New India Assurance Co. Ltd. Vs. Md. Abdul Kalam - Court Judgment

T.N.K. Singh, J.

1. Heard Mr. A. Ahmed, learned Counsel appearing for the appellant as well as Mr. M.H. Rajborbhuya, learned Counsel appearing for the respondent-claimant.

2. This appeal against the judgment and award dated 25.6.2002 passed in W.C. Case No. 31 of 2000 of the Commissioner for Workmen's Compensation Zone-III, Tezpur under Section 30 of the Workmen's Compensation Act, 1923 was admitted for hearing on the following substantial questions of law--

1. Whether the Commissioner, Workmen's Compensation, Tezpur had jurisdiction to entertain and adjudicate the matter when the place of accident as well as the permanent resident of the claimant is in the district of Nagaon?

2. Whether the doctor who has assessed the physical disability of the claimant was capable of doing so while the claimant was treated at Nagaon Civil Hospital and whether such assessment was done in accordance with law?

3. Whether the percentage of loss of earning capacity can be treated as a substitute for the percentage of physical disability?

4. Whether interest can be imposed from the date of accident?

3. For deciding the substantial question of law No. 1, a short facts leading to the filing of the claim case is required to be noted. Admittedly, the claimant Md. Abul Kalam was the Handyman/Cleaner of the vehicle No. AS-11/3217 (608) Minibus and also the owner of the vehicle Abdul Nadir is a resident of Nagaon. Over and above, the said vehicle was registered with the Branch Manager, New India Assurance Co. Ltd., Nagaon Branch. The accident of the said vehicle also took place at a place near Samaguri P.S. Gotonga, Nagaon District. Therefore, it is clear that the owner of the offending vehicle is the resident of Nagaon and also the accident took place at a place near Samaguri, which is within Nagaon District.

4. Mr. A. Ahmed, learned Counsel appearing for the appellant asserts that the claim case should have been filed before the Commissioner for Workmen's Compensation, Nagaon. To the contra, Mr. M.H. Rajborbhuya, learned Counsel appearing for the claimant asserts that since the claimant is temporarily residing at Tezpur, he could file the claim case before the Commissioner for Workmen's Compensation, Tezpur inasmuch as under Sub-section (1)(b) of Section 21 of the Workmen's Compensation Act, 1923 the Workmen/claimant can file the claim case before the Commissioner for Workmen's Compensation having the jurisdiction over the area where the respondent/claimant is temporarily or originally residing. Mr. Ahmed, learned Counsel appearing for the appellant submits that in case the respondent/claimant filed the claim case in pursuance of Sub-section (1)(b) of Section 21 of the Workmen's Compensation Act, 1923 before the Commissioner for Workmen's Compensation, Tezpur for the area where the claimant originally resides, it is the requirement of the 1st proviso to Sub-section (1) of Section 21 of the Workmen's Compensation Act to give notice to the Commissioner for Workmen's Compensation for the area in which the accident took place as well as 'the State Government concerned by the Commissioner for Workmen's Compensation, Tezpur. In the present case, Mr. Ahmed asserts that the Commissioner for Workmen's Compensation Zone No. 3, Tezpvir did not give any notice to the Commissioner for Workmen's Compensation, Nagaon and also to the State concerned. Therefore, according to Mr. Ahmed, learned Counsel appearing for the appellant, the Commissioner, Tezpur did not comply with the requirements of 1st proviso to Section 21(1) of the Workmen's Compensation Act, 1923 before proceeding the Claim Case No. 31 of 2000. For ready reference, the relevant portion of the Section 21 of the Workmen's Compensation Act is quoted hereunder:

21. Venue of proceedings and transfer--(1) Where any matter under this Act is to be done by or before a Commissioner, the same shall, subject to the provisions of this Act and to any rules made hereunder, be clone by or before the Commissioner for the area in which--

(a) the accident took place which resulted in the injury; or

(b) the workman or in case of his death; me dependant claiming the compensation ordinarily resides; or

(c) the employer has his registered office;

Provided that no matter shall be processed before or by a Commissioner, other than the Commissioner having jurisdiction over the area in which he accident took place, without his giving notice in the manner prescribed by the Central Government to the Commissioner having jurisdiction over the area and the State Government concerned.

