The Branch Manager vs Smt Jayamma
2023 Latest Caselaw 1770 Kant

                              1



       IN THE HIGH COURT OF KARNATAKA AT BENGALURU

          DATED THIS THE 10TH DAY OF MARCH, 2023

                          BEFORE

           THE HON'BLE MR. JUSTICE H.P. SANDESH

                  M.F.A.NO.2333/2017 (WC)
                            C/W
                M.F.A.CROB.NO.102/2017(WC)


IN M.F.A. NO.2333/2017:

BETWEEN:

THE BRANCH MANAGER,
M/S ORIENTAL INSURANCE COMPANY LIMITED,
SHANTHA MANSION,
GROUND FLOOR OF MADHU MEDICALS,
TEMPLE ROAD, BELUR TOWN,
HASSAN DISTRICT.
THROUGH ITS REGIONAL OFFICE,
2ND FLOOR, SUMANGALAL COMPLEX,
LAMINGTON ROAD, HUBLI-580 020.
REPRESENTED BY ITS
REGIONAL MANAGER.                             ... APPELLANT

               (BY SRI B.S.UMESH, ADVOCATE)

AND:

1.     SMT. JAYAMMA,
       W/O LATE SUBBAIAH,
       AGED ABOUT 47 YEARS.

2.     KALLESHA,
       S/O LATE SUBBAIAH,
       AGED ABOUT 27 YEARS.
                                2



3.      SATHISHA,
        S/O LATE SUBBAIAH,
        AGED ABOUT 24 YEARS.

        RESPONDENTS 1 TO 3 ARE
        R/AT SUGUDAVANI VILLAGE (BEELANAHALLI),
        SIRIVASE POST, JAGARA HOBLI,
        CHIKKAMAGALUR TALUK &
        DISTRICT 577130.

4.      M.S. MANJEGOWDA,
        S/O SIDDEGOWDA,
        GALIGUDDA ESTATE,
        BIDARE POST, (SIDDAPURA),
        CHIKKAMAGALUR TALUK &
        DISTRICT 577136.                   ... RESPONDENTS

     (BY SRI MOHAN K.N., ADVOCATE FOR CAVEATOR/R1 TO R3;
             SRI N.R. RAVIKUMAR, ADVOCATE FOR R4)

      THIS M.F.A. IS FILED UNDER SECTION 30(1) OF
EMPLOYEE'S COMPENSATION ACT AGAINST THE JUDGMENT AND
AWARD DATED 17.12.2016 PASSED IN ECA NO.53/2015 ON THE
FILE OF THE PRINCIPAL SENIOR CIVIL JUDGE & CJM,
CHIKKAMAGALURU,       AWARDING     COMPENSATION     OF
Rs.5,74,088/- WITH INTEREST @ 12% P.A. ON Rs.5,74,088/-
FROM THE DATE OF ACCIDENT TILL PAYMENT.

M.F.A. CROB NO.102/2017:

BETWEEN:

1.      SMT. JAYAMMA,
        W/O LATE SUBBAIAH,
        AGED ABOUT 47 YEARS.

2.      KALLESHA,
        S/O LATE SUBBAIAH,
        AGED ABOUT 27 YEARS.

3.      SATHISHA,
        S/O LATE SUBBAIAH,
        AGED ABOUT 24 YEARS.
                             3



       ALL ARE R/AT KALAVASE,
       SUGUDAVANI VILLAGE (BEEKANAHALLI),
       SIRAVASE POST, JAGARA HOBLI,
       CHIKKAMAGALURU TALUK
       AND DISTRICT - 577 130.
                                    ... CROSS-OBJECTORS

               (BY SRI MOHAN K.N, ADVOCATE)

AND:

1.     M.S.MANJEGOWDA,
       S/O SIDDEGOWDA,
       AGED ABOUT 62 YEARS,
       GALIGUDDA ESTATE,
       BIDARE POST (SIDDAPURA),
       CHIKKAMAGALURU TALUK.

