Divisional Manager United India ... vs Geeta And Ors
2025 Latest Caselaw 4189 Kant

Karnataka High Court

Divisional Manager United India ... vs Geeta And Ors on 19 February, 2025

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                                                         NC: 2025:KHC-K:1150
                                                   MFA No. 203728 of 2023




                             IN THE HIGH COURT OF KARNATAKA

                                    KALABURAGI BENCH

                        DATED THIS THE 19TH DAY OF FEBRUARY, 2025

                                          BEFORE

                            THE HON'BLE MR. JUSTICE C.M. JOSHI


                           MISCL. FIRST APPEAL NO.203728/2023(ECA)


                   BETWEEN:

                   DIVISIONAL MANAGER,
                   UNITED INDIA INSURANCE CO., LTD.,
                   CENTURY COMPLEX, OPP. SANGAM TALKIES,
                   SUPER MARKET,
                   KALABURAGI.
                   (NOW REPRESENTED BY
                   THE SR. DIVISIONAL MANAGER
                   KALABURAGI).
                                                               ...APPELLANT

Digitally signed   (BY SMT. PREETI PATIL MELKUNDI, ADVOCATE)
by
LUCYGRACE
Location: HIGH
COURT OF
KARNATAKA          1.   SMT. GEETA W/O LATE YALLAPPA WADDAR,
                        AGE: 23 YEARS, OCC: HOUSEHOLD,

                   2.   ARUN S/O LATE YALLAPPA WADDAR,
                        AGE: 3 YEARS AND 8 MONTHS, OCC: NIL,

                   3.   TAYAWWA W/O NAGAPPA WADDAR,
                        AGE: 53 YEARS, OCC: HOUSEHOLD,

                   4.   NAGAPPA S/O GIDAPPA WADDAR,
                        AGE: 58 YEARS, OCC: COOLIE,
                        RESPONDENT NO.2 IS MINOR U/G OF
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                                         NC: 2025:KHC-K:1150
                                    MFA No. 203728 of 2023




     NATURAL MOTHER RESPONDENT NO.1
     ALL ARE R/O. VIDYA NAGAR, JEWARGI,
     DIST. KALABURAGI-585 101.

5.   GOLAYYA C. HIREMATH,
     AGE: MAJOR, OCC: CONTRACTOR,
     R/O HULLUR HOUSE, VIDYA NAGAR,
     JEWARGI, TQ. JEWARGI,
     DIST. KALABURAGI-585 101.
                                            ...RESPONDENTS
(BY SRI NARENDRA M. REDDY, ADV., FOR R1 TO R4;
R5-SERVED, BUT UNREPRESENTED)


     THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER
SECTION 30(1) OF THE EMPLOYEE'S COMPENSATION ACT,
PRAYING TO ALLOW THE APPEAL BY SETTING ASIDE
IMPUGNED JUDGMENT AND AWARD DT.29.03.2023 IN E.C.A
NO.01/2020 PASSED BY THE SENIOR CIVIL JUDGE AND
COMMISSIONER     FOR   EMPLOYEE'S    COMPENSATION,
JEWARGI.

    THIS APPEAL COMING ON FOR ADMISSION, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE C.M. JOSHI


                     ORAL JUDGMENT

(PER: HON'BLE MR. JUSTICE C.M. JOSHI)

1. Heard learned counsel appearing for the

appellant-Insurance Company and learned counsel appearing

for the respondents-claimants.

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2. Though the matter is slated for admission, with

the consent of both the parties, it is taken up for final

disposal.

3. Being aggrieved by the judgment and award in

ECA No.1/2020 dated 29.03.2023 passed by the Senior Civil

Judge and Commissioner under the Employees'

Compensation Act, Jewargi, (for short 'the Commissioner'),

the Insurance Company is before this Court in appeal.

4. The substantial questions of law that arise for

consideration in this appeal are as below:

1) Whether the Commissioner is justified in saddling the entire liability against the Insurance Company though the accident occurred outside the location of the risk covered under the policy?

2) Whether the Commissioner is justified in saddling the appellant-Insurance Company to pay the interest at 12% per annum, though the interest and penalty cannot be saddled upon the

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Insurance Company as per the terms of the policy?

5. The factual matrix of the case is that the husband

of petitioner No.1 - Yallappa was a labourer, working as a

Mason under respondent No.1. On 17.04.2020 as per the

instructions of respondent No.1, he was working at Jewargi

Stadium in the construction work. At about 5.00 p.m., while

he stood near the Indoor Stadium Wall, due to strong winds

and stormy weather, the wall and pillar fell on the deceased

Yallappa causing his death. A case was registered by Police

in Crime No.71/2020. The petitioners filed a claim petition

against the employer and the insurer contending that the

deceased was earning wages of Rs.15,000/- per month, he

was aged about 24 years and therefore, they are entitled for

the compensation.

