The Branch Manager, vs R.Manjula
- Court
- Madras High Court
CMA(MD) No. 57 of 2023
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
Reserved On : 28.10.2026
Delivered On : 02.11.2026
CORAM
THE HON'BLE DR. JUSTICE P. MURUGAN
C.M.A(MD) No. 57 of 2023
CNR:{HCMD011037972022}
and
C.M.P.(MD) No. 721 of 2023
The Branch Manager,
The Original Insurance Company Ltd,
Divisional Office-I,
Madurai-625 001.
… Appellant
Vs.
1. R.Manjula,
W/o (Late) H.Raman,
Door No.14C, CMR Road,
Madurai-625 009.
2. Minor Keerthana,
D/o (Late) H.Raman,
Door No.14C, CMR Road,
Madurai-625 009.
(The Minor 2 and 3 respondents are
represented through their mother and guardian
st
the 1 respondent Tmt.R.Manjula)
3. Minor Sujitha,
D/o (Late) H.Raman,
Door No.14C, CMR Road,
Madurai-625 009.
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CMA(MD) No. 57 of 2023
(The Minors 2 and 3 respondents are
represented through their mother and guardian
st
the 1 respondent Tmt.R.Manjula)
4. M/s Green Hill Farm,
(Vee Grow Button Mushrooms),
Owner, S.No.348/2-A, Ayyankottai Pudur Salai,
Sevugapatti Village-624 211,
Nilakottai Taluk,
Dindigul District.
...Respondents
PRAYER: This Civil Miscellaneous Petition filed under section 30
of the Employees Compensation Act, to set aside the order dated
29.08.2022 passed by the Commissioner for Employees
Compensation, Madurai in E.C.No.110 of 2017 and allow this
appeal with costs.
For Appellant : Mr. C.Jawahar Ravindran
For Respondents : Mr. P. Baburaj
for R1
: Mr. M.E.Ilango
for R4
J U D G M E N T
This Civil Miscellaneous Appeal is filed under section 30 of
the Employee's Compensation Act, 1923, against the order passed by
the Deputy Commissioner of Labour, Madurai in E.C.No.110 of
2017 , dated 29.08.2022.
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CMA(MD) No. 57 of 2023
2. Brief facts to dispose the appeal is as that One
Mr. H. Raman had been working as a Supervisor under the fourth
respondent Firm for the past three years. On 13.06.2016, at about
05.30 p.m., while Mr. H. Raman was supervising the work at the
compost manure site and scattering paddy straw, he died due to
electrocution and electric shock, arising out of and in the course of
his employment. The deceased was earning a monthly salary of
Rs.20,000/-. Since the fourth respondent, being the Proprietor of the
Firm, had engaged the services of Raman, he was liable to pay
compensation of Rs.7,07,160/-. Hence, the legal heirs of the
deceased Raman approached the Deputy Commissioner of Labour,
Madurai.
3. The written statement of the fourth respondent is that the
allegations contained in the claim petition are denied. The fourth
respondent is engaged in horticultural activities, including the
cultivation and sale of button mushrooms. It is admitted that the
deceased Raman was employed under the fourth respondent as a
Supervisor. It is also admitted that the deceased died due to
electrocution and electric shock in the course of his employment.
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CMA(MD) No. 57 of 2023
The monthly salary of Rs.20,000/- drawn by the deceased is also
admitted. The deceased Raman died during the course of
employment and the insurance policy was in force, the insurance
company is liable to pay compensation.
4. The written statement of the appellant is that the allegations
contained in the claim petition are denied. Since the employer has
not been duly insured, the appellant Insurance Company is not liable
to pay compensation. The salary certificate issued by the employer is
a fabricated document. Only a voucher has been produced before the
Court, and the employer has not produced the disbursement book
showing the amount, mode of payment and date of payment. The
fourth respondent has not proved that the deceased Raman is the
employee of the fourth respondent. The appellant is responsible to
pay only for basic compensation and is not liable for interest and
penalty under the terms and conditions of the policy.
5. Before the Labour Commissioner, on the side of the
petitioners, the first petitioner examined herself as P.W.1 and 13
documents were marked as Ex.P1 to Ex.P13. On the first respondent
one Manivannan, who is the Manager of the first respondent Firm,
was examined as R.W.1 and through him Ex.R1 was marked. On
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CMA(MD) No. 57 of 2023
the side of the second respondent, one Ravichandran, who is the
Senior Regional Manager of the second respondent insurance
company, was examined as R.W.2 and through him Ex.R2 was
marked.
6. After considering the case, the Deputy Commissioner of
Labour, Madurai, has come to a conclusion that the second
respondent is liable to pay a compensation of Rs.7,07,160/- and
directed them to pay the said amount together with interest at the
rate of 12% per annum. Against the said order, the second
respondent filed this appeal.
7. This appeal was admitted on 27.01.2023 on the following
substantial questions of law:
“ (1) Whether the learned Commissioner has got
power to order any amount contrary to the terms
and conditions of the insurance policy?
(2) Whether the Commissioner has got power to
go beyond the terms of insurance policy and direct
the appellant / Insurance Company to pay interest
for the award amount?
