The Municipal Committee vs The National Insurance Company

K. Kannan, J.—The questions of law that arise for consideration in the appeal are: (i) Whether the Insurance Company could have been

exonerated from liability when there was proof that the deceased, who was driving the vehicle, had a valid driving licence at the relevant time? (ii)

Whether the Workmen Compensation Commissioner was justified in applying the scales of compensation under the MV Act when he was bound

to apply the provisions of the WC Act for determining the extended compensation? The status of the deceased as a workman and the accident

resulting in his death are admitted facts. The vehicle involved was a tractor and that it had been insured for the statutory liability to a workman with

the Insurance Company is also admitted. The defence at the trial was that the deceased was a water cleaner and he was not authorized to drive the

tractor and consequently, the employer cannot be made liable. The defence was squarely in conflict with Section 3 of the WC Act which made

certain the employer''s liability even if the workman was acting in breach of express instructions if the accident injury was fatal. Consequently, the

fact that he was doing an unauthorized act by driving the tractor could have been no defence under the relevant provisions of the Act. Admittedly,

the accident had taken place in the course of employment and, therefore, the employer was liable, by the proof adduced that the deceased had a

valid driving licence and the Insurance Company ought to have been also made liable for the liability cast on the employer. The exoneration of

liability of the Insurance Company was, therefore, not justified.

The counsel for the Insurance Company would submit that the extent of liability itself could have been only as per the scales of compensation

provided under the WC Act, but the WC Commissioner has awarded Rs. 50,000/- by making a conjecture that if the representatives of the

workman had applied before the MACT, he would have secured the compensation of Rs. 84,000/- and, therefore, the compensation could be

more than what the WC Act provides and fixed compensation of Rs. 50,000/-. I find the procedure adopted by the WC Commissioner was

wholly erroneous. While the MV Act contains a provision that a claim for compensation could be proceeded either under the WC Act or under

the MV Act, the WC Act does not contain a similar provision. While the MACT could apply the scales which are most beneficial by virtue of

Section 167 of the MV Act, the WC Commissioner has no such option. He is mandated to determine compensation of what the law under the

WC Act prescribes. The accident had taken place on 30.03.1983 and as per Schedule IV at the relevant time when the death had taken place, the

compensation payable was tabulated to provide for a compensation of Rs. 21,600/-, if the income was between Rs. 500/- to Rs. 600/-. The

counsel would argue that a liability could be on the Insurance Company only to the extent of liability determined by the Act and, therefore, the

Insurance Company cannot be made liable for any excess amount. In this case, there is no representation for the claimants. It will be too harsh u

set right the error committed by the WC Commissioner in fixing the compensation more than the scales permissible under the WC Act at the

relevant time. The appellant has also urged in his grounds of appeal that the manner of determination of compensation was erroneous. The counsel,

however, submits that the entire compensation as awarded has already been paid. I will only state as a point of law that the WC Commissioner has

not the competency to apply the scales of compensation provided under the MV Act and he is bound to follow the schedule prescribed with

reference to the income and the factor applicable for the particular age of the deceased. The compensation determined is erroneous but I will not

direct any amount to be paid back by the claimants to the Municipal Committee. Since the appellant itself is a public body, I will expect the same

to absorb the additional compensation over the statutory limit without claiming any indemnity from the Insurance Company. The extent of the

indemnity that it can secure through the Insurance Company wilt be what the statute imposed, namely, Rs. 21,600/- with interest as awarded by

the Tribunal. The appellant is entitled to secure the amount from the Insurance. Company. The appeal is allowed in part to the above extent.