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FA/278/2002 5/ 5 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL No. 278 of 2002
For
Approval and Signature:
HONOURABLE
MR.JUSTICE KS JHAVERI
======================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To
be referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
======================================
UNITED
INDIA INSURANCE CO.LTD.
Versus
KHAIRUNISA
BANUBHAI FAKIR AND OTHERS
======================================
Appearance
:
MR SV RAJU for Appellant.
MRS
SHILPA D SHAH for Respondent Nos.1 - 3.
MR KARTIK V PANDYA for
Respondent Nos.1 - 3.
RULE SERVED for Respondent
No.2.
======================================
CORAM
:
HONOURABLE
MR.JUSTICE KS JHAVERI
Date
: 02/09/2008
ORAL
JUDGMENT
1) By
way of this appeal, the appellant has challenged judgment and award
dated 26.8.1987 passed by the learned Ex-officio Commissioner for
Workmen’s Compensation, in Workman Compensation Application No.12 of
1986 whereby the learned Commissioner, Himmatnagar has awarded
Rs.52,788/- and also directed the opponents to pay penalty of 25%
of the total amount of compensation.
2. The
facts in brief, as emerging from record, are as under:
3.
As per the case of the claimants, that deceased Babubhai was working
as a driver with opponent no.1 and was earning Rs.600/- per month as
salary. That on 16-12-1985, while discharging his duties as a driver
on tempo no. GRN 3049, which is of the ownership of opponent no.1,
the deceased was proceeding from Bhiloda to Himmatnagar on National
Highway No.8 and during that time tempo met with an accident in the
sim of village Karanpur. In the said accident, said Babubhai
received injuries and as a result of it, Babubhai died on spot. It
is also stated that at the time of accident the deceased was 23 years
of age. It is also the say of the claimants that the accident has
occurred during the course of employment and, therefore, opponent
no.1 is liable to pay compensation as admissible under Workmen
Compensation Act. It is also the say of the claimants that since the
tempo was insured with opponent no.2, opponent no.2 is liable to
indemnify liability of opponent no.1. It is also contended that for
said purpose notice was given to the opponents, but the opponents
have not paid any amount, therefore, the claimants have filed Workmen
Compensation Application before Workmen Compensation Commissioner,
Himmatnagar. Said application was resisted by opponents by filing
written statement at Exh.34 contending that it is for the claimants
to prove that the deceased was 23 years of age at the time of the
accident. However, factum regarding death of deceased during the
course of employment as well as the fact that he was drawing monthly
salary of Rs.600/- are admitted. However, it is stated that it is
for the claimants to prove that they are dependents of the deceased
and prayed for dismissal of application. Opponent no.2 has also
resisted the application by filing written statement at Exh.11 and
contended that liability of the insurance company is limited either
under the Motor Vehicles Act or as per the policy of insurance
company. It is also contended by insurance company that the deceased
was not possessing valid driving license therefore, the claim is not
required to be granted. It is also contended that the claim of the
claimants is excessive and, therefore, claim application is required
to be dismissed. After considering the evidence on record, Workmen
Compensation Commissioner allowed said application and awarded
Rs.52,788/- as compensation and also directed to pay penalty to the
tune of 25% on the total compensation amount.
4. Being
aggrieved and dissatisfied with the judgment and award passed by the
learned Workmen Compensation Commissioner, Himmatnagar, the
appellant-insurance company has preferred present appeal.
5. Heard
Mr.S.V.Raju, learned Advocate appearing for the appellant-insurance
company. He has submitted that the amount awarded by the learned
Workmen Compensation Commissioner, Himmatnagar has not been rightly
awarded as there is a clause in the insurance policy which provides
that in case of accident, insurance company is not liable to pay the
amount of penalty. He has also submitted that there is no statutory
liability under the Workmen’s Compensation Act, 1923 on the insurance
company to pay the amount of penalty. He has further submitted that
it is a matter of contract between the insurance company and the
insured and it is always open to the insurance company to refuse to
insured. The insurance company is also entitled to provide the terms
in the contract that the insurance company will not be liable to pay
penalty amount. Relying upon the decision of the Apex Court rendered
in S.L.P. (Civil) No.341 of 2003 in case of P.J.Narayan
Vs. Union of India and Ors., Mr. Raju submitted that in
absence of any statute to this effect the insurance company cannot be
forced by the Court to take the liability which is not contemplated
under the policy. Mr.Raju, learned Advocate has also relied upon the
decision of the Hon’ble the Supreme Court in
case of New India Assurance Co.Ltd. v.
Harshadbhai Amrutbhai Modhiya, reported in AIR SC Weekly Vol.3,
2006, 2353, wherein
the Hon’ble the Supreme Court has held that the Insurance Company is
not liable for the interest. The Hon’ble the Supreme Court, in the
given case, construing the contract involved, held that the insurer
has specifically excluded any liability for interest or penalty under
the Workmen’s Compensation Act and confined the liability to
indemnify the employer only against the amount of compensation to be
paid under the Workmen’s Compensation Act.
6. The
learned Advocate for the respondent Nos.1 to 3 has submitted that the
learned Workmen Compensation Commissioner, Himmatnagar, has rightly
awarded the compensation amount with penalty by considering the age
of the deceased and the salary which was being paid to the deceased.
The learned Advocate has further submitted that the learned
Commissioner, Himmatnagar, has rightly come to the conclusion that
since appellant herein failed to pay or deposit the amount of
compensation it is liable to pay penalty on said amount. Therefore,
it is rightly held that the insurance company is also liable to pay
compensation amount and penalty thereon. The learned Advocate has
submitted that the respondent No.1 herein has produced all necessary
documentary evidences in support of claim for amount of compensation
relying on which the learned Commissioner, Himmatnagar has rightly
awarded compensation and penalty interest thereon.
7. I
have considered the submissions made by learned advocates for both
the sides. I have also gone through the documents on record and
impugned judgment of the Commissioner as well as decisions cited by
learned advocate for the appellant. Looking to the settled legal
position of law as held by the Hon’ble the Supreme Court in case of
New India Assurance Co.Ltd. v. Harshadbhai Amrutbhai Modhiya
(supra),
the Court is of the opinion that the Insurance Company is not
required to make payment towards penalty on compensation amount.
Therefore, submissions of the learned Advocate appearing for
Insurance Company are required to be accepted. Therefore, order
impugned herein is required to be modified accordingly.
8. With
the above observations, appeal is partly allowed. The appellant
herein will not be required to make any payment towards penalty.
However, it is held liable to pay principal amount of compensation
as awarded by Workmen Compensation Commissioner. It will be open for
the claimant to recover amount of penalty from the employer.
9. The
appeal is allowed to the aforesaid extent with no order as to costs.
(K.S.JHAVERI,
J.)
*malek
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