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Pratap Narain Singh Deo v. Srinivas Sabata And Another
Factual and Procedural Background
Srinivas Sabata, a carpenter, was engaged on July 6, 1968 to perform ornamental work in one of the appellant’s cinema halls in Jeypore, Orissa. During the course of this work he fell, sustaining injuries that led to the amputation of his left arm above the elbow. After serving a notice dated August 11, 1968 demanding compensation as a regular employee, he received a reply from the appellant on August 21, 1968 denying regular employment status and alleging contributory negligence.
Unable to obtain payment, the respondent filed an application before the Commissioner for Workmen’s Compensation (Respondent 2). The Commissioner, by order dated May 6, 1969, found 100 percent loss of earning capacity, awarded compensation of Rs 9,800, and imposed a 50 percent penalty and 6 percent interest, bringing the total to Rs 15,092.
The appellant’s writ petition before the Orissa High Court was summarily dismissed on October 10, 1969. He then appealed to the Supreme Court of India by special leave.
Legal Issues Presented
- Whether the amputation of the respondent’s left arm constituted “permanent total disablement” under Section 2(1)(e) of the Workmen’s Compensation Act, 1923, or merely “permanent partial disablement.”
- Whether the Commissioner lawfully imposed interest and a 50 percent penalty under Section 4-A of the Act, given the appellant’s contention that compensation was not “due” until settled by the Commissioner.
Arguments of the Parties
Appellant's Arguments
- The injury amounted only to permanent partial disablement falling under Item 3 of Part II of Schedule I because the point of amputation was claimed to be within the statutory measurements.
- Penalty and interest could not be levied because compensation became due only after the Commissioner “settled” the amount under Section 19.
- The respondent was a casual contractor, not a regular employee, and was allegedly negligent, relieving the appellant of liability.
- The Commissioner lacked jurisdiction to entertain and adjudicate the claim.
Respondent's Arguments
- He was a regular employee earning Rs 120 per month.
- The loss of an arm above the elbow rendered him completely unfit to pursue his trade as a carpenter, amounting to total disablement.
- Compensation, interest, and statutory penalty were properly claimable owing to the appellant’s refusal to pay after due notice.
Table of Precedents Cited
No precedents were cited in the provided opinion.
Court's Reasoning and Analysis
Total disablement: The Court referred to the statutory definition in Section 2(1)(e), which incapacitates a workman “for all work which he was capable of performing at the time of the accident.” Relying on the Commissioner’s factual finding that carpentry cannot be performed with one hand, the Court affirmed that the respondent lost 100 percent of his earning capacity and thus suffered permanent total disablement. The appellant’s attempt to invoke Item 3 of Part II of Schedule I was rejected as it had never been urged before the Commissioner and lacked factual foundation.
Liability for compensation and accrual of penalty: Under Section 3(1), an employer becomes liable to pay compensation once personal injury by accident arises out of and in the course of employment. No statutory exception under Section 3(5) applied. Consequently, compensation fell due immediately upon injury; it was not suspended pending a formal “settlement” under Section 19.
Section 4-A(1) obligated the employer to pay compensation promptly, or at least make a provisional payment under Section 4-A(2). The appellant failed to do either and instead pursued unfounded defences—including denial of employment status and disputing jurisdiction—while inducing an agreement the Commissioner found “grossly inadequate.” In view of this conduct, the order directing interest and the statutory 50 percent penalty was upheld.
Holding and Implications
Holding: The appeal is dismissed.
As a result, the Commissioner’s award of Rs 9,800 in compensation, plus 6 percent interest and a 50 percent penalty (totaling Rs 15,092), stands affirmed. The decision reinforces that an employer’s liability to pay compensation under the Workmen’s Compensation Act arises immediately upon occurrence of a compensable accident, and that failure to pay promptly can attract statutory interest and penalties. No new precedent was expressly articulated beyond this clarification.
P.N Shinghal, J.— This appeal by special leave is by Pratap Narain Singh Deo who is the proprietor of two cinema halls in Jeypore, district Koraput, Orissa. It is not in dispute that Srinivas Sabata, Respondent 1, (hereinafter referred to as “the respondent”) was working as a carpenter for doing some ornamental work in a cinema hall of the appellant on July 6, 1968 when he fell down, and suffered injuries resulting in the amputation of his left arm from the elbow. He served a notice on the appellant dated August 11, 1968 demanding payment of compensation as his regular employee. The appellant sent a reply dated August 21, 1968 stating that the respondent was a casual contractor, and that the accident had taken place solely because of his own negligence. The respondent then made a personal approach for obtaining the compensation, but to no avail. He therefore made an application to the Commissioner for Workman's Compensation, Respondent 2, stating that he was a regular employee of the appellant, his wages were Rs 120 per mensem, he had suffered the injury in the course of his employment and was entitled to compensation under the Workmen's Compensation Act, 1923 (hereinafter referred to as “the Act”). Notice of the application was served on the appellant on October 10, 1968 calling upon him to show cause why penalty to the extent of 50 per cent and interest at 6 per cent per annum should not be imposed on him under Section 4-A of the Act on the amount of compensation payable by him because of the default in making the payment of the compensation. The appellant contested the respondents' claim on the grounds mentioned above and on the further ground that Respondent 2 had no jurisdiction to entertain and adjudicate on the claim. He filed a memorandum of agreement on April 10, 1969 accepting the liability to pay compensation for a sum which was found by the Commissioner to be so grossly inadequate that he refused to register it.
