FA/2181/2007 1/18 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 2181 of 2007 For Approval and Signature: HONOURABLE MR.JUSTICE H.K.RATHOD ========================================================= 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 ? ========================================================= THE NATIONAL INSURANCE CO. LTD. - Appellant(s) Versus ANISHABIBI HARUN DILAWAR PIJARI & 6 - Defendant(s) ========================================================= Appearance : MS LILU K BHAYA for Appellant(s) : 1, MRS SANGEETA N PAHWA for Defendant(s) : 1,5 - 6. None for Defendant(s) : 2 - 4. MR MTM HAKIM for Defendant(s) : 7, ========================================================= CORAM : HONOURABLE MR.JUSTICE H.K.RATHOD Date : 24/12/2008 ORAL JUDGMENT 1.Heard learned advocate Ms. LK Bhaya on behalf of appellant – National Insurance Co. Ltd, learned advocate Ms. SN Pahwa appearing for respondent claimants and learned advocate Mr. FA/2181/2007 2/18 JUDGMENT Hakim appearing for respondent no. 7. 2.In this appeal, appellant insurance company has challenged order passed by Workman Compensation Commissioner Surat in Review application no. 2/2005 original application (fatal) no. 95/2004 dated 5/9/2004. The Commissioner has reviewed order dated 23/2/2005 exh 33. Initially, Commissioner has directed to recover amount of compensation from Employer respondent no. 7 but after considering review application, Commissioner has directed to insurance company to pay entire amount together with costs and interest to claimants and penalty amount is to be paid by employer. 3.Learned advocate Ms. Bhaya relied upon one decision of Division Bench of Allahabad High Court in case of Oriental Insurance Co. Ltd Vs. Sanjay Kumar and Ors reported in 2007 (113) FLR 1013 and raised contention that Commissioner under provisions of Workmen Compensation Act 1923 has no jurisdiction to review his own order and passed order in review application is without jurisdiction. 4.Against that, learned advocate Ms. Pahwa appearing for respondent claimants relied upon decision of Punjab and Hariyana High Court reported in 1985 LabIC page 519 and decision of Apex Court reported in 2003 AIR FA/2181/2007 3/18 JUDGMENT SCW page 92, where Apex Court has considered order 47 Rule 4, power of review is possessed by claims Tribunal or not? She also relied upon Rule 41 of Workmen Compensation Act and submitted that under Rule 41, Commissioner has power to review its own order, which is quoted as under: “Certain Provions of Code of Civil Procedure, 1908, to apply.- Save as otherwise expressly provided in the Act or these Rules the following provisions of the First Schedule to the Code of Civil Procedure 1908, namely, those contained in Order V, Rules 9 to 13 and 15 to 30: Order IX, Order XIII, Rules 3 to 10: Order XVI, Rules 2 to 21; Order XVII; and Order XXIII, Rules 1 and 2, shall apply to proceedings before Commissioners, in so far as they may be applicable thereto: Provided that- (a)for the purpose of facilitating the application of the said provisions the Commissioner may construe them with such alterations not affecting the substance as may be necessary or proper to adapt them to the matter before him; (b)the Commissioner may, for sufficient reasons, proceed otherwise than in accordance with the said provisions if he is satisfied that the interest of the parties will not thereby be prejudiced.” 5.I have considered submission made by both learned advocates and I have also perused order passed by Commissioner in review application. Rule 41 where order 47 Rule 1 has not been included while giving power to Commissioner under Act of Civil Procedure FA/2181/2007 4/18 JUDGMENT Code. The decision which has been relied by learned advocate Ms. Pahwa in respect to bonafide mistake committed by Commissioner applying unamended provisions and not applied amended schedule, which is to be corrected that can not consider to be reviewed, but in decision of Apex Court as referred above, Apex Court has considered power of review of claims Tribunal but not considered question that whether Commissioner under Workmen Compensation Act has power to review earlier order or not? 6.This question has been considered by Allahabad High Court in detailed and after examining in detailed, considering Rule 41 of Workmen Compensation Act. The following observation has been made by Division Bench of Allahabad High Court in para 5 to 8, which are quoted as under: “5. According to us, statutory power of review is prohibited to the Commissioner. So far as inherent power of the Civil Court as under section 151 of the Code of Civil Procedure is concerned, that also cannot be applied in the case of Commissioner under the