Orissa High Court
Case Details
Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 A.F.R. IN THE HIGH COURT OF ORISSA AT CUTTACK FAO No.31 of 2025 (An Appeal under Section 30 of the Employee’s Compensation Act, 1923) The Divisional Manager, M/S. ICICI Lombard General Insurance Company Ltd., Bhubaneswar …. Appellant (s) Ashalata Barik & Anr. …. Respondent (s) -versus- Advocates appeared in the case through Hybrid Mode: For Appellant (s) For Respondent (s) : : Mr. G.P. Dutta, Adv. Mr. Bijayananda Samantaray, Adv. CORAM: DR. JUSTICE SANJEEB K. PANIGRAHI DATE OF HEARING:-16.07.2025 DATE OF JUDGMENT:-19.08.2025 Dr. S.K. Panigrahi, J. 1. The Appellant, being aggrieved by the judgment dated 07.12.2024 passed in E.C. Case No. 235 of 2023 by the learned Divisional Labour Commissioner-cum-Commissioner for Employees’ Compensation, Cuttack, has preferred the present appeal. I. FACTUAL MATRIX OF THE CASE:
Facts
2. The brief facts of the case are as follows: Page 1 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 (i) On 10.08.2023, at about 4:00 A.M., one Ronit Barik, the deceased, was travelling in a TATA ACE vehicle bearing registration number OD-02- CH-8537, which was proceeding towards Cuttack from Bhubaneswar. The driver of the said vehicle parked it on the left side of the road near the Government Timber Depot on the Puri Bypass Road to attend to a call of nature. (ii) While the deceased was inside the cabin, a Hywa vehicle coming from the opposite direction collided head-on with the TATA ACE and fled the scene. The deceased sustained grievous injuries and was shifted to Capital Hospital, Bhubaneswar, where he was declared dead on the same day. (iii) In connection with the accident, Badagada P.S. Case No. 434 dated 10.08.2023 was registered. (iv) Subsequently, E.C. Case No. 235 of 2023 was instituted by the claimants seeking compensation on account of the death of the deceased, alleged to have arisen out of and in the course of employment. The Respondent No. 1 filed a written statement admitting the occurrence of the accident and the death, and further stating that a monthly sum of ₹12,000 was being paid to the deceased. (v) The present appellant filed a written statement denying the material averments in the claim application. (vi) On the basis of the pleadings, the learned Commissioner framed three issues for adjudication. Upon consideration of the materials on record, the learned Commissioner directed the appellant to pay a sum of ₹15,49,329 within 40 days from the date of the order, failing which the Page 2 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 amount would carry a penalty of 50 percent along with interest at 12 percent per annum. (vii) Aggrieved by this, the appellant has preferred the present appeal. II. 3. (i) SUBMISSIONS ON BEHALF OF THE APPELLANT: Learned counsel for the Appellant earnestly made the following submissions in support of his contentions: The Learned Commissioner acted illegally and with material irregularity in holding that the deceased was a helper in the offending vehicle and that his death arose out of and in the course of employment, despite the fact that he was the son of the vehicle’s owner. The claimants, by perpetuating fraud, impleaded the father as O.P. No. 1 to claim compensation. The judgment is thus unsustainable and liable to be set aside. (ii) The Police Report in Badagada P.S. Case No. 434 of 2023 clearly shows that the deceased was the son of O.P. No. 1 and was travelling in the TATA ACE bearing No. OD-02-CH-8537 with the driver and another person on the date of the accident. Nowhere in the Police papers is there any mention of the deceased being employed as a helper under O.P. No. 1. By falsely portraying him as a helper, the claimants secured illegal compensation. The judgment is therefore unsustainable and liable to be set aside. (iii) The final form reveals that the deceased, Ronit Barik, son of O.P. No. 1, had gone to Bhubaneswar with his friend Jayaram Sahu and driver Sarat Chandra Mallick without informing their families. While returning to Cuttack, both Ronit and Jayaram fell asleep beside the driver. Near the Timber Depot at Kesura, the driver stopped the Page 3 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 vehicle to attend to the call of nature. At that time, a Hywa truck coming from the wrong side hit the stationary TATA ACE and fled. The driver also fled the scene out of fear, as the trip was unauthorized and not disclosed to the owner. These facts were brought before the Learned Commissioner through the testimony of a witness and documents. However, without any discussion of this evidence, the Learned Commissioner erroneously fixed liability on the appellant. Given the clear indication of fraud, the judgment is unsustainable