Karnataka High Court
Tata Aig General Insurance Co Ltd vs Pramoda Chandra Sarkar on 23 February, 2024
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MFA No. 3856 of 2016
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
R
DATED THIS THE 23RD DAY OF FEBRUARY, 2024
BEFORE
THE HON'BLE MR JUSTICE C.M. POONACHA
MISCELLANEOUS FIRST APPEAL NO. 3856 OF 2016 (WC)
BETWEEN:
1. TATA AIG GENERAL INSURANCE CO LTD,
JT & DEVI JMABHUKESHARI ARCADE,
NO.69, MILLER S ROAD,
BANGALORE-560052.
...APPELLANT
(BY SRI. O MAHESH.,ADVOCATE)
AND:
1. PRAMODA CHANDRA SARKAR,
AGED ABOUT 56 YEAR,
S/O LATE MUNINDRANA CHANDRA SARKAR.
2. ALOMATI SARKAR,
AGE 50 YRS, W/O PROMODH SARKAR,
Digitally 3. PURNIMA SARKAR,
signed by AGE 26 YRS,
BHARATHI S D/O PROMODH CHANDRA SARKAR,
Location:
HIGH COURT 4.
OF BISWAJIT SARKAR
KARNATAKA AGE 18 YRS,
S/O PROMODH CHANDRA SARKAR.
ALL ARE RESIDING AT BAUSHMART VILLAGE,
JL.NO.226, BAMANHAAT POST, DINHATA PS.
COOCHBEHAR DISTRICT,
WEST BENGAL-736168.
5. B.L. KASHYAP & SONS LTD.,
(PROJECT SITE-MANTRI ESPNA)
4TH FLOOR, WEST WING,
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MFA No. 3856 of 2016
SOUL SPACE PARADIGM,
NEAR INNOVATIVE MULTIPLEX,
OUTER RING ROAD, MARATHAHALLI,
BANGALORE-56037.
...RESPONDENTS
(BY SRI. ADINARAYAN.,ADVOCATE FOR R1 TO R4;
SRI. A. MADHUSUDHAN RAO., ADVOCATE FOR R5.)
THIS MFA IS FILED U/S 30(1) OF EMPLOYEE'S COMPENSATION
ACT AGAINST THE JUDGMENT AND AWARD DATED 03.03.2016
PASSED IN ECA NO.70/2014 ON THE FILE OF THE XXI ADDITIONAL
SMALL CAUSE JUDGE, & XIX ACMM, MEMBER, MACT, BANGALORE,
AWARDING COMPENSATION OF RS.8,90,480/- WITH INTEREST @
12% P.A. FROM THE DATE OF INCIDENT TILL REALIZATION AND
ETC,.
THIS APPEAL, COMING ON FOR FURTHER SUBMISSION, THIS
DAY, THE COURT DELIVERED THE FOLLOWING:
JUDGMENT
The above appeal is filed by the insurer challenging the
judgment dated 03.03.2016 passed in ECA.No.70/2014 in the
file of XXI Additional Small Causes Judge and The Motor
Accident Claims Tribunal (SCCH-23), Bengaluru1.
2. For the sake of convenience, the parties herein are
referred as per their rank before the Tribunal.
3. It is the case of the petitioners that on 24.05.2012 one
Paresh Sarkar was working as a unskilled worker at the
project site Manthri Espana, under the Respondent No.1 when
Hereinafter referred as 'Tribunal'
Hereinafter referred as 'Deceased'
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in the course of his employment, he slipped and fell down, as a
result of which he sustained grievous injuries and succumbed to
the same. Claiming compensation for the death of the
deceased, the Petitioners filed a petition under Section 10 of
the Employers Compensation Act3 arraying the employer as
Respondent No.1 and the insurer as Respondent No.2.
4. The petitioners were the parents, brother and sister
of the deceased. The employer and the insurer entered
appearance before the Tribunal and filed their statement of
objections. The petitioner No.1 was examined as PW.1. Ex.P.1
to Ex.P.9 were marked in evidence. The representative of the
employer was examined as RW.1. The representative of insurer
was examined as RW.2. and the investigator of the insurer was
examined as RW.3. Ex.R.1 to Ex.R.7 were marked in evidence.
