Heard Sri Tarun Kumar Mishra learned counsel for the appellant. The appellant is United India Insurance Company Limited.
Under challenge is the order dated 28.2.2009 by Workmen Compensation Commissioner / District Magistrate, Hardoi in Petition No. 14/16/37 of 2003 under Employees Compensation Act. By this order the Commissioner has allowed a sum of Rs. 1,99,546/- to be paid to the petitioner w.e.f. 22.8.2001 with 12% simple interest. The appellant has challenged the order on three grounds. Firstly, the appellant says that the cover note of the Insurance Policy clearly mentions that valid driving license is a must for any compensation to be claimed from the Insurance Company. the appellant alleges that there was no valid license with the deceased driver. Secondly, he says that under Section 4(1)(A) the amount of compensation shall be an amount equal to 50% of monthly wages of the deceased ( employee) employed by the relevant factor. The appellant says that instead of 50% the learned Workmen Compensation Commissioner has allowed 80% of the monthly wages.
The counsel for the respondent fairly agrees that the order of the Workmen compensation Commissioner to this extent is not proper. He agrees that he is entitled for compensation @ 50% monthly income. The counsel for the appellant has further argued that 12% interest will become due only from the date of adjudication of the matter. Accordingly the interest should be allowed from the date of adjudication by the Commissioner i.e. 28.2.2009. In support of his claim the appellant has place reliance upon and judgment reported in 2009 1 TAC 1 Supreme Court ( Kamla Chaturvedi vs. National Insurance Company and others). Para 8 of this judgment is being quoted here below:
"8. In National Insurance Co. Ltd. v. Mubasir Ahmad & Anr., 2007 (2) S.C.C. 349 : 2007 (2) T.A.C. 3, it was, inter alia, held as follows :
Interest is payable under Section 4-A(3) if there is default in paying the compensation due under this act within one month from the date it fell due. The question of liability under Section 4-A was dealt with by this Court in Maghar Singh vs. Jashwant Singh, (1998) 9 S.C.C. 134. By amending Act 30 of 1995, Section $-A of the Act was amended, inter alia, fixing the minimum rate of interest to be simple interest @ 12%. In the instant case, the accident took place after the amendment and, therefore, the rate of 12% as fixed by the High Court cannot be faulted. But, the period as fixed by it is wrong, The starting point is on completion of one month from the date on which it fell due. Obviously it cannot be the date of accident. Since no indication is thre as to when it becomes due, it has to be taken to be the date of adjudication of the claim. This appears to be so because Section 4-A(1) prescribes that -2- compensation under Section 4 shall be paid as soon as it falls due. The compensation becomes due on the basis of adjudication of the claim made. The adjudication under Section 4 in some cases involves the assessment of loss of earning capacity by a qualified medical practitioner. Unless adjudication is done, question of compensation becoming due does not arise. The position becomes clearer on a reading of sub-section (2) of Section 4-A. It provides that provisional payment to the extent of admitted liability has to be made when employer does not accept the liability for compensation to the extent claimed. The crucial expression is " falls due". Significantly, legislature has not used the expression "from the date of accident:. Unless there is an adjudication, the question of an amount falling due does not arise."
Sri Tarun Kumar Mishra has argued that the company can not be made liable to pay interest from the date of accident. According to the judgment this should be from the date of adjudication of the matter. On plain reading one has to agree with his argument but on close scrutiny it appears that intention of the Hon'ble Supreme Court was not such as is being made out by the counsel for the appellant.
Counsel for the opposite party Sri Saket Gupta has drawn the attention of this court towards para no. 9 of the said judgment. In this para the Hon'ble Supreme Court has clearly mentioned that the conclusion is drawn on the basis of the case of National Insurance Company Ltd. vs. Mubasir Ahmad and others reported in AIR 2007 Supreme Court 1208. Relevant para no. 9 of the judgment is as follows :
"In view of what has been stated in Mubasir Ahmed's case (supra) the liability for interest would be in terms of what has been stated in paragraph 9 of the judgment. "
Counsel for the opposite party has also placed reliance on a judgment of Delhi High Court reported in 2008 (3) TAC 30 (Delhi) ( National Insurance Company vs. Kanshi Ram and others). His Lordships in this matter in para no. 33 has made the following observation :
"In Mubasir's case (supra) the Hon'ble Supreme Court dealt with the specific situation where a workman suffers from an injury resulting in permanent partial disablement and the injury is not specified in Schedule I to the Section 4 of the Workmen's Compensation Act, 1923. In such a case, loss of earning capacity suffered by the workman has to quantified by a qualified medical practitioner and on the basis of which compensation payable to the workman is to be computed. Noting that in such cases employer would not be in a position to either admit or pay compensation unless loss of earning capacity is quantified by a qualified medical practitioner, the Hon'ble Supreme Court has held that the compensation becomes due on the date of thee adjudication of the claim."
