Bombay High Court
The Sbi General Insurance Co. Ltd., ... vs Vishal Dinkar Ingle And Others on 22 January, 2026
Author: Anil S. Kilor
Bench: Anil S. Kilor
2026:BHC-NAG:1367
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY,
NAGPUR BENCH, NAGPUR.
FIRST APPEAL NO. 138 OF 2023
The SBI General Insurance Co.Ltd.,
Through its Branch Manager,
"Natraj", 101, 201 and 301, Junction
of Western Express Highway and
Andheri-Kurla Road, Andheri (E),
Mumbai - 400 069.
.... APPELLANT.
// VERSUS //
1. Vishal Dinkar Ingle,
Aged about 21 years, Occu. : Cleaner,
R/o. Sambhaji Nagar, Chikhali,
Tq. Chikhali, Dist. Buldhana
(Orig. Applicant)
2. Shaikh Wasim Abdul Qadar,
Age : Major, Occu. : Owner,
R/o. Behind Panchayat Samiti,
Ward No.9, Chikhali, Dist. Buldhana
(Org. N.A. No.1. )
.... RESPONDENTS.
______________________________________________________________
Shri Dinkar N. Kukday, Advocate for Appellant.
Shri S.W.Sambre, Advocate for the respondent No.1
______________________________________________________________
CORAM : ANIL S. KILOR AND
RAJ D. WAKODE, JJ.
DATED : JANUARY 22, 2026.
ORAL JUDGMENT : (Per : Anil S. Kilor, J)
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1. Heard.
2. This is a reference made by the learned Single Judge (Anil L. Pansare, J) by framing following question :
"Whether the appeal shall lie at the instance of the Insurance Company against the composite order passed by the Commissioner under Clauses (a) and (aa) of sub-section 1 of Section 30 of the Employee's Compensation Act, 1923 upon producing certificate of the Commissioner to the effect that the Insurance Company has deposited with him the amount of compensation under Clause (a) only?"
3. In First Appeal No.138 of 2023 a challenge was raised to the order dated 21/11/2022 passed by the Commissioner for Employee's Compensation and Judge Labour Court, Buldana granting compensation of Rs.20,16,000/- with interest @12% per annum and penalty of Rs.10,08,000/- to be payable by the appellant-Insurance Company.
4. The said order was passed in the proceeding filed by the respondent under Section 22 read with Section 4 of the Employee's Compensation Act, 1923, (hereinafter referred to as "the Act of 1923") seeking compensation on account of the injuries caused to him in an accident dated 09/10/2020.
5. The respondent No.1, during the course of hearing of the said First Appeal, raised a preliminary objection as to the tenability of the 3 appeal on the ground that the appellant has not annexed with the appeal memo, the certificate issued by the Commissioner to the effect that the appellant has deposited with him (Commissioner), the amount payable under the impugned award, as is required under the third proviso to sub- section (1) of Section 30 of the Act of 1923.
6. In reply, the learned counsel for the appellant submitted that the amount of compensation i.e. Rs.20,16,000/- was deposited with the Commissioner and the receipt in respect of the same is filed along with the appeal memo. It was argued that the appeal is maintainable even if the amount of interest and/ or the amount of penalty, which is part of the award, is not deposited with the Commissioner, the same being not covered under the third proviso to sub-section (1) of Section 30 of the Act of 1923.
