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LATE PAYMENT - (Liability to pay interest). - The Employees’ Compensation Act, 1923

The appellant was working with respondent-establishment and was paid RS.72.20 per day. It is the case of appellant that he was working on permanent basis but his name was not maintained on muster roll. While working, on 4.8.1997, he met with an accident and received crush injuries on his right hand due to which his right hand had to be amputated. The appellant filed application under the Act claiming compensation of Rs.2,67,252/- and also claimed interest. The application was allowed and interest @ 12% was awarded from the date of order of the Commissioner of Compensation which was to be deposited within one month of the date of order. Aggrieved by the Award of interest from the date of order, the petitioner-workman has filed the present appeal.

The Court examined the issue whether interest is to be calculated one month after the date of accident, if amount is not deposited within one month or it has to be calculated or paid from the date of order of the Commissioner. The Court held that under Section 4-A of the Act, compensation is to be paid by the employer within one month from the date, it fell due. The Act cast statutory obligation on the Commissioner to Award simple interest at the rate of 12% from the date it fell due and not from the date of order of Commissioner. Non-applicants no.1 and 2 directed jointly and severally to pay interest @ 12% p.a. from the date of accident. Appeal disposed of.

-HC Bom. Shiva S/o. Lakhaji Sakhare, Nagpur v. President, Indo- Rama Synthetics (I) Ltd., Nagpur and Anr.


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