and liable to be set aside. (iv) The claimants, by perpetuating fraud during the course of evidence, developed the case that the deceased was staying separately at the time of the alleged accident, despite there being no such plea in the claim application. The judgment is therefore unsustainable and liable to be set aside. (v) The claimants have admitted in the police papers that three persons were travelling in a goods vehicle, which is a clear violation of the Motor Vehicles Act. As the deceased was an unauthorized passenger, the appellant is not liable to pay any compensation. Despite this, the Learned Commissioner, in a cryptic manner, fastened liability on the appellant. (vi) The Learned Commissioner acted illegally and with material irregularity in not holding that the deceased, being the son of the owner, had an insurable interest in the vehicle. In such circumstances, the claim application is not maintainable. (vii) The Learned Commissioner acted illegally in accepting that the deceased was 21 years old and earning ₹12,000 per month at the time Page 4 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 of the accident, despite the absence of any documentary evidence. It is well settled that minimum wages and reliable proof of age must form the basis for determining compensation. The findings being unsupported by evidence, the judgment is unsustainable and liable to be set aside. (viii) The Learned Commissioner acted illegally and with material irregularity in saddling the liability on the appellant, particularly when the owner had not registered the deceased as a workman under the provisions of the Motor Transport Workers Act in relation to the alleged offending vehicle. (ix) The direction of the Learned Commissioner to deposit the awarded amount within 30 days, failing which a 50% penalty and further 12%
Legal Reasoning
interest shall be imposed, is unsustainable. It is settled law that in cases under the Workmen’s Compensation Act, the insurer is not liable to pay interest or penalty in the absence of a contractual obligation under the policy. Moreover, such directions cannot form part of the main judgment. The impugned order is therefore contrary to binding precedents and is liable to be set aside. III. SUBMISSIONS ON BEHALF OF THE RESPONDENTS: 4. (i) The Learned Counsel for the Respondents earnestly made the following submissions in support of his contentions: The principal ground of challenge raised by the appellant is that the deceased, being the son of the owner of the offending vehicle, could not have been employed as a helper. This submission is untenable as there exists no legal bar preventing a son from working as a helper on a vehicle owned by his father. The Learned Commissioner, upon Page 5 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 appreciation of the evidence, rightly found that the deceased was working in that capacity, and such an arrangement is permissible under law. The mere relationship between the deceased and the owner does not negate the possibility of a valid employer–employee relationship. (ii) In the present case, although the owner of the offending vehicle is the father of the deceased, it has been brought on record that they were living separately, with the claimants residing in a different household along with the deceased. The owner himself appeared as a witness and filed a written statement, categorically stating in his deposition that the deceased was employed as a helper on the vehicle and was earning ₹12,000 per month. The accident, which occurred on 10.08.2023 at about 4:00 A.M., clearly arose in the course of such employment. (iii) Under the provisions of the Employee’s Compensation Act, 1923, an appeal lies only on a substantial question of law. The existence of an employer–employee relationship in the present case is a pure finding of fact, and the relationship between the deceased and his father does not constitute a substantial question of law so as to maintain the present appeal. (iv) The appellant did not adduce any evidence before the learned Commissioner to disprove the case of the claimants. No effort was made to establish that the deceased was not working as a helper under the owner of the vehicle, nor was the factum of the accident itself ever disputed. Raising such a plea for the first time in appeal, that the deceased was not employed and that his death did not occur in the course of employment, is neither tenable nor maintainable in law. Page 6 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 IV. FINDINGS OF THE DIVISIONAL LABOUR COMMISSIONER-CUM- COMMISSIONER FOR EMPLOYEES’ COMPENSATION, CUTTACK The Divisional Labour Commissioner-cum-Commissioner for 5. Employees’ Compensation, Cuttack, framed four issues on the basis of the pleadings: (i) whether the deceased was an employee within the meaning of the Act; (ii) whether the accident arose out of and in the course of his employment as helper; (iii) whether the applicants were entitled to compensation and, if so, to what quantum; and (iv) which of the opposite parties was liable to pay such compensation. 