7. In the case of United India Insurance Company Limited ..vs.. Mulla Chandpasha, reported in 2016(2) ABR 281, the Single Bench of this Court held that the amount of interest and penalty provided under Section 4A(a) of the Act of 1923 is not covered by the third proviso to Section 30 of the Act of 1923, but it only covers the amount of compensation granted under Section 30(1)(a) of the Act of 1923. Relevant paras of the judgment read thus:
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"19.... The proviso shows that it is applicable only in respect of the order made by the Commissioner under section 30(1)(a). In Section 4A of the Act it is provided that when the employer makes default in making the payment of compensation which is due under the Act within one month from the date it fell due, the interest as provided under section 4A(a) becomes payable and if the Commissioner is satisfied that there was no justification for the delay caused in making payment, he can use the power under section 4A(3)(b) also and make employer pay the penalty which may extend to 50% of the amount which was payable by the employer. If the aforesaid portions of section 30 are interpreted literally and section 4A is read into section 30 of the Act, it can be said that the condition given in the third proviso is only in respect of the payment of compensation and it is not in respect of the interest or penalty which can be made payable under section 4A of the Act. It is already observed that the learned counsel for insurance company has not disputed that it is settled law that the insurance company is liable to pay interest on the compensation under the policy unless there is contracting out in respect of such interest. Though there is such liability, for filing appeal, only the compensation amount needs to be deposited by the insurance company. It can be said that if the insurance company wants to challenge only the order of penalty which could not have been made against it, it can file appeal only in respect of that amount without producing certificate of deposit. In that case it will be open to the employee to execute the award against the owner and the insurance company in respect of the compensation awarded. Similarly appeal can be filed only respect of interest and for that there will be no necessity of certificate of deposit of compensation. In that case also employee can proceed with execution proceeding to recover the compensation amount.
On the aforesaid point there is decision of Full Bench of Madhya Pradesh High Court reported as 2004 ACJ 2134 (MP) (New India Assurance Co. Ltd. v. Savita Sen).
20) In view of the object behind the legislation and particularly imposing the condition mentioned in the third provision, it is clear that the condition is mandatory and the appeal cannot be entertained without depositing the compensation mentioned in section 30(1)(a) of the Act. The proposition made by the learned counsel for the insurance company that appeal can be entertained and this point can be decided at the time of admission of appeal is not at all acceptable. Even after filing of the appeal, there is one mare condition like mentioned in first proviso to section 30 viz. there is substantial question of law involved in the appeal. This hurdie also needs to be overcome by the insurance company 5
21) In all the three provisos to Section 30 of the Act the words used are "no appeal shall lie". The first proviso is in respect of making out of the involvement of substantial question of law by the appellant and so the appellant has the right to make out such case before the Court. In view of this circumstance, the appeal needs to be accepted by the office and it is up to the Court to decide as to whether substantial question of law is involved or not and then the Court will decide as to whether the appeal needs to be admitted or not. In the third proviso, which is already quoted, it is made clear that the appeal shall not lie unless the memorandum of appeal is accompanied by certificate to the effect that the appellant has deposited the amount payable under the order appealed against. It is the job of the office and not of the Court to see and confirm that the amount is already deposited. Only after that, the appeal memo can be accepted by the office. Otherwise the office can refuse to accept the appeal memo. Thus, there is difference between the two provisos and it cannot be said that it is up to Court to decide this point. In view of the third proviso, which is mandatory, the Court has no power to direct the office to accept the appeal when the amount mentioned in this proviso is not deposited. However, the manner of deposit of such amount can be regulated by the Court and the Court can direct to deposit such amount in the Court or with the Commissioner first. Thus, from all angles, the proposition is not acceptable that appeal can be entertained, considered by the Court if it is filed by insurance company without certificate of deposit and the pre-
condition is not applicable to the insurance company.
22) to 24)....
