Gujarat High Court
Rajubhai Alias Ashrafali Barkatali ... vs Amitbhai Rajkumar Sharma on 7 July, 2025
NEUTRAL CITATION
C/FA/2444/2007 JUDGMENT DATED: 07/07/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 2444 of 2007
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE HEMANT M. PRACHCHHAK
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Approved for Reporting Yes No
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RAJUBHAI ALIAS ASHRAFALI BARKATALI SHAIKH
Versus
AMITBHAI RAJKUMAR SHARMA & ANR.
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Appearance:
MR.HIREN M MODI(3732) for the Appellant(s) No. 1
MS PRIYAL SHAH FOR MR MURALI N DEVNANI(1863) for the Defendant(s)
No. 1
MR VASANTS SHAH(810) for the Defendant(s) No. 2
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CORAM:HONOURABLE MR. JUSTICE HEMANT M.
PRACHCHHAK
Date : 07/07/2025
ORAL JUDGMENT
1. Present appeal is filed by the appellant - original claimant against the judgment and award dated 12.09.2006 passed by the learned Commissioner for Workmen's Compensation at Surat in Workmen's Compensation Case (N.F.) No.84 of 2004, whereby the learned Commissioner has awarded compensation of Rs.1,41,376/- with interest @ 12% p.a. in favour of original claimant.
2. The short facts giving rise to present appeal are that, the appellant was working with respondent no.1 on the post of Page 1 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025 NEUTRAL CITATION C/FA/2444/2007 JUDGMENT DATED: 07/07/2025 undefined cleaner from 1 year before the accident had occurred. That, the respondent No.1 was running a business of transport and used to give Rs. 50/- per day as Bhattha to the appellant. That, on date 18.03.2004, when the appellant was on duty and on instructions of respondent no.1 was traveling in tempo bearing registration No. GJ-4-V-1652 from Bhavnagar to Mumbai with Goods, one truck which was passing through Ubhel Village border, came with full speed in rash and negligent manner and dashed with the tempo of he appellant due to which, the tempo suddenly turn turtle on the road. As a result of this accident, the appellant got serious injuries and fractures on his both legs and ankle. That, the appellant admitted in Civil Hospital, Surat where he was treated as indoor patient and for long time he was treated as outdoor patient. That, due to injury on the both the legs the appellant sustain 100% permanent disablement. Therefore, the appellant had filed a petition for Compensation of Rs. 4,00,878/- alongwith interest and penalty under the provision of Workman Compensation Act, and in the said application after hearing both the sides, the learned Workman Compensation Commissioner partly allowed the claim petition and awarded Rs.1,41,376/- with 12% interest p.a. and 50% penalty and Rs. 2,000/- as cost by his order dated 12.09.2006. The learned Commissioner held that the respondent no.1 i.e. owner is liable for the Interest and penalty and respondent no.2 liable for compensation and cost.
3. Being aggrieved and dissatisfied by the said impugned order passed by the learned Workman Compensation Commissioner, Surat in Workman Compensation Application Page 2 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025 NEUTRAL CITATION C/FA/2444/2007 JUDGMENT DATED: 07/07/2025 undefined No.84 of 2004 dated 12/09/2006, the appellant preferred the present appeal under Section 30 of the Workmen's Compensation Act, 1923 for enhancement of claim amount.
4. Heard learned advocate Mr. Hiren Modi, appearing for the appellant - original complainant and learned advocate Ms. Priyal Shah, appearing on behalf of Mr. Murali Devnani, learned advocate for the respondent No.1.
4.1 Learned advocate Mr. Vasant Shah, appearing on behalf of the respondent No.2 - Insurance Company is not appearing in the matter since long and hence, the matter is decided in his absence.