The Tribunal by it judgment dated 03.03.2016 allowed the
claim petition and awarded compensation of a sum of
`8,90,480/- together with interest at 12% per annum and
directed Respondent No.2 - insurer to pay the compensation
awarded. Being aggrieved the present appeal is filed by the
insurer.
Hereinafter referred as 'Act'
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5. Learned counsel for the insurer vehemently
contended that Respondent No.1 - owner did not follow the
safety measures. Hence, the insurer ought not to be fastened
with the liability to pay the compensation awarded. Further it
was contended that the petitioners have categorically averred
in the claim petition that the deceased was paid to be `175/-
per day and the employer having stated that the deceased was
being paid the said amount, the liability of the insurer ought to
be restricted to pay compensation commensurate with the
wages that was been paid to the deceased. Learned counsel for
the insurer further submits that the Tribunal has awarded
compensation at 12% per annum from the date of petition and
that the interest is required to be awarded at 12% after thirty
days of the date of the award. Hence, he seeks for allowing of
the above appeal and setting aside the judgment passed by the
Tribunal.
6. Per contra, learned counsel for the claimant submits
that the finding of the Tribunal both on liability and quantum is
just and proper and seeks for dismissal of the appeal filed by
the insurer.
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7. The submissions of both the learned counsels have
been considered and the material on record including the
records of the Tribunal have been perused. The questions that
arise for consideration are:
"i) Whether the insurer has proved that no safety
measures were adopted by the employer so as to
exonerate the insurer from payment of the compensation?
ii) Whether the Tribunal was justified in assessing the
income of the deceased at `8,000/- per month?
iii) Whether the interest at 12% is liable to be paid from
the date of the petition?"
Reg. Question No.(i):-
8. To the claim made by the petitioners, the
Respondent No.1 - employer as well as Respondent No.2-
insurer have filed their separate statement of objections. The
insurer in its statement of objection has stated that the liability
of the insurer is as per the terms and conditions of the policy of
insurance. That the insured was required to take all reasonable
precaution and comply with all the statutory obligations. That
the employer - insured having violated terms and conditions of
the policy, the insurer is not liable to pay the compensation.
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9. The representative of the employer examined
himself as RW.1. In the cross-examination of RW.1 he has
denied the suggestion that the safety measures have not been
taken.
10. RW.2 who is representative of the insurer has
deposed in his testimony that the employer has not taken
safety measures to avoid the accident and the same is
forthcoming from the FIR. In the cross-examination, RW.2 has
stated that he has not visited the spot of the accident and he
has stated regarding safety measures only based on the police
records and survey records. He further submits that he has not
produced any photographs.
11. The investigator has been examined as RW.3 and
he has stated in his testimony that as per the information
gathered from the co-workers and police documents, he has
stated that Respondent No.1 has not taken any safety
measures like providing nets, safety hooks and helmet to the
workers. In the cross-examination of RW.3 has stated that he
has visited the project site about three times. However, he has
admitted that he has not recorded the statement of co-workers
who were working with the deceased and there was no
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impediment to record the statement of the co-workers. He
further admits that he cannot name the co-workers who he has
enquired about the accident. He further states that he had
taken photographs of the project site during his visits. That he
has recorded the statement of the official of the employer
during his visit to the project site. But he admits that he has
not produced those statements before the Court.
12. Ex.R.2 is the investigation report wherein it is
stated that enquiry were made with the workers at the time of
the visit. However, no statements have been produced. Further
it is mentioned in the survey report that there were inadequate
safety measures at the site. It is further noticed in the report
that the deceased was not under the influence of the alcohol. It
is also observed that safety measures like providing nets to
prevent direct fall to the ground, safety hooks and helmets to
the workers were not taken and it was the grievance of the co-
workers also. That if safety measures have been provided, the
fall could have been prevented and the workers would have
escaped with injuries. In the opinion and finding it is stated that
the claim of death for the deceased is well substantiated.
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13. The policy of insurance is produced as Ex.R.1,
wherein condition No.3 states that insured shall take
reasonable precautions to prevent accidents and disease and
shall comply with all the statutory obligations.
