High Court of KeralaSingle Judge2010-06-09Disposed of accordingly; MFA disposed; compensa...

The Oriental Insurance Co. Ltd. v. Pradeepkumar and K.U. Basheer

Case / Petition Number:MFA No. 33 of 2009; WCC 421/2004

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: M.N. Krishnan
Judgment Date: 2010-06-09
Court Decision / Holding: Appeal disposed of; compensation reduced to Rs.44,855; insurer to pay Rs.44,855 with simple interest at 12% from 10.10.2003; any excess deposited to be reimbursed to the insurer and disbursement to the claimant accordingly.
Final Disposition: Disposed of accordingly; MFA disposed; compensation adjusted; interest from accident; deposit handling as stated.

Parties to the Case

Appellants / Petitioners

THE ORIENTAL INSURANCE CO. LTD., THRISSUR, REPRESENTED BY ITS ASSISTANT MANAGER, REGIONAL OFFICE, ERNAKULAM NORTH, KOCHI-18.

Respondents

PRADEEPKUMAR, S/O.GANGADHARAN, PARAKKAL HOUSE, CHETTICHAL P.O. CHEMBOOCHIRA, KODAKARA (VIA), THRISSUR DISTRICT
K.U.BASHEER, KARAPPAM VEETIL HOUSE, MUNGHAT LANE, PUNKUNNAM, THRISSUR DISTRICT

Legal Representation & Advocates

Counsels for Petitioners

• Adv. Sri.George Cherian (Thiruvalla)

Counsels for Respondents

• Adv. Sri.P.V.Chandra Mohan

Case Synopsis & Summary

This is an appeal by The Oriental Insurance Co. Ltd., Thrissur, against an order of the Workmen's Compensation Commissioner, Thrissur in W.C.C. No. 421/2004, arising from an accident involving an auto rickshaw driver. The Commissioner fixed compensation at Rs.65,245 with interest at 12% from the date of the accident. The insurer challenged (i) the existence of an employer–employee relationship, (ii) the calculation of loss of earning capacity (LEC), and (iii) liability to pay interest from the accident date. The appellant relied on a private investigation statement suggesting the claimant was the owner of the vehicle; the claimant denied ownership in cross‑examination, and the registration certificate stood in the first opposite party’s name with no proven transfer. The court upheld the tribunal’s finding on employer–employee relationship in the absence of contrary evidence. On LEC, the tribunal had fixed 16%, but Vanajakshan v. Joseph (2003 (2) KLT 462 FB) requires LEC to be based on the whole work the claimant could perform, not merely the work at the time of the accident; the court thus reduced LEC to 11%, making the amount Rs.44,855. Regarding interest, relying on National Insurance Co. v. Rekha and Pratap Narain Singh Deo v. Shrinivas Sabata (and later Harrison Malayalam Ltd. v. Ashraf and Budha Ram), the court held interest from the date of accident at 12% simple. The MFA is disposed of accordingly with the insurer directed to pay Rs.44,855 plus 12% simple interest from 10.10.2003 until deposit, and any excess deposited to be reimbursed to the insurer with disbursement to the claimant.

Provisions of Law Cited

Workmen's Compensation Act

Legal Doctrines & Maxims

Loss of earning capacity must be calculated with respect to the whole work the claimant was capable of doing, not the work he was doing at the time of the accident.
Constitution Bench decisions prevail over conflicting Division Bench decisions.

Submissions & Arguments

Contentions of Appellants / Petitioners

Insurer contends there is no established employer‑employee relationship; private investigator’s report suggested ownership by the claimant; registration certificate is in the name of the first opposite party and no transfer proven; challenges the 11% LEC assumption and seeks to restrict liability and dates of interest.

Contentions of Respondents

Claimant contends there is an employer‑employee relationship; the registration certificate names the first opposite party but there is no conclusive transfer; disputing the lower LEC method and seeking appropriate computation per established jurisprudence.

Cited Precedents (5)

