JUDGMENT 1. - Learned counsel for the appellant submitted that the issue involved in the present appeal is squarely covered by the decision of Hon'ble Supreme Court in the case of Kamla Chaturvedi v. National Insurance Co. Ltd. & Ors. reported in 2009 ACJ 115 and the present appeal filed by the appellant-employer is only to the extent to exoneration of respondent-Insurance Company (The New Indian Assurance Co. Ltd.) the extent of interest awarded on the amount of compensation awarded by the learned Workmen Compensation Commissioner. 2. The Hon'ble Apex Court in the case of Kamla Chaturvedi (supra) has held as under: "6. In Ved Prakash Garg v. Premi Devi, 1998 ACJ 1 (SC) , this Court observed that the Insurance Company is liable to pay not only the principal amount of compensation payable by the inc"ter employer but also interest thereon, if ordered by the Commissioner to be paid by the insured employer. Insurance company is liable to meet claim for compensation along with interest as imposed on insured employer by the Act on conjoint operation of Sections 3 and 4-A(3)(b) of the Act. In New India Assurance Co. Ltd. v. Harshadbhai Amrutbhai Modhiya, 2006 ACJ 1699 (SC) , Ved Prakash Garg's case, 1998 ACJ 1 (SC), was distinguished on facts. It was observed that in the said case the Court was not concerned with a case where an accident had occurred by use of motor vehicle in respect whereof the contract of insurance will be governed by the provisions of the Motor Vehicles Act, 1988 (in short the 'M.V. Act'). A contract of insurance is governed by the provisions of the Insurance Act, 1938 (in short the 'insurance Act'), unless the said contract is governed by the provisions of a statute. The parties are free to enter into a contract as per their own violation. The Act does not contain a provision like Section 146 of the M.V. Act where a statute does not provide for a compulsory insurance or accident thereof. The parties are free to choose their terms of contract. In that view of the matter contracting out so far as the reimbursement of amount of interest is concerned is not prohibited by a statute. This position have been reiterated in P. Narayan v. Union of India, 2004 ACJ 452 (SC) . In the instant case the position is different. The parties are free to choose their terms of contract. In that view of the matter contracting out so far as the reimbursement of amount of interest is concerned is not prohibited by a statute. This position have been reiterated in P. Narayan v. Union of India, 2004 ACJ 452 (SC) . In the instant case the position is different. The accident in question arose on account of vehicular accident and provisions of M.V. Act are clearly applicable. We have gone through the policy of insurance as was the case in Harshadbhai Amrutbhai Modhiya's case (supra) was stipulated in the policy of insurance. Therefore, the Insurance Company is liable to pay the interest." 3. Learned counsel for the appellant-employer does not challenge the levy of penalty imposed by the learned Commissioner upon the appellant as the liability to pay the penalty cannot be denied by the Insurance Company. 4. Accordingly, the present appeal is partly allowed and it is directed that amount of penalty shall be paid by the appellant-employer, and the respondent No. 3-The New India Assurance Co. Ltd. shall pay the amount of interest also, besides the amount of compensation of Rs. 4,35,560/- awarded by the learned Workmen Compensation Commissioner, Bikaner in WC Case No. 2/2003 (Tara Chand & Anr. v. Basti Ram and New India Assurance Co. Ltd.) . No order as to costs.Appeal Partly Allowed. *******