NEW INDIA ASSURANCE CO LTD Vs. BHOGENDER JHA

JUDGEMENT

(1.) By way of this appeal under section 30 of the Employee's Compensation Act, 1923 (hereinafter referred to as 'the Act'), challenge is made to the impugned order dated 5.10.2011 by which the Commissioner, Employee's Compensation has directed the insurance company to pay penalty at the rate of 50 per cent on the principal amount and also directed to pay 12 per cent interest per annum on the compensation amount from the date of accident till its realization.

(2.) Briefly, the background of the case is as under:

(3.) Notice of the aforesaid application was sent to the appellant, i.e., insurance company as well as to the respondent No. 2. Appellant and the respondent No. 2 contested the claim before the Commissioner. The respondent No. 2 contended that if workers are insured under the workmen compensation policy, the appellants are liable to pay the compensation as well as interest and the penalty and the management has no liability to pay the same. It was contended that the appellant insurance company had already made payment of compensation, as such if any interest and penalty was to be levied, the same was to be recovered from the appellant insurance company. The stand of the insurance company before the Commissioner was that the insurance company was not liable to pay the interest and penalty as they had already made the payment of compensation amount. Their further stand was that the compensation fell due only on the date of adjudication by the court, i.e., on 13.11.2007 and not on the date of accident. Further, it was their stand that in a case where disability was assessed by the Board of Doctors, the compensation falls due only on the date of adjudication and not before.