BAISNAB MOHANTY Vs. RAMESH KUMAR MOHANTY
LAWS(ORI)-2014-5-47
HIGH COURT OF ORISSA
Decided on May 15,2014

Baisnab Mohanty Appellant
VERSUS
Ramesh Kumar Mohanty Respondents




JUDGEMENT

- (1.)THIS is an appeal against the order dated 11.09.2006 passed by the learned Commissioner for Workmen s Compensation -cum - Assistant Labour Commissioner, Cuttack in W.C. Case No.232 - D/2004 awarding compensation of Rs.2,65,644/ - for the death of deceased Subash Chandra Mohanty in a vehicular accident taking place on 05.09.2004 on account of rash and negligent driving on the part of the driver of the offending vehicle bearing Registration No.OAC -6689 in which the deceased was employed as a helper, as against the claim of Rs.4,45,420/ -, along with interest @ 12% per annum. The owner of the vehicle (opposite party No.1 before the learned Commissioner) admitted the employment of the deceased as a helper in the offending truck as well as the accidental death of the workmen arising out of and in course of such employment. The Insurance Company (opposite party No.2 before the learned Commissioner) denied all the averments made in the claim petition and disclaimed their liability to pay any compensation.
(2.)THE appellants are the claimants -applicants before the learned Commissioner. Respondent No.1 is the insured vehicle owner and Respondent No.2 is the insurer of the vehicle.
(3.)THE appeal has been admitted on the following substantial question of law:
Whether the learned Commissioner has committed illegality by not awarding interest on the awarded amount as required under Section 4 - A(3) of the Workmen s Compensation Act, 1923 (now amended as Employees Compensation Act, 1923)?

Admittedly, learned Commissioner has not awarded interest as contemplated under Section 4 -A(3) of the Workmen s Compensation Act (for short, the Act). No reason has been cited as to why interest has not been awarded. Section -4 -A(3) of the Act lays down that where any employer is in default in paying compensation due under the Act within one month from the date it fell due, the Commissioner shall direct that the employer shall pay simple interest on the compensation to the extent it stands as arrear at the rate of 12% per annum or at such higher rate not exceeding the existing maximum of the lending rates of any scheduled bank as may be specified by the Central Government, by notification in the official gazettee. The statute makes it mandatory on the part of the employer to pay simple interest on the amount of arrears which should not be less than 12% per annum. Though Section 4 -A makes the employer liable to pay the interest it is observed by the Supreme Court in the decision (Ved Prakash Garg -Vr. - Premi Devi and others, 1997 AIR(SC) 3854) that when an employee suffers from motor accident injury while on duty on the motor vehicle belonging to the insured employer, the claim for compensation payable under the Act along with interest thereon, if any, as imposed by the Commissioner under Section 3 and 4 -A(3)(a) of the Act will have to be made good by the Insurance Company jointly with the insured employer. It is not the case of the Insurance Company that the terms of the insurance policy do not cover the liability of the employer to pay interest under Section 4 -A(3) of the Act. In (Saberabibi Yakub Bhai Shaikh and Others -Vrs. - National Insurance Co. Ltd. and Others, 2014 1 TAC 385), it is observed that the claimants are entitled to interest @ 12% from the date of the accident. Thus, it is found that making no award of interest vide the impugned order being contrary to provisions contained in Section 4(A)(3) of the Act is illegal. The claimants -appellants are entitled to interest @ 12% on the awarded amount from the date of the accident.



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