JUDGMENT : Harilal, J. 1. New India Insurance Company Ltd, the appellant herein was the 2nd opposite party in WCC 41/2006 on the files of the Commissioner for Workmen's Compensation, Ernakulam. The aforesaid claim petition was filed by the 1st respondent herein/applicant claiming compensation for the death of her husband who died in an accident allegedly arose out and in the course of employment under the 2nd respondent herein/1st opposite party. Hence she claimed compensation from the 1st opposite party. The 1st opposite party filed a written statement admitting that he was a workman and they also admitted the accident as averred by the applicant. Further it was contended that the workman is covered by a valid workman's compensation policy issued by the 2nd opposite party to the 1st opposite party and therefore the 2nd opposite party is liable to pay compensation to the applicant. The 2nd opposite party also filed a written statement admitting the policy. But, raised a contention that they are not liable to pay any interest for the amount of compensation. However, after considering the rival pleas and evidence thereon, the Commissioner for Workmen's Compensation passed the order granting an amount of Rs.3,12,692.50/- as compensation to the respondent. The legality and correctness of the said order granting interest to the compensation is challenged in this appeal. 2. Heard the learned counsel for the appellant and the learned counsel for the respondent. 3. This appeal is filed mainly challenging the order whereby the 2nd opposite party was directed to pay interest at the rate of 12% per annum from the date of accident till the date of compensation. According to the Insurance Company, as per the terms of policy conditions, the Insurance Company is not liable to pay interest for the compensation. It is contended that as per the policy conditions, liability to pay interest for the compensation is excluded. So the Insurance Company is not liable to pay interest for the amount of compensation. 4. We have meticulously gone through the policy condition and find that there is an exclusion clause and in view of the decision of the Supreme Court in New India Assurance Co.Ltd v. Harshadbhai Amrutbhai Modhiya (2006 KHC 662), the exclusion clause is a valid one. 4. We have meticulously gone through the policy condition and find that there is an exclusion clause and in view of the decision of the Supreme Court in New India Assurance Co.Ltd v. Harshadbhai Amrutbhai Modhiya (2006 KHC 662), the exclusion clause is a valid one. In the aforesaid decision, the Supreme Court held that the policy issued under the Workmen's Compensation Act (for short 'the Act') is not a statute policy and the rights and liabilities under the policy are governed by the terms of policy only. In other words, the parties are at free to enter into a contract of their choice, provided that the terms of contract must be lawful. Therefore we find that the exclusion clause is a valid and enforceable one. 5. Then the question to be considered is whether the exclusion clause is an enforceable one in view of the terms of contract in the policy. 6. On an analysis of the exclusion clause we find that the exclusion of interest is not an absolute one and it is a conditional exclusion only. The exclusion clause reads that “the Insurance Company is not liable to pay interest or penalty imposed on the insurer on account of his/their failure to comply with the requirements under the Workmen's Compensation Act, 1923”. In order to invoke the exclusion clause, we find that the Insurance Company ought to have stated in their written statement that the applicant or the 1st opposite party has failed to comply with the requirements laid down under the Act. So also, the Insurance Company should have specified the particulars of the requirement which the applicant had failed to comply under the Act. That apart, the Insurance Company should have proved the said contention also in evidence. But, in the instant case, the Insurance Company has not disclosed the particulars of the requirement, which the applicant had failed to comply under the Act and the Insurance Company has no such case. In other words, the Insurance Company has failed to prove the failure from the part of the applicant or the 1st opposite party to comply with the requirement under the Act. In such circumstances, the Insurance Company cannot escape from the liability to pay interest for the compensation amount. In other words, the Insurance Company has failed to prove the failure from the part of the applicant or the 1st opposite party to comply with the requirement under the Act. In such circumstances, the Insurance Company cannot escape from the liability to pay interest for the compensation amount. In the above analysis we find that the Commissioner for Workmen's Compensation is justified in directing the Insurance Company to pay interest for the compensation amount. The Appeal stands dismissed accordingly.