25) This Court has already discussed the approach adopted by the insurance company at the time of filing of the three appeals. Along with appeal memo there was no certificate of the Commissioner as required by the third proviso to section 30 of the Act. Some amounts were deposited in all the three proceedings only due to direction given by the Court but those directions were for giving stay to the execution of the awards and not for allowing the insurance company to file appeal. The amounts were deposited very late, under the orders, and so in all the matters there will be point of limitation. There condonation of delay automatically though the appeal came to be registered even when there was no compliance of condition laid down in the third proviso to section 30 of the Act and so it needs to be presumed that there was no condonation of delay in all the three matters in respect of the period for which the compensation amount was not deposited by the insurance company. In one matter, even compensation as mentioned in section 30(1)(a) is not deposited till today. Due to these circumstances, the appeals need to be dismissed for non compliance of the condition laid down in the third proviso to section 30 of the Act. All the substantial questions of law are answered against the appellant." 6
8. Contrary to this view another Single Bench of this Court, relying upon the judgment of the Single Bench of Madhya Pradesh High Court, in the case of National Insurance Company Ltd. ..vs.. Smt. Afroz Janha Wd/o. Wahab Khan and Ors. (First Appeal No.695 of 2012) has held that for not depositing the component of interest or penalty the appeal is not maintainable being barred by third proviso to sub-section (1) of Section 30 of the Act of 1923. Relevant paras of the judgment read thus :
"6. At this stage, issue germane is whether there has been compliance of 3rd proviso to section 30 of the Act and not whether the insurer should along with employer be saddled with the liability to pay interest on the principal amount of compensation. In case of National Insurance Co. Ltd., through Divisional Manager, Jabalpur V/s. Ramkishore Mishra and Ors. reported in 2012 III CLR 371 the learned Single Judge of Madhya Pradesh High Court was seized of the similar issue and it was answered thus :
"This appeal has not yet been admitted for final hearing although it has been ordered that it be heard finally. On bare perusal of Section 30 of the W.C. Act, it is gathered that if an appeal is filed against the order of passing the compensation, it should be accompanied by a certificate issued by the Commissioner that the appellant has deposited amount payable under the order and in this regard 3rd proviso to Section 30 of the W.C. Act is quite clear. Looking to the wordings of the third proviso "amount payable under the order appealed against" would also include the interest awarded upon the lump sum, indeed the interest is also a part of award and it is also to be payable to the workman and therefore if an appeal is to be filed against the award of the Commissioner, the same is to be filed after depositing only the against principal amount but also the interest. In the present case order of Commissioner is dated 8.12.2001 and in para 23 of the order it has been mentioned that in case a sum of Rs.5,37,600/- is not deposited within two months from the date of order either by the employer or insurer, they are liable to pay an interest @9% per annum w.e.f 9.6.2001. This appeal has been filed by the insurer on 4.2.2011 and part of the amount of compensation Rs.5,37,600/- was deposited on 7 25.8.2004 as it appears from the photocopy of the receipt of Commissioner certifying the said deposit by the insurer/appellant. Thus, admittedly after the lapse of two months the amount has been deposited and therefore in terms of order of Commissioner the interest @9% was also to be deposited along with principal sum Rs.5,37,600/-. Since the amount of interest has not been deposited, looking to the bar envisaged in third proviso to Section 30 this appeal is not maintainable. I do not find any merit in the contention of learned counsel for the appellant that this Clause is only applicable to employer and not the insurer. Indeed, because the offending vehicle was insured with the insurer/appellant, whatever the liability was fastened upon the employer was also fastened upon the Insurance Company/appellant. The Insurer has also been found liable to pay compensation jointly and severally. In these state of affairs I am of the view that appeal is not maintainable and is to be dismissed on account of its maintainability."
7. Similar issue is answered by the learned Single Judge of the Madhya Pradesh High Court in case of Oriental Insurance Company Limited, Chennai V/s. R. Mahalilngam & Anr. reported in 2012 III CLR 508 wherein it is held that :
"The Insurance Company/appellant having deposited the interest accrued on its failure to deposit the amount within 30 days from the date of receipt of order and as the memorandum of appeal is not accompanied by a certificate by the Commissioner to the effect that the Appellant Insurance Company has deposited with him the amount payable under the order appealed against is not sufficient compliance of the requirement of third proviso to Section 30(1) of the Act, 1923 and as such I hold that the appeal filed by the Insurance company is not maintainable."
8. In view of the aforesaid legal position, this appeal is not maintainable because of bar created by 3rd proviso to Section 30 of the Act."
Hence, this reference.
9. To answer the reference it would be appropriate to refer to Section 4A and 30(1) of the Act of 1923.
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10. Section 4A of the Act of 1923, reads thus :
"4A. Compensation to be paid when due and penalty for default.--(1) Compensation under section 4 shall be paid as soon as it falls due.