6. The respondent No.1 - employer admitted the

relationship of employee and employer and contended that

deceased was deployed at the construction of the indoor

stadium on 17.04.2020 and due to vis-major i.e., stormy

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winds, the wall fell down on him and he died. It is

contended that he was being paid wages of Rs.475/- per

day, i.e., Rs.11,400/- per month. He also stated that he had

obtained 'Employees Compensation Liability Policy' from

respondent No.2 and therefore, respondent No.2 is liable to

pay the compensation.

7. The respondent No.2 denied all the contentions of

the petitioners and submitted that it had issued the policy

and it was obligatory on the part of respondent No.1 to

comply all the conditions. It contended that the award of

interest be restricted to the conditions of the policy.

8. The Commissioner recorded the evidence of

petitioner No.1 as PW1 and Exs.P1 to P7 were marked. The

official of respondent No.2 was examined as RW1 and

documents at Exs.R1 and R2 were marked. After hearing

both the sides, the Commissioner held the wages of

deceased at Rs.11,400/- and applying a factor of 218.47 as

per the Schedule to the E.C. Act, as applicable for the age of

24 years, awarded compensation of Rs.12,50,280/-, inclusive

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of funeral expenses. It saddled the entire compensation

amount to be paid by respondent No.1 - Insurance

Company.

9. A perusal of Ex.R2, the policy issued by

respondent No.2 would show that the location of the risk is

mentioned as Hullur House, Vidya Nagar, Jewargi and the

policy covers ten unskilled labourers with declared total

monthly wages at Rs.1,05,000/-. It is pertinent to note that

the page No.5 of the policy shows that the exclusions are

specifically mentioned. Clause (b) of the Exclusions reads as

below:

"This policy shall not cover the liability of the Insured:

xxxxxxxxxxx

b) Accident occurring at any other place than the place of places of Employment specified in the Schedule, unless the Employee was at such other place whilst on duty for the purpose of Business and on the directions of the Insured or any of its official authorized to

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exercise control and supervision over the Employee."

10. This clause in the policy would clearly indicate

that the policy covers the places where the employee is

deployed by the employer for the purpose of his business.

Therefore, the contention of the learned counsel for the

appellant-Insurance Company that the deceased was

deployed at Indoor Stadium Jewargi and therefore, the policy

does not cover the accident is bereft of any merit. Hence,

the same has to be rejected.

11. The second aspect is, what would be liability of

the appellant - Insurance Company. It is pertinent to note

that the declared monthly wages for ten employees would be

Rs.1,05,000/-. Therefore, per employee, the wages would

be Rs.10,500/- per month. When respondent No.1 -

employer has admitted the wages of Rs.11,400/- per month,

the balance amount has to be paid by the employer. In

other words, the appellant - Insurance Company is liable to

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pay the compensation of Rs.10,500/- x 218.47 x 50% =

Rs.11,46,967/-.

12. The balance amount i.e., Rs.900/- x 218.47 x

50% = Rs.98,312/- and the funeral expenses of Rs.5,000/-

are to be paid by the employer.

13. Coming to the liability to pay the interest, it is

worth to note that the judgment of the Apex Court in the

case of NEW INDIA ASSURANCE CO. LTD. V.

HARSHADBHAI AMRUTBHAI MODHIYA1, which was

clarified later in the case of KAMLA CHATURVEDI V.

NATIONAL INSURANCE CO,2 holds that the Insurance

Company in the absence of any statutory mandate to pay

the interest and penalty and the policy not mentioning

anything about the liability to pay the interest and penalty, is

not liable to pay the same. Therefore, the interest on the

entire compensation at the rate of 12% per annum from the

date of expiry of 30 days from the date of the accident is to

be saddled upon the employer.

(2006) 5 SCC 192

(2009) 1 SCC 487

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14. Thus, the substantial questions of law having

been answered accordingly, the appeal succeeds in part.

Hence, the following:

ORDER

i) The appeal is allowed in part.

ii) The impugned judgment and award passed

by the Commissioner is hereby modified.

iii) The appellant - Insurance Company is liable

to pay the sum of Rs.11,46,967/- to the

claimants.

iv) The employer i.e., respondent No.5 herein

is liable to pay the sum of Rs.1,03,312/- to

the claimants.

v) The employer i.e, respondent No.5 is also

liable to pay the interest at 12% per

annum, from the date of expiry of 30 days

of the accident till the date of deposit before

the Commissioner on the entire sum of

Rs.12,50,280/-.

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vi) The excess amount deposited by the

appellant-Insurance Company before the

Commissioner be refunded to it.

Sd/-

(C.M. JOSHI) JUDGE

SBS

CT: AK