The Oriental Insurance Co. Ltd. Vs K N Sanjeeva Shetty — Karnataka HC (2025) — LawSathi Research

The Oriental Insurance Co. Ltd. Vs K N Sanjeeva Shetty — Karnataka HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

Review petition allowed; judgment and award dated 06.01.2023 in MFA No.5967/2016 modified so that the Insurance Company pays compensation of Rs.78,410/- and the employer Rs.71,800/-, interest awarded payable by the employer, any excess amount refunded to the Insurance Company, and no order as to costs.

Issue for consideration

Whether the Insurance Company's liability under the policy is confined to compensation computed on the monthly wage of Rs.2,088/- declared by the employer, with the employer liable for the balance on the fixed monthly wage of Rs.4,000/-. +1 more

Court's answer

The Insurance Company is liable to pay compensation only to the extent of the wage declared by the employer, i.e., Rs.2,088/-; for the remaining balance wage, the employer is liable to pay the compensation.

Ratio / Principle

On the fixed monthly wage of Rs.4,000/-, the Insurance Company is liable to pay compensation of Rs.78,410/- and the employer Rs.71,800/-, totalling Rs.1,50,210/-.

Key takeaways

The employer is liable to pay interest at 12% p.a. on Rs.71,800/- from the date of accident till realization; if the employer has already paid, it is liable for making the balance payment to the claimant.ratio¶41
The impugned judgment and award dated 06.01.2023 in MFA No.5967/2016 is modified to the extent that the Insurance Company is liable to pay compensation only to the extent of Rs.78,410/- and the employer Rs.71,800/-, with interest payable by the employer and any excess refunded to the Insurance Company.ratio¶45

Detailed headnote1 paragraphs

Review Petition No.194 of 2023 (S.114 r/w Order 47 Rule 1 CPC), High Court of Karnataka at Bengaluru, decided 15-09-2025 by Justice Hanchate Sanjeevkumar. The Oriental Insurance Co Ltd sought review of the order dated 06.01.2023 in MFA No.5967/2016 (ECA) insofar as the quantum of compensation payable to it. Held: the employer had declared a monthly wage of Rs.2,088/- per employee when purchasing the group insurance policy; therefore the insurer is liable to pay compensation only to the extent of the declared wage, and the employer is liable for the remaining balance wage on the fixed monthly wage of Rs.4,000/-. Accordingly, the insurer's liability is Rs.78,410/- (Rs.2,088/- x 60% x 156.47 x 40%) and the employer's is Rs.71,800/- (Rs.1,912/- x 60% x 156.47 x 40%), totalling Rs.1,50,210/-. Interest at 12% p.a. on the employer's share of Rs.71,800/- is payable by the employer from the date of accident till realization; any excess paid is to be refunded to the insurer; no order as to costs. Review petition allowed.

NC: 2025:KHC:36644 RP No. 194 of 2023

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HC-KAR

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 15^TH DAY OF SEPTEMBER, 2025

BEFORE

THE HON'BLE MR. JUSTICE HANCHATE SANJEEVKUMAR

REVIEW PETITION NO.194 OF 2023

BETWEEN:

THE ORIENTAL INSURANCE CO LTD CHICKMAGALUR NOW REPRESENTED BY THE ORIENTAL INSURANCE CO LTD., REGIONAL OFFICE, TP HUB, SUMANGALAM COMPLEX, LAMINGTON ROAD, HUBLI-580 020.

…PETITIONER

(BY SRI. H.C. VRUSHABHENDRAIAH, ADVOCATE)

AND:

Digitally signed by RAMYA D Location: HIGH COURT OF KARNATAKA

K.N. SANJEEVA SHETTY S/O NARAYANA SHETTY AGED ABOUT 50 YEARS, CHOWKI KESUVE POST, KOPPA TALUK, CHICKMAGALUR DISTRICT-577 126.

MANAGEMENT PONNY PLANTATION SIDDARBAN ESTATE KOPPA BY PROPRIETOR PREMLATHA HEGDE, 577 126.

…RESPONDENTS (BY SRI. A. CHANDRANATH ARIGA, ADVOCATE)

THIS REVIEW PETITION IS FILED UNDER SECTION 114 READ WITH ORDER 47 RULE 1 OF THE CPC, PRAYING TO REVIEW THE ORDER DATED 06.01.2023 PASSED BY THIS

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HON’BLE COURT IN M.F.A NO.5967/2016 (ECA), IN SO FOR AS THE QUANTUM OF COMPENSATION PAYABLE TO THE PETITIONER IS CONCERNED AND TO PASS SUCH OTHER ORDER OR ORDERS AS THIS HON’BLE COURT DEEMS FIT, IN THE INTEREST OF JUSTICE AND EQUITY.

THIS PETITION, COMING ON FOR ADMISSION, THIS DAY, ORDER WAS MADE THEREIN AS UNDER:

CORAM: HON'BLE MR. JUSTICE HANCHATE SANJEEVKUMAR

ORAL ORDER

The petitioner/Insurance Company has filed this

Review Petition praying to review the order dated 06.01.2023 passed in MFA No.5967/2016 on the ground that the employer has declared the income of each employee for purchasing insurance policy and the income of the employee is declared and the sum assured of the income is to the extent of Rs.2,088/-. Therefore, the Insurance Company is liable to pay compensation with proportionate income of Rs.2,088/- and the remaining amount shall be paid by the employer.

This Court on 06.01.2023 has dismissed the appeal filed by the Insurance Company, upholding the order and award passed by the learned Commissioner.

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HC-KAR

As per the documentary evidence placed before the learned Commissioner, it is proved that the employer has assured with the appellant/Insurance Company for his employees by declaring the monthly wage of Rs.2,088/and accordingly purchased the insurance policy to cover the risk of the employees. Therefore, the petitioner/Insurance Company is liable to pay compensation to the extent of what is declared by the employer i.e., to the extent of Rs.2,088/- and for the remaining balance wage, the employer is liable to pay the compensation.

Accordingly, the fixed monthly wage is Rs.4,000/- and the extent of liability of the Insurance Company and the employer is calculated as below:

= Rs.4,000/- - Rs.1,912/- = Rs.2,088/-

= Rs.4,000/- - Rs.2,088/- = Rs.1,912/-.

= Rs.2,088/- x 60% x 156.47 x 40% = Rs.78,410/-. = Rs.1,912/- x 60% x 156.47 x 40% = Rs.71,800/-.

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Therefore, the petitioner/Insurance Company is

liable to pay compensation of Rs.78,410/- and the employer is liable to pay compensation of Rs.71,800/-, which would totally come to Rs.1,50,210/-.

The employer is also liable to pay interest at the rate of 12% p.a. on the amount of Rs.71,800/- from the date of accident till the date of realization. If the employer has already paid the amount, then the employer is liable for making balance payment to the claimant. Thus, the review petition is liable to be allowed.

In the result, I proceed to pass the following:

ORDER

i. The review petition is allowed .

ii. The impugned judgment and award dated 06.01.2023 passed in MFA No.5967/2016 is modified to the extent that the petitioner/Insurance Company is liable to pay compensation only to the extent of

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Rs.78,410/- and the employer is liable to

pay compensation of Rs.71,800/-. The interest awarded shall be payable by the employer.

iii. The excess amount, if any, shall be refunded to the petitioner/Insurance Company.

iv. No order as to costs.

SD/(HANCHATE SANJEEVKUMAR) JUDGE

SRA List No.: 1 Sl No.: 34