FAO No.2927 of 2008 (O&M) -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH **** FAO No.2927 of 2008 (O&M) DATE OF DECISION:10.09.2010 **** M/s NITCO Roadways Ltd. through Shri Naresh Kumar Kaushik, Area Manager, NITCO Roadway Pvt. Ltd. Chandigarh. . . . . Appellant VS. Bhikhan Rai and others . . . . Respondents **** CORAM : HON’BLE MR.JUSTICE RAKESH KUMAR JAIN **** Present: - Mr.G.S. Sandhawalia, Advocate for the appellant. Mr.Ram Pal Verma, Advocate for respondents No.1 and 2. Mr.Sanjiv Pabbi, Advocate for respondent No.3. **** RAKESH KUMAR JAIN J. This appeal is directed against the order dated 28.4.2008 passed by Commissioner under the Workmen’s Compensation Act, Circle II, Sonipat (for short ‘the Commissioner) by which claimants have been awarded a sum of `4,30,560/- towards compensation on account of death of Nagender along with interest @ 10% per annum from the date of order. The principal amount was ordered to be paid by defendant No.2 (Insurance Company) and interest was ordered to be paid by defendant No.1(employer). FAO No.2927 of 2008 (O&M) -2- The present appeal has been filed by the employer (defendant No.1) challenging its liability of interest but before that a few facts are required to be noticed. Nagender s/o Bhikhan Rai was working as a driver on truck bearing No.HR-38D-0664 under the employment of the appellant. He died during the course of his employment in a motor vehicle accident on 6.12.2006 in the area of Police Station Murthal, Village Pipli Khera, Tehsil and Distt. Sonipat. His parents filed a claim petition to the Commissioner under the Workmen’s Compensation Act, 1923 (for short ‘the Act’), inter alia, alleging that deceased – Nagender was employee of the appellant and had died during the course of his employment. Admittedly, vehicle was insured vide insurance policy (Ex.R7). The Commissioner under the Act decided issue No.1 in favour of the claimants and held that there was a relationship of employer and employee and the deceased-Nagender had died during the course of his employment. While deciding issue No.2, compensation of `4,30,560/- was awarded which was held to be paid by the Insurance Company whereas interest @ 10% per annum on account of claim from the date of order was also awarded which was held to be paid by the employer. Learned counsel for the appellant/employer has submitted that the payment of component of interest was not specifically excluded in the insurance policy, therefore, the amount of interest was also liable to be paid by the Insurance Company. In support of his submissions, he relied upon a decision of this Court in the case of “Ajay Vs. Balwan Singh and another” 2010(3) RSJ 284. On the other hand, learned counsel for respondent No.3/Insurance Company has submitted that the Insurance Company is not liable to pay interest as it was not the part of the insurance policy. FAO No.2927 of 2008 (O&M) -3- I have heard both the learned counsel for the parties and perused the record with their assistance. Admittedly, a component of interest is not specifically excluded in the insurance policy. In the case of Ajay (Supra), respondent was working as a Cleaner on a truck. The truck met with an accident in which he suffered injuries for which he filed a claim petition before the Commissioner under the Act for an amount of `3 lacs as compensation along with interest. In the said case, this Court has held that if the liability of the Insurance Company to pay interest is not excluded in the insurance policy, the liability would be on the Insurance Company in view of the decision of the Supreme Court in the case of “Ved Parkash Garg Vs. Premi Devi and others” 1997(4) SCT 541. To my mind, present case is fully covered by the decision of this Court in the case of Ajay (Supra) and hence the same is hereby allowed. Order of the Commissioner under the Act is hereby modified to the extent that amount of interest shall also be paid by the Insurance Company not by the employer. No costs. (RAKESH KUMAR JAIN) SEPTEMBER 10, 2010 JUDGE Vivek