2.     THE BRANCH MANAGER,
       ORIENTAL INSURANCE CO. LTD.,
       SHANTHA MANSION,
       GROUND FLOOR OF MADHU MEDICALS,
       TEMPLE ROAD, BELUR TOWN
       HASSAN DISTRICT.
                                         ... RESPONDENTS

         (BY SRI N.R.RAVIKUMAR, ADVOCATE FOR R1;
             SRI B.S.UMESH, ADVOCATE FOR R2)

     THIS M.F.A.CROB IN M.F.A.NO.2333/2017 IS FILED
UNDER ORDER 41 RULE 22 OF CPC R/W SECTION 30(1) OF THE
EMPLOYEES COMPENSATION ACT, AGAINST THE JUDGMENT
AND DECREE DATED 17.12.2016 PASSED IN ECA NO.53/2015
ON THE FILE OF THE PRINCIPAL SENIOR CIVIL JUDGE AND CJM
CHIKKAMAGALURU, PARTLY ALLOWING THE PETITION FOR
COMPENSATION      AND    SEEKING    ENHANCEMENT      OF
COMPENSATION.

     THIS M.F.A. AND M.F.A.CROB HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT ON 02.03.2023, THIS DAY, THE
COURT PRONOUNCED THE FOLLOWING:
                                 4



                        JUDGMENT

M.F.A.No.2333/2017 and M.F.A.Crob.No.102/2017 are filed

challenging the judgment and award dated 17.12.2016, passed

in E.C.A.No.53/2015, on the file of the Principal Senior Civil

Judge and CJM, Chikkamagaluru ('the Tribunal' for short)

questioning the liability as well as quantum of compensation.

2. The factual matrix of the case of the claimants

before the Tribunal is that they are the wife and children of the

deceased Subbaiah and the said Subbaiah was working as a

coolie in the estate of respondent No.1. That on 26.08.2015, at

about 10.00 a.m., when the deceased Subbaiah was plucking

coconut from the tree in the estate, at that time, he accidentally

fell down from the tree, due to which he sustained grievous

injuries. Immediately, he was shifted to M.G. Hospital,

Chikkamagaluru, wherein he was declared dead. It is the case

of the claimants that the deceased was aged about 48 years as

on the date of the accident and he was getting a sum of

Rs.500/- per day as wages from respondent No.1. The accident

was occurred during the course of his employment under

respondent No.1 and hence sought the compensation.

3. In pursuance of the claim petition, the respondents

appeared through their respective learned counsel and filed the

written statement. The respondent No.1/employer in his written

statement admitted the relationship of employer and employee

between him and the deceased, but he denied the age and wage

of the deceased. The respondent No.1 contended that the

deceased was being paid Rs.250/- per day as wages. He further

contended that he had obtained the workmen's insurance policy

from respondent No.2 covering the risk of his employees and

the same was in force and hence respondent No.2 is liable to pay

the compensation.

4. The respondent No.2 in the written statement denied

the relationship of employer and employee between the

respondent No.1 and the deceased. However, admitted the

issuance of policy to respondent No.1 and the policy was in force

as on the date of the accident. It is contended that respondent

No.1 had declared the wages of his employees at Rs.62,400/-

for ten employees and accordingly paid the total premium of

Rs.3,049/- and therefore the average annual wages of each

employee would be Rs.6,240/- per annum and Rs.520/- per

month per employee. Therefore, if this Court comes to the

conclusion that respondent No.2 is liable to pay the

compensation, the liability of respondent No.2 should be

according to the quantum of wages declared by respondent No.1

to respondent No.2 at the time of obtaining the policy.

5. The Tribunal having considered the pleadings of the

parties, framed the issues and in order to establish the case

pleaded by the claimants, petitioner No.2 examined himself as

P.W.1 and got marked the documents at Exs.P.1 to 8. On the

other hand, the respondent examined one witness as R.W.1 and

got marked the documents at Exs.R.1 and 2. The Tribunal after

considered both oral and documentary evidence placed on

record, allowed the claim petition granting compensation of

Rs.5,74,088/- with 12% interest after expiry of 30 days from the

date of accident till the date of payment.

