Nafr High Court
Case Details
1 2025:CGHC:25544 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR MAC No. 1352 of 2017 1 - Smt. Manju Sahu Wd/o Late Shri Dev Kumar Sahu Aged About 33 Years R/o Village- Jhalfa, Police Station- Bilha, District- Bilaspur, Chhattisgarh. 2 - Ku. Shobha Sahu D/o Late Shri Dev Kumar Sahu Aged About 13 Years Minor- Through Their Mother- Smt. Manju Sahu Appellant No. 1 Wd/o Late Shri Dev Kumar Sahu, R/o Village Jhalfa, Police Station- Bilha, District Bilaspur, Chhattisgarh. 3 - Ku. Lawali Sahu D/o Late Shri Dev Kumar Sahu Aged About 11 Years Minor- Through Their Mother- Smt. Manju Sahu Appellant No. 1 Wd/o Late Shri Dev Kumar Sahu, R/o Village Jhalfa, Police Station- Bilha, District Bilaspur, Chhattisgarh. 4 - Rudra Sahu S/o Late Shri Dev Kumar Sahu Aged About 9 Years Minor- Through Their Mother- Smt. Manju Sahu Appellant No. 1 Wd/o Late Shri Dev Kumar Sahu, R/o Village Jhalfa, Police Station- Bilha, District Bilaspur, Chhattisgarh. versus ... Appellants 1 - Harbhajan Singh Gambhir S/o Shri Pritam Singh Gambhir Aged About 37 Years R/o Flat No. 01, Floor No. 3, Block B, Shriram Tower, Vyapar Vihar Bilaspur, Tahsil And District Bilaspur, Chhattisgarh. Present Address- Green Park, Police Station- Civil Line Bilaspur, Tahsil And District- Bilaspur, Chhattisgarh. Owner Of Trailer No. C. G. 10/ T-3511 2 - The Branch Manager, The New India Insurance Company Limited, Branch Office Second Floor, Rama Trade Center, Opposite Rajiv Plaza, Old Bus Stand, Bilaspur, Tahsil And District Bilaspur, Chhattisgarh. Insurer Of Trailer No. C. G.- 10/t- 3511 ... Respondents For Appellants
Legal Reasoning
: Mr. Vikram Pillai, Advocate on behalf of Rishi Rahul For Respondent(s) : None appears. Soni, Advocate BINI PRADEEP Digitally signed by BINI PRADEEP Date: 2025.06.19 18:04:00 +0530 2 (Hon’ble Shri Justice Naresh Kumar Chandravanshi) Order on Board 16/06/2025 Heard. This is a claimants’ appeal under Section 30 of the Employee’s 1. 2. Compensation Act, 1923 (for short ‘the Act of 1923’) against order dated 12.6.2017 passed by Commissioner, Employees Compensation Act, Labour Court, Bilaspur (CG) (for short ‘the Commissioner”) in Case No.99/E.C.Act/2014 fatal, whereby the learned Commissioner has granted compensation in favour of the appellants/claimants to the tune of Rs.7,88,240/-, but granted interest @ 12% per annum from the date of order till its realization, if the amount of award is not paid within one month and it has also not granted penalty. 3. Facts of the case, in brief are that, deceased Dev Kumar Sahu was husband of appellant No.1 and father of appellants No.2 to 4. He was working as driver of trailer bearing No.CG-10/T-3511, which was owned by respondent No.1/employer and insured by respondent No.2/Insurance company. On 12.8.2014, Dev Kumar Sahu was returning from Akaltara to Bilaspur after unloading coal from aforesaid trailer and when he reached near Sirgitti bypass, all of sudden, he lost control over the trailer and dashed with culvert and succumbed to the injuries. The claimants filed application under Section 22 read with Section 10 of the Act 1923 seeking amount of compensation to the tune of Rs.7,88,240/-, other expenses and penalty along with interest. 4. Respondent No.1/employer remained absent and he did not file written statement. Respondent No.2/Insurance Company filed its written statement denying the substantive pleadings of the claimants by pleading that the trailer 3 was being driven by the deceased violating the policy conditions and the accident occurred because of his own negligency. 5. On the basis of pleadings of both the parties, the Commissioner framed as many as 07 issues, recorded evidence of the parties and after considering the same, allowed the application of the claimants in part and granted compensation in favour of them to the tune of Rs.7,88,240/-. It has further directed that if the aforesaid amount is not paid within 30 days from the date of order, then it shall carry interest @ 12% per annum from the date of order till its realization. 6. The appellants/claimants have filed instant appeal seeking grant of interest from the date of accident and also sought penalty, which has not been granted by the Commissioner. 7. This appeal has been admitted for hearing on the following substantial questions of law:- “(1) Whether the Commissioner for Employees Compensation was justified in not granting the interest to the Claimants as is required under Section 4-A of the Employees Compensation Act? (2) Whether in the given factual matrix of the case the Claimants were also entitled for penalty or not?” 8. Learned counsel for the appellants would submit that, in instant case, by the impugned award, learned Labour Court has granted 12% interest against the amount of award, but, it has been directed that, if it is not paid within one month from the date of award, then, said interest shall be payable from the date of award, whereas, as per Section 4A(3)(a) of the Employees Compensation Act, 1923, 12% interest is payable from the date when compensation fell due, meaning thereby, interest is payable from the date of accident. He further submits that, the Labour Court has not granted any 4 amount in respect of penalty as, after alleged accident, the employer had not paid any amount as provided under Section 4A(2) of the Act 1923. Hence, he prayed that, the appeal may be allowed and the amount of interest be paid from the date of accident and penalty may also be imposed. 