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Allahabad High Court

THE NEW INDIA ASSURANCE CO. LTD.versusSMT. KRISHNA DEVI AND OTHERS

Decided

Holding

The appeal is dismissed; the age factor applied was correct and the prior settlement cannot be deducted from the statutory compensation.

Summary

The New India Assurance Co. appealed a compensation award of Rs.3,62,740 granted by the Workmen's Compensation Commissioner under the Employees Compensation Act, 1923, for the death of a 42‑year‑old employee. The appellant contended that the Commissioner incorrectly used an age factor of 181.37 (assuming the deceased was 41) instead of 178.49, and that a prior settlement of Rs.2,00,000 paid by the employer should be deducted from the statutory award. The High Court held that the age factor applied was not a substantial error of law and that the statutory compensation cannot be reduced by any private settlement absent a clear waiver of statutory rights. Consequently, both grounds of appeal were rejected and the award was upheld with statutory interest under Section 4(a)(iii‑a). The Court directed payment of the full amount, including interest, via RTGS to the claimants' bank account, citing Supreme Court guidance on account ownership.

Issues considered

  • Whether the Workmen's Compensation Commissioner was justified in applying the factor of 181.37 based on an assumed age of 41 years instead of the correct factor of 178.49 for the actual age of 42 years.
  • Whether the prior payment of Rs.2,00,000 by the employer should be adjusted against the statutory compensation awarded under the Employees Compensation Act.

Legislation cited

Subjects

  • Employees Compensation Act
  • statutory compensation
  • age factor
  • settlement adjustment
  • appeal
  • tribunal award
  • interest
  • RTGS

Judgment

         HIGH COURT OF JUDICATURE AT ALLAHABAD
                 FIRST APPEAL FROM ORDER No. - 1180 of 2012

The New India Assurance Co. Ltd.
                                                           .....Appellant(s)
                                   Versus

Smt. Krishna Devi And Others
                                                         .....Respondent(s)

Counsel for Appellant(s)        : Sudhanshu Behari Lal Gour, V.C. Dixit
Counsel for Respondent(s)       : Ashish Mishra, Hari Prakash Singh,
                                  Shailesh Rai, Rishi Bhushan Jauhari

Court No. - 50
                      HON'BLE PANKAJ BHATIA, J.

I.A. No. 4 of 2022

1. The application has been filed seeking substitution on account of the
death of the opposite party no.2. As the other legal representative is
already on record, the substitution application is allowed.

2. Let the necessary incorporation be made in the array of the parties by
the applicant during the course of the day.

Order on Appeal

3. The present appeal has been filed challenging an award dated
31.01.2012 passed under the Employees Compensation Act, whereby an
amount of Rs.3,62,740/- was awarded on account of the death of the
employee of the respondent no.3 while on duty. It was alleged by the
claimants that their son died while on duty on 14.12.2010 on account of
the injuries sustained. It was stated that the deceased was aged about 42
years.

4. The Tribunal after considering the evidence passed an award awarding
an amount of Rs.3,62,740/- based upon the table prescribed under the
Employees Provident Fund Act.

5. While challenging the said, the counsel for the appellant argues that at
the time of the death, some amounts were paid by the respondent no.3 to
the claimants towards full and final settlement and thus, the said amount
                                                        FAFO No. 1180 of 2012
                               2


of Rs.2,00,000/- should have been debited from the total amount awarded.
It is further argued that the documentary evidence was not provided. The
appeal was admitted on question No. B and C which are as under :

"B. Whether the Workmen's Compensation Commissioner was justified in
applying the factor of 181.37 accepting the age of the deceased as 41
years, whereas as per claim petition and according to the claimants the
age of the deceased was 42 years and the factor 178.49 is applicable as
provided in Schedule IV The Employee's Compensation Act, 1923 ?


C. Whether the Workmen's Compensation Commissioner was justified in
not adjusting Rs.2,00,000/- from the compensation awarded to the
claimants, which had already been received by the claimants from the
employer under the agreement."

6. Considering the issue no.1, the Tribunal while awarding the
compensation has considered the average age of 41 years, on which the
factor was applied, no error can be shown, which can be said to be a
substantial question of law warranting interference in the said finding.
With regard to the second issue that an amount of Rs.2,00,000/- was paid
towards full and final settlement to the claimants and was also admitted,
the said is also liable to be rejected as the compensation claimed by the
respondents is a statutory compensation flowing from the Employees
Compensation Act and there cannot be any agreement superseding the
statutory intent of awarding the compensation. Even in the said
agreement, there is no material to suggest that the claimants had given up
their right of claiming the compensation under the statute. In view
thereof, the second question of law, as framed by this court, is also
decided against the appellant.

7. In view thereof, the appeal lacks merit and is dismissed.

8. The said amount shall be payable to the claimants along with the
statutory interest as prescribed under section 4(a)(iii-a) of the Act. The
amount deposited shall be taken into consideration while awarding the
interest under section 4(a)(iii-a) of the Act.

9. The amount shall be paid through RTGS by the Tribunal directly in the
                                                                                           FAFO No. 1180 of 2012
                                                                   3


                                    account of the claimants. In case, the bank account contains the details of
                                    anybody other than the family members of the claimants, the amount shall
                                    not be deposited in that account and the claimants would be required to
                                    open a bank account either singly or jointly with family members only in
                                    view of the law as laid down by the Hon'ble Supreme Court in para 17.1
                                    of Parminder Singh vs Honey Goyal and others: 2025 LiveLaw (SC)
                                    318 and in para 9 of Suo Motu Writ Petition (C) No.7 of 2024 In
                                    Re:Compensation Amounts Deposited with Motor Accident Claims
                                    Tribunals and Labour Courts



                                                                                           (Pankaj Bhatia,J.)
                                    May 12, 2026
                                    VNP/-




Digitally signed by :-
VISHVANATH PRASAD SHUKLA
High Court of Judicature at Allahabad


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