# U.P.S.R.T.C v. Smt. Alka and others

- **Citation:** (2008) 3 ILRA 749
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2008-07-28
- **Case number:** First Appeal From Order No. 1663 of 2008
- **Bench:** Amitava Lala, Shishir Kumar
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/u-p-s-r-t-c-v-smt-alka-and-others-41154
- **Pages:** 4

## Headnote

Act
1923Section 4A(3) with Section 30(1)-liability
750 INDIAN LAW REPORTS ALLAHABAD SERIES [2008
to
pay
interest
by
the
insurance
company-without
discussing
fault
of
employer or any contract between the
employer
and
company-held-wholly
misconceived, illegal-Court expressed its
great concern about discharge of Judicial
function by such administrative officerhaving no knowledge of law-matter
remitted back for fresh decision in light
of aforesaid discussion.

Held: Para 5

We are of the view that there is other
reason for which the interest and/or
penalty can not be directed to be paid by
the insurance company. Section 4-A(3)
of the Act, 1923 says that where any
employer is in default in paying the
compensation due under this Act within
one month from the date it fell due, the
Commissioner shall direct the employer
to pay the interest on the amount of
arrears. In addition thereto, if there
seems to have no justification for the
delay in paying the amount of arrears
and interest, a further sum by way of
penalty will be directed to be paid.
Therefore, the Court has to see whether
any such occurrence is available on the
part of the employer or not. The payment
of interest and/or penalty is arising out
of the fault of the employer and without
determination of such fault the insurance
company can not be held liable. Even
when
an
agreement
of
insurance
coverage is made by the employer with
the insurance company it will be the
prime duty of the Commissioner to
ascertain at whose fault the interest
and/or penalty is liable to be paid.
Case law discussed:
(2006) 5 SCC 192

## Text

3 All] U.P.S.R.T.C. V. Smt. Alka and others
749
18. The disciplinary authority,
after setting out the entire facts, agreed
with the findings recorded by the
Inquiry officer and affirmed the same.
In case the appointing authority agrees
with the finding of the Inquiry officer
while passing the order of punishment
it is not necessary to give detailed
reasons, particularly when nothing new
is added in reply to show cause notice
issued by the disciplinary authority.
Disciplinary authority vide order dated
4-5-1988 has clearly stated that the
respondent in reply to the show cause
notice,
has
merely
reiterated
the
averments which were made in reply to
the charge sheet and have added
nothing new in reply to the show cause
notice.

19. The appellate authority has
also held that the respondent in
allowing the bus to be driven by a
cleaner Kalicharan which led to the
death of three persons and causing
injuries to 39 passengers would amount
to a gross misconduct and have further
held that the reasonable opportunity
was given to respondent but he failed
to prove his innocence.

20. The gross misconduct of the
respondent in allowing an unauthorized
person to drive the bus and putting the
lives of a large number of innocent
passengers
in
danger
cannot
be
condoned and he could not have been
permitted
to
continue
in
service,
particularly when he had been found
guilty of committing gross misconduct
on earlier occasions as well.

21. The impugned order passed by
the Tribunal is based on complete
misreading
of
the
case
and
misconception of the legal position
relevant to the matter. The Tribunal has
not recorded any cogent, satisfactory
and convincing reasons to set aside the
order of termination. Bare perusal of
the inquiry report and the order passed
by
the
disciplinary
and
appellate
authority clearly indicates that proper
and reasonable opportunity was granted
to the respondents. In view of the
above, we do not find any illegality in
conducting the inquiry nor in the
findings.

22. No other point has been
pressed.

In view of our conclusions the writ
petition is allowed. The order dated
26.9.2002 passed by the Tribunal is
accordingly quashed. In the facts and
circumstances of this case, there shall
be no order as to costs.
---------
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 28.07.2008

BEFORE
THE HON'BLE AMITAVA LALA, J.
THE HON'BLE SHISHIR KUMAR, J.

First Appeal From Order No. 1663 of 2008

U.P.S.R.T.C.

