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JKLR-Part(IV) OWP 128/1989 Back To Index |
(2001)
1 J & K LAW REPORTER
424 MOHD. SHAFI
Appellants OWP
128 / 1989, decided on 29.1.2001.
Workmen’s Compensation Act, 1923 (VIII of 1923) S. 4A (2) - Petitioner
sustained injuries while on duty - Compensation awarded by Commissioner under the
Workmen’s Compensation Act - Compensation not paid within the time allowed in the
order - Whether entitled to claim interest on the award money from the date it fell due -
Held : Yes.
... the petitioner suffered an injury on 19.6.1984. He preferred a petition, as he
was not paid compensation. No doubt, the commissioner under workmen compensation Act did
not pass an order for payment of penalty, nevertheless, when prayer in this regard was
made before the court which was to execute it, it could have taken note of the fact that
the order dated 30.12.1986 was not complied with and for this non compliance, it could
have done what the authority acting on original application could have not done. The
amount fell due when the payment was not made as per order dated 30.12.1986. Therefore,
the prayer of the petititoner that as compensation was not paid within one month from
30.12.1986, therefore, with effect from 1.2.1987 he was entitled to interest till payment
was made to him, is a plea which is not without merit. The payment fell due on the date of
accident. It positively fell due on the expiry of the period fixed in the order dated:
30.12.1986. Therefore, with effect from 1.2.1987 till payment is made, the petitioner is
held entitled to interest @ 6% p.a, that is the rate which was indicated in the Act as in
force. So far as penalty is concerned, the petitioner is also entitled to the same. This
would be 50% of the amount assessed i.e. Rs.7,600/-.
[Para 6] Advocates who appeared in this case : Cases referred : Chronological JUDGMENT AND ORDER
The petitioner sustained injuries while on duty. He was allowed compensation under
the workmen’s Compensation Act. The operative part of the order passed by the
Commissioner under the Workmen’s Compensation Act on 30.12.1986 reads as under ; “In
view of the above, an award in terms of schedule IV of the Workmen’s Compensation Act
is accordingly issued in favour of the applicant and against the non-applicant for an
amount of Rs.15,200/- only including costs assessed at Rs.80/- The non-applicant is
directed to arrange for the deposit of Rs.15,200/-(Rupees Fifteen thousand and two
Hundred) as compensation with this court within 30 days from the date of announcement of
this award failing which the same shall be recovered by invoking section 31 of the
Workmen’s Compensation Act, 1923.”
No order as to penalty and interest is made. File to go to records after due
completion.”
Payment of this amount was not made within the stipulated period of one month. The
petitioner preferred an application for execution. He pleaded that as the awarded amount
was recovered through execution, he should be paid penalty and interest in terms of
Section 4(A) of the Workmen’s Compensation Act, 1923. This claim of his was rejected
on the ground that such a relief was not granted to him when application preferred by him
came to be decided on 30.12.1986. The Commissioner, accordingly, refused to pass an order
for payment of penalty and interest. It is against this order the present petition has
been preferred.
The learned counsel for the petitioner submits that under the law compensation was
supposed to be paid when it fell due and if it is not paid, then penalty for this denial
is a must. It is submitted that Section 4-A(2) provides in mandatory terms that in case
where the employer does not accept the liability of compensation to the extent claimed, he
shall be bound to make provisional payment based to the extent of liability which he
accepts and such payment has to be deposited with the Commissioner or made to the workman,
as the case may be, without prejudice to the right of the workman to make any further
claim. It is further submitted that if
Sub-section
(3) is taken into consideration, then wherever any employer is in default in paying
compensation due under this Act within one month from the date it fell due, the
Commissioner is to direct that in addition to the amount of arrears, pay simple interest @
6% per annum thereon or at such higher rate not exceeding the maximum of the lending rates
of any scheduled Bank. Section 4-A as it existed when cause of action arises reads under; “Sec.4-A Compensation to be paid, when due and penalty for
default: (1) Compensation under section 4 shall be paid as soon as it falls due. (2)
In cases where the employer does not accept the liability for compensation to the extent
or liability which he accepts, and, such payment shall be deposited with the commissioner
or made to the workmen, as the case may be, without prejudice to the right of the workman
to make any further claim. (3)
Where any employer is in default in paying the compensation due under this Act within one
month from the date it fell due, the Commissioner may direct that, in addition to the
amount of the arrears, simple interest at the rate of
six percent per annum on the amount due together with, if in the opinion of the
Commissioner there is no justification for delay, a further sum not exceeding fifty
percent of such amount, shall be recovered from the employer by way of penalty.”
