Karnataka High Court
Divisional Manager vs Madhusudhan on 30 August, 2018
IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 30TH DAY OF AUGUST 2018
BEFORE
THE HON'BLE MRS.JUSTICE K.S.MUDAGAL
M.F.A. No.5817 OF 2008 (WC)
BETWEEN
DIVISIONAL MANAGER
NATIONAL INSURANCE CO. LTD.,
SUJATHA COMPLEX,P.B. ROAD,
HUBLI, NOW REP.BY ITS
REGIONAL MANAGER,
NATIONAL INSURANCE CO. LTD.,
REGIONAL OFFICE,SUBHARAM COMPLEX,
NO.144, M.G.ROAD,BANGALROE-01. ...APPELLANT
(BY SRI. S. K. KAYAKMATH, ADVOCATE )
AND
1. MADHUSUDHAN,
S/O. S.N.KRISHNA MURTHY,
AGED ABOUT 35 YEARS,
R/O.DAVANGERE,
NOW AT RANEBENNUR,
HAVERI DISTRICT.
2. C.V. BALAJI GANESH BABU,
S/O.VENKATARAJU, AGED MAJOR,
NO.519/2,DAVAL PETH,
DAVANAGERE. ...RESPONDENTS
(BY SRI. S. R. HEGDE, ADVOCATE FOR R1)
(R2 - SERVED)
THIS MFA IS FILED UNDER SECTION 30(1) OF THE
WORKMEN'S COMPENSATION ACT AGAINST THE ORDER DATED
03.01.2008 PASSED IN CASE NO.WCA/NF-253/2004 ON THE FILE
OF THE LABOUR OFFICER AND COMMISSIONER FOR WORKMEN'S
COMPENSATION, HAVERI DISTRICT, HAVERI.
MFA No.5817 OF 2008
2
THIS MFA COMING ON FOR HEARING THIS DAY, THE
COURT DELIVERED THE FOLLOWING:
JUDGMENT
This appeal of the insurer arises out of the award dated 03.01.2008 passed by the Commissioner for Workmen's Compensation, Haveri (for short 'the Commissioner'), in WCA/NF-253/2004. By the impugned award, the Commissioner has granted compensation of Rs.1,11,213/- to the claimant payable by the insurer/appellant and fine of Rs.30,000/- payable by the employer.
2. The appellant was the 2nd respondent, the 1st respondent was the claimant and the 2nd respondent i.e. employer was the 1st respondent in WCA/NF-253/2004. For the purpose of convenience, henceforth the parties will be referred to with their ranks before the Commissioner.
3. Few admitted facts of the case are as follows:
The 1st respondent is the owner of Maruti 800 car No.KA-17/M-5049. The claimant is the younger brother of the wife of the 1st respondent. On 03.07.2004, the family members of the claimant and the 1st respondent were on a MFA No.5817 OF 2008 3 pilgrimage from their town Davanagere to Horanadu and Dharmasthala. On 03.07.2004, when they were proceeding from Horanadu to Dharmasthala, the claimant was driving the car. When their car was proceeding near Malaghatta on N.H.13 within the jurisdiction of Mala Village of Karkala Taluk, the car met with accident. Regarding the said accident, respondent No.1 filed complaint as per Ex.P.2 and on that basis the FIR-Ex.P.1 was registered in Crime No.77 of Karkala Rural Police Station. In Ex.P.2 it was alleged that the accident occurred due to rash and negligent driving of the car by the claimant. In the accident, the daughter of the claimant by name Sahana died and the claimant suffered injuries. The jurisdictional police chargesheeted the claimant for rash and negligent driving etc.
4. The claimant filed claim petition in WCA/NF- 253/2004 contending that the 1st respondent had employed him as driver of the car No.KA-17/M-5049 and the accident occurred during the course of employment and arose out of the employment causing him physical disability and loss of earning capacity. Thus, he claimed compensation of MFA No.5817 OF 2008 4 Rs.3,00,000/-. The claimant further contended that the risk of the driver of the vehicle was insured by the 2nd respondent by issuing the insurance policy, therefore, the 2nd respondent was liable to pay the compensation.
5. The 1st respondent in his written statement contended that he had employed the claimant about six months prior to the accident on monthly wages of Rs.3,000/- and daily allowance of Rs.50/-. He admitted the accident and injuries, but contended that insurer is liable to pay the compensation as the risk was insured by the 2nd respondent.
6. The 2nd respondent contested the petition denying the relationship of the employer and employee, the accident, injuries, income of the claimant. The insurer further contended that, at the time of the accident, the claimant was not holding an effective driving licence, therefore, it is not liable to pay the compensation.