...Appellant
Versus
Smt. Alka and others
 ...Respondents

Counsel for the Appellant:
Sri. J.N. Singh
Sri. S.C. Srivastava
Sri. Manish Kumar Nigam

Counsel for the Respondents:

Workmen's
Compensation
Act
1923Section 4A(3) with Section 30(1)-liability
750 INDIAN LAW REPORTS ALLAHABAD SERIES [2008
to
pay
interest
by
the
insurance
company-without
discussing
fault
of
employer or any contract between the
employer
and
company-held-wholly
misconceived, illegal-Court expressed its
great concern about discharge of Judicial
function by such administrative officerhaving no knowledge of law-matter
remitted back for fresh decision in light
of aforesaid discussion.

Held: Para 5

We are of the view that there is other
reason for which the interest and/or
penalty can not be directed to be paid by
the insurance company. Section 4-A(3)
of the Act, 1923 says that where any
employer is in default in paying the
compensation due under this Act within
one month from the date it fell due, the
Commissioner shall direct the employer
to pay the interest on the amount of
arrears. In addition thereto, if there
seems to have no justification for the
delay in paying the amount of arrears
and interest, a further sum by way of
penalty will be directed to be paid.
Therefore, the Court has to see whether
any such occurrence is available on the
part of the employer or not. The payment
of interest and/or penalty is arising out
of the fault of the employer and without
determination of such fault the insurance
company can not be held liable. Even
when
an
agreement
of
insurance
coverage is made by the employer with
the insurance company it will be the
prime duty of the Commissioner to
ascertain at whose fault the interest
and/or penalty is liable to be paid.
Case law discussed:
(2006) 5 SCC 192

(Delivered by Hon'ble Amitava Lala, J.)

All the appeals are analogously heard
because a common question is involved
herein. The common question is whether
insurance company is liable to pay
interest and/or penalty to the claimants
even in absence of contract between the
employer and insurance company or not.
According to us, it is obviously a
substantial question of law which requires
consideration at the threshold.

1. First proviso to sub-section (1) of
Section
30
of
the
Workmen's
Compensation Act, 1923 (hereinafter
called as Act, 1923) categorically says
that no appeal shall lie against any
order unless any substantial question of
law is involved in the appeal. Therefore,
no appeal can be said to be maintainable
as a matter of course unlike the other law
or laws available in this field.

2. Very often we come across the
appeals from such type of orders passed
by
respective
Commissioners
under
Workmen's Compensation Act, 1923
(hereinafter called as the Commissioner)
under which the insurance companies are
fastened with the liabilities to pay the
interest and/or penalty irrespective of
payment
of
compensation
without
verification of the contractual obligation
between the employers and insurance
companies. In the State of Uttar Pradesh,
the posts of Commissioners under the
Act, 1923 are being filled up by the
members of the executives not by the
members of the judiciary unlike other
States. Instead of being proud position
emerges to irrationality. It is not very far
to say about ignorance of law but
presently we say that the attitude
prevailing in the field is mechanical.
Hence, we want to give it top priority
even at the stage of admission.

3. In (2006) 5 SCC 192 (New India
Assurance Co. Ltd. Vs. Harshadbhai
Amrutbhai Modhiya and another) the
Supreme Court held that by reason of the
3 All] U.P.S.R.T.C. V. Smt. Alka and others
751
provisions of the Act, an employer is not
statutorily liable to enter into a contract of
insurance unlike Section 147 of the Motor
Vehicles Act, 1988. However, Section 17
of the Act, 1923 does not limit or make
any restriction from contracting out
between the employer and insurer. The
terms of a contract of insurance would
depend upon the volition of the parties. A
contract of insurance is governed by the
provisions of the Insurance Act. In terms
of the provisions of the Insurance Act, an
insured is bound to pay premium which is
to be calculated in the manner provided
therein. With a view to minimise his
liability, an employer can contract out so
as to make the insurer not liable as
regards indemnifying him in relation to
certain matters which do not strictly arise
out of the mandatory provisions of any
statute. Contracting out, as regards
payment of interest by an employer,
therefore, is not prohibited in law. The
entitlement of the claimant under the Act,
1923 is to claim the compensation from
the employer. As between the employer
and the insurer the rights and obligations
would depend upon the terms of the
insurance contract.

4. According to us, irrespective of
the question of applicability of Section 17
with full force in this respect, we are of
the view the Supreme Court has laid
down
the
principle
that
insurance
coverage is not mandatory under the Act,
1923, like other law or laws prevailing in
the field but there is no prohibition in
contracting out either for the principal
sum or for interest and/or penalty. In other
words, in absence of any clause in the
contract regarding interest and/or penalty,
the insurance company is not liable to pay
any sum on account of interest and/or
penalty. Therefore, payability to that
extent lies with the employer.