14. It is forthcoming from the aforementioned that the
insurer has taken a specific defence that the safety measures
were not adopted. The condition in the policy of insurance
requires the insured to comply with all the statutory
obligations. The insurer has not stated as to what are the
statutory stipulations that the insured was required to comply.
Further the investigator of the insurer, although having
admitted to have taken photographs of the place of the
accident, has not produced the same. Further, although the
investigator has stated that he has spoken to the co-workers,
he has not produced any statements of the co-workers which
were recorded by him. The investigator has also not produced
any notes made by him during the visit to the project site of
the employer.
15. The insurer having taken a specific defence
regarding non-adherence of safety measures by the insured,
has miserably failed in proving that the safety measures as
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required under the relevant statutory provisions have not been
taken by the insured. In view of the same, the question No.(i)
framed for consideration is answered in the negative.
Reg. Question No.(ii):-
16. It is the vehement contention of the learned
counsel for the insurer that the claimants themselves having
averred that the wages of the deceased was `175/- per day
and the employer also have been stated that he was paying
sum of `175/- per day, the same ought to be have been
calculated for a period of 26 days in a month and accordingly,
the income of the deceased ought to have been as (175 X 26)=
`4,550/- by the Commissioner. Alternatively, the salary details
for the month of March, April and May having been produced as
Ex.P.9 which discloses the deceased had received a sum of
`3,850/-, `3,675/- and `3,500/- respectively, the same ought
to have been considered.
17. The Tribunal has noticed that the deceased was
being paid sum of `175/- per day. However, the Tribunal has
further noticed that the Central Gazette notification dated
31.05.2010 issued under Section 4 of the Act stipulates the
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monthly wages as `8,000/- has adopted the same for the
purpose of calculation of the compensation.
18. Learned counsel for the claimant justifies the
finding of the Tribunal of taking monthly wages as `8,000/- per
month by relying on the judgment of the case of UNITED
INDIA INSURANCE CO.LTD,. V/S SRI NAGENDRA AND
ANOTHER4, wherein, a Co-ordinate Bench of this Court has
held as follows:
"19. In view of the sub-section (1B) of Section 4 of the
Act the Central Government has time and again by Official
Gazette notification increased the monthly wages and as
per the Gazette notification dated 31.05.2010 vide S.O.
1258(E) the monthly wages has been increased to
Rs.8,000/-. When this being the clear intent of the
Legislature to increase the monthly wages time and again
based on the increase in the cost of living and
expenditure, it is to be seen as to what is the purpose of
this Legislation by the Legislature. It cannot be lost sight
of that the Act is a beneficial Legislation and the
statement of objects and reasons clearly suggest that the
amendment is brought into force with a clear intention by
the Legislature to enhance the minimum rate of
compensation from time to time so also the monthly
wages and thereby fixing the specific monthly wages by
way of amendment from time to time due to increase in
the cost of living and increase in standard of living and
price rise. As stated above, pursuant to the notification
dated 31.05.2010 the Central Government once again
enhanced the monthly wages from Rs.8,000/- to
Rs.15,000/-. This itself is very clear and apparent at the
intent of Legislature to bring about the amendment time
and again based on the increase of standard of living and
increase of the price of commodities and growth of society
ILR 2022 KAR 3802
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leading to increase in the expenditure to be incurred by
common man.
20. It cannot be dispute that the Act itself is a beneficial
Law. Hence, there has to be a liberal interpretation and
construction of the same with an intent to bring into effect
the specific Legislative intent in bringing about such
amendments time and again. There is no ambiguity in
Section 4 (1) of the Act as well as Section 4(1B) of the
Act. So also, with regard to the amendment made in the
Gazette notification dated 31.05.2010. When this being
the situation the Courts will have to strictly go by the
provisions of Law and keep in mind the Legislative intent
behind enacting such a Law.
21. It is trite law that whenever beneficial Legislation is
made it is with an intention to see that the aggrieved
party is benefited by such Legislation, more so in the
specific case of death or injury having been caused or
occurred in the course and during the employment. This is
also some what similar to the beneficial Legislation in the
motor accident cases.
