Sri. Lalitha Equipments, Through ... vs Rameshwar Ragho Chauhan And ...
2015 Latest Caselaw 585 Bom

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                     IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                             NAGPUR BENCH, NAGPUR




                                                                                     
                                                             
                               FIRST APPEAL NO. 902 OF 2015


                Sri Lalitha Equipments, through its




                                                            
                Managing Partner Smt. P. Kalyani,
                r/o 31, Friends Layout No.4, Dindayal
                Nagar, Nagpur  .....                                             APPELLANT




                                              
                                      ...VERSUS...

     1]
                             
                Rameshwar Ragho Chauhan,

     2]         Smt. Gyanmati Rameshwar Chauhan,
                            
                Both residents of Gram Belawa (K.H.)
                Post Shahapur, Tq. Khajani, Distt. 
                Gorakhpur.
      

     3]         The United India Insurance Company
                Ltd, through its Divisional Manager,
   



                First Floor, Rajasthan Bhavan, Opposite
                Akola Junta Commercial Cooprative
                Bank Limited, Tilak Road, Akola.......                      RESPONDENTS





     -------------------------------------------------------------------------------------------
     Shri  R.P.Joshi, Advocate, for appellant.
     Ms. Junghare, Advocate, h/f Shri C.N.Wankhede, Adv. For R-1 & 2
     Shri M.R.Joharapurkar, Advocate for R-3
     -------------------------------------------------------------------------------------------





                              CORAM: R. K. DESHPANDE, J.

st DATE : 1 December, 2015.

     ORAL JUDGMENT


                1]             Admit.

                               Heard     finally   by   consent   of   learned   counsels



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              appearing for the parties.  




                                                                                              
                                                                   
              2]               The substantial question of law involved in this

              matter is,




                                                                  

Whether the Commissioner was right in imposing penalty upon the appellant without issuance of show cause notice?

3] The matter is covered by the decision of this

Court in the case of Nandi Sahakari Sakhar Karkhana Ltd

vrs. Dnyanoba Kashinath Aare and others reported in

2010(2) Mh.L.L. 267 and also by the decision of Apex Court

in the case of Oriental Insurance Company Ltd vrs. Siby

George and others, reported in (2012) 12 SCC 540, in which

in para 8 it has been held as under;

It is, thus, to be seen that sub-section (3) of section 4-A is in two parts, separately dealing with interest and penalty in clauses (a) and (b) respectively. Clause (a) makes the levy of interest, with no option, in case of default in payment of compensation, without going into

the question regarding the reasons for the default. Clause (b) provides for imposition of penalty in case, in the opinion of the Commissioner, there was no justification for the delay. Before imposing penalty, however, the Commissioner is required to give the employer a reasonable opportunity to show cause. On a plain reading of the provisions of sub-section (3) it becomes clear that payment of interest is a consequence of default in payment without going into the reasons for the delay and it is only in case where the delay is without justification, the employer might also be held liable to penalty after giving him a show cause. Therefore, a finding to the effect that the delay

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in payment of the amount due was unjustified is required to be recorded only in case of imposition of

penalty and no such finding is required in case of interest which is to be levied on default per se.

In view of the aforesaid position of law, the order

passed by the Commissioner under the Workmen's

Compensation to the extent it imposes the penalty of

Rs.4,78,391/- cannot be sustained. The same will have to be

quashed and set aside with liberty to the Commissioner

under the Workmen's Compensation Act to issue show cause

notice if he deems fit and proper in the facts and

circumstances of the case.

4] In the result, the appeal is partly allowed. The

order directing penalty of Rs.4,78,391/- in the order dated

11.02.2015 passed in W.C.A. Case No. 10 of 2012 is hereby

quashed and set aside. The Commissioner under the

Workmen's Compensation Act is at liberty to issue show

cause notice to the appellant before imposing the penalty if

he deems fit and proper in the facts and circumstances of the

case. No order as to cost.

              5]               The   appellant   has   deposited   some   amount   in




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this Court. The same may be remitted to the Commissioner

under the Workmen's Compensation Act along with interest if

any accrued thereon. The Commissioner to pass appropriate

orders in respect of this amount in accordance with his final

decision in the matter. It is made clear that the

Commissioner shall not get influenced by the fact that this

Court has already asked the appellant to deposit the amount.

JUDGE

Rvjalit