(3) Whether the learned Commissioner has got
power to award interest against the insurance
company contrary to the provisions of law?”
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CMA(MD) No. 57 of 2023
8. The learned counsel for the appellant submitted that
though their liability is admitted, the insurance company is liable to
pay the policy amount, but, has no liable to pay interest on the award
amount, wherein, the contract between the appellant and the fourth
respondent is only for liability and not for interest. The said counsel
referred the insurance policy in Ex.R2 in which as per the policy
conditions in the caption of endorsement, i t is stated that the policy
coverage shall not extend to indemnify the insured in respect of any
interest or penalty arising on account of the insured's failure to
comply with the requirements laid down under the Employees'
Compensation Act, 1923.
9. The policy in Ex.R2 is a computer generator policy, there
is no signature from the insurance company and the policy holder is
the fact admitted by both sides. As far as the conditions and
liabilities, attachment document, it was not acknowledged by the
fourth respondent is also admitted by the witness R.W.2 from the
insurance company. When the conditions of the policy has not been
supplied to the fourth respondent and the liability is admitted by the
insurance company and having no disbursement of claim, since the
employer submitted form to the insurance company, they are liable
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CMA(MD) No. 57 of 2023
to pay interest as per the common law. The case facts also reveal
that when the employer has submitted form with the insurance
company to honour the policy amount to the victim, the insurance
company orally directed, let the parties may approach the Court of
law and as per Court order, the amount would be paid, as per the
arguments of the respondents 1 to 3 in this case, which is not
disputed by the learned counsel for the appellant.
10. The finding of the Labour Commissioner that the
deceased Raman died during the course of the employment is not
disputed. There is an employer and employee relationship between
the fourth respondent in this appeal and the deceased H.Raman.
Therefore, there is no dispute about it. The only submission made by
the appellant before this Court is that the Insurance Company is not
liable to pay interest on the compensation amount, even though there
was a delay on the part of the Insurance Company in disbursing the
admitted amount. In this regard, the Labour Commissioner under
the impugned order discussed the same and referred the Hon’ble
Supreme Court decisions in Pratap Narain Singh Deo v. Srinivas
Sabata ( 1976) 1 SCC 289 and Oriental Insurance Company
Limited v. Sibi George & Ors. (2012) 3 LLN 510 (SC) and imposed
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CMA(MD) No. 57 of 2023
interest at the rate of 12% per annum on the award amount directing
the insurance company to deposit the same.
11. When the deceased Raman died during the course of
employment, the policy was in force, which is not disputed by the
insurance company. Having the policy was in force, the insurance
company is liable to pay the policy amount. The facts of the case
reveal that, when the employer submitted the form seeking
disbursement of the policy amount, the Insurance Company directed
the parties to approach the Court of law and assured them that the
compensation amount, along with interest, would be paid in
accordance with the orders of the Court. Having taken such a stand,
the appellant cannot now contend in the grounds of appeal that the
Insurance Company is not liable to pay interest. Hence, the said
contention cannot be accepted.
12. When the condition of the policy was not known to the
employer, who was availed policy for the employees, the condition
that the insurance company is not liable to pay interest cannot be
accpeted. Whenever the amount is involved in a litigant, if the
opponent party failed to pay that amount and when it come to the
Court, the Court may order the opponent party to pay interest from
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CMA(MD) No. 57 of 2023
the date of liability till the date of realisation is the common law
procedure. Though there is a contract as per Ex.R2, but the
conditions of the contract was not supplied to the employer, when
the policy was taken, therefore, the insurance company cannot be
permitted to plead that they may not pay any interst.
13. In such view of the matter, the substantial questions of
law framed by this Court are answered against the appellant,
wherein, as per section 4A(3) of the Employee’s Compensation Act,
1923, the Labour Commissioner has power to order minimum
interest at the rate of 12% as simple interest or higher rate of interest
as determined in the scheduled bank. Here, in this case, the Labour
Commissioner awarded 12% simple interest per annum, which is
minimum as per section 4A(3) of the 1923 Act, thereby, the said
finding is in consonance with the law and it cannot be set aside by
the appellate Court.
14. In view of the above, all the substantial questions of law
are answered in the negative and against the appellant.
15. In the result, this Civil Miscellaneous Appeal fails and is
accordingly dismissed. The impugned order dated 29.08.2022
passed by the Labour Commissioner, Madurai, in E.C.No.110 of
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CMA(MD) No. 57 of 2023
2017 is confirmed. Considering the nature of the case, there is no
order as to costs. Consequently, connected Miscellaneous Petition
is closed.
Internet : Yes/No 02.11.2026
Index : Yes/No
NCC : Yes/No
LS
To
The Labour Commissioner,
Madurai.
Copy To :
The Section Officer,
VR Section,
Madurai Bench of Madras High Court,
Madurai.
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CMA(MD) No. 57 of 2023
DR. P. MURUGAN, J.
LS
Pre-delivery Judgment made in
CMA(MD) No. 57 of 2023
and CMP(MD) No. 721 of 2023
02.11.2026
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