Nafr High Court
Case Details
1 2025:CGHC:28895 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR MAC No. 556 of 2019 1 - Smt. Satani Poyam W/o Late Ashok Kumar Poyam Aged About 29 Years R/o Baniya, Dhodapara, Tahsil And District Kondagaon, Chhattisgarh. 2 - Homraj Poyam S/o Late Ashok Kumar Poyam Aged About 9 Years Minor Through Natural Guardian Mother Smt. Satani Poyam W/o Late Ashok Kumar Poyam R/o Baniya, Dhodapara, Tahsil And District Kondagaon, Chhattisgarh. 3 - Ku. Sivani Poyam D/o Late Ashok Kumar Poyam Aged About 7 Years Minor Through Natural Guardian Mother Smt. Satani Poyam W/o Late Ashok Kumar Poyam R/o Baniya, Dhodapara, Tahsil And District Kondagaon, Chhattisgarh. 4 - Ku. Sanju Poyam D/o Late Ashok Kumar Poyam Aged About 2 Years Minor Through Natural Guardian Mother Smt. Satani Poyam W/o Late Ashok Kumar Poyam R/o Baniya, Dhodapara, Tahsil And District Kondagaon, Chhattisgarh. 5 - Gundi Ram Poyam S/o Late Girdhar Aged About 52 Years R/o Baniya, Dhodapara, Tahsil And District Kondagaon, Chhattisgarh. ... Appellants versus
Legal Reasoning
1 - Yuvraj Singh Baidh S/o Shri Kushal Singh Baidh Aged About 63 Years R/o Village And Post Sonabal, Murumpara, Tahsil And District Kondagaon Chhattisgarh(Owner). 2 - National Insurance Company Limited Branch Office, Upper Sinde Of Central Bank, Jagdalpur, District Bastar Chhattisgarh (Insurer) ... Respondents (Cause title, as taken from CIS) For Appellants : Mr. Praveen Dhurandhar, Advocate For Respondent No.2 For Respondent No.1 : : Mr. Qamrul Aziz, Advocate None. 2 (Hon’ble Shri Justice Naresh Kumar Chandravanshi) 30/06/2025 Order on Board 1. Heard. 2. This is a claimants’ appeal filed under Section 30 of the Employee’s Compensation Act, 1923 (henceforth referred to as ‘the Act, 1923’) against order dated 25.10.2018 passed by Commissioner, Employees Compensation Act, Labour Court, Jagdalpur (CG) (for short ‘the Commissioner”) in Case No.30/2016/E.C.Act/ fatal, whereby the learned Commissioner has granted compensation in favour of the appellants/claimants to the tune of Rs.5,67,785/-, but granted conditional interest @ 12% per annum from the date of accident, if the same is not paid within a period of 45 days. 3. Facts of the case, in nutshell, are that appellants /claimants are wife and children of deceased -Ashok Kumar Poyam. On instruction of respondent No.1, deceased had gone to village Khandam to thresh paddy by Tractor No. CG/27/A/0987 on 02.12.2015 at around 6:00 pm and while returning, the tractor which he was driving, overturned near the pond of the housing plot and he got crushed under the engine of the tractor, due to which, he died on the spot. Being employee of respondent No.1, claimants filed claim application under Section 22 of the Act, 1923 against employer /respondent No.1 namely; Yuvraj Singh and respondent No.2-Insurance Company for grant of compensation to the tune of Rs.6,23,790/- along with penalty of Rs.3,11,895/- and 13% interest. 4. Both the non-applicants/respondents filed their separate reply, in which, they denied the allegations levelled against them and their 3 liability also. 5. After considering the evidence adduced by the parties, learned Commissioner allowed the claim application filed by the appellants/claimants and granted compensation amount in favour of them to the tune of Rs.5,67,485/-. It also granted interest @ 12% per annum on aforesaid amount from the date of incident with the condition that, if the same is not paid within a period of 45 days. Being aggrieved from aforesaid condition and quantum of award, instant appeal has been preferred by the claimants. 6. This appeal has been admitted for hearing on following substantial questions of law:- 1. Whether the learned Commissioner was justified in awarding interest over the compensation from the date of accident making it conditional for its entitlement in light of the judgment passed by the Hon’ble Supreme Court cited in AIR (2012) SCW 4384? 2. Whether the learned Commissioner was justified in assessing the income of the deceased as 5,460/- without appreciating that the minimum wage as per Minimum Wages Act for the year 2015 is Rs.6,300/-? 7. Learned counsel for the appellants/claimants would submit that, as per Section 4A (3) of the Act, 1923, interest is payable on the amount of compensation when it fell due i.e. from the date of accident, but in instant case, the Commissioner has granted conditional interest @ 12%, that aforesaid interest shall be payable, if amount of compensation is not paid within a period of 45 days from the date of award, hence, imposing such condition is against the provision of Section 4A (3) of the Act, 1923. He would further submit that he does 4 not want to challenge assessment of loss of income of deceased and amount of compensation taking 26 days as actual working days. 8. Learned counsel appearing for the respondent No.2 -Insurance Company supports the impugned judgment dated 25.10.2018. 9. At the outset, learned counsel for appellant submits that he does not want to contest actual working days and monthly income of deceased along with amount of compensation assessed /calculated by learned trial Court, therefore, second question of law is answered against the appellants/claimants. 