National Insurance Co. Ltd. vs Ram Niwas Sharma

Jawahar Lal Gupta, J.—The respondent workman was working as a Driver with Mr. Ram Niwas Sharma. He had received multiple injuries including fracture of ribs and limbs. He submitted an application for the award of compensation to the Commissioner under the Workmen''s Compensation Act, 1923, Karnal. Vide order dated August 16, 1995 the Commissioner assessed and awarded the compensation as underv

Expenses on treatment Rs. 15,746.00 Compensation at 40% disability Rs. 1000 x 50/1000 x as given 209.92 x 40/100 Rs. 41,984.00 Penalty 25% of compensation Rs. 10,496.00 interest @ 6% simple per annum from the date of application i.e. 7.11.90 till today i.e. 16.8.95 Rs. 12,028.00 Total as on 16.8.95 Rs. 80,254.00 (Rs. Eighty Thousand Two Hundred and Fifty Four only)

Aggrieved by the above award the insurer has filed the present appeal.

The solitary contention raised by Mr. Suri, learned counsel for the appellant, is that the Commissioner has erred in awarding the compensation against the insurer. The liability to pay penalty is that of the employer.

A perusal of the award given by the Commissioner shows that a penalty of Rs. 10,496/- has been awarded. It has been held that the liability is that of the insurer. In view of the decision of their Lordships of the Supreme Court in Ved Prakash Garg Vs. Premi Devi and others, the liability for payment of penalty is that of the employer. In paragraph 24 of the decision, their Lordships have been pleased to observe as under :-

"As a result of the aforesaid discussion it must be held that the question posed for our consideration must be answered partly in the affirmative and partly in the negative. In other words the insurance company will be liable to meet the claim for compensation along with interest as imposed on the insured employer by the Workmen''s Commissioner under the Compensation Act on the conjoint operation of Section 3 and Section 4A Sub-section (3)(a) of the Compensation Act. So far as additional amount of compensation by way of penalty imposed on the insured employer by the Workmen''s Commissioner u/s 4A(3)(b) is concerned, however, the insurance company would not remain liable to reimburse the said claim amount, would be the liability of the insured employer alone."

In view of the above, it has to be held that the liability to pay penalty was that of the employer viz. respondent No. 1 in this appeal. In case the amount has already been paid by the appellant to the workman, it shall be entitled to recover it from the employer.

The award given by the Commissioner is modified to the above extent. In other respects, the appeal is dismissed. No costs.