6. Being aggrieved by the judgment and award of the

Tribunal, the Insurance Company has filed M.F.A.No.2333/2017

wherein framed substantial question of law contending that the

Presiding Officer is not justified in holding that the applicant was

the employee of respondent No.4 without any independent

evidence with regard to employer and employee relationship

except the oral testimony of the claimants and also committed

an error in assessing the income at Rs.250/- per day without

any proof and saddling the entire liability on the Insurance

Company. It is contended that the Court is not justified in

awarding compensation beyond the accepted terms in the policy

of contract between the insured and the appellant against the

principles laid down in the judgment of the Apex Court in the

case of NEW INDIA ASSURANCE CO. LTD. v. LILLA

FRANCIS reported in 2014 ACJ 1800 and judgment of this

Court in the case of ORIENTAL INSURANCE CO.LTD. v.

GANGAVVA AND OTHERS reported in (1998) 6 KLJ 433 and

MFA No.1259/2008 and hence the liability fastened on the

Insurance Company is against the principles laid down in the

referred judgments. It is also contended that the wages

declared by the insured under the policy is Rs.520/- per month.

Without admitting even if he has paid the wages more than the

said amount, the policy would cover only to the extent of wages

insured under the policy. Any amount that has to be paid in

excess of the terms of the policy will have to be met by the

insured himself.

7. The claimants in M.F.A.Crob.No.102/2017 would

vehemently contend that the substantial questions of law that

arise before this Court are whether the ECA Court was right in

allowing the petition in part without appreciating that the

accident was occurred during the course of his employment

under respondent No.1 and the award passed in favour of the

appellants is on the lower side as the dependents of the

deceased Subbaiah. The taking of the income as Rs.250/- is

against the declared salary of Rs.500/- and the deceased was

working as a coolie in the estate of respondent No.1 and

compensation awarded is very meager and hence it requires

interference of this Court.

8. Having heard the respective learned counsel, the

following substantial questions of law arise before this Court:

(i) Whether the Tribunal committed an error in fastening the liability on the Insurance Company in its entirety and whether this Court has to modify the judgment proportionately as contended by the appellant Insurance Company?

(ii) Whether the Tribunal committed an error in not awarding just and reasonable

compensation as contended by the claimants in M.F.A.Crob.No.102/2017?

(iii) What order?

Point Nos.(i) and (ii):

9. Having heard the respective learned counsel and

considering the material available on record, this Court in its

judgment in the case of Gangavva (supra), held that the

employer's liability to pay as per Commissioner's award of

variation between wages actually drawn by deceased employee

and wages shown by employer as payable to employee for the

purpose of payment of insurance premia. Where Commissioner's

award of compensation is based on wages actually earned by

deceased, which are more than wages shown as payable for

purpose of insurance, liability of Insurance Company is only to

the extent of premia received by it, and amount exceeding

Insurance Company's liability is to be borne by employer

himself.

10. The learned counsel for the appellant relied upon the

judgment of the Apex Court in the case of NEW INDIA

ASSURANCE CO. LTD. v. HARSHADBHAI AMRUTBHAI

MODHIYA AND ANOTHER reported in 2006 ACJ 1699

wherein, the Apex Court discussed with regard to Section 4-A(3)

and 17 of the Workmen's Compensation Act regarding the

liability of the Insurance Company. Contract of insurance

between the employer and Insurance Company covering the risk

of workman. Contracting out of insurance coverage for payment

of interest by an employer is not prohibited in law. Policy

expressly excludes interest and penalty imposed on the insured

employer on account of his failure to comply with the

requirements of Act. Death of workman in the course of his

employment and his dependants filed claim. Commissioner

allowed compensation with interest and directed Insurance

Company to make payment. Appeal filed by Insurance

Company challenging direction of payment of interest was

dismissed and whether Insurance Company is liable for the

interest and held that no interest is payable by the employer.

11. The learned counsel also relied upon the unreported

judgment of this Court passed in MFA No.1259/2008 dated

23.03.2011, wherein this Court held that the liability of the

Insurance Company is proportionate and remaining

compensation is payable by the insured in view of the terms and

conditions of the policy.

