Oriental Insurance Co.Ltd vs Dasan And Anr

The second opposite party in W.C.Case No.346/1999, the Oriental Insurance Company has filed this appeal. The appeal was admitted on two

substantial questions of law, viz., a whether the interest imposed on the appellant from the date of accident was legally sustainable?

and

b whether the penalty ordered as per the impugned award is legally valid?

As to the first question raised, the learned counsel for the appellant conceded that liability of the Insurance Company starts from the date of

accident and conceding the legal position, a decision reported in Sabeeda Beevi v. Nazeema Thaha [2012(3) KLT 549] was submitted. That question

is, therefore, answered against the appellant.

As to the second core question raised, it was submitted that the Insurance Company being a statutory body, is not liable to be fastened with liability

for payment of penalty. A decision reported in National Insurance Company Ltd. v. Keshav Bahadur & Ors. [(2004)2 SCC 370] was relied on by the

learned counsel for the appellant in this respect.

It is also noticed that before imposing 30% of penalty as per the impugned award, the appellant was not heard in the matter. The imposition being in

violation of principle of natural justice and without being heard, I hold that the approach made by the Commissioner is erroneous. Therefore, the

impugned order requires to be modified to the extent it imposed 30% of penalty.

In the result, appeal is disposed of modifying the impugned order and setting aside the direction issued for deposit of 30% of penalty also. In other

respects, the order is kept in tact.

All pending interlocutory applications will stand closed.