5. Learned advocate Mr. Modi has submitted that the impugned order passed by the learned Commissioner is illegal, erroneous, unjust and against the settled legal position, against the facts and circumstances and against the principles of natural justice. He has submitted that the learned Commissioner has erred in holding that the appellant was getting monthly salary of Rs.2,300/- instead, the learned Commissioner ought to have considered the monthly income of Rs.2,700/- as per the minimum wages. He has submitted that the learned Commissioner has committed an error while considering 46% permanent disability and not considering 100% loss of earning capacity. He has further submitted that so far as the maintainability is concerned, learned Commissioner has committed a serious error of law while considering the fact that the insurance policy was under Motor Page 3 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025 NEUTRAL CITATION C/FA/2444/2007 JUDGMENT DATED: 07/07/2025 undefined Vehicles Act and not under Workmen's Compensation Act and therefore, liability of interest is required to be fastened upon the Insurance Company and not upon the owner, which is a jurisdictional error. He has submitted that the impugned order passed by the learned Commissioner is erroneous, illegal and unjust which is required to be considered as a substantial question of law and therefore, present appeal is maintainable. In support of his submissions, learned advocate Mr. Modi has referred and relied upon the decision of the Hon'ble Apex Court rendered in case of Employees State Insurance Corporation, Ahmedabad vs. Vasantbhai Bhudarbhai Parmar, reported in [2007] 1 GLR 879. Learned advocate Mr. Modi has also referred and relied upon the decision of the Hon'ble Apex Court rendered in case of Kamla Chaturvedi vs. National Insurance Co. Ltd. and others, reported in [2009] ACJ 115 so far as the liability of interest is concerned and urged that in view of the aforesaid decision, the liability to pay interest is upon the Insurance Company and therefore, the impugned order be appropriately modified to that extent.
6. As against that, learned advocate for the respondent has objected the present appeal and submitted that the learned Commissioner has not committed any error while passing the impugned judgment and award and therefore, no interference is required to be called for in the present appeal and the same is required to be dismissed.
7. I have heard the learned advocates appearing for the respective parties and perused the material placed on record. I Page 4 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025 NEUTRAL CITATION C/FA/2444/2007 JUDGMENT DATED: 07/07/2025 undefined have also considered the Record & Proceedings and the impugned judgment and award passed by the learned Commissioner. I have also perused the decision of this Court referred and relied upon by the learned advocate for the appellant that even if the substantial question is not framed or not proposed by the appellant at the stage of admission, it can be agitated at the stage of final hearing and therefore, considering the said aspect, I am of the opinion that the issue agitated by the learned advocate Mr. Modi is required to be considered to that extent only. So far as the contention raised by the learned advocate Mr. Modi with regard to the income is concerned, the learned Commissioner has rightly considered the income at Rs.2,300/- because, at that relevant point of time in the year 2004, even as per the minimum wages, the unskilled labourer was earning Rs.2,300/- per month and therefore, considering the same, there is no any infirmity in the impugned order passed by the learned Commissioner. So far as the physical disability is concerned, the learned Commissioner has rightly considered as 46% disability considering the medical certificate issued by Dr. Sanjiv Shah produced on record at Exh.-20 and no contrary evidence is produced on record and therefore, the said aspect is required to be considered in its true and proper spirit since it was not challenged. So far as the third contention raised by the learned advocate Mr. Modi with regard to liability of interest that the policy was under Motor Vehicles Act and not under the Workmen's Compensation Act is concerned, considering the decision in case of Kamla Chaturvedi (Supra), the same is required to be modified and the present appeal is required to Page 5 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025 NEUTRAL CITATION C/FA/2444/2007 JUDGMENT DATED: 07/07/2025 undefined be partly allowed. The relevant paragraphs are reproduced hereunder :
"6. In Ved Prakash Garg v. Premi Devi and others [1997(8) SCC 1] this court observed that the Insurance Company is liable to pay not only the principal amount of compensation payable by the insurer employer but also interest thereon if ordered by the Commissioner to be paid by the insured, employee. Insurance company is liable to meet claim for compensation along with interest as imposed on insurer employer by the Act on conjoint operation of Section 3 and 4(A)(3)(a) of the Act. It was, however, held that it was the liability of the insured employer alone in respect of additional amount of compensation by way of penalty under Section 4(A)(3)(b) of the Act. In New India Assurance Co.'s case (supra) and Ved Prakash Garg's case (supra) was distinguished on facts. It was observed that in the said case the court was not concerned with a case where an accident had occurred by use of motor vehicle in respect whereof the Contract of Insurance will be governed by the provisions of the Motor Vehicles Act, 1988 (in short the `M.V. Act'). A contract of Insurance is governed by the provisions of the Insurance Act, 1938 (in short the `Insurance Act'), unless the said contract is governed by the provisions of a statute. The parties are free to enter into a contract as per their own volition. The Act does not contain a provision like Section 148 of the MV Act where a statute does not provide for a compulsory insurance or accident thereof. The parties are free to choose their terms of contract. In that view of the matter contracting out so far as the reimbursement of amount of interest is concerned is not prohibited by a statute. This position have been reiterated in P.J. Narayan v. Union of India and others [2006 (5) SCC 200]. In the instant case the position is different. The accident in question arose on account of vehicular accident and provisions of MV Act are clearly applicable. We have gone through the policy of insurance and we find that no such exception as was the case in New India Assurance Co.'s case was stipulated in the policy of insurance. Therefore, the Insurance Company is liable to pay the interest.
