c -^ Vl' BEFORE THE HON'BLE HIGH COURT OF CHHATTISGARH, AT BILASPUR MISC. APPEAL (C) No. /7' r2-'^OF 2009 APPELLANT(S) : Manoj Gupta, S/o. Ram Vishal Gupta, aged NON APPLICANT N0. 1 about 38 years,. working as Electrical ^ J^ Contractor, R/o. Colony - Civil Line, ^.y-.v-"t ^\c...y Tahsil - Khairagarh, Distt. Rajnandgaon ^s^ '^••••^ >»'»* (C.G.) VERSUS RESPONDENTS CLAIMANTS 1. Dukhiya Bai, Widow of Hemant Kumar, aged about 27 years 2. Tikesh Ram, S/o. Late Hemant Kumar, aged about 7 years 3. Ku. Pooja, D/o. Late Hemant Kumar, aged about 2 years Respondent No. 2 & 3 are minor represented by their mother (Guardian) Dukhiya Bai, Widow of Hemant Kumar, 4. Janak Lal, S/o. Late Balaram, aged about 52 years, 5. Hemeen Bai, W/o. Janak'TLal, aged about 47 years, -" Respondent No. 1 to 5 all R/o. Village - Gahiratola, P.0. - Devari, Thana &, tahsil - Khairagarh, Distt. Rajnandgaon [Q.^ NON-APPLICANT N0. 2 6. Executive Engineer, Chhattisgarh Electricity Board, Office - KhairagarhE^ Distt. Rajnandgaon (C.G.) 2- NON-APPLICANT N0. 3 7. Kiunar Lal Uaikey, S/o. Videshi Ram Uaikey, aged about 37 years, working as Junior Engineer, Chhattisgarh Electricity Board, Office - Pandhadah, TahsU 85 Thana - Khairagarh, Distt. Rajnandgaon (C.G.) APPEAL UNDER SECTION 30 OF THE WORKMEN COMPENSATION ACT 1923 ^I. / /I • yV '.?..- 1 ^ HIGHCOURT OF CHHATTISGARH AT BILASPUR Single Bench: Honlble ShrLJustice Prashant Kumar IVIishra IVIiscellaneous Appeal (C.) No.1228 of 2009 Manoj Gupta versus Dukhiya Bai and others •IVIiscellaneous Appeal (C.) No.1273 of2009 Chhattisgarh State Power Distribution Company Limited vereus Dukhiya Bai and others IVIiscellaneoys Appeal (C.) No.1309 of 2009 Dukhiyabai and others versus Manoj Gupta and others ORDER Postfor 27-8-2010 'Sd/- prashantKumarMishra . Judge .-l»sac!K'St^ ^e"~^.... "'^ ,/^s- ''\ f( ....S& 1 f.tesfilSSss ": i;VWfi"~t i ^ta.o'"" ^ HIGH COURTOFCHHATTISGARHATBILASPUR Sinole Bench; Hon'ble Shri Justice Prashant Kumar 1'flishra Appellant IVIiscellaneous Appeal (C.LNo.1228 of 2009 Manoj Gupta versus Resp_onden.ts Dukhiya Bai and others Present: Shri Manik Singh, counsel forthe appellant. Shri Abhishek Sharma, counsel for respondents No.1 to 5. Shri P.S.Koshy, counsel for respondent No.6. Mjscellaneous Appeal under Secticn 30 of the Workmen's Compensation Act, 1923 MisceUaneousAppeal (C.) No.1273 of 2009 Appellant versus Respondents Chhattisgarh State Power Distribution Company Limited Dukhiya Bai and others Present: Shri P.S.Koshy, counsel forthe appellant. Shri Abhishek Sharma, counsel for respondents No.1 to 5. Shri Manik Singh, counsel for respondent No.6. Miscellaneous Appeal under Section 30 of the Workmen's Compensation Act, 1923 Miscellaneous Appeal (C.) No.1309 of 2009 Appellants Dukhiyabai and others versus Respondente Manoj Gupta and others 'iiSSSS^V! ^ Present: Shri Abhishek Sharma, counsel for the appellants. Shri Manik Singh, counsel for respondent No. 1. Shri P,S,Koshy, counsel for respondent No.2. Mjscellaneous Appeal under Section 30 ofthe Workmen's Compensation Act, 1923 ORDER (Passed on J^August, 2010) 1. By this common order, Miscellaneous Appeal (C.) No.1228/2009 filed by the contractor/employer, Miscellaneous Appeal (C.) No. 1273/2009 filed by the alleged principal employer and Miscellaneous Appeal (C.) No. 1309/2009 filed by the claimants are decided analogously. IVIiscejlaneoys Appeal (C.) No.1228/2009 and Miscellaneous Appeal (C.) No.1273/2009 2. These two appeals are preferred by the employer and the principal employer respectively. 3. The Commissioner for Workmen's Compensation, Labour Court, Rajnandgaon (hehceforth 'the Commissioner') has awarded compensation of Rs.2,59,975/- together with the default interest at the rate of 10% if the amount is not deposited within one month, both the amounts being payable by the appellants have been passed by the Commissioner. 4. The claimants, who are the widow, the minor son, the minor daughter and the parents of the deceased Hemant Kumar, have ^-fifeferred the claim petition before the Commissioner on the submission inter alia that the appellant Manoj Gupta (henceforth 'the contractor') is the registered contractor with the Chhattisgarh State Electricity Board, the appellant Chhattisgarh State Power Distribution Company Limited (henceforth 'the Company') being its successor in interest and was obtaining contracts for providing connection for supply of electrical energy to the consumers of the Company. The contractor had engaged the deceased for performing the job of installation of poles, laying of electrical line etc. as a labour on monthly wages of Rs.2,500/-. It was alleged that on 12-5-2006, the contractor, on the orders of the officers of the Company, who were arrayed as non- applicants No.2 and 3 in the claim petition, directed the deceased to provide single line connection to the consumers. At that time, the deceased was working with other labourers, namely, Manik Verma, Vishnu Verma and Hemu Verma, When the deceased climbed-up the electric pole for connecting the wire, he received electric shock and fell down and was taken to a hospital where he was declared dead. According to the claimants, the officers of the Company were negligent by not disconnecting the power supply at the time of performance of the job by the deceased and, therefore, the contractor and the Company are liable to pay compensation of Rs.5 Lakhs together with penalty and interest as admissible under the Workmen's Compensation Act, 1923 (henceforth 'theAct'). ^^ 5, The contractor fiied his reply and stated that he was.only engaged in providing etectrical fittings for singte line connection and "ihat the installation of electric meter and connecting it to the line was f-c |)one by the Company. He denied to have employed the deceased V-. and that he was not given any job or contract by the Company for Pipalakachhar Village where the incident has taken place. 