Interest in w.c.act
Ladhu Ram Chowdhary
(Querist) 28 May 2008
This query is : Resolved
Interest payable in default of payment of compensation amount within one month from thedate itfalls due-whether the commissioner was justified inawarding interest at the of 12 per cent on the amount of compensation awarded by him from the date of accident .what cases law about s.c.&othere H.C.
H. S. Thukral
(Expert) 28 May 2008
Interest payable on default is controlled by statutory provisionin WC Act. Section 4A 3 (a) says
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-
(a) direct that the employer shall, in addition to the amount of the arrears, pay simple interest thereon at the rate of twelve per cent per annum or at such higher rate not exceeding the maximum of the lending rates of any scheduled bank as may be specified by the Central Government, by notification in the Official Gazette, on the amount due; and
Therefore the interest payable should be at the lending rate of any schedule bank.
I have come across judgments wherein simple interest @ 6% p.a. is awarded. However in motor accident case the Supreme Court has held that 9% interest p.a. is reasonable.