Workmen's compensation Act. Therefore, excepting accidental slip or omission, a Commissioner cannot possess any power of review as available to the Civil Court. Therefore, either second order passed by the Commissioner is an order without having any authority of the Commissioner FA/2181/2007 5/18 JUDGMENT or the same is made in the grab of an application for correction. From the plain reading of the order and consideration of various judgements it does not seem that the order is passed for correction of any accidental mistake or omission, but a complete order of review that too at the instance of third party/ claimant. Third party/claimant cannot be said to be aggrieved by the order since he will get his entitlement of compensation and interest, if any, accrued thereon either by the owner or by the insurance company. Hence, the order is totally misconceived in nature. 6. In Patel Narshi Thakershi and others v. Pradyumansinghji Arjunsinghji, a three Judges Bench of the Supreme Court held that it is well settled that the power of review is not an inherent power. It must be conferred by law wither specifically or by necessary implication. Learned counsel appearing for the respondents contended that if the Court finds that he order was passed under a mistake and it would not have exercised the jurisdiction but for the erroneous assumption which in fact did not exist and its perpetration shall result in miscarriage of justice then it cannot on any principle be precluded from rectifying the error. Mistake is accepted as valid reason to recall an order. Difference lies in the nature of mistake and scope of rectification, depending on the fact or law. But the root from which the power flows is the anxiety to avoid injustice. Review literally and even judicially means re examination or re consideration. Basic philosophy inherent in it is the universal acceptance of human FA/2181/2007 6/18 JUDGMENT fallibility. Yet in the realm of law the Courts and even the statutes lean strongly in favour of finality of decision legally and properly made. Exceptions both statutorily and judicially have been carved out to correct accidental mistake or miscarriage of justice. In Ved Prakash Garg Vs. Premi Devi and others.' a question arose before the Supreme Court whether the phrase “liability arising under the Compensation Act” as employed by the proviso to subsection (1) of section 147 of the Motor Vehicles Act and as found under the proviso to Clause (i) of sub section (1) of section II of the Insurance policy, would cover only the principal amount of compensation as computed by the Workmen's Commissioner under the Workmen's compensation Act and made payable by the insured employer or whether it can also include interest and penalty as imposed on the insured employer under contingencies contem- plated by section 4-A(3)(a) and (b) of the Compensation Act. The Court held that unlike section 147 of the Motor Vehicles Act Section 4-A(3)(a) of the Act,1923 contemplates that liability to pay interest on the principal amount under the said provision remains a part and parcel of the statutory liability, which is legally liable to be discharged by the insured employer. Thus, the principal amount as well as the interest made payable thereon would remain part and parcel of the legal liability of the insured to be discharged under the Compensation Act and not de hors it. It therefore, cannot be said by the insurance company that when it is statutorily and even contractually liable to reimburse the employer qua his FA/2181/2007 7/18 JUDGMENT statutory liability to pay comparable to the claimants in case of such motor accidents to his workmen, the interest on the principal amount which almost automatically gets foisted upon him once the comparable amount is not paid within one month from the date it fell due, would not be a part of the insured liability of the employer. In New India Assurance Co. Ltd Vs. Harshadbhai Amrutbhai Modhiya and another, the Supreme Court further held that a contract of insurance is governed by the provision of the Insurance Act. Unless the said contract is governed by the provision of a statute, the parties are free to enter into ac contract as for their own volition, the Act does not contain a provision like section 147 of the Motor Vehicles Act. It was further held that a policy of insurance has, therefore, to be construed like any other contract. On a construction of the contract in question it is clear that the insurer had not undertaken the liability for interest and penalty, but had undertaken to indemnify the employer only to reimburse the compensation the employer was liable to pay among other things under the Workmen's Compensation Act. Unless one