Case: New India Assurance Co. Ltd Vs. Harshadbhai Amrutbhai Modhiya

3. Before adverting to the contentions raised by the parties herein, we may notice the contract of insurance. By reason of the said contract, the insurer has made itself liable to reimburse the insured if during the period of insurance any employee in his immediate service sustained personal injury by accident or disease arising out of and in the course of employment by the insured in the business wherefor he would be liable to pay compensation either under:(i) the law set out in the Schedule or(ii) at common lawHowever, therein a proviso has been added which reads as under:"Provided that the insurance granted hereunder is not extended to include:(i) any interest and/or penalty imposed on the insured on account of his/her failure of comply with the requirements laid down under the W.C. Act, 1923 and(ii) any compensation payable on account of occupational diseases listed in part C of schedule III of the W.C. Act, 1923."Sanjay Amrutbhai Modhiya was a sales man employed by the insured Respondent No. 1. He met with an accident on 24.8.1996. His heirs and legal representatives filed an application for grant of compensation before the Workmens Compensation Court, Godhra claiming a sum of Rs. 2,25,220/-. The Appellant herein raised a contention as regards its limited liability in terms of the contract of insurance. By an order dated 1.6.2004, the Commissioner of Workmens Compensation awarded a sum of Rs. 2,25,220/- with 9% interest thereon from the date of filing of application till realization in favour of the claimants. A direction was also issued to the Appellant to pay the said amount. The appeal there against was preferred by the Appellant in terms of Section 30 of the Act which by reason of the impugned judgment has been dismissed relying on or on the basis of the decisions of this Court in Ved Prakash Garg v. Premi Devi and Others [(1997) 8 SCC1] and L.R. Ferro Alloys Ltd. v. Mahavir Mahto and Another [(2002) 9 SCC 450] 4. Theinsurer is in appeal before us.

Reasoning:
We are, in this case, not concerned with a case where an accident has occurred by use of a motor vehicle in respect whereof the contract of insurance would be governed by the provisions of the Motor Vehicle Act, 1988