New India Assurance Co. Ltd. Vs. Abida Bai and ors. - Court Judgment

Excerpt:
- section 2(f): [dipak misra, k.k. lahoti & rajendra menon, jj] service tax - packaging and bottling of liquor whether amounts to manufacture within meaning of section 2(f) of central excise act 1944? finance act 932 of 1994), section 65 (76 b) (as amended on 16.6.2005) - held, the first limb of the inclusive definition of the manufacture under section 2(f) of central excise act has a very wide connotation. as the definition clause lays down an inclusive facet, the term manufacture has to be construed in a natural and plain manner and would include any process incidental or ancillary to the completion of a manufactured product. keeping in view the context in which the term manufacture has been used, it would take in its fold incidental and ancillary process in the manufacture or finishing of any manufactured product. it does not leave any room for doubt that an allied process should be integral and inextricable part of manufacture of completeness and presentability of the manufactured product. section 65(76b) of finance act used the words but it does not include. thus it is a definition which has the inclusive as well as exclusive facet. by virtue of the same it may include certain things and exclude others. it is well settled principle of law that a definition is not to be read in isolation and has to read in context of phrase which it defines, releasing that function of a definition is to give precision and certainty to the word or phrase which would otherwise be vague and uncertain. regard being had to the exclusionary fact in the finance act, though a limited one it would exclude the manufacturing process as defined under section 2(f) of the 1944 act. keeping in view the aforesaid dictionary clauses and circulars issued by the c.b.e.c. it is quite luminescent that would manufacture has to be understood in a broader sense and not to be confined or restricted to the excisable product in the act. it would include all processes which amount to manufacture whether or not the final product is an excisable product. in the process of manufacturing of country spirit, the over proof spirit which is not potable is reduced to issuable strength, which is potable. colouring and flavouring agents are added at the time of maturation. thereafter the liquor is supplied in sealed bottles to the retail contractors. this is the process of treatment given to over proof spirit in order to render it fit for human consumption in the form of country liquor. if the process is analysed there cannot be any scintilla of doubt that the process involves the manufacturing one under the provisions of section 2(f) of central excise act, 1944. as per the m.p. country spirits rules as well as clause 6 of the tender conditions it is mandatory for a distiller to supply country liquor in sealed bottles and not otherwise. therefore, packaging and bottling of liquor come within the ambit and sweep of manufacture within the meaning of clause (f) of section 2 central excise act, 1944 in view of the definition contained in section 65(76b) of the finance act especially keeping in view the exclusionary facet and further regard being had to the circular issued by central board of excise and customs. - one has to look merely as to what is clearly said. penalty cannot be imposed unless there are good grounds to do so and unless the person on whom the penalty is imposed has been given opportunity of being heard.j.g. chitre, j.1. this appeal assails the award passed by commissioner for workmen compensation, dewas who decided w.c.f. case no. 5 of 1988 on 11.2.1992 by passing the award under challenge. on 1.1.1981 deceased abid, the driver driving truck no. mpm 5414 was proceeding towards kantaphod. unfortunately, the axel of the said truck was damaged and, therefore, for the purpose of repairing it, he proceeded to kantaphod by truck no mpf 7181. the said truck unfortunately toppled down. as a result, abdul sustained serious injuries and succumbed to the death. respondents 1 to 3 initially filed claim against driver, owner and insurer of truck bearing number mff 7181 claiming compensation for accidental death of abdul. on 13.12.1985 names of driver and insurer of the said truck were deleted. by amendment the name of respondent no. 5 was added as the truck bearing number mpm 5414 stood registered in his name.2. the claim was heard by learned commissioner who passed the award in favour of respondents 1, 2 and 3 granting compensation of rs. 63,808/- payable by the insurance company to them along with interest at the rate of 6% per annum and penalty at the rate of 10% in the event of default in depositing the amount of compensation within prescribed time limit. the said award is being challenged by the insurance company in this appeal.3. mr. dandvate, learned counsel for the appellant insurance company submitted that table no. 4 has been introduced by act no. 22 of 1984 and relying on that schedule the learned commissioner has calculated the amount of compensation awardable to respondents 1 to 3. it is his argument that the accident took place on 1.1.1981 and that was the cause of action for the claim for compensation. he placed reliance on following judgments: padma shrinivasan v. premier insurance co. ltd. reported in 1982 acj 191, national insurance co. ltd. v. smt. gangabai reported in 1991 m.p.w.n. note 117, page 156 and new india assurance co. ltd. v. nafis begum reported in 1991 acj 960. mr. rawal, learned counsel for the respondents 1 to 3 relied on the judgment of this court in the matter of mines manager v. waheedul haque abbasi reported in (1994 acj 334) for substantiating his argument for canvassing that schedule no. 4 has retrospective effect,4. in padma shrinivassan's case (supra) supreme court held that the retrospectivability depends on the cause of action so far as statutory liability of the insurer is concerned and the liability of insurer must be determined by the application of law introduced by the amendment which had come into force before the date of the accident. in the matter of national insurance co. ltd. v. ganga bai (supra) single bench of this court held that the settled view of this court is that section 92-a of motor vehicles act, 1939 is not retrospective in its operation and will not apply to pending cases. the single bench of this court has considered the judgment of this court in the matter of karuram v. omprakash air 1989 mp 105, and shamsher khan's case, 1989 a.c.j. 394. the court has also considered the judgment of this court in the matter bhagchand and anr. v. national insurance co. ltd. 1989 acj 495. in the matter of new india assurance co. lid. v. nafis begum (supra) the full bench of this court has held that rights and liabilities under motor vehicles act, 1939 arise on happening of the accident and not on any subsequent date. it held that filing of the claim petition before the claims tribunal has no relevance