7. The parties adduced evidence. The claimant got himself examined as P.W.1 and the doctor as P.W.2 and got MFA No.5817 OF 2008 5 marked Exs.P.1 to P.13. The 1st respondent got himself examined as R.W.1. Officer of the 2nd respondent was examined as R.W.2. On behalf of the insurer, the policy was marked as Exs.R.1 and R.2.
8. The Commissioner after hearing the parties granted compensation as aforesaid payable by the insurer on the ground that the jural relationship was proved by the admissions of respondent no.1 and the occurrence of the accident during the course of the employment and out of employment was proved by the evidence adduced by the parties. The Commissioner further held that as per the medical evidence adduced by the claimant, the claimant suffered 30% physical disability, considered his monthly wages at Rs.3,000/-, his age at 31 years and applied factor 205.95.
9. The insurer challenges the said award in this appeal. This Court admitted the appeal to hear the following substantial questions of law.
" (1) Having regard to the pleadings and material on record whether the Workmen's Commissioner was right in holding that there MFA No.5817 OF 2008 6 exists the relationship of the Workmen and employer between the Claimant and the 1st respondent ?
(2) Whether loss of earning capacity of the claimant at 30% assessed by the Commissioner is in accordance with Section 4(1)(c)(ii) of Workmen's Compensation Act, 1923?"
10. Sri. S.K. Kayakmath, the learned counsel for the insurer, submits that as per the claimant's own documents Ex.P.1 and P.2, the FIR and the complaint, the contention of the claimant being employee of the 1st respondent is falsified, therefore the award is perverse. He further submits that the disability and the loss of earning capacity assessed by the Commissioner is contrary to Section 4(1)(c)(ii) of the Employee's Compensation Act, 1923.
11. In support of his contention, he relies upon the judgment of Hon'ble Supreme Court in Oriental Insurance Co. Ltd. Vs. Premlata Shukla and others - 2007 ACJ 1928.
12. Sri S.R. Hegde, learned counsel for the claimant submits that when respondent No.1 himself admitted the MFA No.5817 OF 2008 7 jural relationship, it is not open to the insurer question the same. He further submits that when such defence is not open to the insurer, the appeal does not lie to this Court by the insurer.
13. In support of his contention, he relies upon the following judgments:
i) United India Insurance Co. Ltd. Vs. Prakash Shankar Gurav - ILR 2006 KAR 1036.
ii) Smt. Kavitha Dilip Patil and Others Vs. Ananda Gnanu Patil and Others- ILR 2004 KAR 461.
14. The Commissioner gets jurisdiction under Section 22 of the Employees' Compensation Act, 1923, to entertain a claim petition and adjudicate upon the same, only if there is relationship of employer and employee between the claimant and his adversary. Therefore, that is the basic jurisdictional issue. Whether the other party contests or not, the claimant is required to prove the said basic fact.
15. It is no doubt true that, in the present case, the 1st respondent in his written statement conceded that the claimant was employed by him as driver. But, soon after the MFA No.5817 OF 2008 8 accident, he only filed complaint-Ex.P.2 on the basis of which the FIR-Ex.P.1 was registered. In Ex.P.2, nowhere he has whispered that the claimant was driving the car as his employee. As against that, he has stated in the complaint that they were on a pilgrimage and touring party consisted of the family of himself and the claimant.
16. Claimant is, admittedly, the younger brother of the wife of the 1st respondent. If claimant was driving the vehicle as an employee, naturally, it could have been said so in the complaint. The accident has occurred on 03.07.2004 at about 4.45 p.m. The complaint is filed on the same day at 8.00 p.m. Respondent No.1 filed his statement before the Commissioner conceding the jural relationship on 31.01.2005 i.e. after more than seven months. The claimant did not produce the copy of the chargesheet or the judgment of the criminal court to show that he was driving the vehicle as a driver under respondent no.1.
17. In Prakash Shankar Gurav's case relied upon by the learned counsel for the claimant, it was held that there is no bar for a father employing his son in his vehicle as a MFA No.5817 OF 2008 9 driver. It is true that there is no legal bar for a person employing his own blood relative as an employee, but the question in the case is not whether there was such bar. The question is whether the fact of employment was established before the Commissioner.
