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2017 DIGILAW 195 (CAL)

United India Insurance Co. Ltd. v. Amal Kumar Ray

2017-02-17

DIPANKAR DATTA, SAHIDULLAH MUNSHI

body2017
JUDGMENT : DIPANKAR DATTA, J. 1. The respondent no. 1 (hereafter the workman) approached the Commissioner, Workmen’s Compensation, Durgapur under the Workmen’s Compensation Act, 1923 (hereafter the Act) with an application in Form ‘F’ under rule 20 of the Rules framed thereunder claiming compensation of Rs.89,712/-. In his application, registered as Claim Case No. 104 of 1997, G.K.W. Limited, Wheels Division (hereafter G.K.W.) and the United India Insurance Co. Ltd. were impleaded as opposite party nos. 1 and 2 respectively. The pleaded case was that that while on duty in the production department of G.K.W. on January 9, 1996, suddenly the workman’s right hand got trapped in a running machine. As a result thereof, he sustained grievous injuries on his right hand and more particularly his right thumb. He was treated in different hospitals and ultimately, he was assessed to have suffered 40% permanent partial disability of the thumb. The workman on the date of accident claimed to be 39 years old and was in receipt of salary of Rs.3000/- per month. Since the authorities of G.K.W. did not consider the prayer for payment of compensation, the workman was thus forced to approach the Commissioner. 2. The claim of the workman was contested by both the parties. G.K.W. contended that the workman being covered by a policy of the opposite party no.2 in the application (hereafter the insurer), question of payment of compensation by G.K.W. did not arise. The insurer contested the application by contending that the primary liability of compensating the workman ought to be shouldered by G.K.W in the capacity of employer of the workman. 3. The Commissioner by his judgment and order dated September 2, 2003 allowed the application, without costs. Without dealing with the objection raised by the insurer, the Commissioner fastened it with the liability of paying Rs.74,760/- to the workman by issuing a cheque within a month from date. 4. The present appeal at the instance of the insurer registers a challenge to such judgment and order. 5. Before we advert to the contentions raised by the parties, we place on record that by an order dated April 30, 2004 passed by a coordinate Bench, the respondent-workman was allowed to withdraw one half of Rs. 74,760/- pursuant whereto such amount has been withdrawn by him. It is also placed on record that the other half of Rs. 5. Before we advert to the contentions raised by the parties, we place on record that by an order dated April 30, 2004 passed by a coordinate Bench, the respondent-workman was allowed to withdraw one half of Rs. 74,760/- pursuant whereto such amount has been withdrawn by him. It is also placed on record that the other half of Rs. 74,760/- has been kept in deposit in the office of the Commissioner. 6. An objection to the maintainability of this appeal has been raised by the learned advocate for the respondent no.1/workman. According to him, the appeal does not involve any substantial question of law and it is not maintainable in view of section 30 of the Act. 7. Mr. Pahari, learned advocate for the appellant-insurer, contested the objection by contending that the appeal does involve a substantial question of law i.e. whether an insurer is under any statutory liability to compensate an insured workman who approaches the Commissioner under the Act or it is the primary liability of the employer to compensate. 8. Mr. Pahari submitted that considering the decisions of the Supreme Court reported in (2002) 9 SCC 450 [L.R. Ferror Alloys Ltd. v. Mahavir Mahto], (2006) 5 SCC 200 [P.J. Narayan v. Union of India], and 2006 (5) SCC 192 [New India Assurance Co. Ltd. v. Harshadbhai Amrutbhai Modhiya], three separate coordinate Benches of this Court in the decisions reported in 2012 ACJ 1654 [Sukro Munda v. National Insurance Co. Ltd.], 2012 (3) T.A.C. 50 (Cal.) [Smt. Murahi Devi v. New India Assurance Co. Ltd.], and 2015 (2) T.A.C. 740 (Cal.) [New India Assurance Co. Ltd. v. Narayan Basu] have authoritatively held bearing in mind the provisions of the Act that the initial responsibility of payment of compensation is cast on the employer and that upon payment of such compensation, the employer may seek reimbursement from the insurer; in other words, the insurer has no primary liability. It was, accordingly, urged that the Commissioner fell in error in directing compensation to be paid to the respondent no.1-workman by the appellant-insurer at the first instance and that the appeal, involving a substantial question of law, is well-nigh maintainable. 9. So far as determination of compensation by the Commissioner is concerned, Mr. Pahari did not advance any argument. However, a fair submission made by him shall be referred to later. 10. The parties have been heard. 11. 9. So far as determination of compensation by the Commissioner is concerned, Mr. Pahari did not advance any argument. However, a fair submission made by him shall be referred to later. 10. The parties have been heard. 