10. So far as interest part is concerned, learned Labour Court has granted conditional interest that, if the amount of compensation is not paid within a period of 45 days, then said interest shall be payable, but such condition cannot be imposed while granting interest as has been provided in Section 4A (3) of the Act, 1923, which reads thus:- “ 4A(3) where any employer is in default in paying the compensation due under this Act within one month from the date it fell due, the commissioner shall:- (a) direct that the employer shall, in addition to the amount of the arrears, pay simple interest thereon at the rate of twelve percent per annum or at such higher rate not exceeding the maximum of the lending rates of any scheduled bank as may be specified by the Central Government by notification in the Official Gazette, on the amount due; and (b) if, in his opinion, there is no justification for the delay, direct that the employer shall, in addition to the amount of the arrears and interest thereon, pay a further sum not exceeding fifty per cent of such amount by way of penalty: 5 Provided that an order for the payment of penalty shall not be passed under clause (b) without giving a reasonable opportunity to the employer to show cause why it should not be passed. 11. In the case of Shobha Vs. The Chairman, Vitthal Rao Shinde in Civil Appeal No.1860 of 2022 decided by Hon’ble Apex Court on 11-03- 2022, it has been held that:- “Therefore, on the death of the employee/ deceased immediately, the amount of compensation can be said to be falling due. Therefore, the liability to pay the compensation would arise immediately on the death of the deceased. Even as per Section 4A(2), in cases, where the employer does not accept the liability for compensation to the extent claimed, he shall be bound to make provisional payment based on the extent of liability which he accepts, and, such payment shall be deposited with the Commissioner or made to the employee, as the case may be, without prejudice to the right of the employee to make any further claim. Therefore, the liability to pay the compensation would arise from the date on which the deceased died for which he is entitled to the compensation and therefore, the liability to pay the interest on the amount of arrears/compensation shall be from the date of accident and not from the date of the order passed by the Commissioner. ...” 12. This issue is no more res integra as Hon’ble the Supreme Court in case of Ajay Kumar Das Vs. Divisional Manager (2022 SCC OnLine SC 93) has reiterated the law that compensation is payable within one month from the date when it fell due. Hon’ble the Supreme Court in paragraph 5 & 6 has held as under: 6 “5……..To set the record straight, the High Court has erred on merits as well. Section 4A of the Workmen’s Compensation Act 1923 stipulates that the Commissioner shall direct the employer to pay interest of 12% or at a higher rate, not exceeding the lending rates of any scheduled banks specified, if the employer does not pay the compensation within one month from the date it fell due. In Saberabibi Yakubhai Shaikh v. National Insurance Co. Ltd. [(2014) (2) SCC 298], this Court held that interest shall be paid on the compensation awarded from the date of the accident and not the date of adjudication of the claim in view of the decision of this Court in Oriental Insurance Co. Ltd. v. Siby George [(2012) SCC 540] where it was held that compensation would fall due from the date of the accident. Further, in the recent decision in P. Meenaraj v. P. Adigurusamy & Anr. (Civil Appeal No. 209/2022 decided on 6-1-2022), this Court reiterated that the applicant is entitled to interest from the date of accident while rejecting the submission that the award of interest should be after the expiry of 30 days from the date of accident. Thus, there was no legal basis for the High Court to delete the order of payment of interest.
Decision
6. For the above reasons, we set aside the direction contained in the order of the High Court dated 11 April 2018 by which the order for the payment of interest was deleted. The order for the payment of interest which was issued by the Additional Labour Commissioner-cum-Commissioner, Workmen Compensation shall together with the award of compensation stand restored.” 13. In view of the aforesaid law laid down by Apex court, it is 7 abundantly clear that, award of compensation fells due on the date of occurrence/ accident and computation of compensation and grant of interest begins from the date, it fell due i.e. the date of accident and not the date of award, till its realization. In case of accident out of use of motor vehicle causing death or injuries to employee, the insurer of vehicle can’t escape liability to pay the interest on principal amount of award. 14. Having considered aforesaid law, it is abundantly clear that granting conditional interest by the Commissioner is against the law, therefore, condition imposed by the Commissioner in this regard is set- aside/quashed and it is directed that amount of compensation i.e. Rs.5,67,785/- assessed by the Commissioner shall carry interest of 12% per annum from the date of accident i.e. on 02.12.2015. Accordingly, first question of law is answered in favour of appellants/ claimants and against the respondents. 15. In view of above discussion, the instant appeal is allowed in part and respondents are directed to pay interest @ 12% per annum on the amount of compensation of Rs.5,67,785/- to the appellants/claimants from the date of accident i.e. 02.12.2015, till its actual realization / payment of compensation. Rest of the terms of the impugned judgment shall remain intact. 16. The appeal is allowed to the extent indicated here-in-above. Record of the Labour Court be returned along with a copy of this Order. Sd/- (Naresh Kumar Chandravanshi) JUDGE Rukhsar RUKHSAR BANO Digitally signed by RUKHSAR BANO Date: 2025.07.01 16:53:18 +0530