5. We are of the view that there is
other reason for which the interest and/or
penalty can not be directed to be paid by
the insurance company. Section 4-A(3) of
the Act, 1923 says that where any
employer is in default in paying the
compensation due under this Act within
one month from the date it fell due, the
Commissioner shall direct the employer
to pay the interest on the amount of
arrears. In addition thereto, if there seems
to have no justification for the delay in
paying the amount of arrears and interest,
a further sum by way of penalty will be
directed to be paid. Therefore, the Court
has to see whether any such occurrence is
available on the part of the employer or
not. The payment of interest and/or
penalty is arising out of the fault of the
employer and without determination of
such fault the insurance company can not
be held liable. Even when an agreement
of insurance coverage is made by the
employer with the insurance company it
will
be
the
prime
duty
of
the
Commissioner to ascertain at whose fault
the interest and/or penalty is liable to be
paid. If there is no coverage it will be paid
by the employer and if coverage is there
then after determination of the fault so
that payment and recovery of the amount
by the insurance company can not be
extinguished. Firstly, it is under whose
fault and secondly whether the insurance
company will pay the said sum on
account of fault of the employer or not.
When an employer is statutorily liable,
the same will be strictly determined to
give respect to the statute. Even if by
virtue of the contract it is directed that the
insurance company is liable to pay, it has
to be ascertained by the appropriate court
752 INDIAN LAW REPORTS ALLAHABAD SERIES [2008
that the employer was not at fault. Thus,
the inference is that in case the coverage
if it is evidently proved that the employer
is
liable
to
pay
the
amount
of
compensation to the ultimate sufferer
without delaying the cause, the insurance
company will be directed to pay and
recover it since the statutory duty lies
with the employer. Therefore, it requires
further consideration by the appropriate
court and as such matters are remitted
back to the appropriate court to reconsider
the issue in presence of the parties upon
notice and giving adequate opportunity of
hearing and to come to an appropriate
finding thereof. If it is done, the principle
of audi alteram partem will be fulfilled in
its true sense before the Court where not
only substantial question of law but
factual ascertainment is needed to be
considered. Keeping the appeal pending
for the sake of pendency is a matter of
futility and therefore, orders are required
to be set aside and are set aside hereunder
and the matters are remitted back
hereunder, however, without imposing
any cost and with a caution that in the
garb of the decision to be taken by the
appropriate court the payment of principal
sum to the ultimate sufferer would not be
stalled.

6. Accordingly, the appeals are
treated to be disposed of even at the stage
of admission, however, without imposing
any cost.

7. All the pending matters on such
ground
are
reviewed
hereunder.
Therefore, all such appeals are bound by
this order subject to passing of a formal
order as and when those will appear in the
cause list.

Appeal disposed of.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 08.07.2008

BEFORE
THE HON'BLE TARUN AGARWALA, J.

Civil Misc. Writ Petition No. 62220 of 2006

Shri Vinod Kumar Singh
...Petitioner
Versus.
State of U.P. and others ...Respondents

Counsel for the Petitioner:
Sri S.P. Singh Parmar
Sri V.K. Singh

Counsel for the Respondents:
S.C.

U.P. Intermediate Education Act, 1921Chapter
III
Regulation
101
-
Appointment of class 4th employee-no
prior permission to advertise the vacancy
taken-within
11
days
of
notifying
vacancy-selection
made-DIOS refused
financial approval-held-prior permission
not mandatory-giving 11 days time to
apply the prospective candidates-not
illegal
but
mere
irregular-State
Government to make necessary provision
in this connection-till amendment made
Secretary to issue circular by forthwith.

Held: Para 6

In so far as the time factor is concerned,
this Court finds that no period is
prescribed under Regulation 101 for
giving a time factor to the prospective
candidates to apply for the post in
question. Normally 15 days' time is
considered sufficient for a prospective
candidate to apply for the post. In the
present case, only 11 days' time was
granted but, by giving only 11 days' time
will not make the selection process
illegal on the ground that sufficient time
was not granted since there is no
complaint
from
any
prospective
candidates in this regard. Consequently,