2. The Commissioner held in his order dated May 6, 1969 that the injury had resulted in the amputation of the left arm of the respondent above the elbow. He held further that the respondent was a carpenter by profession and “by loss of his left hand above the elbow he has evidently been rendered unfit for the work of carpenter as the work of carpentry cannot be done by one hand only”. He therefore adjudged him to have lost “100 per cent of his earning capacity”. On that basis, he calculated the amount of compensation at Rs 9800 and ordered the payment of penalty to the extent of 50 per cent, together with interest at 6 per cent per annum, making a total of Rs 15092.
3. The appellant felt aggrieved and filed a writ petition in the High Court of Orissa, but it was dismissed summarily on October 10, 1969. He has therefore come up in appeal to this Court by special leave.
4. It has not been disputed before us that the injury in question was caused to the respondent by an accident which arose out of and in the course of his employment with the appellant. It is also not in dispute that the injury resulted in amputation of his left arm at the elbow. It has however been argued that the injury did not result in permanent total disablement of the respondent, and that the Commissioner committed a gross error of law in taking that view as there was only partial disablement within the meaning of Section 2(1)(g) of the Act which should have been deemed to have resulted in permanent partial disablement of the nature referred to in Item 3 of Part II of Schedule I of the Act. This argument has been advanced on the ground that the amputation was from 8″ from tip of acromion and less than 4½″ below tip of olecranon. As will appear, there is no force in this argument.
5. The expression “total disablement” has been defined in Section 2(1)(e) of the Act as follows:
“(1) ‘total disablement’ means such disablement whether of a temporary or permanent nature, as incapacitates workman for all work which he was capable of performing at the time of the accident resulting in such disablement.”
It has not been disputed before us that the injury was of such a nature as to cause permanent disablement to the respondent, and the question for consideration is whether the disablement incapacitated the respondent for all work which he was capable of performing at the time of the accident. The Commissioner has examined the question and recorded his finding as follows:
“The injured workman in this case is carpenter by profession .... By loss of the left hand above the elbow, he has evidently been rendered unfit for the work of carpenter as the work of carpentry cannot be done by one hand only.”
This is obviously a reasonable and correct finding. Counsel for the appellant has not been able to assail it on any ground and it does not require to be corrected in this appeal. There is also no justification for the other argument which has been advanced with reference to Item 3 of Part II of Schedule 1, because it was not the appellant's case before the Commissioner that amputation of the arm was from 8” from tip of acromion to less than 4 below the tip of olecranon. A new case cannot therefore be allowed to be set up on facts which have not been admitted or established.
6. It has next been argued that the Commissioner committed a serious error of law in imposing a penalty on the appellant under Section 4½″A(3) of the Act as the compensation had not fallen due until it was “settled” by the Commissioner under Section 19 by his impugned order dated May 6, 1969. There is however no force in this argument.
7. Section 3 of the Act deals with the employer's liability for compensation. Sub-section (1) of that section provides that the employer shall be liable to pay compensation if “personal injury is caused to a workman by accident arising out of and in the course of his employment”. It was not the case of the employer that the right to compensation was taken away under sub-section (5) of Section 3 because of the institution of a suit in a civil court for damages, in respect of the injury, against the employer or any other person. The employer therefore became liable to pay the compensation as soon as the aforesaid personal injury was caused to the workman by the accident which admittedly arose out of and in the course of the employment. It is therefore futile to contend that the compensation did not fall due until after the Commissioner's order dated May 6, 1969 under Section 19. What the section provides is that if any question arises in any proceeding under the Act as to the ability of any person to pay compensation or as to the amount or duration of the compensation it shall, in default of agreement, be settled by the Commissioner. There is therefore nothing to justify the argument that the employer's liability to pay compensation under Section 3, in respect of the injury, was suspended until after the settlement contemplated by Section 19. The appellant was thus liable to pay compensation as soon as the aforesaid personal injury was caused to the appellant, and there is no justification for the argument to the contrary.
8. It was the duty of the appellant, under Section 4-A(1) of the Act, to pay the compensation at the rate provided by Section 4 as soon as the personal injury was caused to the respondent. He failed to do so. What is worse, he did not even make a provisional payment under sub-section (2) of Section 4 for, as has been stated, he went to the extent of taking the false pleas that the respondent was a casual contractor and that the accident occurred solely because of his negligence. Then there is the further fact that he paid no heed to the respondent's personal approach for obtaining the compensation. It will be recalled that the respondent was driven to the necessity of making an application to the Commissioner for settling the claim, and even there the appellant raised a frivolous objection as to the jurisdiction of the Commissioner and prevailed on the respondent to file a memorandum of agreement settling the claim for a sum which was so grossly inadequate that it was rejected by the Commissioner. In these facts and circumstances, we have no doubt that the Commissioner was fully justified in making an order for the payment of interest and the penalty.
9. The appeal fails and is dismissed.
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