is in a position to void an exclusion clause concerning liability of interest and penalty imposed upon the insured on account of his failure to comply with the requirements of the Workmen's Compensation Act, 1923, the insurer cannot be made liable to the insured for those amounts. In this situation, the obligation of the insurance company clearly stands limited and the relevant proviso providing for exclusion of liability for interest or penalty has to FA/2181/2007 8/18 JUDGMENT be given effect to. Unlike the scheme of the Motor Vehicles Act the Workmen's Compensation Act does not confer a right on the claimant for compensation under the Act to claim the payment of compensation in its entirety from the insurer himself. 7. Therefore, in totality we are of the view that it if very difficult to construe that the insurance company is liable to pay interest on compensation as under the Motor Vehicles Act without the specific clause under the contract of insurance itself. Contract of insurance is not available to us. Therefore, we have to go by the statute and the legal interpretations, which does not sound the subsequent order passed on the basis of Single Bench Judgement of this High Court can be stated to be correct interpretation when the earlier order was passed on analysis of the aforesaid judgement/s. 8. Be that as it may, can this interpretation by a subsequent order of the Workmen's Compensation Court be said to be correction of the inherent mistake? Our answer is “No”. It is not a correction of inherent mistake but reconsideration of the case of payment of interest by the insurance company in the place and instead of the owner on the wrong appreciation of law and without any authority that too at the instance of third party/claimant/s. Therefore, such order being dated 12th February, 2007 cannot be held to be sustainable at all and is hereby set aside.” 7.The similar view taken by Rajasthan High FA/2181/2007 9/18 JUDGMENT Court in case of Uttam Chand Gangwal Vs. Commissioner, W.C.C. Act, Ajmer and others reported in 2008 (117) FLR 1083. The relevant observations made in para 8 to 11 are quoted as under: “8. In this regard, learned Counsel for the petitioner referred Rule 41 of Workmen's Compensation Rules, 1924. The Statute provides that certain provisions of Code of Civil Procedure, 1908 to apply Save as otherwise expressly provided in the Act or these rules the following provisions of the First Schedule to the Code of Civil Procedure, 1908 and they are applicable thereto: (a)for the purpose of facilitating the application of the said provisions the Commissioner may construe them with such alterations not affecting the substance as may be necessary not affecting the substance as may be necessary or proper to adapt them to the matter before him; (b)the Commissioner may for sufficient reasons, proceed otherwise than in accordance with the said provisions if he is satisfied that the interest of the parties will not thereby be prejudiced. 9. Section 21 of General Clauses Act, 1807 also relied upon by the learned Counsel for the petitioner, which deals with the provisions applicable to make of rule or bye laws after previous publication. As per section 21, the authority is having power to issue, to include power to add to amend, vary or rescind, notifications, orders, rules of bye laws. FA/2181/2007 10/18 JUDGMENT 10. The analogous provisions of section 23 of Rajasthan General Clauses Act 1955 also provides power to make or issue to include power to add, to amen, vary or rescind orders. 11. Upon careful perusal of provisions of Rule 41 of Workmen's Compensation Rules, 1924 and section 21 of Central General Clauses Act, 1897 certain provisions of Code of Civil Procedure can be applied to proceed before the Commissioner, but the discretion was also given to the Commissioner and when applying the principles of CPC, the Commissioner may for sufficient reasons proceed otherwise than in accordance with other provisions if he is satisfied that the interest of the parties will not thereby be prejudiced. Meaning thereby, the Rule 41 is discretionary power given to the Commissioner. Similarly, the Central General Clauses Act and the Rajasthan General Clauses Act gives power to make or issue to include power to add, to amend, vary and rescind orders. It is for the authorities to confer power by adding or amending or rescinding the orders as per procedure laid down under the Act. Admittedly there is no power of review of the award.” 