22. In view of the above discussions and keeping in mind
the intent of the Legislature, I am of the opinion that the
amount of monthly wages increased form time to time by
way of amendment through Gazette notification by the
Central Government, clearly prescribes the said amount
to be a minimum wages amount. In a case where there is
proof of wages / salary produced it is incumbent upon the
Court to take the minimum wages for consideration for
computing compensation despite the pleading by the
petitioner of an amount being lesser than the minimum
wages prescribed by the Act.
23. In the present case on hand, though the petitioner
has pleaded and lead evidence to the effect that he was
earning Rs.6,000/- per month, I deem it appropriate that
in the facts and circumstances of the present case an
amount of Rs.8,000/- per month requires to be taken as
income for computation of compensation. Accordingly,
Rs.8,000/- is taken as monthly income of the petitioner as
against Rs.6,000/- adopted by the trial Court."
(emphasis supplied)
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19. The learned counsel for the insurer attempting to
distinguish the said judgment contends that in the said case the
compensation was awarded in respect of a driver of the insured
vehicle in respect of which the policy of insurance was issued.
Hence, in the said case, the policy insurance was a motor policy
whereas in the present case the policy has been specifically
issued under the provisions of the Act. Hence, the liability of
the insurer under the present policy being contractual one, the
actual wages of the deceased was required to be taken into
consideration.
20. It is relevant to note that in the judgment of this
Court in the case of UNITED INDIA INSURANCE CO.LTD4
this Court has noticed a similar contention wherein the claimant
has averred that he was earning `6,000/- per month i.e., `4800
as wages and `1200/- towards bata. Hence, the specific plea of
the insurer that the income ought to be taken at the amount
averred by the claimant. However, this Court noticing Section 4
of the Act and upon a detail discussion of the relevant aspect of
the matter has recorded a finding that the legislation being a
beneficial one, interpretation commensurate with the object of
the Act ought to be resorted to. Hence, has held that the
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assessment of income ought to be as per the notification issued
by the Central Government.
21. In the present case although its contention of the
insurer that it's liability is limited to the actual wages paid and
the premium that is received by the insurer in respect of the
deceased being limited to the actual wages paid as represented
by the employer, it is relevant to note that such a calculation
stipulating the exact wages that the insured claims to have paid
as set froth in the proposal form furnished while issuing the
policy of insurance has not been averred by the insurer. It
further failed in demonstrating that the policy has been issued
restricting or limiting the coverage to the extent of the
representation made by the insurer regarding the wages paid
and the premium has been received, having regard to the
same. Hence, it cannot be held that liability of the insurer is
limited to the actual amount of wages paid to the deceased.
22. This Court having taken a considered view not
withstanding the plea made by the claimants with regard to the
actual wages paid, having regard to the notification issued
under the provisions of the Act and having regard to the
legislation being a beneficial one, the contention of the insurer
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to limit its liability to the actual wages paid and direct the
balance liability if any, to be fastened on the owner, cannot be
accepted. Hence, the findings of the Tribunal relying upon
notification dated 31.05.2010 for the purpose of assessment of
income of `8,000/- is just and proper. Accordingly, question
No.(ii) framed for consideration is answered in the affirmative.
Reg. Question No.(iii):-
23. It is the contention of the insurer that the liability to
pay interest would arise only within one month of adjudication
of the claim by the Tribunal and the order of the Tribunal
awarding interest from the date of petition is erroneous. The
said contention is required to be accepted having regard to the
judgment of the Hon'ble Supreme Court in the case of
National Insurance Company Ltd., V/s. Mubasir Ahmed
and others5. Hence, question No.(iii) framed for
consideration is answered in the Negative.
24. In view of the aforementioned, following order is
passed:
2007 ACJ 845
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ORDER
i) The appeal is allowed in part;
ii) The judgment and award dated 03.03.2016 passed in
the Court of XXI Additional Small Causes Judge and
The Motor Accident Claims Tribunal (SCCH-23),
Bengaluru, is modified to the extent stated herein. In
all other respects, the judgment and award of the
Tribunal remains unaltered;
iii) The compensation awarded by the Tribunal shall be
paid by the insurer who is the Appellant in the above
appeal and Respondent No.2 before the Tribunal with
interest at 12% per annum after 30 days from the
date of award of the Tribunal till payment;
iv) The amount deposited together with accrued interest
be disbursed in terms of the award of the Tribunal.
