FA/6561/1999 1/6 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 6561 of 1999 To FIRST APPEAL No. 6563 of 1999 For Approval and Signature: HONOURABLE MR.JUSTICE M.R. SHAH ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= UNITED INDIA INSURANCE CO LTD - Appellant(s) Versus LALSINGHBHAI JITHABHAI DAMOR (VASAVA) & 6 - Defendant(s) ========================================================= Appearance : MR VIBHUTI NANAVATI for Appellant(s) : 1, MR AR MAJMUDAR for Defendant(s) : 1 - 2. None for Defendant(s) : 3, MR MTM HAKIM for Defendant(s) : 4, 6, RULE UNSERVED for Defendant(s) : 5, RULE SERVED for Defendant(s) : 7, ========================================================= FA/6561/1999 2/6 JUDGMENT CORAM : HONOURABLE MR.JUSTICE M.R. SHAH Date : 9/05/2008 C.A.V. JUDGMENT 1. First Appeal No.6561 of 1999 under sec.30 of the Workmen's Compensation Act, 1923 (“the Act” for short) is filed by the appellant – original opponent No.6 – United India Insurance Co.Ltd. challenging the Judgement and Award dtd.21/6/1999 passed by the learned Commissioner under Act, Vadodara in Workmen's Compensation Case No.31 of 1989, in so far as directing the appellant – Insurance Company to pay penalty to the extent of 50% of the compensation and pay interest at the rate of 12% per annum on the amount of compensation from the date of accident till realisation. First Appeal No.6562 of 1999 under sec.30 of the Workmen's Compensation Act, 1923 (“the Act” for short) is filed by the appellant – original opponent No.6 – United India Insurance Co.Ltd. challenging the Judgement and Award dtd.21/6/1999 passed by the learned FA/6561/1999 3/6 JUDGMENT Commissioner under Act, Vadodara in Workmen's Compensation Case No.46 of 1989, in so far as directing the appellant – Insurance Company to pay penalty to the extent of 50% of the compensation and pay interest at the rate of 12% per annum on the amount of compensation from the date of accident till realisation. First Appeal No.6563 of 1999 under sec.30 of the Workmen's Compensation Act, 1923 (“the Act” for short) is filed by the appellant – original opponent No.6 – United India Insurance Co.Ltd. challenging the Judgement and Award dtd.29/6/1999 passed by the learned Commissioner under Act, Vadodara in Workmen's Compensation Case No.47 of 1989, in so far as directing the appellant – Insurance Company to pay penalty. 2. As the controversy raised in the present appeal is in narrow compass, this Court is not narrating the facts in detail. 3. Mr.Nanavati, learned advocate appearing on behalf of the appellant has vehemently submitted that the learned Commissioner has materially erred in directing the FA/6561/1999 4/6 JUDGMENT appellant Insurance Company to pay 50% penalty. It is submitted that as held by the Hon'ble Supreme Court in the case of Ved Prakash Garg Vs. Premi Devi and others, reported in AIR 1997 S.C. 3854, Insurance Company cannot be held liable to pay penalty as provided under sec.4-A(3)(b) of the Act. He has also further submitted that as the accident has taken place in the year 1986 i.e. prior to the Amendment Act of 1996, interest on the delayed payment of compensation would be 6% per annum and therefore, the learned Commissioner has committed an error in awarding interest at the rate of 12% per annum. He has also relied upon the decision of the Hon'ble Supreme Court in the case of Kerala Electricity Board and another Vs. Valsala K., reported in AIR 1999 S.C. 3502. No other submissions have been made by the learned advocate appearing on behalf of the appellant. 4. Mr.AR Majmudar and Mr.MTM Hakim, learned advocates appearing on behalf of the respective respondents – original claimants are not in a position to show any contrary judgement and/or any other judgement taking a different view than the view taken by the Hon'ble FA/6561/1999 5/6 JUDGMENT Supreme Court in the case of Ved Prakash Garg (supra) and Kerala Electricity Board and another (supra). 5. Under the circumstances and considering the judgement of the Hon'ble Supreme Court in the case of Ved Prakash Garg (supra) and Kerala Electricity Board and another (supra), the learned Commissioner has committed an error in directing the appellant – Insurance Company to pay penalty and also to pay interest at the rate of 12% per annum. Considering the fact that the accident in question has occurred in the year 1986, the claimant would be entitled to interest at the rate of 6% per annum, prevailing at the relevant time. 6. For the reasons stated above, the appeals succeed in part. The impugned Judgement and Award passed by the learned Commissioner under Act, Vadodara in Workmen's Compensation Case Nos.31/89, 46/89 & 47/89 dtd.21/6/1999, 21/6/1999 and 29/6/1999, respectively, are hereby quashed and set aside in so far as directing the appellant – Insurance Company to pay penalty and the rate of interest is reduced from 12% to 6% and that the original claimants would be entitled to interest at FA/6561/1999 6/6 JUDGMENT the rate of 6% per annum on the delayed payment of compensation from the date of accident till 15/9/1995, the day on which amendment came into force in the Act and the rate of interest on the amount of compensation would be 12% per annum from 15/9/1995 till realisation. Consequently, the appellant – Insurance Company would be entitled to get back/recover the differential amount of penalty already deposited. If any excess amount is deposited by the appellant before the learned Commissioner, in view of the final order passed in this appeal, the said amount be refunded by the learned Commissioner to the appellant on making a request. The appeals are allowed to the aforesaid extent only. In the facts and circumstances of the case, there shall be no order as to costs. [M.R. SHAH, J.] rafik