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2019 DIGILAW 984 (HP)

New India Assurance Company Ltd. v. Poonam Sood

2019-07-19

JYOTSNA REWAL DUA

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JUDGMENT : Jyotsna Rewal Dua, J. Challenge by the insurer in this appeal is to the award, dated 27.08.2018, passed by the learned Commissioner, Palampur, exercising power under the Employees Compensation Act, 1923, whereby appellant/insurer has been ordered to pay Rs.4,52,172.50/- as compensation alongwith interest @ 12% per annum w.e.f. 12.11.2014, till it's actual realization to the claimants/respondents No.1 to 5. 2. The insurer in the present appeal, has challenged the impugned award, primarily on the grounds :- 2(i) Deceased Sh. Ashwani Kumar Sood, did not suffer fatal injuries during the course of his employment. Hence, the insurer could not have been directed to satisfy the liability of paying the awarded amount to the claimants. 2(ii) In any case, in terms of insurance policy, the monthly wages insured by the employer in the instant case are upto Rs.4000/-. Whereas, the award has been passed, taking the monthly salary of the deceased at Rs. 6500/- per month, and liability of insurer to pay the compensation has been calculated by treating the insured wages as Rs. 6500/- per month, which is erroneous being contrary to Insurance Policy. 3. Case :- The claimants in the instant case are widow, children and mother of late Sh. Ashwani Kumar Sood. The case as set up by the claimants is that deceased Ashwani Kumar Sood, was employed by respondent No.6, M/s B.K. Enterprises, w.e.f. 28.12.2005. He was sent by his employer/respondent No.6 on official duty on 12.10.2014, from Suka Bag to Palampur for reconciling the accounts of the firm. While going there on scooty with his son as pillion rider, neck of Sh. Ashwani Kumar was struck by a loose rope of truck coming from opposite side near Banuri. As a result of this accident, he suffered fatal injuries and died on 12.10.2014. Notice was served by the brother of the deceased upon the insurer on 12.10.2014. Failing to get any compensation, claim peition was preferred under the Employees Compensation Act, 1923 (EC Act for short), which came to be allowed vide impugned order. 4. I have heard the learned counsel for the parties and gone through the record. 5. (I) Choosing the remedy:- Learned counsel for the appellants, has contended that the claimants/respondents No.1 to 5, ought to have filed claim petition under Section 166 of the Motor Vehicles Act, instead of preferring present petition under the Employees Compensation Act. 4. I have heard the learned counsel for the parties and gone through the record. 5. (I) Choosing the remedy:- Learned counsel for the appellants, has contended that the claimants/respondents No.1 to 5, ought to have filed claim petition under Section 166 of the Motor Vehicles Act, instead of preferring present petition under the Employees Compensation Act. It is the prerogative of the claimants to opt for choosing the remedies available to them. It is not in dispute that filing of petition under EC Act was also one of the remedies available to the claimants. 5(ii) Learned counsel for respondents No.1 to 5, has also given a reasonable explanation, of the accident being a hit and run case with untraced vehicle, for resorting to remedy under EC Act instead of the one available under the Motor Vehicles Act. Therefore, this objection, which was not even taken in the learned Tribunal below, sans merit and is rejected. 5(iii) Whether death was caused during the course of employment or not:- Sh. B.M. Chauhan, learned Senior Counsel for the appellant, has vehemently contended that deceased did not suffer fatal injuries during the course of his employment and therefore, the impugned award fastening the liability to pay compensation upon the insurer, is bad in eyes of law. In support of his contention, learned Senior Counsel for the appellant, has drawn attention to following:- 5(iii)(a) The fateful day i.e. 12.10.2014, was a Sunday. It being a holiday, the deceased could not be expected to be discharging his duty on a Sunday. 5(iii)(b) Deceased had met with an accident while riding a scooty with his son as a pillion rider. Therefore, the necessary inference can be drawn that he was not travelling in discharge of his duties. 5(iii)(c) The attendance register of employees Ext.R-1 to R-10, reflects that deceased used to be on holiday on every Sunday and that it was only on 12.10.2014, wherein, his presence has been marked. 