6. Non-Applicant No.2 before the Commissioner was arrayed as the Executive Engineer, Chhattisgarh State Electricity Board, Office Khairagarh. The said officer filed reply on behalf of the Company to submit that the contractor was awarded work order to perform thework at Village Pandadah on 14-3-2006 in which the name of Pipalakachhar was not mehtioned as there was no consumer enlisted from the said village. Thus, the case of the Company through the Executive Engineer is that with respect to the subject work at Village Pipalakachhar, the contractor was not engaged by the Company. It was specifically pleaded by the Company that it appears that the contractor had engaged the deceased for erection of single line connection to acquire unlawful pecuniary advantage for which the Company cannot be held liable. The Junior Engineer of the Company, who was arrayed as non-applicant No.3 before the Commissioner, contested the claim by filing a separate reply. According to him, he was informed about the incident when he had gone to attend the meeting at Khairagarh and was not present at the spot as alleged by the contractor and that on humanitarian considerations he had gone to the spot subsequently. 7. The Commissioner has found that the contractor as well as the Company are jointly responsible for payment of compensation, as, according to the Commissioner, the contractor was engaged by the '1^~ Company, which is proved from thestatement ofwitnesses. ^ru!\. //^^\ lfe» l^ ^;•• 8. Learned counsel for the contractor has argued that the finding recorded by the Commissioner that the deceased was engaged by the contractor is perverse and that he is not liabie to pay compensation. 9. Learned counsel for the Company has argued that the contractor was not awarded any work order with respect to Village Pipalakachhar, therefore, the Company cannot be held liable on the ground that the Company was the principal employer. According to the learned counsel, the' contractor wanted to obtain unlawful gain and, therefore, he was performing the work of his own for which the Company cannot be held liable. 10. From the replies filed by the contractor, the Executive Engineer and the Junior Engineer of the Company, it would be apparent that the contractor is shifting the burden on the Company by submitting that he was acting under the instructions of the Junior Engineer, whereas the Executive Engineer has stated that the contractor was performing the work of his own. On a reading and appreciation of the statement of fellow labourer Manik Verma, it would be clear that he, along with the deceased, was employed by the contractor for providing single line connection to the consumers. He has stated that on the date of accident, the contractor as well as the Junior Engineer were present on the spot and Hemant Kumar climbed-up the electric pole on the instructions of the Junior Engineer and the contractor. He has also stated that he was taken to the Khairagarh Hospital on a vehicle belonging to the Company. Even in the cross-examination, he has stated that he was engaged by the contractor and the Junior Engineer. Witness Bhukhan is the person in whose house the single line .-''^"^'^ •y--^. -^ in.,.«®!fe.% :?Sgs^BiS I •'i-.-.e/ £' "s,;... '"..^ ""'Ss.x"'1'' s Jt->. connection was to be provided on the date of accident. In his statement, he has clearly stated that the contractor as well as the Junior Engineer of the Company had come to the village and were supervising the work of providing single line connection. He was the person who was holding the ladder when the deceased climbed-up the electric pole. This witness has also remained unshaken during his cross-examination and has maintained his statement that the contractor as well as the Junior Engineer were present on the spot and that the deceased was taken to the Khairagarh Hospital on the vehicle belonging to the Company. 11. The finding recorded by the Commissioner that the deceased was working under the contractor, who was engaged by the officers of the principal employer for providing single line connection to the consumers is, thus, found to be in accordance with the evidence available on record and there is absolutely no illegality or perversity in the said finding. 12. The argument of learned counsel for the Company that in absence of the work order for the Village Pipalakachhar, the Company cannot be held liable, has no force because providing connection for supply of electric energy to a consumer is the monopoly of the Company. A contractor or any other person cannot perform the work unless he is instructed by the Company or its officers. The fact that the contractor was, in fact, awarded a work order though for a different village, goes to establish that the contractor was engaged by the principal employer, i.e., the Company and that he is not a stranger vis- d-vis the Company. Since the officer of the Company was present on ? f-f the spot at the time when the connection was provided in the house of witness Bhukhan itself goes to establish that the contractor was acting under the instructions and directions of the Company. Thus, there is no error committed by the Commissioner while holding the Company to be responsible for payment of compensation. 