The balance amount, if any, to be paid within eight
weeks from the date of receipt of a copy of this order;
vi) The Registry to draw the modified award accordingly;
vii) No costs.
Sd/-
JUDGE
PNV
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CMPJ:
ORDER ON FOR BEING SPOKEN TO
This Court vide judgment dated 23.2.2024 has while
considering the contention of the insurer that interest is
required to be paid 30 days after the date of the judgment and
award of the Tribunal has relied on the judgment of the Hon'ble
Supreme Court in the case of Mubasir Ahmed5 and partly
allowed the appeal of the insurer. However, subsequently it is
noticed that the said judgment of the Hon'ble Supreme Court in
Mubasir Ahmed5 has been held as not expressing correct
view and not making binding precedence. With regard to the
contention of the insurer regarding the dates from which
interest is to be paid, it is relevant to notice the following
judgments:
i) In the case of Pratap Narain Singh Deo Vs. Srinivas
Sabata6, a four Judge Bench of the Hon'ble Supreme Court
held that the interest is liable to be paid from the date of the
accident.
1976 ACJ 141
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ii) In the case of Kerala State Electricity Board Vs.
Valsala K.7, a three Bench of the Hon'ble Supreme Court has
followed the judgment in the case of Prathap Narain Singh
Deo1.
iii) In the case of Mubasir Ahmed5, a two Judge
Bench of the Hon'ble Supreme Court held that interest is liable
to be paid one month after the date of judgment of the
Commissioner.
iv) In the case of Oriental Co. Ltd., Vs. Mohd.
Nasir8, a two Judge Bench of the Hon'ble Supreme Court has
followed the view taken in the case of Mubasir Ahmed5.
v) In the case of Oriental Insurance company Ltd.,
V/s. Siby George and Others9, a two Judge Bench of the
Hon'ble Supreme Court, noticing that the judgment in the case
of Mubasir Ahmed5 and Moh. Nasir8 it is rendered without
noticing the larger Bench in the case of Pratap Narain Singh
Deo6 and Valsala K7 held that the cases of Mubasir Ahmed5
and Moh. Nasir8 insofar as they took a contrary view to the
2000 ACJ 5 (SC)
2009 ACJ 2742 (SC)
2012 ACJ 2126
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earlier decision in Pratap Narain Singh Deo6 and Valsala K7
do not express the correct view and do not make binding
precedents.
vi) A two Judge Bench of the Hon'ble Supreme Court in
the case of Saberbibi Yakubbhai Shaikh and Others Vs.
National Insurance Co. Ltd., and Others10 noticing the
aforementioned judgments has followed the view taken in
Pratap Narain Singh Deo5, Valsala K7, Siby George and
Others9 and held that interest is liable to be paid from the
date of the accident.
vii) The Hon'ble Supreme Court in the case of P.
Meenaraj Vs. P.Adigurusamy and another11 and in the case
of Ajay Kumar Das and another Vs. Divisional Manager,
National Insurance Co. Ltd., and another12 has followed
the view taken that the interest is liable to be paid from the
date of the accident.
2. Having regard to the settled proposition of law as
noticed above, the contention of the insurer raised in the above
appeal in respect of which question No.(iii) has been framed for
2014 ACJ 467
2022 ACJ 1001
2022 ACJ 1004
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consideration is answered in the affirmative and the appeal of
the insurer is liable to be dismissed.
3. In view of the aforementioned, the operative
portion of the order dated 23.2.2024 passed in the above
appeal is modified as under:
ORDER
i) The above appeal is dismissed;
ii) The judgment and award dated 03.03.2016 passed
in the Court of XXI Additional Small Causes Judge
and The Motor Accident Claims Tribunal (SCCH-23),
Bengaluru, is affirmed;
iii) The amount deposited by the appellant - insurer be
transmitted to the Tribunal for disbursement in
terms of the award of the Tribunal;
iv) The appellant - insurer shall deposit the balance
amount together with accrued interest within eight
weeks from the date of receipt of a copy of this
judgment;
v) Registry to draw the decree accordingly;
Sd/-
JUDGE
BS