5. On bare perusal of the 1st proviso to Sub-section (1) of Section 21 of the Workmen's Compensation Act, 1923 it is clear that the Commissioner for Workmen's Compensation, Zone-III, Tezpur should give the notice in the manner provided by the Central Government to the Commissioner for Workmen's Compensation, Nagaon and also to the State Government concerned before proceeding the Claim Case No. 31 of 2000. But from the records as well as from the submissions of the learned Counsel of the parties, it is clear that the Commissioner for Workmen's, Tezpur did not give notice in compliance with the 1st proviso to Section 21(1) of the Workmen's Compensation Act, 1923 to the Commissioner for Workmen's Compensation, Nagaon and the State of Assam. For the reasons discussed above, the substantial question of law No. 1 is answered accordingly.

6. For deciding the substantial questions of law Nos. 2 and 3 it is required to see the Explanation II to Section 4 Sub-section (1)c). The relevant portions of Section 4 are quoted hereunder:

5. Amount of Compensation--(1) Subject to the provisions of this Act, the amount of compensation shall be as follows, namely-

(a) Where death results from me injury an amount to (fifty percent) of the monthly wages of the deceased workman multiplied by the relevant factor;

or an amount of (eighty thousand rupees) whichever is more

(b) Where permanent total disablement results from the injury, an amount equal to (sixty percent) of the monthly wages of the injured workman multiplied by the relevant factor; or an amount of (ninety thousand rupees), whichever is more;

Explanation I--For the purposes of Clause (a) and Clause (b) 'relevant factor' in relation to a workman means the factor specified in the second column of Schedule IV against the entry in the first column of that Schedule specifying the number of years which are the same as the completed years of the age of the workman on his last birthday immediately preceding the date on which the compensation fell clue.

Explanation II--Where the monthly wages of a workman exceed (four thousand rupees), his monthly wages for the purposes of Clause (a) and Clause (b) shall be deemed to be (four thousand rupees) only;

(c) Where permanent partial disablement result from the injury--

(i) in the case of an injury specified in Part II of Schedule I, such percentage of the compensation which would have been payable in the case of permanent total disablement as is specified therein as being the percentage of the loss of earning capacity caused by that injury; and

(ii) in the case of an injury not specified in Schedule I, such percentage of the compensation payable in the case of permanent total disablement as is proportionate to the loss of earning capacity (as assessed by the qualified medical practitioner) permanently caused by the injury;

Explanation I--Where more injuries than one are caused by the same accident, the amount of compensation payable under this head shall be aggregated but not so in any case as to exceed the amount which would have been payable if permanent total disablement had resulted from the injuries.

Explanation II--In assessing the loss of earning capacity for the purpose of Sub-clause (ii), the qualified medical practitioner shall have due regard to the percentages of loss of earning capacity in relation to different injuries specified in Schedule I;

7. On perusal of the explanation II, which has been quoted above, it is crystal clear that the qualified medical practitioner has to determine the percentage of loss of earning capacity in relation to different injuries specified in Schedule-I.

8. Mr. A. Ahmed, learned Counsel appearing for the petitioner submits that the percentage of injury is not the sole criteria for determining percentage of loss of earning capacity inasmuch as the loss of earning capacity is dependent of nature of injury, nature of jobs performed by the claimant. In support of his contention Mr. Ahmed relied on the decision of the Apex Court in National Insurance Co. Ltd. v. Mabasir Ahmed and Anr. : 2007 (112) FLR 1033 (SC) : (2007) 2 SCC 349, wherein the Apex Court held that loss of earning capacity, is not a substitute of percentage of physical disablement.