13. Consequently, Miscellaneous Appeals (C.) No.1228/2009 anc' 1273/2009 filed by the contractor and the Company respectively are dismissed. 'There shall be no order as to costs. Miscellaneous Appeal fC.) No.1309/2009 14. In this appeal, the contention of learned counsel for the appellants/claimants is that the Commissioner should have awarded interest and the penalty under Section 4A of the Act. Learned counsel has relied on the judgments in Secretary, Trivandrum Port and Headload Workers Co-Operative Society Ltd. vs. V. Dhanesh Kumar alias Thampi and another, 2001 (3) TAC 280 (Kerala), Oriental Insurance Co. Ltd. vs. Santhi and others, 2006 (1) TAC 264 (Madras) and Marimuthuammal and another vs. R.P.P. Construction (P) Ltd. andothers, 2008 ACJ 2788 (Madras). 15. Section 4A(3) of the Act provides as under: "4A.: Compensation to be paid when due and penalty for default.— (1) xxxxx xxxxx xxxxx (2) xxxxx xxxxx. ' xxxxx (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- ~\; "T.- 8 (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 fiffy 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. Explanafion.— 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 (2 of 1934)," 16. Learned counsel for the appellants/claimants submits that the compensation fell due on the date of accident and since the employer has not paid the compensation within one month and thereafter in spite of seFvice of notice, the appellants/claimants are entitled to interest under clause (a) and penalty under clause (b) of sub-section (3) of Section 4A of the Act. In a recent judgment in Orlental Insurance Co. Ltd. vs. Mohd. Nasir and another,.AtR 2009 SC (Supp) 1619, the Hon'ble Supreme Court has held in paragraph 23 ofthe report thus: "23. The said provision, as it appears from a plain reading, is penal in nature. It, however, does not fake info f-c consideration the chargeability of interest on various other grounds including the amount which the claimant would have earned if the amount of compensation would have been determined as on the date of filing of the claim petition. Workmen's Compensation Act does not prohibit grant of interest at a reasonable rate from the date of filing of the claim petition till an order is passed. Only when sub-section (3) of Section 4A would be attracted, a higher rate of interest would be payable wherefor a finding of fact as envisaged therein has to be arrived at. Only because in a given case, penalty may not be held to be leviable, by itself may not be a ground not to award reasonable interest. Reliance has been placed on Mubasir Ahmed (supra), wherein it was held: "8. 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 4A was dealt with by this Court in Maghar Singh v. JashwantSingh t(1998) 9 SCC 134]. By Amending Act, 14 of 1995, Section 4A of the Act was amended, inferalia, fixing the minimum rate ofinterest fo 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 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 4A(1) presa-ibes that compensation under Section 4 shall be paid as soon as it- falls due. The compensation hecomes 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 compensatlon becoming 10 due does not arise. The position becomes clearer on a reading of Sub-section (2) of Section 4A. 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 not used the expression "from the date of accident". Unless there is an adjudication, the question of an amount falling due does not arise." As therein this aspect of the matter has not been considered, we are of the opinion that interest will also payable at the rate of 7%% per annum from the date of filing of the application till the date of award. The rate of interest thereafter shall be pgyable in terms of the order passed by the Commissioner." 17. In view of the pronouncement made by the Hon'ble Supreme Court in the above referred case, the appellants/claimants are not entitled to the interest under Section 4A(3)(a) of the Act and the penalty under Section 4A(3)(b) of. the Act, however, in the above referred case, the Hon'ble Supreme Court has held that the Act does not prohibit grant of interest at a reasonable rate from the date of the filing of the claim petition till an order is passed. It is further held that Section 4A(3)(a) of the Act contemplates a higher rate of interestwhen default is made and that only because in a given case penalty may not be hetd to be leviable, by itself may not be a ground not to award reasonable interest. The Hon'ble Supreme Court ultimately granted interest at the rate of 7%%. In the present case, the appellants/claimants are young widow, minor son and minor daughter of the deceased along with the parents. This Court, therefore, deems it fit to allow interest on the claim awarded by the Commissioner at the 11 rate of 8% per annum from the date of presentation of the claim petition. 18. In the result, Miscellaneous Appeal (C.) No.1309/2009 is partly allowed. The appellants/claimants shall also be entitled to interest at the rate of 8% per annum on the award amount from the date of presentation ofthe claim petition. There shall be no order as to costs. Sd/- Prashant Kumar Mishra Judge OopBl