(2) In cases where the employer does not accept the liability for compensation to the extent claimed, he shall be bound to make provisional payment based on the extent of liability which he accepts, and, such payment shall be deposited with the Commissioner or made to the [employee], as the case may be, without prejudice to the right of the [employee] to make any further claim.
(3) Where any employer is in default in paying the compensation due under this Act within one month from the date it fell due, the Commissioner shall--
(a) direct that the employer shall, in addition to the amount of the arrears, pay simple interest thereon at the rate of twelve per cent. per annum or at such higher, rate not exceeding the maximum of the lending rates of any scheduled bank as may be specified by the Central Government by notification in the Official Gazette, on the amount due; and
(b) if, in his opinion, there is no justification for the delay, direct that the employer shall, in addition to the amount of the arrears and interest thereon, pay a further sum not exceeding fifty per cent. of such amount by way of penalty:
Provided that an order for the payment of penalty shall not be passed under clause (b) without giving a reasonable opportunity to the employer to show cause why it should not be passed. Explanation.--For the purposes of this sub-section, "scheduled bank"
means a bank for the time being included in the Second Schedule to the Reserve Bank of India Act, 1934.
(3A) The interest and the penalty payable under sub-section (3) shall be paid to the [employee] or his dependant, as the case may be."
11. It is evident that Section 4A of the Act of 1923 provides that, when the employer makes default in making the payment of compensation which is due under the Act within one month from the date it fell due, the interest as provided under Section 4A(a) of the Act of 1923 becomes payable and if the Commissioner is satisfied that there was 9 no justification for the delay caused in making payment, he can use the power under Section 4A (3)(b) also and make the employer pay the penalty which may extend to 50% of the amount which was payable by the employer.
12. Section 30 of the Act of 1923, reads thus:
"30. Appeals.-- (1) An appeal shall lie to the High Court from the following orders of a Commissioner, namely:
(a) an order awarding as compensation a lump sum whether by way of redemption of a half-monthly payment or otherwise or disallowing a claim in full or in part for a lump sum; (aa) an order awarding interest or penalty under section 4A;
(b) an order refusing to allow redemption of a half-monthly payment;
(c) an order providing for the distribution of compensation among the dependants of a deceased employee, or disallowing any claim of a person alleging himself to be such dependant;
(d) an order allowing or disallowing any claim for the amount of an indemnity under the provisions of sub-section (2) of section 12; or
(e) an order refusing to register a memorandum of agreement or registering the same or providing for the registration of the same subject to conditions:
Provided that no appeal shall lie against any order unless a substantial question of law is involved in the appeal, and in the case of an order other than an order such as is referred to in clause (b), unless the amount in dispute in the appeal is not less than n thousand rupees or such higher amount as the Central Government may, by notification in the Official Gazette, specify: Provided further that no appeal shall lie in any case in which the parties have agreed to abide by the decision of the Commissioner, or in which the order of the Commissioner gives effect to an agreement come to by the parties:
Provided further that no appeal by an employer under clause (a) shall lie unless the memorandum of appeal is accompanied by a certificate by the Commissioner to the effect that the appellant has deposited with him the amount payable under the order appealed against.
(2) The period of limitation for an appeal under this section shall be sixty days.
(3) The provisions of section 5 of the Limitation Act, 1963 (36 of 1963), shall be applicable to appeals under this section."10
13. The cardinal Rule of Interpretation, as observed by the Hon'ble Supreme Court of India in the case of Gurudevdatta VKSSS Maryadit ..vs.. State of Maharashtra , reported in (2001)4 SCC 534, reads thus :
"26. ... it is a cardinal principle of interpretation of statute that the words of a statute must be understood in their natural, ordinary or popular sense and construed according to their grammatical meaning, unless such construction leads to some absurdity or unless there is something in the context or in the object of the statute to suggest to the contrary. The golden rule is that the words of a statute must prima facie be given their ordinary meaning. It is yet another rule of construction that when the words of the statute are clear, plain and unambiguous, then the courts are bound to give effect to that meaning, irrespective of the consequences. It is said that the words themselves best declare the intention of the law- giver. The courts have adhered to the principle that efforts should be made to give meaning to each and every word used by the legislature and it is not a sound principle of construction to brush aside words in a statute as being inapposite surpluses, if they can have a proper application in circumstances conceivable within the contemplation of the statute. ..."
