1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD FIRST APPEAL No. 2188 OF 2009 Rajabhau S/o Baburao Pangal Age 44 years, Occu. Contractor R/o Murud, Tq. & Dist. Latur ... Appellant V/s. 1. Latabai W/o Gurunath Gurav, Age 34 years, 2. Aakash S/o Gurunath Gurav, Age 19 yeas, Occu. Education 3. Meerabai d/o Gurunath Gurav, Age 16 years, Occu. Nil Under Guardianship of Respondent No.1 4. Pushpabai D/o Gurunath Gurav, Age 12 years, Under Guardianship of Respondent No.1 5. Balbhhim S/o Nagnath Gurav Age 63 years, Occu. Agril., 6. Shahubai W/o Balbhim Gurav, Age 58 years, Occu. Household, All R/o Bamni, Tq. & Dist. Osmanabad 7. Dr. Babasaheb Ambedkar Shetkari Sahakari Sakhar Karkhana Ltd., Kesegaon, Tq. & Dist. Osmanabad through its Managing Director ... Respondents WITH CIVIL APPLICATION No. 8620 OF 2009 2 Rajabhau S/o Baburao Pangal ... APPLICANT. V/s. Latabai W/o Gurunath Gurav & others ... Respondents -------- Shri B.R. Kedar, Advocate for appellant. Shri, S.S. Shinde advocate for respondent Nos. 1 to 6 Shri S.R. Bharad h/f V.D. Salunke, advocate for respondent No.7 ----- CORAM: V.R.KINGAONKAR, J. DATE: 11h DECEMBER, 2009 ORAL JUDGMENT : 1) This appeal is directed against the award rendered by the learned Commissioner for Workmen’s Compensation and Civil Judge (Senior Division), Osmanabad in proceedings Under Section 3 read with 4 of the Workmen’s Compensation Act, 1923 (WCA No. 33 of 2001). 2) By the impugned judgment, the learned Commissioner directed the appellant to pay compensation amount of Rs. 1,56,462/- along with interest at the rate of 12% per annum, along 3 with 25% of the claim amount, by way of penalty. 3) There is no dispute about the fact that the appellant had under taken construction work on contractual basis in the month of May, 2001 as per the contract with Original Respondent No. 2- Sugar factory. He was assigned work to construct residential quarters for providing accommodation to employees of the sugar factory, apart from the work executed by him. There is also no dispute about the fact that, on 29-06-2001 deceased Gurunath, who was the workman, climbed on the constructed residential quarter for changing direction of the water pipe in order to facilitate proper flow of the water. While he was executing the work, accidentally he fell down from the roof top. He was severely injured. He was rushed to the hospital. It was of no avail. He died as a result of the injuries suffered during the course of said accident. There is no dispute about the fact that original claimants are the heirs left by deceased Gurunath 4 4) Briefly stated, the claimant’s case before the Commissioner was that deceased Gurunath was employed by the appellant to work on the site of construction. He was workman of the appellant and had climbed on the roof of the residential quarter at the instance of the appellant. He died during the course of employment. He was earning amount of Rs. 50/- per day as daily wages. Hence, they urged for compensation from the appellant. 5) By filing his Written Statement (Exh. 26), the appellant, who was original respondent No. 1, categorically denied that deceased Gurunath was engaged by him to work on daily wages. He denied all the material averments made in the application of the claimants. He denied that the accident was caused out of and during the course of employment of Gurunath. His contention was that the respondent No. 2 -Sugar Factory was the principal employer of deceased 5 Gurunath and was, therefore, liable to pay the compensation on his accidental death. He denied liability to pay mainly for the reasons that there was no employer and employee relationship, between himself and deceased Gurunath. 6) Initially, the claim set up was only against the appellant. However, after filing of Written Statement by the appellant, the claim petition was amended and the respondent No. 2 – Sugar Factory came to be added. 7) According to the respondent No. 2- Sugar factory, deceased Gurunath was in the employment of appellant on the work of construction of ‘F’ type residential quarters. It was denied that deceased Gurunath was in the employment of the sugar factory. It was pleaded that the claim of compensation could not be entertained against the sugar factory. 8) The parties went to trial over certain 6 issues framed below (Exh. 27) by the Commissioner. They adduced oral and documentary evidence in support of their rival contentions. 9) On merits, the learned Commissioner came to the conclusion that deceased Gurunath was employee of the appellant. The learned Commissioner held that the accidental death of Gurunath was result of nature of the work assigned to him and hence the appellant was liable to pay the compensation and penalty as described here-in-above. 10) Heard learned counsel for the parties. 11) It is necessary to examine the following two aspects of the matter : “i] Whether it is duly proved that deceased Gurunath was the employee of appellant and died during the course of accident which had reasonable casual connection with the employment? 7 ii] Whether it is duly proved that the appellant failed to pay the compensation due under the Act within one month from the date it was due and therefore, the appellant was liable to pay penalty?” 