Bombay High Court
Gopinath Ankush Pole vs Nem Virchand Soni & Ors on 29 January, 2018
Bench: M.S. Sonak
(1) 213-FA 639 of 2004
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
BENCH AT AURANGABAD
213 FIRST APPEAL NO. 639 OF 2004
. Gopinath s/o Ankush Pole
Age: 23 years, Occu.: Nil,
R/o.Sumthana, Ta.Ahmedpur,
Dist.Latur. ..Appellant
VERSUS
1. Nem Virchand Soni
Age: - years, Occu.: Owner,
R/o.R.No.115, New Anant Bhawan,
Ist Floor, 257/65, Narsi-nath,
Street, Mumbai 09.
2. National Insurance Company,
Branch Ghatkopar (E), through
it's Manager, Hanuman Chauk,
Latur. 1 ..Respondents
...
Advocate for Appellant : Mr.S.S.Manale
Advocate for Respondent No.2 : Mr.P.P.Bafna (absent)
...
CORAM : M.S.SONAK, J.
DATE : 29.1.2018
ORAL JUDGMENT:-
1) Although, on the date of admission of this appeal,
no specific substantial question of law was framed, the
(2) 213-FA 639 of 2004
learned counsel for the appellant points out that in this
case, the interest awarded is in breach of provisions of
Section 4-A of the Employees' Compensation Act, 1923.
Accordingly, this appeal is considered on the following
substantial question of law:-
a) Whether the Commissioner erred in awarding
interest @ only 9% p.a. from the date of accident ?
or whether in terms of provisions of Section 4-A of
the Employees' Compensation Act, 1923, the interest
should have been awarded @ 12% p.a. from the date of
the accident ?
2) The respondents though served are not present.
3) Mr.S.S.Manale learned counsel for the appellant has
made submission on behalf of the appellant. He has
pointed out that the provisions of Section 4-A of the
Employees' Compensation Act, 1923. He has also placed
reliance on the decision of this Court in Subhash
Gajananrao Tiwade & anr. Vs. National Insurance Co.Ltd.
& anr. [2015 (1) Bom.C.R., 358] in support of his
(3) 213-FA 639 of 2004
contention that interest ought to have been awarded @ 12%
p.a. and that too from the date of accident.
4) The operative portion of the impugned award dated
12.9.2003 reads as follows:-
"ORDER
Application is allowed as under:
1. The opponent no.1 & 2 are held jointly and
severally liable to pay the compensation amount
of Rs.2,00,435/- with simple interest @ 9% p.a.
from the date of accident i.e. 02.10.2001 till
its full realisation to the appellant.
2. The opponents no.2 shall bear it's own costs.
3. The opponents no.1 to pay costs of this
litigation to the tune of Rs.1000/- to the
applicant.
4. Judgment and order pronounced in open Court
in presence of Adv.Shri Poul.
Sd/-
Date: 12.09.2003 (V.S.Padalkar)
Place: Latur. Commissioner,
For W.C. Act & Judge
Labour Court, Latur."
5) The only question is whether the Commissioner erred
(4) 213-FA 639 of 2004
in awarding interest @ 9% p.a. instead of 12% p.a. as
claimed by the claimant.
6) Section 4-A of the Employees Compensation Act, 1923
reads as follows:-
"4A. Compensation to be paid when due and penalty
for default.-
(1) Compensation under section 4 shall be paid as
soon as it falls due.
(2) In cases where the employer does not accept
the liability for compensation to the extent
claimed, he shall be bound to make provisional
payment based on the extent of liability which he
accepts, and, such payment shall be deposited
with the Commissioner or made to the employee, as
the case may be, without prejudice to the right
of the employee to make any further claim.
(3) Where any employer is in default in paying
the compensation due under this Act within one
month from the date it fell due, the Commissioner
(5) 213-FA 639 of 2004
shall--
(a) direct that the employer shall, in addition
to the amount of the arrears, pay simple interest
thereon at the rate of twelve per cent per annum
or at such higher rate not exceeding the maximum
of the lending rates of any scheduled bank as may
be specified by the Central Government, by
notification in the Official Gazette, on the
amount due; and
(b) if, in his opinion, there is no justification
for the delay, direct that the employer shall, in
addition to the amount of the arrears and
interest thereon, pay a further sum not exceeding
fifty per cent, of such amount by way of penalty:
Provided that an order for the payment of penalty
shall not be passed under clause (b) without
giving a reasonable opportunity to the employer
to show cause why it should not be passed."
7) Sub-Section 3 of Section 4-A very clearly provides
that where any employer is in default in paying the
compensation due under this Act within one month from the
date it fell down, the Commissioner may direct the
(6) 213-FA 639 of 2004
employer that, in addition to the amount of the arrears,
simple interest thereon @ 12% p.a. or such higher rate
not exceeding the maximum of the lending rates of any
Scheduled bank as may be specified by the Central
Government by Notification in the Official Gazette on the
amount due.
8) In this case, taking into consideration the
provisions of Section 4-A(3) of the Employees'
Compensation Act, there was no justification on the part
of Commissioner to award interest only @ 9% p.a. instead
of 12% p.a. Accordingly, the question will have to be
answered in favour of the appellant.
9) This Court in Subhash Gajananrao Tiwade & anr.
(supra) has held that compensation is payable from the
date of the accident and that too with interest @ 12%
p.a.
10) For the aforesaid reasons, the impugned order is
(7) 213-FA 639 of 2004
modified and the direction for payment of interest @ 9%
p.a. is substituted by direction for payment of interest
@ 12% p.a.
11) The appeal is allowed in the aforesaid terms.
12) The respondents are directed to pay the differential
amount within eight weeks from today.
13) The appeal is disposed of in the aforesaid terms.
[M.S.SONAK, J.]
SPT/213-FA 639 of 2004