Case Name	Citation	Treatment	Explanation
Vanajakshan v. Joseph	2003 (2) KLT 462 FB	Positive	Full Bench principle that loss of earning capacity must be calculated on the whole work the person is capable of doing, not merely the work at the time of the accident; used to reject the 16% LEC and fix 11%.
Pratap Narain Singh Deo v. Shrinivas Sabata	AIR 1976 SC 222	Positive	Constitution Bench decision cited to establish that constitutional bench rulings prevail over conflicting Division Bench decisions regarding interest from the accident date.
National Insurance Co. Ltd. v. Rekha	2008 A.C.J. 886	Positive	Division Bench relied on this decision to hold interest from the date of accident, aligning with constitutional bench precedents.
Harrison Malayalam Ltd. v. Ashraf	2009 (1) KLT 825	Positive	Cited as subsequent affirmation of the date‑of‑accident interest principle in similar jurisprudence.
New India Assurance Co. v. Budha Ram	2009 (4) TAC 614	Positive	Cited as supportive authority for the interest from accident date principle in other jurisdictions.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT :** **THE HONOURABLE MR. JUSTICE M.N.KRISHNAN** **WEDNESDAY, THE 9TH JUNE 2010 / 19TH JYAISTHA 1932** **MFA.No. 33 of 2009()** **--------------------** **WCC.421/2004 of W.C.C.,THRISSUR** **....................** ## **APPELLANT(S): 2ND OPPOSITE PARTY:** **------------------------------------------------------------** **THE ORIENTAL INSURANCE CO.LTD., THRISSUR, REPRESENTED BY ITS ASSISTANT MANAGER, REGIONAL OFFICE, ERNAKULAM NORTH, KOCHI-18.** **BY ADV. SRI.GEORGE CHERIAN (THIRUVALLA)** ## **RESPONDENT(S): APPLICANT/IST OPPOSITE PARTY:** **-------------------------------------------------------------------------------** **1. PRADEEPKUMAR, S/O.GANGADHARAN, PARAKKAL HOUSE, CHETTICHAL P.O. CHEMBOOCHIRA, KODAKARA (VIA), THRISSUR DISTRICT.** **2. K.U.BASHEER, KARAPPAM VEETIL HOUSE, MUNGHAT LANE, PUNKUNNAM, THRISSUR DISTRICT.** **R1 BY ADV. SRI.P.V.CHANDRA MOHAN** **THIS MISC. FIRST APPEAL HAVING BEEN FINALLY HEARD ON 09/06/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **Kss** ## **ORDER ON I.A.NO.403/2009 IN MFA NO.33/2009** ## **DISMISSED** **9/06/2010 SD/- M.N.KRISHNAN, JUDGE /TRUE COPY/ P.A.TO JUDGE** **Kss** ## **M.N. KRISHNAN, J.** ........................................... M.F.A.NO.33 OF 2009 ............................................. Dated this the 9[th] day of June, 2010. ## **J U D G M E N T** This is an appeal preferred against the order of the Workmen's Compensation Commissioner, Thrissur in W.C.C.No.421/2004. The claimant alleging to be an auto driver met with an accident when it capsised and the Workmen's Compensation Commissioner has fixed the compensation at Rs.65,245/= with the liability to pay interest at 12% from the date of accident. Challenging the employer-employee relationship as well as percentage of loss of earning capacity and liability to pay interest from the date of accident, the insurance company has come up in appeal. 2. Heard the learned counsel for the appellant as well as the claimant. The first question to be considered is regarding the employer-employee relationship. The learned counsel for the appellant would contend that by conducting a private investigation and recording a statement of the claimant it has come out that he is the owner of the auto : 2 : rickshaw and that the registration certificate alone is not transferred. But the learned counsel for the claimant would contend that it has been properly answered by the claimant in cross examination. I had perused the statement as well as the cross examination. It is true that in the statement before the private investigator the claimant had stated that he is the owner of the vehicle. But he was cross examined by the counsel for the insurance company. He has said that he has not understood the contents and therefore the mistake has taken place. He reiterates that he is not the owner of the vehicle. A statement made by a party can always be explained. Now the question is whether the explanation tendered is proper or not. The registration certificate stands in the name of the first opposite party in the claim petition. He has not come forward with any contention regarding the transfer of the auto rickshaw. Except for a mere sentence in the statement, no other evidence is adduced or forthcoming to substantiate the contention of the insurance company regarding the transfer. So as things stand, the registration certificate stands in the name of the first opposite : 3 : party. The claimant denies that he is the owner of the vehicle. Against this, there is no contra evidence to hold otherwise. Therefore, I sustain the finding on the employer-employee relationship. 3. The next question is regarding the loss of earning capacity. What the claimant had sustained is a radius fracture. The Tribunal did not accept the disability certificate issued by the doctor as such and fixed it at 16%. A perusal of the disability certificate would reveal that it is not issued in accordance with the document relied down by this Court in the decision reported in **Vanajakshan v. Joseph** (2003 (2) KLT 462 FB). A Full Bench of this Court had made it very clear that loss of earning capacity has to be calculated on the basis of loss of earning capacity by a person with respect to the whole work which he was capable of doing and not with respect to the work which he was doing at the time of the accident. It has not been done. Therefore the Tribunal's finding regarding loss of earning capacity cannot be accepted. 4. I persuaded the learned counsel appearing for : 4 : both to have a via media and both of them did co-operate very well and therefore, decided to reduce the percentage by 5% making the loss of earning capacity at 11%. When the loss of earning capacity is fixed at 11%, the entitled compensation would be Rs.44,855/=. So, the amount is modified accordingly. 5. Lastly on the question of interest. The learned counsel would contend that the insurance company is liable to pay the interest only from the date of award. In the light of a decision of this Court in **National Insurance Company Ltd. V. Rekha** (2008 A..C.J. 886), the entitlement would be from the date of accident. In the said decision, the Division Bench has considered the Constitutional Bench decision of the Supreme Court in **Pratap Narain Singh Deo v. Shrinivas Sabata** (AIR 1976 SC 222). The Division Bench also considered regarding the conflicting decision of the Constitutional Bench and the Division Bench and held that the decision of the Constitutional Bench will prevail. Therefore it has to be held that the claimant will be entitled to interest from the : 5 : date of accident. It has been followed by another Bench of this Court in **Harrison Malayalam Ltd. v. Ashraf** (2009 (1) KLT 825) and also the Himachal Pradesh High Court in **New India Assurance Company v. Budha Ram** (2009 (4) TAC 614). 6. Therefore the appeal is disposed of and a revised order is passed fixing the compensation at Rs.44,855/= and the insurance company is directed to pay the said amount with simple interest at 12% from 10.10.2003 till the date of deposit. Since amount is deposited for the purpose of the appeal, the excess amount, if any, to be reimbursed to the insurance company and the amount which is entitled to be drawn by the claimant be disbursed to him. Disposed of accordingly. ## **M.N. KRISHNAN, JUDGE.** **cl** : 6 :