New Delhi: The liability to pay compensation on the part of the employer would arise immediately on the death of a workman and the interest would also be levied from the date of demise and not from the date of the order passed by the Commissioner, the Supreme Court said on Friday. In the verdict, the apex court dealt with the provisions of the Employee's Compensation Act, 1923 while coming to the rescue of a family whose bread-earner had died of a snake bite in 2009 while cutting sugarcane at a field in Solapur district of Maharashtra.
A bench of justices M R Shah and B V Nagarathna termed as unsustainable the Bombay High Court's order. The Aurangabad bench of the high court had upheld the award of Rs 3.06 lakh to the family of the workers. However, the high court modified the aspect of the Commissioner's order with regard to interest and said simple interest at the rate of 12 per cent would be charged after one month from the date of compensation order and not from the date of death.
Writing the judgement, Justice Shah dealt with provisions of the Employee's Compensation Act and said the compensation has to be paid as soon as it falls due. Therefore, on the death of the employee/deceased immediately, the amount of compensation can be said to be falling due. Therefore, the liability to pay the compensation would arise immediately on the death of the deceased, it said.