6. In support of the claim, the mother of the deceased was examined as P.W.1 and produced police papers including the FIR, final form, inquest and post-mortem reports. The owner of the vehicle (O.P.W.1) also entered appearance and in his deposition admitted that the deceased was employed as a helper on his TATA ACE and was being paid monthly wages of ₹12,000, excluding fooding allowance. The occurrence of the accident and the resultant death on 10.08.2023 stood established through oral as well as documentary evidence. The insurer, Opposite Party No. 2, denied the claim but adduced no evidence to disprove the employment of the deceased or the occurrence of the accident. 7. Upon appreciation of the evidence, the Learned Commissioner recorded findings that the deceased was employed as a helper under Opposite Party No. 1 and that his death occurred in an accident arising out of and in the course of such employment. The age of the deceased was accepted as 21 years on the basis of the post-mortem report, and his wages were assessed at ₹12,000 per month in view of the consistent Page 7 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 statements of P.W.1 and O.P.W.1. Applying the relevant factors under the Act, 50% of the monthly wages was multiplied by the relevant factor of 222.71, resulting in a compensation figure of ₹13,36,260. Interest at 12% per annum from the date of accident was awarded, amounting to ₹2,13,069, thereby bringing the total compensation to ₹15,49,329. 8. On the issue of liability, the Learned Commissioner found that the offending vehicle was duly insured with Opposite Party No. 2, ICICI Lombard General Insurance Company Ltd., under a valid policy covering the date of accident, and accordingly fastened the liability upon the insurer to deposit the awarded sum within 30 days of the order. It was further directed that in the event of default, the insurer would be liable to pay 50% penalty in addition to interest at 12% per annum under Section 4A of the Act. V. THE COURT’S REASONING AND ANALYSIS: 9. 10. Heard learned counsel for the parties and perused the material on record. At the outset, it is necessary to bear in mind the statutory framework under which the present appeal has been preferred. Section 30 of the Employees’ Compensation Act, 1923 provides for an appeal to this Court only against the specific orders enumerated in clauses (a) to (e) of the section and further subjects such appeal to the condition that it must involve a substantial question of law. 11. In this regard, the Supreme Court in North East Karnataka Road Transport Corpn. v. Sujatha1 observed that the High Court’s 1(2019) 11 SCC 514. Page 8 of 12 jurisdiction under Section 30 is not akin to a first appeal under Section 96 CPC and that it is confined only to substantial questions of law. The relevant extract is reproduced hereinunder: Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 “9. At the outset, we may take note of the fact, being a settled principle, that the question as to whether the employee met with an accident, whether the accident occurred during the course of employment, whether it arose out of an employment, how and in what manner the accident occurred, who was negligent in causing the accident, whether there existed any relationship of employee and employer, what was the age and monthly salary of the employee, how many are the dependants of the deceased employee, the extent of disability caused to the employee due to injuries suffered in an accident, whether there was any insurance coverage obtained by the employer to cover the incident, etc. are some of the material issues which arise for the just decision of the Commissioner in a claim petition when an employee suffers any bodily injury or dies during the course of his employment and he/his LRs sue(s) his employer to claim compensation under the Act. 10. The aforementioned questions are essentially the questions of fact and, therefore, they are required to be proved with the aid of evidence. Once they are proved either way, the findings recorded thereon are regarded as the findings of fact. 11. The appeal provided under Section 30 of the Act to the High Court against the order of the Commissioner lies only against the specific orders set out in clauses (a) to (e) of Section 30 of the Act with a further rider contained in the first proviso to the section that the appeal must involve substantial questions of law. 