5(iv) Per contra, Sh. Sunil Mohan Goel, learned counsel for the respondent supported the impugned award and has argued that Sh. Ashwani Kumar Sood, had died during the course of his employment. 5(v) It would be appropriate to refer to a decision of the Hon'ble Apex Court in titled Jara Biswal and Ors. 5(iv) Per contra, Sh. Sunil Mohan Goel, learned counsel for the respondent supported the impugned award and has argued that Sh. Ashwani Kumar Sood, had died during the course of his employment. 5(v) It would be appropriate to refer to a decision of the Hon'ble Apex Court in titled Jara Biswal and Ors. vs. branch manager, (2016) 11 SCC 201 Iffco tokio General Insurance Company Ltd. and another: "18 The E.C. Act is a welfare legislation enacted to secure compensation to the poor workmen who suffer from injuries at their place of work. This becomes clear from a perusal of the preamble of the Act which reads as under: "An Act to provide for the payment by certain classes of employers to their workmen of compensation for injury by accident." This further becomes clear from a perusal of the Statement of Objects and Reasons, which reads as under: "The growing complexity of industry in this country, with the increasing use of machinery and consequent danger to workmen, alongwith the comparative poverty of the workmen themselves, renders it advisable that they should be protected, as far as possible, from hardship arising from accidents. An additional advantage of legislation of this type is that by increasing the importance for the employer of adequate safety devices, it reduces the number of accidents to workmen in a manner that cannot be achieved by official inspection. Further, the encouragement given to employers to provide adequate medical treatment for their workmen should mitigate the effects to such accidents as do occur. The benefits so conferred on the workman added to the increased sense of security which he will enjoy, should render industrial life more attractive and thus increase the available supply of labour. At the same time, a corresponding increase in the efficiency of the average workman may be expected." (emphasis laid by this Court) Thus, the E.C. Act is a social welfare legislation meant to benefit the workers and their dependents in case of death of workman due to accident caused during and in the course of employment should be construed as such. Section 3 of the E.C. Act provides for employer's liability for compensation and reads as: "3 (1) If personal injury is caused to a workman by accident arising out of and in the course of his employment his employer shall be liable to pay compensation in accordance with the provisions of this Chapter" (emphasis laid by this Court) "19. The liability of the employer, thus, arises, when the workman sustains injuries in an accident which arises out of and in the course of his employment. In the case of Regional Director, E.S.I. Corporation and Anr. v. Francis De Costa and Anr., a Three Judge Bench of this Court held as under: "In the case of Dover Navigation Company Limited v. Isabella Craig, (1940) AC 190, it was observed by Lord Wright that- Nothing could be simpler than the words "arising out of and in the course of the employment." It is clear that there are two conditions to be fulfilled. What arises "in the course of the employment is to be distinguished from what arises "out of the employment." The former words relate to time conditioned by reference to the man's service, the latter to causality. Not every accident which occurs to a man during the time when he is on his employment, that is directly or indirectly engaged on what he is employed to do, gives a claim to compensation unless it also arises out of the employment. Hence the section imports a distinction which it does not define. The language is simple and unqualified. Although the facts of this case are quite dissimilar, the principles laid down in this case, are instructive and should be borne in mind. In order to succeed, it has to be proved by the employee that (1) there was an accident, (2) the accident had a causal connection with the employment and (3) the accident must have been suffered in course of employment." 