7. The further question arises as to from which date it would be paid.
8. In National Insurance co. Ltd. v. Mubasir Ahmed & Anr. [2007(2) SCC 349] it was, inter alia, held as follows:
"(9) Interest is payable under Section 4-A(3) if there is default in paying the compensation due under this Act within one month from the date it fell due. The question of liability under Section 4-A was dealt with by this Court in Maghar Singh v.
Jashwant Singh [(1998) 9 SCC 134]. By amending Act 30 of 1995, Section 4-A of the Act was amended, inter alia, fixing the minimum rate of interest to be simple interest @ 12%. In the instant case, the accident took place after the Page 6 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025 NEUTRAL CITATION C/FA/2444/2007 JUDGMENT DATED: 07/07/2025 undefined amendment and, therefore, the rate of 12% as fixed by the High Court cannot be faulted. But the period as fixed by it is wrong. The starting point is on completion of one month from the date on which it fell due. Obviously it cannot be the date of accident. Since no indication is there as to when it becomes due, it has to be taken to be the date of adjudication of the claim. This appears to be so because Section 4-A(1) prescribes that compensation under Section 4 shall be paid as soon as it falls due. The compensation becomes due on the basis of adjudication of the claim made. The adjudication under Section 4 in some cases involves the assessment of loss of earning capacity by a qualified medical practitioner. Unless adjudication is done, question of compensation becoming due does not arise. The position becomes clearer on a reading of sub- section (2) of Section 4- A. It provides that provisional payment to the extent of admitted liability has to be made when employer does not accept the liability for compensation to the extent claimed. The crucial expression is "falls due". Significantly, legislature has not used the expression "from the date of accident".
Unless there is an adjudication, the question of an amount falling due does not arise."
8. In view of above, the impugned judgment and award dated 12.09.2006 passed by the learned Commissioner for Workmen's Compensation at Surat in Workmen's Compensation Case (N.F.) No.84 of 2004 is hereby modified to the extent that the interest @ 12% as awarded by the learned Commissioner is to be borne by the respondent No.2 herein - Insurance Company and not by the respondent No.1 - owner of the vehicle.
8.1 The respondent No.2 - Insurance Company is hereby directed to deposit the amount of interest @ 12% as awarded by the learned Commissioner before the court concerned within a period of 8 (eight) weeks from the date of receipt of order of this Court. Once the amount of interest is deposited, the same shall be disbursed in favour of the appellant -
Page 7 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025NEUTRAL CITATION C/FA/2444/2007 JUDGMENT DATED: 07/07/2025 undefined original claimant through RTGS/NEFT, after due verification.
9. Accordingly the appeal is party allowed. No order as to costs.
10. Record and proceedings, if any, be sent back to the concerned Court forthwith.
(HEMANT M. PRACHCHHAK,J) Dolly Page 8 of 8 Uploaded by DOLLY CHETAN VADUKAR(HC01392) on Fri Jul 11 2025 Downloaded on : Fri Jul 11 23:03:56 IST 2025