##PAGE1##

141 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH

Date of decision : 06.04.2026 FAO-1093-2018 (O&M)

Saroj Devi & ors. ….Appellants

Versus

Haryana Roadways & ors. ….Respondents

FAO-3266-2016 (O&M)

ICICI Lombared General Insurance Co., ….Appellant

Versus

Saroj Devi & ors. ….Respondents

CORAM: HON’BLE MR. JUSTICE PANKAJ JAIN

*****

Present :- Mr. Shvetanshu Goel, Advocate and Mr. Shivam Gupta, Advocate

for the appellants-FAO-1093-2018 for respondents No.1 to 4- FAO-3266-2016

Ms. Vandanaa Malhotra, Advocate (Through video conferencing)

and Ms. Manvi Verma, Advocate for respondent No.3- FAO-1093-2018

for the appellant-FAO-3266-2016

Mr. Naveen Singh Panwar, D.A.G., Haryana for respondents No.1 & 2- FAO-1093-2018 for respondents No.5 & 6- FAO-3266-2016

Ms. Devika Kamboj, Advocate for Mr. Vikram Singh, Singh, Advocate

for respondent No.7-FAO-3266-2016

*****

POOJA SHARMA Page 1 of 6

2026.04.10 12:28 I attest to the accuracy and integrity of this document

PANKAJ JAIN, J.(ORAL)

1 These two appeals are directed against order dated 30.03.2016 passed by Commissioner under Employee’s Compensation Act, 1923 (for

short, ‘the 1923 Act’).

2 is at the behest of claimants seeking modification of the order qua interest awarded by the Commissioner. Mr. Shvetanshu Goel, Advocate for the appellants, submits that the Commissioner erred in restricting interest for the period of five years instead

of granting the same in terms of mandate of Section 4A of the 1923 Act.

3 is at the behest of insurance company challenging its liability to indemnify the employer- Haryana Roadways qua compensation awarded by the Commissioner. Ms.Vandanaa Malhotra, Advocate for the insurance company contends that the Commissioner erred in misreading the contract of insurance between the insured and the insurer. The policy was issued to indemnify third party loss. No premium was paid to

cover the accidental loss caused to the driver.

4

5 Section 4A of 1923 Act reads as under :-

“4A. Compensation to be paid when due and penalty for default.- -(1) Compensation under section 4 shall be paid as soon as it

falls due.

(2) In cases where the employer does not accept the liability for compensation to the extent claimed, he shall be bound to make provisional payment based on the extent of liability which he

POOJA SHARMA Page 2 of 6

2026.04.10 12:28 I attest to the accuracy and integrity of this document

accepts, and, such payment shall be deposited with the Commissioner or made to the1[employee], as the case may be, without prejudice to the right of the 1[employee] to make any

further claim.

[(3) Where any employer is in default in paying the compensation due under this Act within one month from the date it fell due, the

Commissioner shall--

(a) direct that the employer shall, in addition to the amount of the arrears, pay simple interest thereon at the rate of twelve per cent. per annum or at such higher, rate not exceeding the maximum of the lending rates of any scheduled bank as may be specified by the Central Government by notification in the

Official Gazette, on the amount due; and (b) if, in his opinion, there is no justification for the delay, direct that the employer shall, in addition to the amount of the arrears and interest thereon, pay a further sum not exceeding fifty per

cent. of such amount by way of penalty:

Provided that an order for the payment of penalty shall not be passed under clause (b) without giving a reasonable opportunity

to the employer to show cause why it should not be passed.

Explanation.--For the purposes of this sub-section, "scheduled bank" means a bank for the time being included in the Second

Schedule to the Reserve Bank of India Act, 1934.

[(3A) The interest and the penalty payable under sub-section (3) shall be paid to the 1[employee] or his dependant, as the case

may be.”

6 In view of above, this Court finds that the Commissioner erred in restricting the interest for five years and thus the impugned order militates against the statutory mandate. The interest