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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
Umesh M Adiga
United India Insurance Co. Ltd. – Appellant
Versus
Goni Miya @ Miya Gani – Respondent
JUDGMENT :
Umesh M Adiga, J.
Both these appeals arise out of award passed by the Commissioner of Labour under the Workmen's Compensation Act, 1923 and XXI Additional Small Causes Judge, MACT (SCCH-23), Bengaluru (for short 'the Commissioner) dated 07.06.2016 passed in E.C.A. No.493/2014.
2. For the sake of convenience, the parties are referred to as per their ranking before the Trial Court.
3. Both the appeals are admitted to consider the following substantial questions of law:
1) Whether Commissioner is justified in directing insurer to pay interest contrary to terms of insurance policy?
2) Whether Commissioner is justified in not accepting contentions of claimant that deceased was earning Rs.12,000/- per month when employer was not disputed the same?
3) Whether Commissioner is justified in not directing the employer to pay penalty when admittedly employer had not deposited the admitted compensation within 30 days from the date of incident?
4. The brief facts of the case are that, one Mufaz-Ul-Haque was working with respondent No.1 as his employee and was doing centering work at his instructions. There existed employee and employer relationship between deceased and respondent No.1. On 28.
The court ruled that the employer must pay timely compensation and could face penalties for delays under the Workmen's Compensation Act.
The insurer's liability in a Workmen's Compensation case is dictated by the declared salary in the policy, and penalties for delay must comply with statutory requirements.
The Insurance Company is liable for interest on compensation under the Employee’s Compensation Act, while the employer is responsible for penalty payments.
The court held that under the Employees' Compensation Act, 1923, employers cannot refuse to pay interest on compensation for delays, mandating payment of 12% interest from 30 days post-incident.
The court held that the liability for interest on compensation lies with the Insurance Company, affirming a statutory interest rate of 12% under the Workmen's Compensation Act if not paid within a mo....
Insurance companies are liable for interest on compensation but not for penalties due to employer violations under the Workmen's Compensation Act.
It was for claimant to have opted for claim of compensation either under Workmen’s Compensation Act or under Motor Vehicles Act.
The main legal point established in the judgment is that the penalty under Section 4-A(3)(b) of the Workmen's Compensation Act is the liability of the employer and not the insurance company.
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