Karnataka High Court: Insurer liable for sole proprietor’s death

The Karnataka High Court has ruled that an insurer cannot deny compensation to the dependents of a deceased sole proprietor who personally undertook hazardous work, holding the principal employer and insurer jointly and severally liable. The division bench of Justice Suraj Govindaraj and Dr. Justice Chillakur Sumalatha set aside the Raichur Workmen's Compensation Commissioner's order and directed payment of Rs 7,07,760 as compensation with 12 per cent interest.

The court noted that a substantial proportion of commercial activity in India is carried on through sole proprietary concerns, and a proprietor who personally executes hazardous work cannot be excluded from the definition of 'workman' under the Employees' Compensation Act, 1923. The judgment was delivered in the case of Radha & Ors. v. BBM Ispat Limited & Ors.