The learned counsel for the petitioner submits that the amount fell due not only
when the accident took place but it fell due also when the Commissioner gave its award on
31.02.1986. It is, accordingly, submitted that the workman was entitled to penalty and
interest and to that extent relief could not be denied to him.
The question which is required to be gone into is as to what would be the amount of
compensation, that would be deemed to have fallen due. Under normal circumstances,
compensation would be due as soon as accident takes place. Causing death or disablement of
the workman. There is no reason for postponment of accrual of this right to a future date.
There can be no two opinions regarding this. The argument which has been raised by the
learned counsel for the petitioner is that compensation would again fall due when it is
actually determined by the Commissioner on the application of the workman and if a time
limit is fixed for payment and the payment is not made, even then a presumption would be
that compensation has fallen due. It is accordingly, submitted that the workman was
entitled to claim interest and its denial is not justified. In case reported as ACJ 1975
84 Smt. Vimlaben Vashrambhai and others v. The
Gujrat housing Board and others, employer failed to make provisional payment based to
the extent of liability inspite of reciept of notice. The employer was held liable to pay
penalty and interest. Rate of interest was fixed at 6% and penalty was fixed at 50% of the
amount due. In case reported as 1994 Labour and industrial cases 2561 Divisional Forest Officer, Gwalier v. Baijnatibai a
Division Bench of Madhya Pradesh High Court imposed a penalty @50% when compensation was
not deposited. In case reported as 1981 Labour and Industrial cases 1399 Divisional Engineer M.P.E.B Morena v. Mantobai the
view expressed was that payment of penalty and interest is a question which depends upon
the interpretation of the Act and is a natural consequence, and even if no issue was
framed in this regard, this would not debar the grant of interest. In case reported as
1981 Labour and Industrial cases 1281 Ramlal and
others v. Regional Manager Food Corporation of India, Jaipur and others it was
observed that liability of payment arises on the date of accident and not on expiry of 30
days of service of a notice. In case reported as 1998 Labour and industrial cases 2316 Traffic Manager, New Mangalore Port Trust v. B. Radha,
where the claimant was deprived of lawful benefit, interest and penalty was allowed.
In the present case, the petitioner suffered an injury on 19.6.1984. He preferred a
petition, as he was not paid compensation. No doubt, the Commissioner under Workmen
Compensation Act did not pass an order for payment of penalty, nevertheless, when prayer
in this regard was made before the court which was to execute it, it could have taken note
of the fact that the order dated 30.12.1986 was not complied with and for this non
compliance, it could have done what the authority acting on original application could
have not done. The amount fell due when the payment was not made as per order dated
30.12.1986. Therefore, the prayer of the petititoner that as compensation was not paid
within one month from 30.12.1986, therefore, with effect from 1.2.1987 he was entitled to
interest till payment was made to him, is a plea which is not without merit. The payment
fell due on the date of accident. It positively fell due on the expiry of the period fixed
in the order dated 30.12.1986. Therefore, with effect from 1.2.1987 till payment is made,
the petitioner is held entitled to interest @ 6% p.a, that is, the rate which was
indicated in the Act as in force. So far as penalty is concerned, the petitioner is also
entitled to the same. This would be 50% of the amount assessed, i.e., Rs.7,600/-.
This petition is allowed in the manner indicated above. ......... |