Bombay High Court
Mohammad Istiyaque S/O Shaikh Baramad vs M/S Sterling And Willson Limited, ... on 20 December, 2019
Author: Vinay Joshi
Bench: Vinay Joshi
Judgment 1 FA1449.19.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
NAGPUR BENCH, NAGPUR.
FIRST APPEAL NO. 1449/2019
Mohammad Istiyaque s/o Shaikh Baramd,
aged about 28 years, Occ.-Nil,
R/o Hatroon, Tq. Balapur, Distt. Akola.
.... APPELLANT
// VERSUS //
1. M/s. Sterling and Willson Limited,
Registered office at Universal
Magestic, 9th floor, P.L. Lokhande Marg,
Chembur (West), Mumbai - 400 043
2. The New India Insurance Company Limited,
through its Manager, Near Matrubhumi Press,
Gorakshan Road, Akola,
Tq. and Distt. Akola.
.... RESPONDENTS
Shri C.A. Joshi, Advocate for appellant.
Shri Rohini Mankar, Advocate for respondent no.2.
Shri N.R. Tekade, Advocate for respondent no. 1.
_______________________________________________________________________
CORAM : VINAY JOSHI, J.
CLOSED FOR JUDGMENT ON : 19/11/2019 JUDGMENT PRONOUNCED ON : /12/2019 Heard finally by consent of learned Counsel appearing for the parties at the stage of admission. Also gone through the written notes of argument filed by the respondent. ::: Uploaded on - 20/12/2019 ::: Downloaded on - 21/12/2019 05:31:37 :::
Judgment 2 FA1449.19.odt 2. The appellant/original claimant raised the limited
challenge to the extent of refusal to grant penalty in terms of Section 4-A(3)(b) of the Employee's Compensation Act, 1923.
3. The Appellant was working with the respondent no. 1 as a fitter. During the course of employment, he met with an accident on 14.03.2013 in which his left shoulder and two fingers of the right hand were disabled. The appellant who was earning Rs.6,000/- per month, has filed a claim before the Commissioner, under the Employees Compensation Act.
4. The respondent no. 1-employer denied the liability by contending that there was no relationship of employer and employee in between them. However, after recording the evidence, the Commissioner on the basis of income, age, disablement and relevant factor held that the appellant is entitled for compensation of Rs.7,91,820/-. In the meantime, on 19.03.2014, respondent no. 2-Insurer had deposited an amount of Rs.6,29,194/- with the Commissioner under the Act. Considering said deposit it is held that the appellant is entitled for remaining balance amount of compensation of Rs.1,62,626/- ::: Uploaded on - 20/12/2019 ::: Downloaded on - 21/12/2019 05:31:37 :::
Judgment 3 FA1449.19.odt alongwith interest at the rate of 12 per cent per annum from the date of accident.
5. The controversy lies thereafter, as the Commissioner has declined to grant penalty on account of delayed payment in terms of sub clause (b) of clause 3 to Section 4-A of the Employee's Compensation Act, 1923. If the Commissioner is of the opinion that there is no justification for the delayed payment then employer has to pay interest as well as penalty. However, the proviso added to sub clause (b) contemplates that the order of payment of penalty shall not be passed without giving a reasonable opportunity to the employer to show cause as to why penalty should not be imposed.
6. In this regard, the Commissioner has rightly mentioned that unless show cause notice is given to the employer, penalty cannot be imposed. However, the Commissioner expressed that since no show cause notice was given, the appellant is not entitled to claim penalty in view of Section 4-A (3)(b) of the Employee's Compensation Act, 1923.
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Judgment 4 FA1449.19.odt
7. The respondent in resistance, initially submitted that there was no relationship of employer and employee and therefore no penalty could be saddled. In fact, the Commissioner on merit held that their exists relationship as employer and employee. In absence of appeal filed by the employer, it is not open for him to agitate said grievance. Secondly, the employer would submit that since he has denied the entire liability to pay compensation, the question of payment of penalty does not arise. In support of said contention, he relied on the judgments in cases of Amita Prakash Madavi V. New India Assurance Co. Ltd. reported in 2016 (2) Bom. LC 349 (Bom), State of Maharashtra Vs. Arti wd/o Ashok Kapshikar and ors. reported in 2007 (6) Mh.L.J. 108 and judgment of Hon'ble Supreme Court in case no. Civil Appeal No. 7363 of 2000 (State of Rajasthan & ors V. Shiv Dayal and anr.) passed on 14.08.2019. Concededly, this point was not considered by the Commissioner while deciding the claim. The entitlement of penalty is an issue which require to be decided on the basis of evidence as contemplated under Section 4-A(3)(b) of the Employee's Compensation Act, 1923. For grant of compensation prior notice to employer is necessary.
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Judgment 5 FA1449.19.odt
8. The plain reading of the proviso appended to sub clause
(b) postulate that it is for the Commissioner to give reasonable opportunity to the employer by way of show cause notice which he has to do. The Commissioner himself instead of giving show cause notice or inferring on facts that there was due notice to the employer, has stated that for want of show cause notice penalty cannot be awarded. The provisions of Workmen's Compensation Act, are beneficial in nature, no specific procedure is prescribed by the statute for issuance of show cause notice. The only requirement is about giving reasonable opportunity to the employer to show cause on the point of imposition of penalty.
9. There is not finding recorded by the Commissioner about claimants' entitlement for the penalty. The respondent can well agitate his grievance on the issue before the Commissioner on which the matter can be decided. In this regard, the Commissioner has to comply the mandatory provisions for issuing notice on the point of imposition of penalty. The Commissioner may construe that there was due notice to the ::: Uploaded on - 20/12/2019 ::: Downloaded on - 21/12/2019 05:31:37 ::: Judgment 6 FA1449.19.odt employer, on the basis of given facts, if he deems fit. Therefore, it is necessary to remit the matter back to the Commissioner to issue notice to the employer and upon hearing both sides, to record specific finding on the point of imposition of penalty in terms of Section4-A(3)(b) of the Employees Compensation Act, 1923.
10. As regards to the assessment of compensation of Rs.
7,91,820/- is concerned, in absence of employers' appeal, it will remain as it is. In the wake of such position, the Commissioner is to pass appropriate order only to the extent of imposition of penalty on hearing both sides, alongwith other finding which are maintained.
11. In view of the above, the impugned judgment is set aside, the matter is remitted back to the limited extent of recording a finding on the aspect of imposition of penalty and for passing appropriate orders.
12. First Appeal stands disposed in above terms. No costs.
JUDGE
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Judgment 7 FA1449.19.odt
Later On :
The leaned Counsel for appellant requested to fix date for appearance before the Commissioner. Parties are directed to appear before the Commissioner on 15.01.2020, on which date the Commissioner may issue formal statutory notice to respondent.
JUDGE Trupti ::: Uploaded on - 20/12/2019 ::: Downloaded on - 21/12/2019 05:31:37 :::