with regard to the rights and liabilities should be governed by the state of law existing on the date of the accident and not on the state of law existing on the date of filing of the claim petition or of the filing of the appeal in the case. it has been further held by the full bench that the rights and liabilities of the parties were held to depend on any change of law effected subsequent to the accident, discriminatory situation is likely to arise between the parties involved in accidents happening even on the same date. the date of accident should, therefore, be taken as date of application of the state of law existing then. the full bench further held that the legislative intent is clear from the express language used in the act and there is no scope for any legal dynamism or idea of progressive social welfare involved in determining the date from which section 92-a is to take effect. one has to look merely as to what is clearly said. there is no room for any intendment. there is no scope for equity or progressive nature of the legislative amendment coming into play. there is no scope for reading into the amending act something about which it is unambiguous and unequivocal. nothing is to be implied. one has only to look fairly at the language used.5. mr. dandvate, learned counsel for the appellant also placed reliance on the division bench judgment of bombay high court in the matter of zubeda bano and ors. v. divisional controller maharashtra state road transport corporation and ors. reported in 1990 acj 923 wherein bombay high court held by considering the full bench judgment of assam high court in the matter of assam railways & trading co. ltd. v. saraswati devi 1958-65 acj 394, assam that the compensation will be calculated on the basis of rates mentioned in the schedule in force on the date of accident. the division bench also considered various cases while coming to the conclusion which has been indicated by the judgment quoted supra.6. the entire amendment which has been brought into force by introducing act no. 22 of 84 does not show any specific intendment indicating that the rate mentioned in schedule no. 4 of amending act has retrospective effect.7. learned counsel mr. rawal appearing for respondents 1 to 3 has placed reliance on the judgment of this court in the matter mines manager v. waheedul haque abbasi (supra) for the purpose of canvassing his argument pointing out that the amending act has passed a welfare legislation and, therefore, should be given retrospective effect. i do not accept this argument on two counts. firstly that the single bench judgment of this court has no force in view of the ratio which has been laid down by the judgment of full bench of this court. so also it does not have any force in view of the judgment of the supreme court which has been quoted supra. when the enactment does not specifically indicate that the amendment has retrospective effect, charitable view cannot be adopted for the purpose of enforcing retrospectiveness to such amendment. nothing can be read into the amending act which has not been indicated by it, when there is no ambiguity and the provisions of amending act are equivocal pointing to the direction indicated by the amending act.8. thus, in view of discussion made above i have no hesitation in coming to the conclusion that the table which has been used for calculating the compensation to be granted in respect of accident which took place on 1.1.1981 has to be by the rate which has been indicated by the prevalent schedule on that date. thus, i dismiss the submission of mr. rawal on this point.9. mr. dandvate submitted that by schedule indicated by section 4 the compensation should be rs. 24,000/- because the limit which has been indicated is rs. 700/- to 800/-. i do not agree with him because the said schedule shows further that the compensation should beat the rate of rs. 27,000/- if the salary is from rs. 800/- to rs. 900/-. both the entries are indicating the figure of rs. 800/- as salary. unfortunately the schedule is not making any difference between the salary which is to the tune of rs. 800/- per month and the salary which is more than rs. 800/- and the salary which is less than rs. 800/-. when the schedule is to be interpreted for granting compensation to workman, the pointer should always be in favour of the person who is to be benefited by the calculation done in accordance with the schedule. on this point the schedule is ambiguous and, therefore, the pointer should be definitely in favour of heirs of the deceased workman who are to get the benefit of compensation. therefore, the submission advanced by mr. dandvate urging that the compensation should be rs. 24,000/- and not rs. 27,000/- is without merit. however, 1 accept his submission for the purpose of reducing the amount of compensation from rs. 63,808/- to rs. 27,000/- because the learned commissioner has committed error of calculating the compensation payable to the heirs of deceased workman by applying the schedule which was not prevalent on the date of accident i.e. 1.1.1981.10. thus, the award of rs. 63,808/- is hereby reduced to the sum of rs. 27,000/-.11. mr. dandvate further submitted that the learned commissioner has imposed penalty at the rate of 10% for not depositing the said amount of award within prescribed time limit without assigning any reason. if such penalty is to be imposed, the learned commissioner is obliged to give reasons fordoing so. he is obliged to pass speaking order disclosing the reasons which led him to impose such penalty. penalty cannot be imposed unless there are good grounds to do so and unless the person on whom the penalty is imposed has been given opportunity of being heard. therefore, i uphold the submission made by mr. dandvate on this point and remove the penalty which has been imposed on the appellant, keeping in view the submission made at bar by mr. dandvate that the entire amount of rs. 63,808/- has beta deposited in the office of the commissioner with interest.12. thus, the appeal is partly allowed. the amount of compensation payable to the heirs of deceased abid is hereby reduced to rs. 27,000/- from rs. 63,808/-. the heirs are permitted to withdraw that amount. the share of compensation payable to minor ku. sajida be kept invested with the nationalised bank, if not already kept. she would be entitled to get that amount after attaining the age of majority after moving an application to that effect before the learned commissioner. the share which is receivable by other heirs of deceased to be given by the commissioner be given by directing the bank to give it to them by crossed-cheques. the amount of interest be invested in the name of minor ku. sajida because she is unmarried girl and still minor. that amount be used by her mother for her marriage expenses. the remaining amount be returned to appellant by the commissioner after an application has been moved to that effect before the commissioner.