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(Non-Reportable)

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 10018  OF 2017 (Arising out of SLP (C) No. 36105 of 2014)

Smt. Surekha & Ors.     ….Appellant(s)

Versus

The Branch Manager, National Insurance Co. Ltd.        …Respondent(s)

J U D G M E N T

MOHAN M. SHANTANAGOUDAR, J.

Leave granted.

2. This appeal is directed against the judgment of the High

Court of Karnataka dated 5th April, 2014 passed in MFA No.

30749 of 2012 (WC), seeking enhancement of compensation.

The  records  reveal  that  Mr.  Anand  (the  deceased)  met

with an accident while driving Mahindra Temp Trax bearing

No.  KA023/M-7391  during  the  course  of  his  duty  and

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sustained  severe  injuries.   He  died  during  the  course  of

treatment leaving behind his wife, child and aged parents.   

The  appellants  (wife,  child  and  parents)  claimed

compensation  before  the  Commissioner  for  Workmen’s

Compensation and Labour Officer, DN-II, Bijapur.    

3.     The Commissioner while assessing the compensation held

that the income of the deceased was at Rs.4,000/- per month,

took 50% of the same, and by adding Rs.5,000/- for funeral

expenses  quantified the  compensation at  Rs.3,94,120/-  with

interest  @  12% per  annum  from  the  date  of  expiry  of  one

month of the award.    

Aggrieved  by  the  Award  of  compensation  of  the

Commissioner, the appellants filed an appeal before the High

Court.  The High Court assessed the income of the deceased at

Rs.5,500/-.   With  50% of  the  wages  at  Rs.2,750/-  and  by

applying relevant factor of 197.06, the compensation payable

was  determined  at  Rs.5,41,915/-.   Under  the  Provisions  of

Section  4(4)  of  the  Act,  the  appellants  are  entitled  to  a

maximum of  Rs.5,000/-  incurred  towards  funeral  expenses.

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Therefore, the High Court awarded Rs.5,46,915/- in toto with

interest  @  12% per  annum  from  the  date  of  expiry  of  one

month of the date when the amount was due.

4. The learned counsel for the appellants argued that the

Commissioner,  as well  as the High Court is  not justified in

deducting 50% of the wages while quantifying compensation.

It is further submitted that the income of the deceased should

have been assessed at Rs.6,000/- per month.   

The arguments of the learned counsel that it is not open

for  the  High  Court  to  deduct  50%  of  the  wages  while

quantifying the compensation is unacceptable, inasmuch as it

is mandatory as per Section 4 of the Employee’s Compensation

Act, 1923 that the amount of compensation should be based

on  an  amount  equal  to  50% of  the  monthly  wages  of  the

deceased multiplied by relevant factor.  Section 4 reads thus:

“Section  4:  Amount  of  compensation.- (1) Subject  to  the  provisions  of  this  Act,  the  amount  of compensation shall be as follows, namely:-

(a) where death results  from the injury : An amount equal  to  fifty  per  cent  of  the  monthly  wages  of  the deceased *[employee] multiplied by the relevant factor; or

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an amount of *[one lakh and twenty thousand rupees], whichever is more;

****                  *****                  ****

Explanation  I.--For  the  purposes  of  clause  (a)  and clause  (b),  "relevant  factor",  in  relation  to  a *[employee] means the factor specified in the second column of Schedule IV against  the entry in  the first column  of  that  Schedule  specifying  the  number  of years which are the same as the completed years of the age  of  the  *[employee]  on  his  last  birthday immediately  preceding  the  date  on  which  the compensation fell due.

***      ****          ****

(4) If the injury of the *[employee] results in his death, the  employer  shall,  in  addition  to  the  compensation under sub-section (1), deposit with the Commissioner a sum  of  *[not  less  than  five  thousand  rupees]  for payment of the same to the eldest surviving dependant of  the  *[employee]  towards  the  expenditure  of  the funeral of such *[employee] or where the *[employee] did not have a dependant or was not living with his dependant at the time of his death to the person who actually incurred such expenditure.]”

5. The Commissioner as well as the High Court had found

that the deceased was aged about 35 years at the time of his

death.  He had to look after his wife, child and aged parents.

Though the evidence on record clarifies that the deceased was

getting Rs.6,000/- per month and  Rs. 100/-   as daily Bhatta,

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the High Court without any reason assessed the income of the

deceased at Rs.5,500/- per month. The daily Bhatta earned by

the deceased usually would have been spent for his personal

purposes. Consequently the entire wages of Rs.6,000/- could

have  been  utilized  by  him  for  the  maintenance  of  his  big

family.   

6. Having regard to the totality of factors, we deem it proper

to hold that the deceased was earning Rs.6,000/- per month.

In the matter on hand, the Commissioner as well as the High

Court had rightly assessed the compensation by multiplying

relevant  factor  of  197.06  with  50% of  wages  as  mentioned

supra. So also the appellants are entitled to a maximum of

Rs.5,000/- towards funeral expenses as per Section 4(4) of the

Act.   

7. Since the income of the deceased was at Rs.6,000/- per

month,  with  50% of  the  wages  at  Rs.3,000  by  multiplying

relevant factor of 197.06, and by adding Rs.5000/- towards

funeral  expenses,  the  net  compensation  payable  would  be

Rs.5,96,180/- with interest @ 12% per annum from the date of

expiry of one month from the date of death of the deceased.

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Out of the enhanced compensation, a sum of Rs.1,00,000/-

shall be deposited in the name of appellant No. 2 Varsha, the

daughter of the deceased till she attains the age of majority

and  the  excess  amount  shall  be  shared amongst  the  other

appellants.  The  judgment  of  the  High  Court  is  modified

accordingly.  The appeal is allowed in part to the above extent.

No costs.

……. …………………………..J.             (R.K. Agrawal)

    …………………………………J.

      (Mohan M. Shantanagoudar) New Delhi Dated: 03rd August, 2017