Partly allowed

Sri Nanjundaswamy v. M/S S L N Coffee Curing Works

Karnataka HC26 Sept 2024MFA/3098/2019

Case brief

AI extract

What is this about?

In an appeal under the Employees Compensation Act arising from an industrial accident, the High Court held that the insurance company’s liability is limited to the policy amount. The employer was directed to pay the excess compensation and applicable interest.

What did the court decide?

The appeal allowed in part. The employer directed to deposit enhanced compensation with interest within six weeks. Apportionment to claimants per Tribunal award.

Sri Nanjundaswamy Vs M/S S L N Coffee Curing Works — Service and Employment | Karnataka HC (2024)

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1 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 26^TH DAY OF SEPTEMBER, 2024

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BEFORE

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THE HON'BLE MR JUSTICE H.T. NARENDRA PRASAD MISCELLANEOUS FIRST APPEAL NO. 3098 OF 2019 (ECA)

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BETWEEN:

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SRI NANJUNDASWAMY S/O DEVAIAH AGED ABOUT 50 YEARS

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OCC: AGRICULTURE.

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SMT LAXMAMMA

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W/O NANJUNDASWAMY AGED ABOUT 49 YEARS OCC: HOUSEHOLD WORK BOTH ARE R/AT MALAGANAKERE MAKODU POST, PIRIYAPATTANA TALUK MYSURU DIST-571108.

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…APPELLANTS

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(BY SRI. PARAMESWARAIAH D C.,ADVOCATE)

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AND:

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Digitally signed by HEMALATHA A Location: HIGH COURT OF KARNATAKA

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M/S S L N COFFEE CURING WORKS BY ITS MANAGING DIRECTOR KODLURU AREA, KUSHALNAGAR KODAGU DIST-571201.

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M/S UNITED INDIA INSURANCE CO. LTD., BY ITS MANAGER, MAIN BRANCH MADAKERI, KODAGU DIST-571201.

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…RESPONDENTS

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(BY SRI. SUBRAMANYA R.,ADVOCATE)

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THIS MFA IS FILED UNDER SECTION 30(1) OF THE EMPLOYEES COMPENSATION ACT, AGAINST THE JUDGMENT AND AWARD DATED:11.05.2018 PASSED IN ECA NO.2/2014

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2 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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ON THE FILE OF THE SENIOR CIVIL JUDGE & COURT OF THE CIVIL JUDGE AND TRIBUNAL FOR EMPLOYEES COMPENSATION, MADIKERI, PARTLY ALLOWING THE CLAIM PETITION FOR COMPENSATION AND SEEKING ENHANCEMENT OF COMPENSATION.

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THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE H.T. NARENDRA PRASAD

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ORAL JUDGMENT

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This appeal under Section 30(1) of the Employees Compensation Act, 1923 (hereinafter referred to as ‘the Act’) has been filed by the claimants being aggrieved by the judgment dated 11.05.2018 passed by Senior Civil Judge & MACT, Madikeri in ECA No.2/2014.

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Facts giving rise to the filing of the appeal briefly stated are that the deceased Puneeth.N was an employee working in Coffee Curing Works under respondent No.1. On 14.06.2006, when the deceased was working in Coffee Curing Words, at that time, a loaded coffee bag fell on him and sustained injuries. Immediately, he was shifted to

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3 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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Kushalnagar Government Hospital, where he died while taking treatment.

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The claimants filed a petition under Section 22 of the Act seeking compensation.

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On service of notice, the respondents appeared through respective counsel and filed written statements in which the averments made in the petition were denied.

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On the basis of the pleadings of the parties, the Tribunal framed the issues and thereafter recorded the evidence. The claimant No.1 was examined as PW-1 and got exhibited documents namely Ex.P1 to Ex.P9. On behalf of the respondents, one witness was examined as RW-1 and got exhibited documents namely Ex.R-1 and 2. The Tribunal, by the impugned judgment, inter alia, partly allowed the claim petition and awarded compensation of Rs.171,822/- with interest at 12% p.a. from one month after the date of accident till realization. Being aggrieved, this appeal has been filed.

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4 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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The learned counsel for the claimants has submitted

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that the deceased was an employee under respondent No.1 and he died during the course of his employment. Under Section 4(1B) of the Act, the minimum wages fixed is Rs.4,000/- as on the date of accident. While computing compensation, the Tribunal has assessed wages at Rs.1,517/-, which is on the lower side. Hence, he sought for enhancement of compensation.