It is clear by His Lordships observation that in the cases of accident resulting into injury an assessment of the damage has to be made by a competent doctor. In absence of such a calculation by a medical practitioner the claim -3- can not be quantified. This can not be done by any agency who is liable to pay without the help of a medical practitioner. Hence, what can not be done by a prudent person by his normal capacity without the aid of a medical practitioner, penalty can not be imposed upon him. It was in such a situation that the Hon'ble Supreme Court carrying on its original view in Mobassir Ahmad's case has passed order in Kamla Chaturvedi. Naturally it has to be read in the light of the case of Mobassir Ahmad's case.
A distinction has to be drawn in the case of death and in a case of injury. If there is a case of injury the assessment of injury by medical practitioner is necessary while in the case of death no such assessment is required. When no such assessment is required there is no need of medical practitioner. There will be no so called adjudication. The word 'Adjudication' used by Hon'ble Supreme Court has to be read in the sense that there has to be an assessment of the injury by a medical practitioner. Word 'Adjudication' is not in the sense of adjudication by the Workmen Compensation Commissioner. The adjudication in the courts of law is a tedious and cumbersome process. It is dependent on number of factors including the work load, availability of the courts, availability of the respective lawyers, strikes and other numerous factors. A case can linger on for two years and it can linger on for 20 years also. If interest is not to be paid, say for 20 years the amount of compensation awarded will become totally irrelevant in the times to come after twenty years. In the present case the claim was filed in the year 2003 and it was decided in year 2009. The claimant can not be faulted for this time taken by the Commissioner and if the money due to the claimant at the time of accident is to be paid to him or her after 9 years without interest then the compensation will not be in real terms. The value of the compensation at the time of accident will loose its purchasing power, hence, it will become very unjust and harsh, if the date of falling due is to be reckoned with from the date of adjudication by a court of law.
Sri Tarun Kumar Mishra has given number of case laws and he has emphasized that compensation can be given @ 7.5.% from the date of notice till the date of adjudication and after adjudication it can be @ 12% as has been laid down in para no. 50 of Oriental Insurance Company Limited vs. Mohd. Nasir and another (2009) 6 Supreme Court Cases 280. For convenience paragraph no. 50 is being quoted herebelow :
"50. Reliance has been placed on Mubasir Ahmed wherein it was held: (SCC pp. 354-55, para 9)
9. Interest is payable under Section 4-A (3) if there is default in paying the compensation due under this Act within one month from the date it fell due. The question of liability under Section 4-A was dealt with by this Court in Maghar Singh v. Jashwani Singh. By amending Act 30 of 1995, Section 4-A of the Act was amended, inter alia, fixing the minimum rate of interest to be simple interest @ 12%. In the instant case, the accident took place after the amendment and, therefore, the rate of 12% as fixed by the High Court cannot be faulted. But the period as fixed by it is wrong. The starting point is on completion of one month from the date on which it fell due. Obviously it can not be the date of accident. Since no indication is there as to when it becomes -4- due, it has to be taken to be the date of adjudication of the claim. This appears to be so because Section 4-A(1) prescribes that compensation under Section 4 shall be paid as soon as it falls due. The compensation becomes due on the basis of adjudication of the claim made. The adjudication under Section 4 in some cases involves the assessment of loss of earning capacity by a qualified medical practitioner. Unless adjudication is done, question of compensation becoming due does not arise. The position becomes clearer on a reading of sub-section (2) of Section 4-A. It provides that provisional payment to the extent of admitted liability has to be made when employer does not accept the liability for compensation to the extent claimed. The crucial expression is 'falls due'. Significantly, legislature has not used the expression ' from the date of accident'. Unless there is an adjudication, the question of an amount falling due does not arise.
As therein this aspect of the matter has not been considered, we are of the opinion that interest will also be payable at the rate of 7 1/2% per annum from the date of filing of the application till the date of award. The rate of interest thereafter shall be payable in terms of the order passed by the Commissioner."
So far as the question of driving license is concerned Sri T.K. Mishra has argued that no finding has been given on issue no. 3 by the Tribunal. Issue no. 3 was with regard to having valid driving license by the driver.
Sri Saket Gupta has referred to the judgment of 2006 TAC- 982 New India Insurance Company vs. Smt. Kanku and others & TAC 506 United India Insurance Company Limited vs. Seema Devi & others wherein it has been observed that the Insurance Company shall be liable to pay the compensation to the employee and shall have the right to recover the same from the employer.
Accordingly, the order of the appeal is modified to the extent that the opposite party shall be entitled to a claim to be calculated @ 50% of the monthly income with 7.5% of interest till the date of adjudication and 12% interest therefrom. The Insurance company will have the right to recover the amount of compensation from the employer, if it so chooses from the date of actual payment.
Both the parties have agreed that the amount calculated @ 50% is Rs. 2,49,716.25 paise is actual amount. So far as this amount is concerned there is no dispute. It is directed that the appellants shall calculate 7.5% interest from the date the claim was placed before the Insurance company in 2001 itself. After that the interest shall be calculated @ 12% till the actual date of payment.
The appeal is thus finally disposed of.
Order Date :- 21.3.2012 Om.