9. None appeared for the respondents. 10. Heard learned counsel for the appellants and perused the record of the case. 11. Vide impugned order, the Commissioner has granted 12% annual interest upon the award of compensation, that too from the date of order with a condition that said interest shall be payable if the amount of compensation is not paid within one month from the date of order, i.e. 12.6.2017, meaning thereby, if the compensation amount is paid within one month from the date of order, then the claimants will not be entitled for any interest on the amount of compensation. But this observation of the Commissioner is completely against the provisions of Section 4A(3) of the Act 1923, as interest on the amount of compensation is payable from the date it fell due. 12. Provision for payment of interest on amount of compensation has been provided in Section 4A(3)of the Employee’s Compensation Act which reads as under:- “ 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 5 (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: 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. 13. 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. ...” 6 14. 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: “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 7 which was issued by the Additional Labour Commissioner-cum-Commissioner, Workmen Compensation shall together with the award of compensation stand restored.” 15. In view of the aforesaid law laid down by Apex court, it is abundantly clear that, award of compensation fells due on the date of occurrence/ accident and computation of compensation and 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 award. 16. Having considered the aforesaid law, it is found that the Commissioner has not granted interest on the amount of compensation from the date of accident, rather it has granted interest to the tune of 12% per annum from the date of order i.e. 12.6.2017, that too, if the compensation amount is not paid within one month from the date of order, meaning thereby that, if the amount of compensation is paid to the claimants by the insurance company within 30 days, then interest will not be payable at all, whereas, the accident of the instant case was occurred on 12.8.2014 and as per the statutory mandate of Section 4A(3) fo the Act 1923 and the law laid down by the Apex Court, interest on the amount of compensation is payable from the date of accident. However, the learned Commissioner has not followed the above statutory provision while passing the impugned order, hence, the same requires interference of this Court. Therefore, in view of the above discussion, order of granting interest to the tune of 12% per annum from the date of impugned order, is perverse and illegal hence, the same is required to be modified. Therefore, respondent No.2/Insurance Company is directed to pay interest @ 12% per annum on the amount of compensation i.e. Rs.7,88,240/- from the 8 date of accident, i.e. 12.8.2014 till its realization, as such, first question of law is answered in favour of the appellants/claimants and against the respondents. 17. So far as second question of law with regard to entitlement for penalty to the appellants/claimants is concerned, Section 4A(2) contemplates that, “if the employer does not accept 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.” Thus, as per the aforesaid provision, provisional payment was to be made by the employer either to the employee or it may be deposited with the Commissioner. But in the instant case, nothing has been brought on record to ascertain as to whether any provisional payment was made by the employer to the employee/claimants or not, or whether the same has been deposited with the Commissioner or not. 18. The employer/respondent No.1 remained absent therefore, specific fact in this regard ought to have been brought on record by the claimants, but no specific facts have been brought on record by the parties. Section 4A(3) (b) of the Act 1923 further provides that, unjustifiable delay in payment of provisional amount shall entitled the employee/claimant for getting penalty, but as has been stated above, whether any provisional payment has been made by the employer or not is not clear from the record, therefore, in such ambiguous circumstances, the claimants cannot be held to be entitled to get penalty on the amount of compensation granted to them, as such, second question of law is answered accordingly. 19. In view of the above discussion, I feel inclined to allow the appeal in part. Consequently, the instant appeal is allowed in part and the relief granted by the Commissioner, Employees Compensation Act, Labour Court, 9 Bilaspur (CG) in para 13(ब) of relief clause of the impugned order dated 12.6.2017, is modified to the extent that the claimants are entitled to get interest @ 12% per anuum on the amount of Rs.7,88,240/- from the date of accident, i.e. from 12.8.2014 till its realization. Remaining part of the relief(s) granted vide impugned order shall remain intact. 20. Respondent No.2/Insurance Company is directed to pay the amount of interest to the appellants/claimants, as above, within 30 days from today. 21. The appeal is allowed to the extent indicated herein above. Record of the Labour Court be returned along with a copy of this Order. Sd/- (Naresh Kumar Chandravanshi) Judge Bini