Madras High Court
United India Insurance Co. Ltd vs Albones on 6 October, 2021
CMA.No.2768 of 2018
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 06.10.2021
CORAM:
THE HON'BLE MR. JUSTICE ABDUL QUDDHOSE
C.M.A.No. 2768 of 2018 &
CMP.No. 18433 of 2018
United India Insurance Co. Ltd.,
No. A5 & 6, II Floor, Appasamy Towers,
New 27, Sri Thyagaraya Road,
(Next to (Old) Theatre Nagesh),
T. Nagar, Chennai - 600 017. ... Appellant
Vs.
1. Albones
2. Chandrasekar
3. Thambiraj
4. Indra
5. M/s. SRM Engg Construction Corporation Ltd.,
No.2, Veerasamy Street, West Mambalam,
Chennai - 600 033. ... Respondents
Civil Miscellaneous Appeal filed under Section 30 of Workmen
Compensation Act, 1923 against the award dated 31.08.2017 made in
W.C. No. 162 of 2013 on the file of Workmen's Compensation Authority
(Employee's Compensation Authority), (DC1) at Chennai.
For Appellant : Mr. C. Paranthaman
For Respondents: Ms. A. Subadra
for M/s. M. Malar
for R1 to R4.
R5 - No Appearance
https://www.mhc.tn.gov.in/judis/
1/7
CMA.No.2768 of 2018
JUDGMENT
(This case was heard through Video Conferencing)
This Appeal has been filed by the Insurance Company challenging
the award dated 31.08.2017 passed by the Deputy Commissioner of
Labour - I, Chennai under the Employees Compensation Act, 1923 in
W.C. No. 162 of 2013.
2. Heard, Mr. C. Paranthaman, learned counsel for the Appellant
and Ms. A. Subadra, learned counsel for the respondents 1 to 4.
Despite service of notice on the fifth respondent and their name having
been printed in the cause list today, there is no representation on their
side.
3. This Appeal is admitted on the following substantial questions
of law:
1. Whether the learned Commissioner in
right in holding that the deceased Shanmugathai
is an employee of the 5th respondent?
2. Whether the learned Commissioner is
right in holding that the insurer appellant is liable
to pay interest as per the policy condition?
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CMA.No.2768 of 2018
4. The main contention of the Appellant Insurance Company in the
Appeal is that being a contractual liability the Tribunal ought not to have
awarded interest to the respondents/ applicants under the impugned
award. It is their contention that since the insurance policy does not
provide for payment of interest, they are not liable to pay interest to the
respondents/ applicants.
5. Mr. C. Paranthaman, learned counsel for the Appellant drew the
attention of this Court to the insurance policy in support of the
contention raised by the Appellant / Insurance Company in this Appeal.
He also relied upon a decision of the Hon'ble Supreme Court in the case
of P.J. Narayan vs Union of India (Uoi) and Others reported in 2004
ACJ 452 which was followed by a Single Bench Judgment of this Court
in the case of Bharti AXA General Insurance Company Limited vs T.
Pappa and 3 others in CMA No.628 of 2020 dated 17.02.2021.
6. Admittedly, under the Employees Compensation Act, 1923,
there is no statutory liability for the Insurance Company to pay the
compensation but it is only a contractual liability. As seen from the
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CMA.No.2768 of 2018
insurance policy issued by the Appellant to the 5th respondent which has
been marked as Ex.P6 and Ex.R2, it is clear that no interest is payable
under the policy to the claimant. However, as seen from the impugned
Award, the Deputy Commissioner of Labour - I, Chennai has erroneously
awarded interest at 12% per annum to the respondents/ applicants. The
relevant paragraph of the order of the Hon'ble Supreme Court in P.J.
Narayan vs Union of India (Uoi) And Others reported in 2004 ACJ
452 referred to by the learned counsel for the Appellant reads as follows:
This writ petition is for the purpose of directing
Insurance Company to delete the clause in the
Insurance Policy which provides that in case of
compensation under the Workmen's Compensation Act,
1923, the Insurance Company will not be liable to pay
interest. We see no substance in the writ petition.
There is no statutory liability on the Insurance
Company. The statutory liability under the Workmen's
Compensation Act is on the employer. An insurance is
a matter of contract between the Insurance Company
and the insured. It is always open to the Insurance
Company to refuse to insure. Similarly they are
entitled to provide by contract that they will not take
on liability for interest. In the absence of any statute
to that effect, insurance company cannot be forced by
Courts to take on liabilities which they do not want to
take on. The Writ Petition is dismissed. No order as
to costs.
7. The aforesaid decision has also been followed by a learned
single Judge of this Court in the decision dated 17.02.2021 in the case of
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CMA.No.2768 of 2018
Bharti AXA General Insurance Company Limited vs T. Pappa and 3
others in CMA No.628 of 2020 .
8. If at all, the respondents/ applicants are entitled to get interest,
they can only claim from the Employer viz., the 5th respondent herein
and not from the Insurance Company as the Insurance Company does not
provide for payment of interest.
9. For the foregoing reasons, substantial questions of law,
formulated by this Court is answered in favour of the Appellant /
Insurance Company and the Civil Miscellaneous Appeal is allowed and
the impugned award dated 31.08.2017 is set aside only to the extent of
interest awarded by the Tribunal as against the Appellant / Insurance
Company. No costs. Consequently, connected miscellaneous petition
is closed.
10. Insofar as the compensation determined by the Tribunal at
Rs.6,49,667/- is concerned, the Appellant Insurance Company is liable to
pay the respondents/ applicants. Insofar as the funeral expenses at
Rs.5,000/- is concerned, the same is confirmed by this Court.
11. The Appellant Insurance Company has deposited the entire
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CMA.No.2768 of 2018
award amount as determined by the Tribunal which includes the funeral
expenses also at Rs.6,54,667/-. Since the award for payment of interest
has been set aside by this Court, the Appellant /Insurance Company is
permitted to withdraw the excess amount paid by them by filling an
appropriate application before the Deputy Commissioner of Labour - I,
Chennai.
06.10.2021
Index: Yes/No
Internet: Yes/No
Speaking Order/Non-Speaking Order
ab/vsi2
To
1. The Deputy Commissioner – 1,
Workmen's Compensation Authority,
(Employee's Compensation Authority),
Chennai.
2. The Section Officer,
V.R. Section,
High Court, Madras.
ABDUL QUDDHOSE, J.
ab
https://www.mhc.tn.gov.in/judis/
CMA.No.2768 of 2018
CMA.No.2768 of 2018
&
CMP.No. 18433 of 2018
06.10.2021
https://www.mhc.tn.gov.in/judis/