11. In terms of the first proviso to section 30 of the Act, no appeal shall lie to the High Court against any order of a Commissioner unless, inter alia, a substantial question of law is involved therein. We are afraid, the objection raised on behalf of the respondent no.1-workman to the maintainability of the appeal does not commend acceptance. Whether or not it is the primary liability of the insurer to compensate an insured workman is indeed a substantial question of law arising for decision in the appeal. The objection to the maintainability of the appeal, accordingly, stands overruled. 12. We noticed in the decision in Narayan Basu (supra) that the Supreme Court had reversed the decision in Sukro Munda (supra). On our request to place the decision, Mr. Pahari regretted his inability. We found Mr. Rajesh Singh, learned advocate present before us. He had represented one of the insurers in Sukro Munda (supra). Accordingly, we had enquired of him as to whether he had with him a copy of the decision of the Supreme Court upsetting the decision in Sukro Munda (supra) or not. Taking some time, Mr. Singh furnished us a copy of the relevant decision of the Supreme Court. It was submitted that numerous appeals were disposed of by a common decision in Sukro Munda (supra); that, only one aggrieved party carried the decision to the Supreme Court by a special leave petition; and that leave having been granted, the appeal was allowed by the Court by setting aside the judgment and order under challenge therein. 13. We have perused the relevant decision. It appears that while allowing Civil Appeal No. 6697 of 2014 [Mahendra Rai v. United India Insurance Co. Ltd.], a Bench of two learned Judges of the Supreme Court by judgment and order dated July 23, 2015 observed that the High Court in the appellate judgment and order under challenge without giving any reason had held that the insurance company at the first instance had no liability to meet the award of compensation and doubted the maintainability of the order passed by the Commissioner. Having found that the Commissioner did not commit any error in passing the judgment and order impugned in the appeal before the High Court, the Supreme Court set aside the judgment and order of the High Court dated June 20, 2011 passed in FMA 364 of 2007. 14. As has rightly been noted by the coordinate Bench in Narayan Basu (supra), the Bench of the Supreme Court while deciding Mahendra Rai (supra) did not notice the earlier decisions of the Supreme Court in P.J. Narayan (supra) and Harshadbhai Amrutbhai Modhiya (supra). In the latter decision, it was held on consideration of the former decision that insofar as a claim under the Act is concerned, the insurer does not have a statutory liability as distinguished from the liability that is primarily imposed on it by the Motor Vehicles Act, 1988 in respect of a claim arising out of motor accident. In view thereof, the precedential value of the decision in Mahendra Rai (supra) stands eroded. We do not, therefore, propose to hold the impugned judgment and order of the Commissioner impugned in this appeal to be valid based on the decision in Mahendra Rai (supra); on the contrary, having regard to the law laid down by the Supreme Court in P.J. Narayan (supra) and Harshadbhai Amrutbhai Modhiya (supra), we are of the considered opinion that thrusting the primary liability on the appellant-insurer by the Commissioner, in the present case, was not proper. We, therefore, accept the contention of Mr. Pahari and hold that the judgment and order under challenge is vitiated by gross jurisdictional error. 15. At the same time, we also ought to place on record the very fair submission of Mr. Pahari that the appellant-insurer would not mind if, after making the position clear, we allow the respondent no.1-workman to reap the benefit of the order of the Commissioner and thus withdraw the balance half of Rs. 74,760/- deposited by the appellant-insurer in the office of the Commissioner. 16. This is one reason why we feel inclined not to interfere. 17. There is one other reason for which we ought to decline interference, on facts and in the circumstances. 74,760/- deposited by the appellant-insurer in the office of the Commissioner. 16. This is one reason why we feel inclined not to interfere. 17. There is one other reason for which we ought to decline interference, on facts and in the circumstances. Although it has not been proved to our satisfaction that G.K.W. has become insolvent and thus section 14 of the Act is attracted, it has been made to appear before us that proceedings in respect of G.K.W. are pending before the Board for Industrial and Financial Reconstruction under the Sick Industrial Companies (Special Provisions) Act, 1985. In view of such turmoil, we do not consider it wise to leave it to the respondent no.1-workman to recover compensation from G.K.W., or to thrust the liability on it to pay compensation. In exercise of our power to ensure that justice is achieved, we direct that the respondent no.1-workman shall be entitled to withdraw the other half of Rs. 74,760/- with accrued interest from the office of the Commissioner in accordance with law. 18. With the aforesaid observation, the appeal stands disposed of. There shall be no order as to costs. 19. The records of Claim Case No. 104 of 1997 shall be transmitted by the concerned department to the office of the Commissioner at the earliest. Urgent photostat certified copy of this judgment and order, if applied, may be furnished to the applicant at an early date. SAHIDULLAH MUNSHI, J. I agree.