8.In case of Swapnil Enterprises Vs. Chandrakala w/o Kashiram Kawale & Ors reported in 2004 II CLR page 1033, the High Court of Bombay (Nagpur Bench) has taken view in para 5, 6, 12, 13 and 14, which are quoted FA/2181/2007 11/18 JUDGMENT as under: 5. Ms. Joshi, the learned counsel for the respondent Nos. 1 to 4 contended that the revision application itself is not maintainable because there is no statutory provision in the Act by virtue of which the Commissioner could have exercised his powers of review. She contended that the Commissioner can not exercise powers of review unless the statutes specifically confers such powers, and therefore, the review application was not maintainable. In support of this submission, she relied on the decision of Supreme Court in the case of P. N. Thakershi Vs. Pradhyumansinghji, AIR 1970 SC 1273 and also on the decision of Madhya Pradesh high Court in the case of Abdul Majid vs. Union of India, 1987 (1) TAC 63. 6. She further contended that the review application not maintainable because there is specific provisions in the act which provides appeal under Section 30 of the Act but the petitioner instead of filing appeal filed the said review application. 12. In P. N. Thakershi Vs. Pradymansinghji, AIR 1970 SC 1273, it has been observed by the Supreme Court that there is no provision in the Act from which the power of State Government to review its order under section 63 can be gathered. It is obvious that the Commissioners functioning as delegates of its functions under section 63 cannot review its order. 13. The Madhya Pradesh High Court in the case of Abdul Majid Vs. Union of India, FA/2181/2007 12/18 JUDGMENT 1987 (1) TAC 63 held that the powers of review could not readily be inferred as inherent in any Court unless the statutes specifically confer such powers and Commissioner appointed under the Workmen's Compensation Act, does not enjoin power of review. 14. In view of the observations mentioned above coupled with the provisions of section 6 and 30 of the Act, it would clearly, reveal that review application itself was not maintainable before the Commissioner. The contention of the learned counsel for the petitioner that review application was maintainable in view of the case of Mahendra Kumar Vs. Real Feb Autonagar, 1997 I CLR 79 cannot be accepted because the said decision has no bearing on the facts and circumstances of the present case. Thus, this Court is of the considered opinion that the review application before the Commissioner was not maintainable and the impugned order passed by him is without jurisdiction. The fact remains that the employer did not prefer any appeal against the order passed by the Commissioner on 19/10/2001, and therefore, no case has been made out for interference by this Court into the said order dated 19/10/2001.” 9.As well as Bombay High Court has also decided similar question for review in case of Shikshan Prasarak Mandal, Akola and Ors Vs. Laxmikant Balkrishna Joshi and Others reported in 2004 (102) FLR 805. Relevant observation made in head note as well as in FA/2181/2007 13/18 JUDGMENT para 23 and 24 are quoted as under: “Review- Power of review is creature of Statute- Therefore, unless it is specifically conferred on the Court by the Statute – It cannot be invoked – Power of review cannot be generalised.” 23.In the case of Raghunath Gambhirshet Vs. Ganpat Motiram and others, the question, which fell for consideration of this Court, was whether the Tribunal has jurisdiction to review its own order. It was not in dispute that under the Bombay Revenue Tribunal Act (12 of 1939), Bombay Revenue Tribunal was set up and its powers and functions were defined in section 4 of the said Act. Similarly, section 7 of the Act, in terms, expressly conferred upon the Tribunal power of review. The contention, which was advanced in the said case before the Division Bench, was that section 7 is limited by section 4 and the power of review is only conferred upon the Tribunal, which exercises the powers and functions mentioned in section 4 and therefore, though the legislature, at a later point of time, conferred revisional powers upon the Revenue Tribunal, under section 76 the legislature did not confer upon the Tribunal the power to review its own decision rendered in exercise of these revisional powers under section 76 and it was not open to the Tribunal to fall back upon section 7 in order to find jurisdiction to review its own decision. On the backdrop of this controversy, the Division Bench in case of Raghunath Gambhirshet (cited supra) in para 2 observed thus: “In our opinion that is not the proper interpretation to put upon section 4 and section 7 of the Act 12 of 1939. That FA/2181/2007 14/18 JUDGMENT act sets up a new Tribunal and section 7 confers upon that Tribunal generally certain power, viz, the power and jurisdiction to review its own decisions. Section 4 defines its functions and so long as this Act