5(vi) On the basis of the pleadings and evidence on record; there can be no escape from the conclusion that deceased Sh. Ashwani Kumar Sood was an employee of respondent No.6, when he met with the fatal accident on 12.10.2014. The employer, respondent No.1, was though represented by his learned counsel, however, he did not contest the case. No reply was filed. Only document Ext. RA was relied by the employer. Deceased Sh. Ashwani Kumar Sood was an employee of respondent No.6, when he met with the fatal accident on 12.10.2014. The employer, respondent No.1, was though represented by his learned counsel, however, he did not contest the case. No reply was filed. Only document Ext. RA was relied by the employer. Deceased Sh. Ashwani Kumar Sood, had died during the course of his employment. This fact is amply clear from the statement of RW-1, his wife Smt. Poonam Sood; the certificate Mark-X-2 of the employer and the statement of RW-1, Sh. Amar Dass, the manager of the employer, who was brought in the witness box by the insurer itself:- 5(vi)(a) Smt. Poonam Sood, wife of deceased Sh. Ashwani Kumar Sood, while appearing as PW-3, has denied that her husband used to have holiday on Sunday. She has further denied that her husband on the fateful day was going for his personal work. It is her categorical statement that her husband on the day of accident, though a holiday being Sunday, was going to Palampur in respect of the work of reconciling the accounts of Petrol Pump/ firm of respondent No.6. 5(vi)(b) Smt. Poonam Sood, as PW-3, has also amongst other documents, produced Ext. R-A ( earlier marked as X-2), which is a certificate issued by the employer, respondent No.6, to the effect that late Sh. Ashwani Kumar Sood was working as a manager with them since 28th December, 2005. It has been certified therein that he met with an accident on 12.10.2014 while on business tour of the organization. 5(vi)(c) Sh. Amar Dass, RW-1, was brought in the witness box by the insurer as its witness. This witness is working as manager of the employer, respondent No.6, w.e.f. 2015 and as per his statement in cross-examination, he had been employed in place of deceased Ashwani Kumar Sood. In his examination-in-Chief, he has produced the attendance register of late Sh. Ashwani Kumar Sood (referred to earlier), where the deceased was shown to be on duty on 12.10.2014. This witness has further deposed that deceased Sh. Ashwani Kumar Sood used to have holiday on Sunday, yet, he has further elaborated that irrespective of the day being holiday or not, the employees were to discharge their duties even on holidays either in case of reconciling the accounts or in case of arrival of the tanker on a holiday. This witness has further deposed that deceased Sh. Ashwani Kumar Sood used to have holiday on Sunday, yet, he has further elaborated that irrespective of the day being holiday or not, the employees were to discharge their duties even on holidays either in case of reconciling the accounts or in case of arrival of the tanker on a holiday. Thus, even on Sunday, they may have to go to Palampur for reconciling the accounts of the Petrol Pump, for which, they are paid extra. 5(vi)(d) The statement of RW-1, clinches the issue in respect of the deceased being on official duty on Sunday, i.e. on 12.10.2014, while he met with the fatal accident. This witness as observed above, has categorically submitted that workers, especially, those who were involved in reconciling of the accounts, had to be on official duties even on holidays and the accounts had to be reconciled by taking the documents to Palampur. It is this witness who has produced the attendance register Ext.R-1 to R-10, wherein, presence of deceased Sh. Ashwani Kumar Sood, has been marked on 12.10.2014. 5(vi) (e) Ext. R-A, is the certificate issued by the employer to the effect that deceased was on duty on 12.10.2014. Hence, learned Commissioner while exercising its powers under the Employees Compensation Act, has not committed any error in holding that deceased Sh. Ashwani Kumar Sood, had died while discharging his official duty on 12.10.2014. 