The liability to pay compensation on the part of the employer would arise immediately on the death of a workman and the interest would also be levied from the date of demise and not from the date of the order passed by the Commissioner, the Supreme Court said on Friday.
In the verdict, the apex court dealt with the provisions of the Employee’s Compensation Act, 1923 while coming to the rescue of a family whose bread-earner had died of a snake bite in 2009 while cutting sugarcane at a field in Solapur district of Maharashtra.
A bench of justices M R Shah and B V Nagarathna termed as “unsustainable” the Bombay High Court’s order.
The Aurangabad bench of the high court had upheld the award of Rs 3.06 lakh to the family of the workers.
However, the high court modified the aspect of the Commissioner’s order with regard to interest and said simple interest at the rate of 12 per cent would be charged after one month from the date of compensation order and not from the date of death.
Writing the judgement, Justice Shah dealt with provisions of the Employee’s Compensation Act and said the compensation has to be paid as soon as it falls due.
“Therefore, on the death of the employee/deceased immediately, the amount of compensation can be said to be falling due. Therefore, the liability to pay the compensation would arise immediately on the death of the deceased,” it said.
“The liability to pay the compensation would arise from the date on which the deceased died for which he is entitled to the compensation and therefore, the liability to pay the interest on the amount of arrears/compensation shall be from the date of accident and not from the date of the order passed by the Commissioner,” it said.
As per the case records, a workman had died of snakebite in the sugarcane field on November 29, 2009, and as neither the sugar factory nor the contractor paid the compensation, the family members moved a claim petition before the Commissioner Workmen’s Compensation at Beed and claimed Rs 5 lakh.
By order in 2017, the Commissioner allowed the plea and asked the Chairman, Vithalrao Shinde Sahakari Sakhar Karkhana Ltd, and others to pay the compensation of Rs 3.06 lakh along with simple interest at the rate of 12 per cent from the date of the accident.
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