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Per contra, the learned counsel for the Insurance Company has contended that the respondent No.1, employer has taken a Workmen’s Compensation Policy, which is a contract between the employer and Insurance Company. As per the policy, the employer has paid premium for 73 employees and the wages for computation of compensation is fixed at Rs.1,142/-. The liability of the Insurance Company is only to that extent. Remaining amount, if any, has to be paid by the employer. In support of his contention, he has relied upon the judgment of this Court in MFA No.2705/2017 disposed of on 06.02.2023.

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5 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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He further contended that the Insurance Company has taken up a specific contention on this aspect before the Tribunal and also examined RW-1 and led evidence and marked the policy at Ex.R-2. If this Court comes to a conclusion and fixes the wages beyond Rs.1,142/- and enhances the compensation, the said liability shall be fastened on the employer and direct the employer to pay the said compensation along with interest. The Insurance Company is not liable to pay the enhanced compensation. Hence, he sought to dismiss the appeal.

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In rebuttal, the learned counsel for the claimant has contended that since the employer has taken the policy under Workmen’s compensation, the Insurance Company is liable to pay the entire compensation. In support of his contention, he has relied upon the judgment of the Apex Court in the case of Ramachandra Vs. Regional Manager, United India Insurance Company Limited reported in 2013 SC 2561 .

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6 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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Heard the learned counsel for the parties and

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perused the judgment and award passed by the Tribunal.

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10. The substantial question of law that arises for consideration is “whether the liability of the Insurance Company fixed by the Tribunal is in terms of the conditions of the policy, Ex.R-1?”

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The specific case of the claimants is that on 14.06.2006, when the deceased was working in Coffee Curing Words, at that time, a loaded coffee bag fell on him and sustained injuries. Immediately, he was shifted to Kushalnagar Government Hospital, where he died while taking treatment.

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It is not in dispute that the deceased Puneeth.N was an employee working in Coffee Curing Works under respondent No.1 and that he died during course of his employment.

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7 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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As per Section 4(1B) of the Act, as on the date of accident, the monthly minimum wages fixed is Rs.4,000/-. Therefore, the minimum wages of Rs.4,000/- has to be considered. But the Tribunal has taken the wages of the deceased at Rs.1,517/-. The deceased was aged 18 years and factor applicable is 226.38. As per Section 4(1)(a) of the Act, 50% of the wages i.e., Rs.2,000/- has to be taken while computing the compensation. Therefore, the compensation is reassessed, which comes to Rs.452,760/- (Rs.2,000*226.38). The claimants are entitled to the said compensation along with interest.

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This Court in similar circumstance in MFA No.2705/2017 disposed of 06.02.2023 has held that the Insurance Company has to pay the compensation as per the contract entered into between the parties and remaining amount has to be paid by the employer.

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In the judgment of the Apex Court in the case of Ramachandra (supra) relied upon the learned counsel for the claimants, the Insurance Company has not raised the

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8 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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contention that their liability would be restricted as per the policy. But in the instant case, the Insurance Company has taken a specific contention in the written statement that their liability is restricted as per the policy and also examined the officer of the Insurance Company as RW-1 and led evidence and marked the policy as Ex.R-2.

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In that view of the matter, the liability of the Insurance Company has to be restricted as per the terms and conditions of the policy. Hence, the Insurance Company is liable to pay the compensation as per the terms of the policy and remaining compensation amount has to be paid by the employer along with interest. The substantial question of law framed by this Court is answered accordingly.

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17. In the result, the following order is passed:

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ORDER

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a) The appeal is allowed-in-part.

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9 - NC: 2024:KHC:40068 MFA No. 3098 of 2019

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b) The respondent No.1, employer is directed to deposit the enhanced compensation amount along with interest at 12% p.a. from one month after the date of accident till realization, within six weeks from the date of receipt of copy of this judgment.

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c) The apportionment of compensation to the claimants shall be made in terms of the award of the Tribunal.

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Sd/(H.T. NARENDRA PRASAD) JUDGE

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List No.: 1 Sl No.: 57

Sri Nanjundaswamy v. M/S S L N Coffee Curing Works

Case brief

What is this about?

What did the court decide?

Sri Nanjundaswamy v. M/S S L N Coffee Curing Works

Case brief

What is this about?

What did the court decide?

What the court decided

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