12. There is no dispute with regard to the principles laid

down in the judgments referred supra and also liability is in

terms of the contract between the parties i.e., employer and the

Insurance Company. However, this Court has to take note of

the material on record. It is the claim of the claimants that the

deceased died while plucking coconut from the tree and the

Insurance Company disputed that there was no relationship of

employer and employee. But the employer appeared and filed

the written statement admitting the relationship between the

parties. The Insurance Company also not disputes the fact that

the policy taken is under the Workmen's Compensation Act. The

respondent No.1 admitted the wages as Rs.250/-, but denied the

contention of the claimants that he was paying wages of

Rs.500/- per day. In order to prove the factum of the wages is

concerned, respondent No.1 also not produced the documents,

except filing the written statement and the Insurance Company

also not summoned any documents from respondent No.1. The

Insurance Company examined the Senior Assistant of Oriental

Insurance Company as D.W.1. He reiterated the contention of

the written statement in his affidavit and also admitted that the

policy covered for ten employees is Rs.62,400/- and also admits

for having paid Rs.3,049/- as premium. It is contended in

paragraph No.7 that monthly average wages of each worker is

Rs.520/- as declared by the insured. In order to prove the said

factum, the Insurance Company not placed any documents

having declared the same by respondent No.1 and even not

produced the proposal form except marking of the document of

policy Ex.R1.

13. In the cross-examination he categorically admits that

while issuing the policy, they ought to have collected the diary

and the same was not collected. But, they claim that the

insured has declared the wages as Rs.520/- per month. In order

to substantiate the same, no documents is placed before the

Court. However, the learned counsel for the appellant submits

in the course of argument that it was Rs.5,200/- per month and

in order to substantiate the same also not produced any material

before the Court. When the Insurance Company takes the

defence that the liability is in terms of the policy, ought to have

placed the material for having declared the wages by respondent

No.1. Except marking the policy, no other document is placed

before the Court. The policy is also marked as Ex.R2 wherein

gross premium was Rs.2,714/- including service tax of Rs.380/-.

The total amount is Rs.3,094/. The Trial Court also taken note

of the contents of the policy, wherein it is declared as ten

employees and occupation also declared as coffee estate all

other employees and estimated total wages/other earnings is

Rs.62,400/- and in the estimated total earnings also mentioned

the same amount. The contract details also mentioned in the

document Ex.R.1 that insurance under this policy is extended to

cover the risk of the total added wages of all employees i.e., 120

times. It is mentioned that as per the form attached, but no

such form is placed before the Court. When the Insurance

Company failed to produce the said form as well as proposal

form, wherein the respondent has declared the wages of each

employees, the very contention of the Insurance Company

cannot be accepted. In one breath they claim that wage is

Rs.520/- per month and the learned counsel during the course of

argument claims that it was Rs.5,200/- and he contend that the

liability is only to the extent of Rs.3,98,034/- considering 50% of

the income as Rs.2,600/- x 153.9 factor and the learned counsel

contend that the liability is only to such an extent. The

respondent No.1 in his evidence claims that he was paying an

amount of Rs.250/-. I have already pointed out that neither

respondent No.1 nor respondent No.2 have produced any

documents with regard to the wages and the Insurance

Company ought to have produced the proposal form wherein the

wages was declared by respondent No.1 and the same has not

been placed before the Court. When such being the case, the

very contention of the Insurance Company cannot be accepted

that the Trial Court taking the admitted income of Rs.250/-

calculated the compensation.

14. The learned counsel for the claimants would contend

that the deceased was getting Rs.500/- per day, but in order to

substantiate the same, the claimants have not summoned the

wages register and not placed any other documents before the

Court. Even as per the schedule also, the maximum wages is

Rs.8,000/- and in the absence of any material that he was

getting Rs.500/-, the very contention of the claimants also

cannot be accepted. No doubt, the claimants are the wife and

two children of the deceased and the Tribunal while taking the

income of Rs.250/- rightly applied the relevant factor and

calculated the compensation by taking 50%, since it is a case of

death. Hence, I do not find any ground even for enhancing the

compensation as contended by the claimants. Hence, I answer

both the points in the negative.

Point No.(iii):

15. In view of the discussions made above, I pass the

following:

ORDER

(i) Both M.F.A.No.2333/2017 and M.F.A.Crob.No.102/2017 are dismissed.

(ii) The amount in deposit made by the Insurance Company is ordered to be transmitted to the concerned Tribunal forthwith.

(iii) The Registry is directed to transmit the records to the concerned Tribunal, forthwith.

Sd/-

JUDGE

MD