Workmen Compensation Case: Supreme Court Increases Compensation for Deceased Truck Driver

The case of Mamta Devi & Ors. v. The Reliance General Insurance Company Limited & Anr. revolves around the legal intricacies of workmen compensation under the Workmen’s Compensation Act, 1923. The Supreme Court was tasked with determining whether the compensation awarded by the Deputy Labour Commissioner-cum-Commissioner for Workmen Compensation was adequate and whether the High Court erred in setting aside the award.

The dispute stemmed from the tragic death of Vakil Choudhary, a truck driver, in an accident while on duty. His dependents, including his wife, son, and parents, filed a claim for compensation. The primary legal question was whether the tribunal had the jurisdiction to entertain the claim and whether the awarded amount was justified.

Background of the Case

The deceased, Vakil Choudhary, was employed as a truck driver and was earning Rs. 6,000 per month. On April 21, 2011, at around 10:30 PM, he met with a fatal road accident while performing his employment duties. His legal heirs sought compensation from the employer and the insurer, Reliance General Insurance Company, under the Workmen’s Compensation Act, 1923.

The case was initially heard by the Deputy Labour Commissioner-cum-Commissioner for Workmen Compensation, who ruled in favor of the claimants. The tribunal awarded a compensation amount of Rs. 4,31,671, calculating the deceased’s income at Rs. 150 per day and applying the statutory multiplier of 221.37. An interest rate of 6% per annum was also imposed.

Dissatisfied with the quantum of compensation, the claimants appealed before the Patna High Court, arguing that the awarded amount was too low. However, the High Court dismissed the appeal, holding that the Deputy Labour Commissioner lacked jurisdiction as the case was contested. The claimants then approached the Supreme Court.

Petitioner’s Arguments

The claimants, represented by Mr. Atil Inam, contended:

The deceased was earning Rs. 6,000 per month, which was wrongly reduced to Rs. 3,900 per month by the tribunal.
The compensation should have been calculated based on his actual wages, and the interest rate should have been higher.
The High Court erred in dismissing the case on the ground of jurisdiction, as the insurance company did not actively contest the claim beyond filing a written statement.
The insurer had already deposited the awarded amount, which indicated that it had accepted liability.

Respondent’s Arguments

The insurer, Reliance General Insurance Company, represented by Mr. Vishnu Mehra, argued:

The claim was a contested matter, and therefore, the Deputy Labour Commissioner did not have jurisdiction.
The High Court correctly ruled that the claim should have been brought before the jurisdictional Labour Court.
The compensation was calculated correctly as per statutory provisions.

Supreme Court Judgment

The case was heard by Justice J.K. Maheshwari and Justice Aravind Kumar. The Supreme Court ruled in favor of the claimants, setting aside the Patna High Court’s decision and enhancing the compensation amount.

1. Tribunal’s Jurisdiction

The Supreme Court held that the High Court erred in dismissing the claim on jurisdictional grounds. It ruled:

“The insurer had merely filed a written statement but did not contest the claim beyond that. Therefore, the case did not become a ‘contested claim’ under the notification issued under Section 20(1) and (2) of the Workmen’s Compensation Act.”

Since the employer admitted that the deceased was in their employment and was earning Rs. 6,000 per month, there was no dispute requiring adjudication by the Labour Court.

2. Calculation of Compensation

The Court ruled that the tribunal erred in assuming a lower income for the deceased:

“The written statement filed by the employer categorically admitted that the deceased was earning Rs. 6,000 per month. The tribunal’s assessment at Rs. 3,900 per month was incorrect.”

The Court recalculated the compensation as follows:

Income: Rs. 6,000 per month
Loss of income (after 50% deduction): Rs. 3,000 per month
Multiplier: 221.37
Total compensation: Rs. 6,64,110

3. Interest Rate Revision

The Supreme Court also revised the interest rate from 6% to 12%, stating:

“The claimants would be entitled to interest @ 12% per annum from one month after the date of accident till the date of payment, excluding the amount already deposited by the insurer.”

Final Verdict

The Supreme Court ruled:

The High Court’s judgment was set aside.
The total compensation was increased to Rs. 6,64,110.
Interest was revised to 12% per annum from one month after the accident.
The insurer was directed to deposit the balance amount with the tribunal within six weeks.

Conclusion

This judgment reinforces the principles of fair compensation under the Workmen’s Compensation Act. The Supreme Court emphasized the need for tribunals to rely on undisputed employer statements regarding wages, ensuring that dependents of deceased workers receive just compensation. The ruling also clarifies that merely filing a written statement does not make a claim ‘contested’ in the absence of active opposition by the employer or insurer.

Petitioner Name: Mamta Devi & Ors..
Respondent Name: The Reliance General Insurance Company Limited & Anr..
Judgment By: Justice J.K. Maheshwari, Justice Aravind Kumar.
Place Of Incident: Bihar.
Judgment Date: 19-05-2023.

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