New India Assurance Company Ltd. v. Bhoma Ram @ Hanuta Ram
2004-04-06
PRAKASH TATIA
body2004
DigiLaw.ai
JUDGMENT 1. - Heard learned counsel for the parties. 2. The only question involved in this appeal is that whether Insurance Co. is liable to pay the interest amount to the compensation amount which has been awarded by the Workmen Compensation Commissioner in favour of the respondent No. 1 claimant on account of the loss which he suffered due to the accident during course of his employment. 3. Learned counsel for the appellant vehemently submitted that it was the duty of the employer to pay the compensation amount forthwith and if he did not pay compensation, the Insurance Company cannot be held liable to pay that amount which became liability of the insured because of his own fault. Learned counsel for the appellant relied upon the judgment of the Hon'ble Apex Court delivered in Writ Petition (Civil) No. 34112003, P.J. Narain is Union of India decided on 8.8.2003. 4. I considered the submission of the learned counsel for the appellant and find no substance in the argument of the learned counsel for the appellant. The Insurance Co. contracted with the insured to reimburse the entire amount which insured have to pay to his workman on account of accident suffered by his employee. 5. In the case relied upon by the learned counsel for the appellant, the writ petition was filed for the purpose of directing the Insurance Co. to delete the clause in the insurance policy which provides that in cases of is compensation under the Workmen's Compensation Act, 1923, the Insurance Co. will not be liable to pay interest. The Hon'ble Apex Court dismissed the writ petition holding that the liability of the Insurance Company is contractual and there is no liability of Insurance Company under the Workmen's Compensation Act and further observed that insurance is a matter of contract between the Insurance Company and insured and it is always open to the Insurance Company to refuse to insured and thereafter the Hon'ble Apex Court further observed that the Insurance Companies are entitled to provide by contract that they will not take on liability for interest. The Hon'ble Apex Court, in these facts, hold that the Insurance Company cannot be forced to take on liability which they do not want to take on.
The Hon'ble Apex Court, in these facts, hold that the Insurance Company cannot be forced to take on liability which they do not want to take on. The said decision itself clearly suggest that to avoid liability to interest, there must be a clause in the contract of Insurance Co, itself against taking on liability of interest by the insurance Company. Apart from it, it is necessary that Insurance Company should show that there is no statutory liability of the Insurance Company to 25 reimburse the entire claim amount to the insured which includes interest. 6. In view of the above when there is no contract between the appellant and the insured for not taking the liability of interest, I do not find any force in the appeal. The appeal is, therefore, dismissed.Appeal Dismissed. *******