 of 2012 is hereby quashed and set aside. The Commissioner under the Workmen's Compensation Act is at liberty to issue show cause notice to the appellant before imposing the penalty if he deems fit and proper in the facts and circumstances of the case. No order as to cost. 5] The appellant has deposited some amount in this Court. The same may be remitted to the Commissioner under the Workmen's Compensation Act along with interest if any accrued thereon. The Commissioner to pass appropriate orders in respect of this amount in accordance with his final decision in the matter. It is made clear that the Commissioner shall not get influenced by the fact that this Court has already asked the appellant to deposit the amount.