18. So far as the judgment in Kavitha Dilip Patil's case, the said judgment was rendered on a reference. The reference was answered in para 25 as follows:
"25. As discussed above, our answers to the questions, which arose for our consideration, are as under:
a) The Insurance Company cannot take up defences other than what is available to them under the terms of the insurance policy and which are specified in Section 149(2) of the Motor Vehicles Act even in proceedings under the provisions of the Workmen's Compensation Act.
b) As under Section 30 of the Workmen's Compensation Act an appeal lies only against a substantial question of law, the Insurance company cannot urge any other ground other than what is available to them under the provisions of the Motor Vehicles Act and even in MFA No.5817 OF 2008 10 respect of those grounds unless a substantial question of law is made out. Accordingly, the questions are answered."
19. Para 25 of the aforesaid judgment shows that the insurer can challenge the award in respect of the grounds which involve the substantial question of law. Whether there was a jural relationship is a substantial question of law and whether the finding of the Commissioner on such question is perverse is a substantial question of law. In fact, in the very same judgment, the Full Bench refers to the judgment of the Hon'ble Supreme Court in National Insurance Company Limited, Chandigarh Vs. Nicolletta Rohtagi and Others - AIR 2002 SC 3350.
20. Para 31 of the judgment in Nicolletta Rohtagi's case reads as follows:
"We have already held that unless the conditions precedent specified in Section 170 of 1988 Act is satisfied, an insurance company has no right of appeal to challenge the award on merits. However, in a situation where there is a collusion between the claimants and the insured or the insured does not contest the claim and, MFA No.5817 OF 2008 11 further, the tribunal does not implead the insurance company to contest the claim in such cases it is open to an insurer to seek permission of the tribunal to contest the claim on the ground available to the insured or to a person against whom a claim has been made. If permission is granted and the insurer is allowed to contest the claim on merits in that case it is open to the insurer to file an appeal against an award on merits, if aggrieved. In any case where an application for permission is erroneously rejected the insurer can challenge only that part of the order while filing appeal on grounds specified in Sub-section (2) of Section 149 of 1988 Act. But such application for permission has to be bona fide and filed at the stage when the insured is required to lead his evidence. So far as obtaining compensation by fraud by the claimant is concerned, it is no longer res integra that fraud vitiates the entire proceeding and in such cases it is open to an insurer to apply to the Tribunal for rectification of award".
(Emphasis Supplied)
21. Reading of the judgment in Nicolletta Rohtagi's case makes it clear that if there is a collusion between the MFA No.5817 OF 2008 12 claimant and the insured or the insured does not contest the claim, the insurer can seek permission of the Tribunal to contest the claim on the grounds available to the insurer and if permission is granted the insurer is allowed to contest the claim on merits and file appeal against such award. In the present case, the insurer had filed an application under Section 170 of the Motor Vehicles Act and that was granted. The same is made out from the impugned award itself. Therefore, the judgment in Kavitha Dilip Patil's case does not in any way advance the case of the claimant.
22. Ex.P.2 is the claimant's own document where respondent No.1 did not concede or whisper anything about the jural relationship. R.W.1 the complainant, in his cross- examination, admitted that Ex.P.2 is filed by him only. He has further admitted that he has subscribed his signature on Ex.R.2 on understanding the contents of the documents. He says that he has vouchers, but does not produce the same. That amounts to suppression of material fact.
23. The claimant cannot demand that Ex.P.2 shall be relied only to the extent it suits his case and the rest of the MFA No.5817 OF 2008 13 contents of the documents shall be rejected. In this regard, the Hon'ble Supreme Court in Premlata Shukla's case referred to supra, in para 13 held as follows:
"13. However, the factum of an accident could also be proved from the first information report. It is also to be noted that once a part of the contents of the document is admitted in evidence, the party bringing the same on record cannot be permitted to turn round and contend that the other contents contained in the rest part thereof had not been proved. Both the parties have relied thereupon. It was marked as an Exhibit as both the parties intended to rely upon it."
(Emphasis Supplied)
24. In view of the aforesaid judgment, Ex.P.2, the complaint, has to be read in evidence wholly. On such reading, it falsifies the case of the claimant and respondent No.1 regarding jural relationship between them. Having regard to this, the award passed by the Commissioner is perverse and without jurisdiction. Consequently, the compensation awarded also does not sustain. Therefore, the MFA No.5817 OF 2008 14 substantial questions of law are answered in favour of the appellant.
25. The appeal is allowed. The impugned award dated 03.01.2008 in WCA/NF-253/2004 passed by the Commissioner for Workmen's Compensation, Haveri, is hereby set aside. The claim petition is hereby dismissed.
The amount in deposit shall be refunded to the appellant.
In view of the disposal of the appeal, I.A. No.3/2008 does not survive for consideration and same is disposed of accordingly.
Sd/-
JUDGE Kms