M/S Agrawal Ginning Pressing Thr ... vs Rasul Nabi Khatik And Anr
2016 Latest Caselaw 6698 Bom

                                             1                     FA No.3174/2016

            IN THE HIGH COURT OF JUDICATURE OF BOMBAY




                                                                             
                       BENCH AT AURANGABAD

                           FIRST APPEAL NO.3174 OF 2016




                                                     
      M/s Agrawal Ginning Pressing
      Through it's proprietor,
      Shri Santosh Harshy Agrawal,




                                                    
      Age: 56 Yrs., occu. Business,
      R/o Virwada Chowk, Chopda,
      Dist. Jalgaon.                                  =    APPELLANT
                                                       (Orig.Oppn.No.1)




                                      
               VERSUS

      1) 
                             
               Shri Rasul Nabi Khatik
               Age: 54 Yrs., occu. Labour,
               R/o Malharpura, Chopada,
               Dist. Jalgaon.                         ..  Orig.Claimant
                            
      2)       The National Insurance co.Ltd.
               Jalgaon
               (Through it's Branch Manager)=    RESPONDENTS 
                                            (orig.oppnt.No.2)
      


                                   -----
   



      Mr.Vijay Y.Patil, Advocate for Appellant;
      Mr.Kishor C.Sant, Advocate for Respondent No.1;
      Mr.V.N.Upadhye, Advocate for Respondent No.2.
                              -----





                                   CORAM :  P.R.BORA, J.

DATE :

25 th

November,2016.

ORAL JUDGMENT:

1) With the consent of Learned Counsel

appearing for the parties, the appeal is finally

heard at the stage of admission.

2) In the present appeal, the only

objection raised by the appellant in exception to

the impugned Award passed by the Employees'

Compensation Commissioner (for short, the

Commissioner) in WCA No.22/2011 is that, -

without issuing any notice, as contemplated under

Section 4-A of the Employees' Compensation Act

(for short, the Act), the learned Commissioner

has saddled the penalty of Rs.1,00,000/- on the

present appellant.

. The learned Counsel has placed reliance

on the judgment of Hon'ble Apex Court in the case

of Oriental Insurance Co. Ltd. Vs. Siby George

and Ors. - reported in AIR 2012 SC 3144. The

learned counsel submitted that the learned

Commissioner has not given any show-cause notice

before imposing the penalty to the present

appellant.

3) Shri Sant, learned Counsel appearing for

the original complainant, i.e. the employee,

submitted that since the present appellant has

fully participated in the proceedings before the

Commissioner, there was no need of issuing any

separate notice before imposing the penalty.

4) Shri Upadhye, learned Counsel appearing

for the insurance company, has prayed for passing

appropriate orders.

5)

On perusal of the impugned judgment, it

is quite evident that the learned Commissioner

did not issue any notice to the present appellant

before saddling the liability of penalty on him.

In view of the judgment of the Hon'ble Apex Court

relied upon by the appellant, the impugned order

passed by the Commissioner so far it relates to

imposition of the penalty, cannot be sustained.

In Para 7 of the cited judgment, the Hon'ble Apex

Court has observed thus, -

"7. 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 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."

6) In view of the law laid down by the

Hon'ble Apex Court as above, the impugned order

so far as it relates to imposing the penalty

cannot be sustained and deserves to be quashed

and set aside and accordingly is set aside.

However, it will be open for the learned

Commissioner to issue a notice, as contemplated

under Section 4-A of the Act, to the employer and

decide the issue of penalty afresh by giving due

opportunities to the parties. The learned

Commissioner shall issue notice, as above, and

decide the issue so raised, as expeditiously as

possible and preferably within a period of six

months from the date of this order.

. The R. and P. be forthwith sent back to

the learned Commissioner.

7) The appeal stands allowed in the

aforesaid terms.

(P.R.BORA) JUDGE bdv/