SATPAL Vs. PANKAJ KUMAR MALHOTRA AND ANOTHER

JUDGEMENT

(1.) This appeal is by the workman against the award of the Commissioner under the Workmen Compensation Act, 1923 (for short 'the Act') which is now called as Employee's Compensation Act, 1923 after the Workmen's Compensation (Amendment) Act, 2009 by which he has been awarded a sum of Rs.4,67,136/- as compensation on account of his injuries suffered in the vehicular accident occurred during the course of his employment. In respect of interest, it has been observed that "if the insurance company fails to pay the aforesaid amount within 30 days then after that it shall also liable to pay interest @ 12% per annum". Basically, the appellant is aggrieved against the order of the Commissioner in respect of award of the interest. It is contended as to whether the appellant would not be entitled to any interest if the amount of compensation is paid by the insurance company within 30 days after the passing of the award or he would be entitled to interest only for that period when insurance company would not pay the compensation after 30 days. It is also not clear as to whether the interest is to be paid by the insurance company after 30 days from the decision of the Commissioner or after 30 days from the date when he had suffered the injury.

(2.) This Court has come across various cases being filed either by the insurance company or by the claimants only in respect of the order of interest passed by the Commissioner under the Act. Learned counsel for the Insurance Company has relied upon a decision of two Judges Bench of the Supreme Court in the case of "National Insurance Company Limited Versus Mubasir Ahmed and another" 2007(2 PLR 188 and an another judgment of two Judges Bench of the Supreme Court in the case of "Kamla Chaturvedi Vs. National Insurance Co. Ltd. and others", 2009 ACJ 115 to contend that interest would become payable after it falls due.

(3.) In this regard, the following observations have been made by the Supreme Court in the case of National Insurance Company : " 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, 1997 ACJ 517 (SC). 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 at the rate of 12 per cent. In the instant case, the accident took place after the amendment and, therefore, the rate of 12 per cent 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 there 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 the 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 subsection (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 of 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." In the case of Kamla Chaturvedi the aforesaid view was reiterated.