9. Paras 7, 8 and 9 of the SCC in National Insurance Co. Ltd. (supra) are quoted hereunder:

7. These cases related to injuries which were not specified in Schedule I and as such cases are covered by Section 4(1)(c)(ii) Explanation. In terms of Explanation II the qualified medical practitioner has to assess loss of earning capacity having due regard to percentage of loss of earning capacity in relation to the different injuries in Schedule I. Explanation I also provides that where there are more than one injuries, the aggregate has to be taken, so that the amount which would be payable for permanent total disablement is not exceeded.

8. Loss of earning capacity is, therefore, not a substitute for percentage of the physical disablement. It is one of the factors taken into account. In the instant case the doctor who examined the claimant also noted about the functional disablement. In other words, the doctor had taken note of the relevant factors relating to loss of earning capacity. Without indicating any reason or basis the High Court held that there was 100% loss of earning capacity. Since no basis was indicated in support of the conclusion, same cannot be maintained. Therefore, we set aside that part of the High. Court's order and restore that of the Commissioner, in view of the fact situation. Coming to the question of liability to pay interest, Section 4-A(3) deals with that question. The provision has been quoted above.

9. Interest is payable under Section 4-A(3) if there is default in paying the, compensation due under this Act within one month from the date it fell-due. The question of liability under Section 4-A was dealt with by this Court in Maghar Singh v. Jashwant Singh. By amending Act 30 of 1995,, Section 4-A of the Act was amended, inter alia, fixing the minimum rate of interest to be simple interest @ 12%. In the instant case, the accident took place after the amendment and, therefore, the rate of 12% as fixed' by the High Court cannot be faulted. But the period as fixed by it is wrong. The starting point is on completion of one month from the date on which it fell due. Obviously it cannot be the date of accident. Since no 'indication is there as to when it becomes due,' it has to be taken to be the date of adjudication of the claim. This appears to be so because Section 4-A(1) prescribes that compensation under Section 4 shall be paid as soon as it falls due. The compensation becomes due on the basis of adjudication of the claim made. The adjudication under Section 4 in some cases involves the assessment of loss of earning capacity by a qualified medical practitioner. Unless adjudication is done, question of compensation becoming due does not arise. The position becomes clearer oh a reading of Sub-section (2) of Section 4-A. It provides that provisional payment to the extent of admitted liability has to be made when employer does not accept the liability for compensation to the extent claimed. The crucial expression is 'falls due'. Significantly legislature has hot used the expression 'from the date of accident'. Unless there is an adjudication the question of an amount falling due does not arise.

10. Coming back to the present case, it is clear that doctor who was examined as PW-2 merely stated only percentage of physical disablement of the claimant and not the percentage of loss of earning capacity. As discussed above, the medical practitioner is to give his opinion regarding the loss of earning capacity of the claimant. Therefore, the substantial question of law Nos. 2 and 3 are also answered accordingly.

11. Regarding the substantial questions of law No. 4 it would be suffice to refer to the para No. 9 of the SCC in National Insurance Co. Ltd. (supra) which has been quoted above. The Apex Court in National Insurance Co. Ltd. (supra) in the clear term held that the starting point of the interest is on completion of 30 days from the date on which the payment of compensation fell due and it cannot be the date of accident. The substantial question of law No. 4 is also answered in favour of the appellant.

12. For the reasons discussed, above, the impugned judgment and award dated 25.6.2002 passed in W.C. Case No. 31 of 2000 of the Commissioner for Workmen's Compensation, Zone, III, Tezpur is hereby set aside. The whole case is remitted back to the Commissioner for Workmen's Compensation Zone-III, Tezpur for proceeding and deciding the W.C. Case No. 31 of 2000 in compliance with the 1st proviso to Section 21(1) of the Workmen's Compensation Act, 1923 and relevant provisions of law.

13. 3oth the parties are directed to appear before the Commissioner for Workmen's Compensation, Zone-IU, Tezpur on 7.5.2008.

14. Registry is directed to send down the lower Court records forthwith.

15. It appears from the records that, the appellant had already paid Rs. 50,000/- to the claimant.