Navashankar Transport and Another vs Dhakappa Bin Subbanayak

M.P. Chinappa, J.—On 14-9-1995 at about 1.45 p.m. Dhakappa bin Subbanayak was driving the bus bearing Registration No. MEC 4803 owned by Navashankar Transport insured with the Oriental Insurance Company Limited, met with an accident and as a result of which the bus driver sustained grievous injuries such as fracture of tibia and also injury on his cheek and also on his left hand. It is not in dispute that during the course of and in the discharge of his duties, he met with an accident. On that ground, he lodged a claim petition in WC/SR.1/96 on the file of the Commissioner for Workmen''s Compensation, Shimoga. After assessing the evidence, the Commissioner has come to the conclusion that the claimant is entitled for compensation and accordingly determined the compensation in a sum of Rs. 1,23,650/- u/s 4-A of the Act. Being aggrieved by that judgment dated 30-4-1998, the owner and the Insurance Company have preferred this appeal.

Heard the learned Counsel for the appellants and the learned Counsel for the respondent.

At the very outset, the learned Counsel for the appellants has vehemently argued that the quantum of compensation determined by the Commissioner is highly excessive and exorbitant. While emphasising this argument, he submitted that the appellant has sustained only fracture of tibia and damage to his kneecap and injury on his cheek. Therefore, the compensation awarded is unreasonable and excessive. This argument is not acceptable taking into consideration the evidence of the Doctor who has clearly stated that the injured-claimant would not be in a position to drive the vehicle and he also would not be in a position to do any other work. It is clear from his evidence and as well as evidence of the Doctor that because he sustained injury to his left leg, he cannot operate the clutch, as while pressing the clutch he is experiencing pain on the left leg and he does not have sufficient strength to operate the clutch. Therefore, I hold that the disability fixed by the Commissioner does not call for interference.

The learned Counsel for the appellant has vehemently argued that the Commission has awarded compensation at 60% as per the provisions of new Act which came into force with effect from 15-9-1995 notwithstanding the fact that the accident occurred on 14-9-1995. He also further argued that that the date of accident should be taken by the claimants to claim the compensation and not from the date the new Act came into force. To substantiate his argument, he placed reliance on a decision in Oriental Insurance Co. Ltd. Vs. Majeed, , wherein Division Bench of Kerala High Court has held:

"We are inclined to accept the contention raised by appellant. Admittedly, the provisions contained under Sections 4 and 5 of the Amending Act came into force only with effect from 15-9-1995. Therefore, it has to be taken that the amendment to Sections 4 and 4-A of the parent Act has no retrospective effect from a date prior to 15-9-1995. Going by the dictum laid down by the Supreme Court in Pratap Narain Singh Deo Vs. Srinivas Sabata and Another, , it has to be taken that the liability of the employer to pay compensation accrued on the date on which the workmen suffered personal injury. Relevant date is not the date on which the amount of compensation is quantified by the Commissioner for Workmen''s Compensation. A Bench of this Court had occasion to consider the effect of the provisions of the Workmen''s Compensation (Amendment) Act, 1976, in respect of pending proceedings in Kochu Velu v Purakkattu Joseph . In that case, injury was sustained by the workman in 1972. Following the decision of the Supreme Court in Pratap Narain Singh Deo''s case, supra, this Court took the view that the right for compensation arose when the injury was sustained in 1972. Workmen''s Compensation (Amendment) Act, 1976 came into force on 21-5-1976. But Section 4 of the Amending Act which amended Schedule IV of the parent Act was given retrospective effect from 1-10-1975. This Court took the view that when the substantive law is altered during the pendency of an action, the rights of parties are decided according to law as it existed when the obligation of the employer to pay compensation arose in the year 1972, the amendment which came into effect from 1-10-1975 cannot be made applicable to pending proceeding. In Padma Srinivasan v Premier Insurance Company Limited, Supreme Court had taken a similar view while considering the liability of the insurer u/s 95(2) of the Motor Vehicles Act, 1939. The contention raised by the Insurance Company that crucial date is the date on which they entered into agreement with the owner of the vehicle and, therefore, their liability is not affected by the amendment brought to Section 95(2) by Act 56 of 1969 which came into force on 2-3-1970, was not accepted by the Supreme Court. It was held that even though the policy was issued on 30-6-1969, since the accident had happened on 5-4-1970, after the amendment had come into force, the amended provisions of Section 95(2) shall be applied. While considering the applicability of the provisions contained under the amended provisions of Section 140 of the Motor Vehicles Act, 1988, in The Oriental Insurance Co. Ltd. Vs. Sheela Ratnan and Others, , this Court also took the same view, namely, that the liability to pay compensation accrued on the date of the accident and that the law as on the date of the accident shall be applied on computing the quantum of compensation".

In this case, the accident occurred on 14-9-1995 at 1.45 p.m. The amending Act came into force with effect from 15-9-1995. In view of the decisions referred to above, which came to be rendered following the decisions of Supreme Court, I hold that the old Act is applicable as far as this case is concerned wherein the Commissioner ought to have determined the compensation multiplying by 50% instead of 60%. Therefore, if the multiplier is applied at 50% on

( 50 x 1174 x 175.54 x 100

100 100 )

the claimant is entitled for a total compensation in a sum of Rs. 1,03,312/-.

The learned Counsel for the appellants further argued that the Commissioner has awarded interest at 12% as provided under the new Act. While elaborating his argument he has drawn my attention to Section 4-A(iii) of the old Act which prescribes the rate of interest at 6% which reads:

"4-A(iii) - When any employer is under default in paying the compensation due under this Act, within one month from the date it fell due, the Commissioner may direct that in addition to the amount of the arrears, simple interest at the rate of 6% p.a. on the amount due together with, if in the opinion of the Commissioner there is no justification for the delay, a further sum not exceeding 50% of such amount, shall be recovered from the employer by way of penalty".

In this case admittedly, the appellant-owner of the bus had not deposited the amount. As I could read from this provision, the discretion of the Commissioner to award interest is at 6% and that would be the minimum. Under the circumstances, I hold that the claimant is entitled for interest only at 6%.

Accordingly the appeal is allowed reducing the quantum of compensation from Rs. 1,23,650/- to Rs. 1,03,312/- with interest at 6% p.a. instead of 12% p.a.

The Insurance Company has deposited the entire amount. The amount shall be sent to the Commissioner to make payments in accordance with the order passed. If the amount is found excess, the same shall be returned to the appellant-Insurance Company.