12. In other words, the appeal provided under Section 30 of the Act to the High Court against the order of the Commissioner is not like a regular first appeal akin to Section 96 of the Code of Civil Procedure, 1908 which can be heard both on facts and law. The appellate jurisdiction of the High Court to decide the appeal is confined only to Page 9 of 12 examine the substantial questions of law arising in the case.” 12. In the present case, the Commissioner, upon appreciation of oral and Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 documentary evidence, found that the deceased was employed as a helper under Opposite Party No. 1, was 21 years of age at the time of his death, and was earning ₹12,000 per month. These findings were based not merely on the testimony of the claimants but also on the categorical admission of the owner of the vehicle, who deposed that the deceased was working as his helper and was being paid wages of ₹12,000. The police papers and post-mortem report further corroborated the age and occurrence of the accident. No evidence was led by the present appellant-insurer to dislodge these findings. Such conclusions, being rooted in evidence and not shown to be perverse, cannot be reopened in appeal. The attempt of the appellant to assail these findings amounts to seeking a reappreciation of facts, which is impermissible within the narrow compass of Section 30 jurisdiction. 13. The plea that the deceased, being the son of Opposite Party No. 1, could not be his employee does not raise any substantial question of law. The existence of an employer–employee relationship is a pure question of fact, determined by the Commissioner on the basis of evidence, including the owner’s own admission. 14. However, one aspect of the Commissioner’s order does raise a substantial question of law, namely, the fastening of liability on the insurer not only to pay compensation and interest but also the penalty under Section 4A(3)(b) of the Act. Page 10 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 15. The legal position on this point is well settled. In Ved Prakash Garg v. Premi Devi2, the Supreme Court observed that the Insurance Company, so far as the question of penalty is concerned, would not be liable under the provision of the Workmen’s Compensation Act, 1923. 16. While the insurer is liable to indemnify the employer for the compensation and interest payable under Section 4A(3)(a), the penalty imposed under Section 4A(3)(b) is on account of the personal fault of the employer and does not fall within the scope of indemnification. The insurer cannot, therefore, be made liable for penalty. 17. In light of the above legal position, while the award of compensation and interest at the rate of 12% per annum from the date of accident as determined by the Commissioner is affirmed, the direction fastening liability on the appellant-insurer to pay penalty under Section 4A(3)(b) cannot be sustained and is accordingly set aside. The liability to pay penalty, if any, shall rest exclusively on Opposite Party No. 1, the employer. VI. CONCLUSION: 18. In view of the foregoing discussion, this Court finds no infirmity in the findings of fact recorded by the learned Commissioner with respect to the employment of the deceased, the circumstances of the accident, his age, or his monthly wages. Those findings are supported by evidence and cannot be reopened in the limited jurisdiction under Section 30 of the Employees’ Compensation Act, 1923. 19. However, fastening liability upon the appellant-insurer to pay penalty under Section 4A(3)(b) of the Act is unsustainable in law. While the 2(1997) 8 SCC 1. Page 11 of 12 Signature Not Verified Digitally Signed Signed by: BHABAGRAHI JHANKAR Reason: Authentication Location: ORISSA HIGH COURT, CUTTACK Date: 04-Sep-2025 19:41:54 insurer is liable to indemnify the employer in respect of the compensation together with statutory interest under Section 4A(3)(a), the liability to pay penalty rests solely upon the employer. 20. The impugned judgment dated 07.12.2024 passed by the learned Commissioner is modified to the extent that the appellant-insurer shall remain liable to pay the compensation of ₹13,36,260/- (Rupees Thirteen Lakhs Thirty Six Thousand Two Hundred Sixty only) together with interest at the rate of 12% per annum from the date of accident till realization. The direction to pay penalty under Section 4A(3)(b) is set aside insofar as it concerns the appellant-insurer. The liability to pay penalty, if any, shall rest exclusively with the employer. Accordingly, the appeal is partly allowed in the above terms. Interim order, if any, passed earlier stands vacated. 21. 22. (Dr. Sanjeeb K. Panigrahi) Judge Orissa High Court, Cuttack, Dated the19th August, 2025/ Page 12 of 12