Partly allowed

The Divisional Manager, v. Akula Padma

Telangana HC6 Dec 2010CMA/84/2008

Case brief

AI extract

What is this about?

The Single Judge dismissed an insurer's appeal on lack of license proof and allowed a claimant's appeal for pre-award interest. The court held insurers must prove license absence and applied Supreme Court precedent to grant 7.5% interest from filing date.

What did the court decide?

Interest of 7.5% per annum awarded on Rs. 2,65,878/- from the date of filing the application till the date of passing the award.

The Divisional Manager, Vs Akula Padma — Pension and Retirement Benefits | Telangana HC (2010)

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THE HON’BLE SRI JUSTICE SAMUDRALA GOVINDARAJULU

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C.M.A.No.84 of 2008 and C.M.A.No.77 of 2007

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Date: 06.12.2010

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C.M.A.No.84 of 2008 :

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Between: The Divisional Manager, United India Insurance Company Ltd., Nizamabad … Appellant And Akula Padma and another … Respondents C.M.A.No.77 of 2007 : Between: Akula Padma … Appellant And P. Srinivas and another … Respondents

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THE HON’BLE SRI JUSTICE SAMUDRALA GOVINDARAJULU

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C.M.A.No.84 of 2008 and C.M.A.No.77 of 2007

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COMMON JUDGMENT :

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These two appeals are filed by the Insurance Company and the claimant, respectively, against the award, dated 12.12.2006, passed by the Commissioner for Workmens’ Compensation and Assistant Commissioner of Labour, Nizamabad, in W.C. Case No.63 of 2004 (F), awarding compensation of Rs.2,65,878/- to the claimant against the employer and the Insurance Company.

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2. The claimant is dependant on the deceased driver of Auto bearing No.AP 25U 112 belonging to the insured and which met with an accident on 13.3.2002 at about 9-30 p.m., in the outskirts of Yemcha village in which the driver died during the course of his employment under the insured.

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3. It is contended by the counsel for the insurer that the deceased was driving the accident vehicle without holding any licence to drive the vehicle and that, therefore, liability of the insurer under the Insurance Policy Ex.A-4 does not arise at all. This submission of the counsel for the insurer is based on the supposition that the deceased was not having any driving licence.

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4. No doubt, wife of the deceased, who was examined as P.W.1, did not produce driving licence of the deceased. That does not mean that the deceased was not having any driving licence at all. The claimant proved existence of Insurance Policy Ex.A-4 for the accident vehicle and terms therein. In case, the insurer wants to plead that there is violation of terms of the Insurance Policy, it is for the insurer to prove the said violation of terms of the policy. It is contended by the counsel for the insurer that in the absence of driving licence, the insured should not have recruited the deceased as driver of the insured

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vehicle and that, therefore, in the absence of proof of driving licence for the deceased, the deceased cannot be termed as workman for the purpose of Workmen’s Compensation Act under the insured.

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5. This submission of the counsel for the insurer is baseless. Such submission would be available only on proof of the deceased having no driving licence to drive the accident vehicle. Except filing Ex.B-1 certified copy of Insurance Policy, the insurer did not lead any evidence before the Commissioner. The insurer did not take any steps to ascertain with the Road Transport Authorities whether the deceased was having any driving licence or not having driving licence and, if having driving licence, whether such driving licence is a valid driving licence for driving the auto. The insurer did not even examine any person from the Road Transport Authorities to prove the said facts. It is not as if any crime records relating to the accident disclose the deceased not having any driving licence or valid driving licence. In the absence of any such material before the Commissioner, the insurer cannot be allowed to contend that there was no driving licence for the deceased to drive the accident vehicle.

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6. The insured did not dispute the deceased being his driver and under his employment for the accident vehicle. In the absence of leading any evidence from the Road Transport Authorities, Divisional Manager, National Co.Ltd. vs. Rabi Saho o^[1] of Orissa High Court and Chhote Khan vs. Rajesh Kumar Agrawal^[2] of Madhya Pradesh High Court cannot have any relevance herein.

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7. It is contended by the claimant’s counsel that the deceased was drawing a salary of Rs.8,000/- per month as driver of the accident vehicle and that the Commissioner erred in taking his income as Rs.,2,434/- per month. The claimant did not produce any acceptable material to show that the deceased was having any salary over and above that was taken into account by the Commissioner. Therefore, I

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find that the compensation amount awarded by the Commissioner is just and proper.

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8. The Commissioner, while awarding compensation, did not award interest on the compensation amount from the date of filing of the application before him. It is contended by the claimant’s counsel that the Commissioner should have granted reasonable interest on the compensation amount from the date of filing of application for compensation before the Commissioner.

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9. On the other hand, the insurer’s counsel contended that as per Section 4-A (3) of the Workmen’s Compensation Act, interest is payable after the compensation has fallen due and that the compensation falls due only on the date of adjudication made by the Commissioner on that aspect.

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10. In Oriental Insurance Co. Ltd. vs. Mohd. Nasir and another^[3] , the Supreme Court, while considering the scope of granting interest on the compensation amount in the light of Section 4-A(3) of the Act, observed as under:

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“The said provision, as it appears from a plain reading, is penal in nature. It, however, does not take into consideration the chargeability of interest on various other grounds including the amount which the claimant would have earned if the amount of compensation would have been determined as on the date of filing of the claim petition. Workmen Compensation Act does not prohibit grant of interest at a reasonable rate from the date of filing of the claim petition till an order is passed. Only when sub-section (3) of Section 4A would be attracted, a higher rate of interest would be payable wherefor a finding of fact as envisaged therein has to be arrived at. Only because in a given case, penalty may not be held to be leviable, by itself may not be a ground not to award reasonable interest.”

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Accordingly, the Supreme Court awarded interest of 7.5% per annum on the compensation amount from the date of filing of the

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application till the date of realisation.

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11. Further, 4-Judge Bench of the Supreme Court in Pratap Narain Singh Deo v. Shrinivas Sabat a^[4] found favour with granting of pre-adjudication interest on the compensation amount from the date of filing of the application before the Commissioner.

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12. C.M.A.No.84 of 2008: In the result, the appeal is dismissed with costs.

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13. C.M.A.No.77 of 2007: In the result, the appeal is partly allowed without costs, awarding interest of 7.5% per annum on Rs.2,65,878/- in favour of the claimant and against the insured and the insurer from the date of filing of the application by the claimant before the Commissioner till the date of passing award.

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___________________________________ SAMUDRALA GOVINDARAJULU, J 06.12.2010. Msr

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THE HON’BLE SRI JUSTICE SAMUDRALA GOVINDARAJULU

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C.M.A.No.84 of 2008 and C.M.A.No.77 of 2007

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06.12.2010 (Msr)

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[1] 2001 ACJ 538 [2] 1999 (1) Cur Lr 1192 [3] 2010 (1) ALD 74 (SC) [4] 1976 A.C.J. 141

The Divisional Manager, v. Akula Padma

Case brief

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The Divisional Manager, v. Akula Padma

Case brief

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