12) The record reveals that the appellant attempted to toss the liability on the sugar factory. The sugar factory, however, disowned the liability. There is absolutely no record to show that deceased Gurunath was on the pay roll of the sugar factory. Nor there is any record to show that he was employed as a daily wager. It appears that already some other construction of the residential quarters was carried out before the appellant was required to execute the construction work for eight ‘F’ type residential quarters. In order to prove employment of deceased Gurunath with the appellant, PW-1 Latabai supported her claim. She states that deceased Gurunath was working with the appellant on the day of accident. Her version purports to 8 show that he was earning daily wages of Rs. 50/-. She admits that deceased Gurunath climbed over the water tank for carrying out certain repairing work. She further admits that the appellant had undertaken the work of construction of water tank and for the sugar factory and had completed the same. She admits that the person residing in the residential quarter had asked Gurunath to repair the water tank connection. On basis of such stray admission, it is argued by the learned counsel for the appellant, that Gurunath was executing the work assigned by employee of the sugar factory and was not discharging the work of the appellant. The testimony of PW Latabai shows that Gurunath used to manage the work given by the appellant. Since she was not present at the site her stray admission of no much avail 13) The testimony of PW-2 shahaji supports the case of the claimants. He deposed that he was working as a mason on the same day, whereas deceased Gurunath was working as supervisor 9 employed by the appellant. He deposed that Gurunath was earning daily wages of Rs. 50/- per day. His version purports to show that the residential quarters meant for employees of the sugar factory were being constructed through the private contractor. He is an independent witness. There is no reason as to why he should speak lie. He has no animosity with the appellant. On the other hand, by supporting of the case of the claimants, he would have perhaps lost some opportunity of employment as a mason on work of the appellant. The learned Commissioner rightly believed his version. 14) The appellant filed his affidavit (Exh. 46) before the learned Commissioner in support of his contention that he had not employed the deceased on the date of accident. In his affidavit, the appellant categorically stated that on 29-06-2001 i.e., on the date of accident,deceased Gurunath was employed by the Sugar factory on daily wages. As stated before, 10 there is absolutely no documentary evidence to show that the deceased Gurunath, in fact, was employed by the sugar factory on daily wages at the relevant time. It is significant to note that DW-1 Rajabhau (Appellant) admitted that as and when he was in need of labour, deceased Gurunath use to work with him on daily wages. He avoided to state whether PW Shahaji was employed by him. He admits, unequivocally, that the deceased was a trust-worthy employee and in his absence, he used to repose confidence in him. He further admits that on 28-06-2001, forty bags of cement were requisitioned. He attempted to show that deceased Gurunath was not his servant on the relevant day. However, his cross-examination reveals that as and when, he used to attend the work of construction with delay, Gurunath used to manage collecting of cement, iron bars and other construction materials at place of the construction work. Such construction material was to be supplied by the Sugar factory for which authority was given to deceased Gurunath by the 11 appellant. This part of admissions of the appellant goes to show that deceased Gurunath was his trusted employee. It appears that the appellant gave evasive answers as regards employment of Shahaji with him. 15) On perusal of the testimony of DW Gopal sonar, it is explicit that deceased Gurunath was in the employment of the appellant at the relevant time. His version shows that without written order, or record no one could be employed by the sugar factory. The testimony of DW1 Sidharam is rather important. He was supervisor on the construction work of the appellant. He states that deceased Gurunath was then working with the appellant as a Manager-cum- labour. This witness is examined by the respondent No. 2 i.e. sugar factory . His cross- examination shows that PW Shahaji was employed as mason on the construction work. He supported the case of the claimants. It is true that he admitted the fact that he was brought to the 12 Court by one Shri Kamble who was in the Civil Department of the Sugar factory. That admission is of no much importance. Considering the preponderance of probabilities, the workmen’s Compensation Commissioner came to the conclusion that deceased Gurunath was in the employment of the appellant. The quantum of compensation is also properly drawn. 16) So far as penalty imposed by the Commissioner is concerned, it is worthy to be noted that the learned Commissioner did not assign any reason to justify the order of penalty. He simply observed that despite service of notice issued by the claimants, the payment was not made, and therefore, as per Section 4(A) sub clause (b) of the Workmen’s Compensation Act, 1923 the appellant was liable to pay penalty. On consideration of Section 4(A)(3)(b), it is manifest that the Commissioner is required to give finding that there is no justification for the delay in making the payment. It is only after 13 such findings that penalty could be imposed. Secondly, a proviso to sub clause (b) of Section 4(A) shows that the order cannot be passed without giving any reasonable opportunity to show cause as to why penalty be not imposed. NO such procedure was adopted by the learned Commissioner. The proviso reads as under : “ 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.” Obviously, the impugned order in respect of the penalty is not in consonance with the relevant provisions of the Workmen’s Compensation Act, 1923. 16) In the result, the appeal is partly allowed, the impugned Award is maintained to the extent of amount of compensation as payable under 14 the impugned judgment. However, the impugned order regarding payment of penalty of 25%, which was worked out Rs. 38,615/- payable in addition to the amount of compensation, stands deleted and the Award to that extent is set aside. 17) The appellant shall pay the costs of the appeal to the respondent including cost of original proceedings. 18) In view of disposal of First Appeal, Civil Application No. 8620 of 2009 does not survive and hence, stands disposed of accordingly. (V.R. KINGAONKAR, J.) SDM/FA2188.09 15