5 (vii) Wages of deceased:- Learned Senior Counsel has disputed the monthly wages of deceased calculated at Rs. 6500/- per month. It is borne out from the record that monthly wages of deceased Sh. Ashwani Kumar were Rs.6500/- per month:- (i) It has been so stated by Smt. Poonam Sood, wife of Sh. Ashwani Kumar Sood, in her examination-in-chief as well as in cross-examination; (ii) The present appeal does not specifically disputes the wages of deceased Sh. Ashwani Kumar as Rs. 6500/- per month. Though, in Paragraph-4 of the grounds of instant appeal, an objection has been taken that the learned Commissioner erred in taking the monthly salary of the deceased at Rs. Ashwani Kumar Sood, in her examination-in-chief as well as in cross-examination; (ii) The present appeal does not specifically disputes the wages of deceased Sh. Ashwani Kumar as Rs. 6500/- per month. Though, in Paragraph-4 of the grounds of instant appeal, an objection has been taken that the learned Commissioner erred in taking the monthly salary of the deceased at Rs. 6500/- for the purpose of calculating the compensation, however, reading of the entire para, makes it clear that this objection has been taken in respect to the maximum cap fixed by the Insurance Company for covering the wages at Rs.4000/- per month, and not for disputing the actual wages of deceased in the instant case, Rs. 6500/-per month. The wages of deceased @ Rs. 6500/- per month were not disputed by the insurer. In any case, Paragraph 5 of the claim petition, puts the wages of deceased Sh. Ashwani Kumar Sood, to Rs. 6500/- per month. The fact has not been controverted by the employer. Even though, the present appellant disputes the wages, yet, the employer having not disputed this fact, therefore, wages of the deceased have to be taken as Rs.6500/- per month. Therefore, the monthly wages of deceased Sh. Ashwani Kumar Sood, have rightly been taken as Rs. 6500/- per month, by learned Commissioner below. Extent of wages covered under Insurance Policy:- 5 (vii) (a). The contention of learned Sr. Counsel, for the appellant, is that in terms of Insurance Policy Ext.R-X, the maximum insured monthly wages are upto Rs. 4000/-, therefore, in any case, the liability of the insurer will only be for the wages up to Rs. 4000/- and not for Rs.6500/- per month. Learned Commissioner has erroneously treated entire monthly wages of deceased i.e. Rs.6500/- as wages insured by employer and fastened liability upon the insurer. 5 (vii)(b). As against the above contention, learned counsel for claimants contended that in terms of amendment carried out in Sub-Section (1B) of Section 4 of the Employee's Compensation Act on 31.05.2010, the statutory limit of cap on wages, has been raised from Rs.4000/- to Rs. 8000/- per month, therefore, learned commissioner, rightly treated Rs. 6500/- per month as the wages insured by the insurer and determined the liability accordingly. 5 (vii)(c). The Insurance Policy Ext. 8000/- per month, therefore, learned commissioner, rightly treated Rs. 6500/- per month as the wages insured by the insurer and determined the liability accordingly. 5 (vii)(c). The Insurance Policy Ext. R-X, clearly points out that appellant/insurer and insured/employer had entered into contract of Insurance on 23.08.2014 whereby maximum wages insured were upto Rs.4000/- per month. Premium was paid by employer only on insured wages upto Rs.4000/- per month. Neither wages exceeding Rs. 4000/- per month were insured nor any premium for wages in excess of Rs. 4000/- per month was paid. Therefore, even though, under the amended EC Act w.e.f. 31.05.2010, specified monthly wages have been enhanced to Rs. 8000/- per month, yet in the instant case, the wages insured under the terms of contract (Ext. R-X) were Rs. 4000/- per month and not Rs. 6500/- per month. Therefore, liability of the appellant/insurer is only to the extent of wages insured by it i.e. Rs. 4000/- per month. Liability on account of balance wages i.e. Rs.2500/- per month, has to fall on employer/respondent No.6, who has not disputed monthly wages of deceased @ Rs. 6500/- per month. Point is answered accordingly. 6. Liability:- 6(i) In terms of above discussion, the liability of appellant/insurer to satisfy the award in terms of Section 4 of EC Act, is calculated as:- Rs.2000 (half of Rs. 4000) x 139.13 (relevant factor)= Rs.2,78,260/- 6(ii) In terms of above discussion, the liability of employer/respondent No.6, to satisfy the award in terms of Section 4 of EC Act, is calculated as:- Rs.1250 (half of Rs.2500) x 139.13 (relevant factor) = Rs. 173912.5/- Total: Rs. 4,52,172.50/- 6(iii) Interest payable on above determined liabilities will be as per impugned award. 7. In view of the above discussion, present appeal is partly allowed. Accordingly, the impugned award passed by learned Commissioner is modified to the extent indicated above. The appeal is disposed of along with pending applications, if any.