FAO No. 552 of 1989 [1] IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO No. 552 of 1989 (O&M) Date of decision: 18.1.2011 National Insurance Co. Ltd. .. Appellant v. Smt.Champa Devi and others .. Respondents CORAM: HON'BLE MR. JUSTICE RAJESH BINDAL Present: Mr. Paul S. Saini, Advocate for the appellant. ... Rajesh Bindal J. The Insurance Company is in appeal against the order passed by the Workmen Compensation Commissioner (for short, `the Commissioner') challenging the same on the limited issue of levy of penalty. Briefly, the facts are that Udey Pal alias Udey Bahadur was employed as driver with respondent No. 4 on Maruti Van No. HYE 1952. On 30.4.1987, Udey Pal met with an accident while driving the said van. As a result of the accident, he succumbed to the injuries. The deceased was 20 years of age at the time of death and was receiving ` 590/- per month as wages. The facts regarding employment of the deceased, his age and salary being not in dispute, the learned Commissioner assessed the compensation at ` 51,908.20 along with 40% penalty. Learned counsel for the appellant, placing reliance upon a judgment of of Hon'ble the Supreme Court in Ved Prakash Garg v. Premi Devi and others, 1998 ACJ 1, submitted that the insurer is not liable to pay the amount of penalty, as the primary liability to pay the compensation to the family of the deceased is of the employer, the insurer is only to indemnify the insured. In the present case, the Commissioner, while FAO No. 552 of 1989 [2] assessing the compensation at ` 51,908.20 awarded 40% thereof on account of penalty, the liability thereof has to fall upon the insured. No one has appeared for the respondents. After hearing learned counsel for the appellant, I find merit in the submissions made by him. The issue as to whether the insurer is liable to pay the penalty has been considered in Ved Prakash Garg's case (supra) and it was opined that the Insurance Company is not liable to re-imburse the amount of penalty levied on the employer. Relevant para 19 thereof is extracted below: “19. 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 4-A 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 under section 4-A(3)(b) is concerned, however, the insurance company would not remain liable to reimburse the said claim and it would be the liability of the insured employer alone.” Once the legal issue raised by the appellant is squarely covered by the judgment of Hon'ble the Supreme Court in Ved Prakash Garg's case (supra), the present appeal is accepted to the extent that the appellant shall not be liable to pay the amount of penalty. ( Rajesh Bindal ) Judge 18.1.2011 mk