IN THE HIGH COURT OF JUDICATURE AT PATNA MA No.74 of 2002 1. Sr. Divisional Manager, National Insurance Co. Ltd., Divisional Office, Motijheel, Muzaffarpur. 2. Branch Manager, National Insurance Co. Ltd., Barmipur Branch, Barmipur, Station Road, P.O, Barmipur, District – 24 Pargana ………….. O.P. No. 2 and 3 – Appellants. Versus 1. Sri Rahunath Sahni, S/o. Shri Mahendra Sahni, Village – Kerma Dih, P.S. Kurhni, District – Muzaffarpur. …………… Applicant ………… Respondent. 2. Mr. J. Bose. M/S Power Max (I) Pvt. Ltd., Power Plant Servicing Centre And Erection Stephent Courts 18 A., Park Street, Calcutta – 71. ………… O.P. No. 1 ………… Respondent. ----------- 16/ 29.07.2010 Heard the parties. This appeal has been preferred against the order dated 04.01.2002 passed in W.C. 3 of 1999 by Workmen Commissioner – cum – Deputy Labour Commissioner, Muzaffarpur under the Workmen’s Compensation Act whereby penalty of Rs.54,323/- has been imposed on the Insurance Company for not paying the amount of compensation within the prescribed period as contemplated under Section 4(A) (3) (b) of the Workmen’s Compensation Act, 1923. From the perusal of the records it appears that the claimant Raghunath Sahani got injury in his head causing loss of vision of his right eye and his claim allowed 2 to the extent of Rs. 78,088/- by the Deputy Labour Commissioner with a direction to pay within 60 days. However, the said amount has not been paid though the order was passed on 15.03.2000 and hence the penalty of Rs.54,323/- in addition to dues of Rs.78,088/- was imposed by order dated 04.01.2002 with direction to be paid by insurance company. Learned counsel for the Insurance Company, however, contended that the Insurance Company is not liable to pay the penalty and the interest for non-compliance as the penalty cannot be fastened with the Insurance Company and such penalty can only be imposed on the owner and has placed reliance upon a decision reported in 2003 (2) PLJR 722 (Most. Parmada Devi Vs. Sri Bishwanath Singh & ors.) and 2003 (3) PLJR 748 (The Divisional Manager, Oriental Insurance Co. Ltd. Vs. Naseema Khatoon and Anr.). From the fact of the case it is apparent that workmen compensation matter arises out of the loss of vision to the appellant by the accident but the amount of the compensation was not paid within the statutory period and hence the penalty was imposed. 3 However, in decision reported in 2003 (2) PLJR 722 (Most. Parmada Devi Vs. Sri Bishwanath Singh & ors.) not applicable as it is for proposition that once employer contest Deputy Labour Commissioner has no jurisdiction to decide. However, the decision reported in 2003 (3) PLJR 748 (The Divisional Manager, Oriental Insurance Co. Ltd. Vs. Naseema Khatoon and Anr.) it has been held that Insurance Company cannot be fastened with the liability to pay penalty imposed by the Deputy Labour Commissioner and has relying upon the decision reported in 1997 (8) SCC 1 (Ved Prakash Garg Vs. Premi Devi & Ors.) However, Section 4 (a) (3) (a) and (b) of the Workmen’s Compensation Act, the liability has been fixed on the employer to make provisional payment to the extent of liability and as per Section 4 (a) (3) (b) of the Act and in default in paying within a month from the date the same falls due. However, having regard to the law laid down in 1997 (8) SCC 1 (Ved Prakash Garg Vs. Premi Devi & Ors.) it has been held “when an employee suffers from injury while on duty on the motor accident, vehicle 4 belonging to the insured employer, the claim for compensation payable under the Compensation Act along with interest thereon, if any, as imposed by the Commissioner, Section 3 and Sections 4 (A) (3) (b) of the Compensation Act will have to be made good by the Insurance Company jointly with the insured employer. But so far as the amount of penalty imposed on the insured employer under contingencies contemplated by Section 4 (A) (3) (b) is concerned as that is on account of personal fault of the insured not backed up by any justifiable cause, the insurance company cannot be made liable to reimburse that part of the penalty amount imposed on the employer”. Hence, since the Act cast a duty on employer to pay the provisional or adjudicated compensation once fall due within a month then it is the employer who is liable to pay and if defalcated, it is his personal liability and Insurance Company cannot be held liable to fasten with the liability to pay for the default of employer as contemplated under Section 4(a) (3) (b) of the Workmen’s Compensation Act. Hence, it is the owner who is to pay the penalty with interest and not the Insurance Company and hence, the appellant Insurance Company is exonerated from the 5 liability and the impugned order is set aside to that extent regarding the payment by the Insurance Company. This appeal is, accordingly, disposed of. Kundan (Gopal Prasad, J.)