14. Keeping this cardinal principal of interpretation in mind if we consider the third proviso to Section 30(1) of the Act of 1923, there cannot be any dispute that no appeal shall lie under clause (a) of sub- section (1) of Section 30 of the Act of 1923, unless the memorandum of appeal is accompanied by the certificate by the Commissioner to the effect that the appellant has deposited with him an amount payable under the order appealed against. Thus, this condition of certificate to be accompanied in respect of the deposit of amount payable is applicable to the order awarding compensation.
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15. It is to be noted that Section 4A of the Act of 1923 was inserted by Act 8 of 1959. Section 30(1)(aa) of the Act of 1923 is a distinct and separate provision than Section 30(1)(a) which was also inserted by the Act 8 of 1959. Thus, it is evident that while inserting Section 4A the legislature has taken care to insert Clause (aa) to sub- Section (1) of Section 30 of the Act of 1923. Had the intention of the legislature been to make the condition of deposit of amount as stipulated in third proviso, applicable to Clause (aa) of sub-section (1) of Section 30 of the Act of 1923, an amendment to that effect could have been made to the third proviso by the same Act i.e. Act 8 of 1959. However, while introducing Section 4A and inserting clause (aa) to sub-section (1) of Section 30 of the Act of 1923, no such amendment was made to the third proviso as regards applicability of it to Clause (aa) to sub-Section (1) of Section 30 of the Act of 1923.
16. Thus, we have no hesitation to hold that the intention of the legislature was not to apply the condition of depositing the amount of interest or penalty imposed under Section 4A of the Act of 1923 to the third proviso, but to restrict its application to clause (a) to sub-section(1) of Section 30 of the Act of 1923, only.
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17. Having held so, we are of the opinion that the view taken by the learned Single Bench of this Court in the case of United India Insurance Co. Ltd. ..vs.. Mulla Chandpasha (supra) is just and proper. The learned Single Judge is right in holding that for filing the appeal, only the compensation amount ought to be deposited by the Insurance Company. In case, the Insurance Company has challenged the order of interest alone there will be no necessity of filing certificate for deposit of compensation. Similarly, as regards the penalty, the Insurance Company is not bound to produce the certificate of deposit. Thus, the final conclusion recorded by the learned Single Judge in United India Insurance Co. Ltd. v. Mulla Chandpasha (supra), is that the third proviso of Section 30(1) of the Act of 1923 applies only to clause (a) and not to clause (aa). In our view, this judgment lays down the correct position of law, having regard to the interpretation of Section 30(1) of the Act of 1923.
18. At the same time, we find that the view taken by the learned single Judge in the case of Smt. Afroz Janha (supra), based on the judgments of the Madhya Pradesh High Court in the case of National Insurance Co. Ltd. ..vs.. Ramkishore Mishra , reported in 2012 III CLR 371 and another case of Oriental Insurance Co. Ltd. ..vs.. R. Mahalingam , reported in 2012 III CLR 508, is not the correct view and hence, cannot be accepted.
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19. Accordingly, we answered the reference as under :
The third proviso to sub-section (1) of Section 30 of the Employees' Compensation Act, 1923 is applicable only to clause (a) of sub-section (1) of Section 30 of the said Act and not to clause (aa) thereof. Hence, the reference is answered in affirmative.
The matter be placed before the learned Single Judge for further consideration.
( RAJ D. WAKODE, J ) (ANIL S. KILOR, J )
RRaut..
Signed by: Raut (RR)
Designation: PS To Honourable Judge
Date: 28/01/2026 19:05:23