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FA/3357/2005 5/ 5 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL No. 3357 of 2005
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 ?
==========================================
THE
NEW INDIA ASSURANCE CO. LTD.
Versus
SHRI
DEVKARANBHAI VASANBHAI KERASIYA & ANR
==========================================
Appearance
:
MR KV GADHIA for Appellant:1
MR
SANDEEP N BHATT for Defendant:1
NOTICE SERVED for
Defendant:2
==========================================
CORAM
:
HONOURABLE
MR.JUSTICE KS JHAVERI
Date
: 29/08/2008
ORAL JUDGMENT
By
way of this appeal, the appellant has challenged judgment and award
dated 14.6.2005 passed by the learned Commissioner under Workmen’s
Compensation Act, Labour Court, Gandhidham-Kuchchh in Workman
Compensation Application No.21 of 2002 whereby the learned
Commissioner, Gandhidham-Kuchchh has awarded Rs.4,54,968/- with
interest @ 9% from the date of accident till realization of amount
and order regarding cost of application, court fees was also made.
The learned Commissioner, Gandhidham-Kuchchh also imposed amount of
Rs.84,400/- towards medical expenses. The opponent no.2 herein was
also directed to pay Rs.10,000/- as an amount of penalty.
The
facts in brief, as emerging from record, are as under:
2.1 As per the
case of the claimant, he was working as Driver with respondent No.2
at the salary of Rs.4000/- per month.
2.2 On 11.5.2002, when
he was driving truck owned by opponent no.2 herein, he met with an
accident which caused serious injuries on his left and right legs and
on different parts of body. He also received 40% permanent
disability. He, thereafter, filed application for compensation for an
amount of Rs.5,00,000/- as compensation along with 18% interest on
the amount of compensation and also 50% amount of penalty on account
of hardships caused to him during the course of employment before the
learned Workmen Compensation Commissioner at Gandhidham-Kuchchh who
vide his judgment and award dated 14.6.2005 allowed the application
by awarding Rs.4,54,968/- as compensation to the respondent No.1
herein along with interest on the said amount @ 9% from the date of
accident till the date of realization of amount and an amount of
Rs.500/- towards cost of an application, Rs.1000/- towards court fee
stamp and Rs.84,000/- towards medical expenses.
2.4 Being aggrieved and
dissatisfied with the judgment and award passed by the learned
Workmen Compensation Commissioner, Gandhidham-Kuchchh, the appellant
herein preferred the present appeal.
Heard
Mr.K.V.Gadhia, learned Advocate appearing for the appellant-New
India Assurance Company Ltd. He has submitted that the amount
awarded by the learned Workmen Compensation Commissioner,
Gandhidham-Kuchchh has not been rightly awarded as there is a clause
in the insurance policy which provides that in case of accident,
insurance company is liable to pay compensation amount only under
the Workmen’s Compensation Act, 1923 but not the interest. He has
also submitted that there is no statutory liability under the
Workmen’s Compensation Act, 1923 on the insurance company. 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 the interest. 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.Parikh 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. The learned Advocate for the appellant has also relied upon
the decision of the Hon’ble the Supreme Court reported in AIR
SC Weekly Vol.3, 2006, 2353 in
case of New India Assurance Co.Ltd. v.
Harshadbhai Amrutbhai Modhiya, 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.
The
learned Advocate for the respondent No.1 has submitted that the
learned Workmen Compensation Commissioner, Gandhidham-Kuchchh, has
rightly awarded the compensation amount with interest by considering
the medical certificate showing permanent disability caused to him
and other medical certificates produced by the respondent No.1 and
the salary which was being paid to the respondent No.1. The learned
Advocate has further submitted that the learned Commissioner,
Gandhidham-Kuchchh, relying upon settled legal proposition of law,
has rightly come to the conclusion that in default of making payment
of compensation within a month by the employer, under the Workmen’s
Compensation Act, the insurance company is also liable to pay
compensation amount and the interest 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,
Gandhidham-Kuchchh has rightly awarded the compensation and the
interest thereon.
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 interest on compensation amount.
The Court is in complete agreement with the submissions of the
learned Advocate appearing for Insurance Company. Therefore, order
impugned herein is required to be modified accordingly.
With
the above observations, appeal is partly allowed. The appellant
herein will not be required to make any payment towards interest
except the principal amount to the claimant. It will be open for the
claimant to recover the interest amount from the employer. The
interest amount on the amount of compensation, if deposited by the
Insurance Company, is not allowed to be withdrawn by the claimant,
but if the same is withdrawn, FDR will be given to the Bank and it
will be open for the claimant to recover the interest amount from
the employer.
The
appeal is allowed to the aforesaid extent with no order as to costs.
(K.S.JHAVERI,
J.)
Amit/-
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