Case Note & Summary
The appellants, parents of a deceased workman, filed a claim under the Workmen's Compensation Act, 1923, for the death of their son who worked as a helper in a truck. The accident occurred on 30 October 2004 when the truck driver lost control and hit the helper, who died on 1 November 2004. The Commissioner awarded compensation of Rs. 2,64,895 with 12% interest from the date of accident, based on a monthly wage of Rs. 2,425 (including Rs. 25 daily food expense). The High Court reduced the compensation to Rs. 1,98,807.70 by taking minimum wage of Rs. 910 and reduced interest to 8% from the date of award, holding that there was no material to prove the salary and that interest is not payable from the accident date. The Supreme Court allowed the appeal, holding that the employer had admitted the salary of Rs. 2,400 per month, and there was no reason to disbelieve it. The Court clarified that the food expense of Rs. 25 per day is excluded from wages under Section 2(m) as a special expense. Thus, the correct compensation is (50% of 2400) x 218.47 = Rs. 2,62,164 with 12% interest from the date of accident till realization, following the precedent in North East Karnataka Road Transport Corporation v. Sujatha. The Court criticized the insurer for dragging the poor family into litigation over a paltry sum and awarded Rs. 1 lakh as costs.
Headnote
A) Workmen's Compensation - Wages - Definition - Section 2(m) Workmen's Compensation Act, 1923 - Food expense paid by employer is a special expense excluded from wages - The Commissioner erred in including Rs. 25 daily food expense as wages; only Rs. 2400 per month salary is considered - Held that the High Court's reduction of wages to minimum wage was unjustified as employer admitted Rs. 2400 salary (Paras 6-9). B) Workmen's Compensation - Interest - Section 4-A Workmen's Compensation Act, 1923 - Interest payable from date of accident - The High Court erred in holding that interest is not payable from date of accident - Following North East Karnataka Road Transport Corporation v. Sujatha, (2019) 11 SCC 514, interest at 12% per annum from date of accident is awarded (Paras 6, 9). C) Workmen's Compensation - Computation - Section 4 Workmen's Compensation Act, 1923 - Compensation for death - 50% of monthly wages multiplied by relevant factor - For deceased aged 24 years, relevant factor is 218.47 - Compensation computed as (50% of 2400) x 218.47 = Rs. 2,62,164 (Para 9). D) Civil Procedure - Costs - Supreme Court awarded Rs. 1 lakh costs to appellants for being dragged into litigation by insurer over paltry sum - Held that insurer should not have challenged the award before High Court (Paras 7, 10).
Issue of Consideration
Whether the High Court was justified in reducing the compensation awarded by the Commissioner under the Workmen's Compensation Act, 1923, by disregarding the employer's admission of wages and by denying interest from the date of accident.
Final Decision
Appeals allowed. High Court judgment set aside. Compensation restored to Rs. 2,62,164 (50% of Rs. 2400 x 218.47) with interest at 12% per annum from date of accident till realization. Appellants entitled to costs of Rs. 1 lakh. Commissioner to ensure payment within one month.
Law Points
- Workmen's Compensation Act
- 1923
- Section 2(m) definition of wages
- Section 4 computation of compensation
- Section 4-A interest from date of accident
- Employer's admission of wages binding on insurer
- No justification for High Court to reduce wages without evidence
