Dismissed

Oriental Insurance Company v. Ashok and Ors.

Bombay HC10 Jul 2009FA/3717/2008

Case brief

AI extract

What is this about?

This bench dismissed an appeal by an insurance company against an order directing it to pay 12% interest on workmen's compensation. The court held the insurer liable for interest due to its delay in settling an undisputed claim as per policy.

What did the court decide?

Insurance company directed to pay 12% interest on the claim amount from the date of accident; appeal dismissed.

Oriental Insurance Company Vs Ashok and Ors. — Bombay HC (2009) — LawSathi Research

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IN THE HIGH COURT OF JUDICATURE OF BOMBAY BENCH AT AURANGABAD

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FIRST APPEAL NO. 3717 OF 2008

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Oriental Insurance Company,
Through it’s Branch Manager,
Opp.ST Stand, Latur.

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- APPELLANT

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 VERSUS

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1)Ashok s/o Dattatraya Deolekar
and others. - RESPONDENTS

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*****

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Mr.AA Joshi, Advocate for Appellant;
Mr.LB Sayyed, Adv. h/for SS Kazi, Advocate for
Respondent No.1;

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Mr.VR Mundada, Advocate for Respondent No.9

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CORAM : K.U.CHANDIWAL, J.
DATE : 10th July, 2009.

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PER COURT :

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1)Heard learned Counsel extensively.

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2)The interest liability on death of an

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employee under Workmen's Compensation Act, is
subject of controversy.

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3)The interest being not exorbitant, the

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counsel for the appellant was asked to ensure if

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settlement is possible. Sufficient time was
consumer ultimately to yield result of no

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settlement. The appeal is finally heard at
admission stage, as indicated on 23rd October,
2008.

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4)The factual details, in the matter about

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the death of Kundan in an accident, being
employee of Ashok Garage, are not in controversy.
The insurance company/appellant accepted
insurance and consequently accepted to pay Rs.
Rs.2,16,910/-.

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5)The substantial question of law is –
Whether the insurance company is liable to pay

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the interest of 12% from the date of accident
dated 6.11.1997 till realization of the amount to
the claimant?.

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6)The correspondence between Ashok Garage

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and Oriental Insurance Company was tendered
before the learned Judge. The details of the

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accident including the requisite papers were sent

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by the original respondent no.3 on 23.11.1997 and

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again details were furnished on 10.2.1998. As
demanded by Oriental Insurance Company, policy
details were given on 31.10.1998. Since the

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insurancecompany/appellantassuredAshok

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Deolekar, it will look into the claim and
remittance of the amount, matter was not

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properly attended by said Ashok Deolekar. It is
pertinent, since he realized from the order that
the responsibility of making payment of interest
was saddled to him, he filed review application
being 1/2001, which was served upon the Oriental
Insurance company, the appellant herein. However,
for the reasons best known, the appellant did not
participate, and consequently, based on the
correspondence, slackness of insurance company to
be obvious, directed payment of interest by the
appellant/insurance company.

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7)The policy under which the liability of
insurance company comes into acceleration, has an
inbuilt indication to make the payment, either to

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the claimants or to the employer. Since the
insurance company cannot claim ignorance of
passing of the order dated 19.7.2000, it was
equally incumbent upon the insurance company to
have paid the amount of Rs.2,16,910/- in time,

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which it failed. The term `liability’ envisage
all consequential payments including interest but
excluding penalty.

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8)It was expected of the insurance
company/appellant, when it got knowledge of the
accident with the details immediately after the
accident with the formalities completed, to have
settled the same even as per its own calculation,
which is also not done. The apathetic approach is
beyond comprehension. In the facts of the case,
the insurance company cannot be allowed to plead
that it is not liable to make the payment of
interest payable by insured employer. The
substantial question of law is answered against
the appellant. Appeal dismissed. No costs. CA
No. 4524/2002 stands dismissed.

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stay to continue for a period of four weeks.

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( K.U.CHANDIWAL ) JUDGE

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bdv/fa3717.08

Oriental Insurance Company v. Ashok and Ors.

Case brief

What is this about?

What did the court decide?

Oriental Insurance Company v. Ashok and Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

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