stood on the statute book, the only functions which the Tribunal could discharge were the functions mentioned in section 4 and in discharging those functions, it could exercise the power of review conferred upon it under section 7. But when the Tenancy Act was passed, further functions were allocated to the Tribunal, and one of those functions was the power to act as a revisional body in certain tenancy matters specified in the Tenancy Act. But when the functions of the Tribunal were increased, the Tribunal still had the power to review its decisions conferred upon it under section 7. The power to review conferred upon it under section 7 was not limited to the exercise of the functions enumerated in section 4 but that power attached to the Tribunal as such and it could always be exercised by the Tribunal, whatever powers might be conferred upon it from time to time. Therefore, the power to review is the power that attaches to the Tribunal as such irrespective of what jurisdiction may be conferred upon it from time to time by the legislature. Therefore, it would not be correct to say that as section 76, Tenancy act conferred a new power upon the Tribunal that power had to be exercised without the power of review conferred upon it under section 7.” 24.The above referred observations made by this Court in para 2 of its judgement clearly reveal that power of review was FA/2181/2007 15/18 JUDGMENT conferred on the Tribunal under section 7 of the Act and, therefore, merely because the jurisdiction of the Tribunal was increased by conferring on it revisional powers under section 76, it was not possible to restrict the power of review to section 7 only i respect of powers and functions of the Tribunal as defined in section 4 of the Act and the Division Bench, therefore, held that when the Tribunal exercises its revisional power under section 76, the Tribunal has power to review its decision. There is no quarrel with the proposition of law laid down by this Court in the above referred judgement. However, the analogy is based on the scheme of provisions of Tenancy Act. Where the power of review of its own order already existed in the Tribunal vide section 7 of the Act and the question was whether it was restricted only in respect of the powers and functions the Tribunal exercised as defined in section 4 or the same can also be extended to the revisional jurisdiction which was conferred on the Tribunal by the legislature at the later point of time vide section 76, which becomes one of the functions and powers of the Tribunal and, therefore, Their Lordships have held that Tribunal is entitled to review its own order passed under section 76 of the Act. In the case in hand, there is a clear line of demarcation between the jurisdictions Division Bench exercises and the Full Bench exercises while answering the question of reference on the point of law. These powers and jurisdictions are distinct and separate and are exercised by the High Court in altogether different fields one is under Article 226 of the Constitution of and the other is in advisory/consultative jurisdiction. It FA/2181/2007 16/18 JUDGMENT is, no doubt, true that High Court is entitled to review its order, which is passed in exercise of power/jurisdiction under Article 226 of the Constitution, since power to review is in built therein. However, the same cannot be extended in respect of the orders passed by the High Court under any other power or jurisdiction unless it is specifically provided and conferred on the High Court under the said law or statute. In other words, we cannot generalize the power of review and cannot extended it to the orders passed by the High Court under power or jurisdiction other than under Article 226 of the Constitution. If it is not provided, nor conferred on the High Court under the said Act or statute, merely because the same is inherent in respect of the orders passed by the High Court under Article 226 of the Constitution. It is well settled that power of review is the creature of statute and, therefore, unless it is specifically conferred on the Court by the statute, it cannot be invoked, with the only exception the order passed by the High Court under Article 226 of the Constitution. Therefore, power of review cannot be generalised or extended in respect of the orders passed by the High Court under the jurisdiction other than Article 226 of the Constitution. We are, therefore, of the view that the law laid down by this Court in the case of Raghunath Gambhirshet (cited supra) is not of much help to the applicants.” 10.In view of decision of Division Bench of Allahabad High Court as well as above referred decisions, which are squarely FA/2181/2007 17/18 JUDGMENT