- (1.) HEARD learned advocate Mr. Gadhia on behalf of appellant New India Assurance Co. Ltd. The appellant assurance company has challenged award passed by Workmen Compensation Commissioner, Kachchh at Bhuj in Workmen Compensation none fatal case no. 20/2007 vide exh 41 dated 29/4/2008. The Commissioner has awarded Rs. 3,14,596/- with 9% interest from the date of accident till realization of amount of compensation. Learned advocate Mr. Gadhia raised contention that Commissioner has committed gross error in coming to conclusion that figure of disability is having adverse effect on earning capacity of workman, that has been enhanced from 25% to 60% without any medical evidence. He submitted that medical evidence suggests 25% disability, which has been enhanced without any proper evidence by Commissioner upto 60% and that is the basic error committed by Commissioner. He submitted that Doctor was examined by workman before Commissioner. He also submitted that direction against appellant to pay interest is not part of terms and condition of insurance policy and submitted that there is no statutory liability of insurance company to pay interest upon compensation to workman. He relied upon decision of this Court in case of New India Assurance Company Ltd v/s Pababhai Mayabhai Harijan and Ors reported in 2008 (II) CLR 161 = 2008 (2) GLR 1091 and recent decision given by Co-ordinate bench on the same issue in First appeal no. 3581/2006 dated 29/8/2008. He submitted that Co-ordinate bench has considered decision of Apex Court in case of New India Assurance Co. Ltd. V/s Harshadbhai Amrutbhai Modhiya reported in 2006 AIR SCW 2352. He also raised contention before this Court that one side Commissioner come to conclusion that because of injury earning capacity of workman is reduced from 25% to 60%, but real fact is otherwise, because during pendency of proceeding workman was getting double amount as salary from insured. Therefore, it can not be considered a case of reducing earning capacity of workman. He also raised contention that application under the provisions of Workmen compensation Act filed after a period of two years from the date of accident, even though, interest was awarded from date of accident. Except that learned advocate Mr. Gadhia has not raised any other contention before this Court. I have considered contention raised by learned advocate Mr. Gadhia and I have perused award passed by Workmen Compensation Commissioner, Kachchh at Bhuj. The contention raised by learned advocate Mr. Gadhia for reducing earning capacity, for that, relevant discussion made in para 20 of award, which is quoted as under: "20. In view of the rival contentions of the parties in light of the documentary as well as oral evidence on record, this Court would like to consider as to whether the earning capacity of the applicant has been reduced totally or partially. As mentioned in the disability certificate Exh 33 the applicant has incurred permanent disability of 25%. The applicant has not examined the medical expert evidence for throwing light on the point of disability. The applicant himself examined, on oath, at Exh 15. He deposed, on oath, that due to the said injury and consequent disability, he is not able to do his work properly. Applicant further deposed that he used to do his work with right hand but due to accident now he is not able to do his work with right hand but dues his work with left hand. Applicant deposed, on oath, that routine work he is forced to take help of other persons. During cross-examination of the applicant, the learned advocate for the opponents have not been able to extract any contrary evidence from the mouth of the applicant that his earning capacity has not been reduced. Of course, it has come out that the applicant was doing work as R. S. T. Machine and that work cannot be done by single hand and the help of both the hands is required. Looking to the circumstance and the facts of the present case, it is clearly established that the applicant used to work with the right hand and as the four fingers of the right hand have been crushed and cut, he is not able to do his original work as he was doing prior to the accident. It has also come out from the record that the applicant used to work on crushing machine and both the hands are required to do that work. In absence of right hand, such a work cannot be properly performed with the left hand. Therefore, looking to the disability certificate issued by the Orthopaedic Surgeon and the nature of his work this Court has no hesitation to hold that the earning capacity of the applicant is reduced to 60% instead of 25%. The figure of disability given by the Orthopaedic Surgeon of Bombay is only of the particular limb such as four fingers but the doctor has not mentioned the effect of loss of such fingers in the working of the life of a workman like applicant who used to work on the crushing (grinding) machine of the ownership of opponent No. 1. As held above, if we take into consideration such impact of the reduction of four fingers particularly of right hand of a person who is labourer on the machine, then without hesitation it can be said that the earning capacity of the applicant must have been reduced to a great extent which cannot be compensated in terms of money but a view to compensate the applicant against the loss of his earning capacity, then the 60% loss of earning capacity in the present is just and proper. Therefore, this Court holds that applicant has suffered 60% loss of his earning capacity. " the commissioner has considered that evidence of workman was examined on oath vide exh 15 and deposed due to said injury and consequent disability, he is not able to do his work properly. The workmen further deposed that he used to do his work with right hand, but due to accident, now he is not able to do his work with right hand but does his work with left hand. He also deposed before Commissioner that in routine work, he is forced to take help of other person. According to Commissioner, looking to facts and circumstances, it was clearly established that workman used to work with right hand and as four finger of right hand have been crushed and cut, he is not able to do his original work as he was doing prior to accident. While working on crushing machine both hands are required to do that work and in absence of right hand, such work can not be properly performed with left hand. Therefore, Commissioner has examined matter in light of hard reality that workman has loss his four fingers, which has been crushed and cut. That can not be utilized for doing same kind of work with help of right hand, then naturally reduced earning capacity of person, which has been quantified by Commissioner after considering medical certificate from 25% to 60%. This aspect recently examined by Apex Court in case of K. Janardhan V/s United India Insurance Co. Ltd and other reported in 2008 (8) SCC 518. The apex Court has considered earlier decision in case of Pratap Narain Singh Deo Vs. Srinivas Sabata reported in 1976 (1) SCC 289. The fact of reported case is that appellant driver received injury in accident, which resulted into amputation of right leg of driver. The medical certificate certified 15% disability as prescribed in schedule I Pt. II List 20 for amputation of right leg of driver. The relevant discussion made in para 5 is quoted as under: "5. The learned counsel for the appellant has raised only one argument during the course of the hearing. He has submitted that the appellant claimant being a tanker driver, the loss of his right leg ipso facto meant a total disablement as understood in terms of Section 2 (1) (l) of the Workmen's Compensation Act and as such the appellant was entitled to have his compensation computed on that basis. In support of this plea, the learned counsel has placed reliance on Pratap narain Singh Deo Vs. Srinivas Sabata. The cited case pertained to a carpenter who had suffered an amputation of his left arm from the elbow and this Court held this amounted to a total disability as the injury was of such a nature that the claimant had been disabled from all work which he was capable of performing at the time of the accident. It was observed as under: ( SCC p. 291, para 5)"5. The expression "total disablement" means such disablement, whether of a temporary or permanent nature, as incapacities a workman for all work which he was capable of performing at the time of the accident resulting in such disablement," it has not been dispute before us that the injury was of such a nature as to cause permanent disablement to the respondent, and the question for consideration is whether the disablement incapacitied the respondent for all work which he was capable of performing at the time of the accident. The Commissioner has examined the question and recorded his finding as follows: "the injured workman in this case is carpenter by profession. . . By loss of the left hand above the elbow, he has evidently been rendered unfit for the work of carpenter as the work of carpentary can not been done by one hand only. " this is obviously a reasonable and correct finding. Counsel for the appellant has not been able to assail it on any ground and it does not require to be corrected in this appeal. There is also no justification for the other argument which has been advanced with reference to Item 3 of Part II of Schedule 1, because it was not the appellant's case before the Commissioner that amputation of the arm was from 8" from tip of acromion to less than 4 below the tip of olecranon. A new case cannot therefore be allowed to be set up on facts which have not been admitted or established. " the question was examined by Apex Court that permanent disability and incapacity in earning capacity, both are different things and both have to be considered separately in light of injury received by workman and in light of work performed by workman. Looking to fact of this case, workman, who loss his four fingers of right hand which has been cut, having any adverse effect on earning capacity or not? That has been rightly examined by Commissioner and come to conclusion that normally workman required two hands in crushing machine, but person is expert, having experience and good skill may able to perform work on left hand without help of right hand. That does not mean that there is no loss of earning capacity of workman. Therefore, contention raised by learned advocate Mr. Gadhia can not be accepted. The contention raised by learned advocate Mr. Gadhia is that insurance company is not liable to make payment of interest to workman as he relying upon decision of Apex Court in case of Modhia with decision of co-ordinate bench as referred above. Learned advocate Mr. Gadhia submitted that this Court after considering decision of Apex Court in case of Modhiya held that liability to pay penalty and interest can not be fasten upon insurance company. Therefore, he submitted that in fact of this case, Workmen Compensation Commissioner has committed gross error in holding liability for interest upon insurance company. I have considered submission made by learned advocate Mr. Gadhia and also perused judgement of this Court as referred above. In reported decision, policy specifically provides that insurance company is not liable to pay interest and/or penalty imposed on insured on account of his/their failure to comply with requirements as laid down under the Act. This observation made by Co-ordinate bench of this Court in para 12, which is quoted as under: "12. In the instant case, the policy specifically provides that the Insurance Company is not liable to pay interest and/or penalty imposed on the insured on account of his/their failure to comply with the requirements as laid down under the Act. Therefore, in the light of the ratio laid down by the Apex Court in the case of NEW INDIA ASSURANCE CO. LTD. V/s. HARSHADBHAI AMRUTBHAI MODHIYA [supra], the appellant Insurance Company cannot be fastened with the liability to pay penalty and interest. " the facts of present case are on hand, it was not case of appellant insurance company before Workmen Compensation Commissioner that as per terms and conditions of insurance policy, insurance company is not liable to pay interest and penalty amount to claimant. Learned advocate Mr. Gadhia submitted that only compensation worked out by Commissioner, for that, Commissioner can pass appropriate orders but can not pass order while directing insurance company to pay compensation and interest to respondent claimant. The insurance company is liable or not? is to be examined on the basis of terms and conditions incorporated in insurance policy. Therefore, if, there was specific condition incorporated in insurance policy between both parties then insurance company is not liable to make any payment in case of accident occurred for penalty and interest. It is not clear from record of this case and not established by appellant before Commissioner that there was a specific condition incorporated by insurance company that no premium was paid by insured to cover risk of concerned employee for penalty and interest. In absence of such condition, insurance company is liable to pay interest but if, specific condition is there then insurance company is not liable to pay interest to respondent claimant. This fact has not been high lighted by appellant before Commissioner under the Provisions of Workmen Compensation Act. Therefore, Commissioner has rightly directed both parties for protecting interest of claimant. The insurance company can recover amount from employer, if, that amount is to be paid by Company beyond terms and condition of insurance policy. In light of aforesaid back ground, case relied by learned advocate Mr. Gadhia is distinguishable. This aspect has been examined by Commissioner in para 22, 23 which is quoted as under: "22. Now, this Court is required to consider as to whether the opponent No. 1 employer was negligent in paying the compensation to the applicant employee within the period of one month as per the provisions of Section 4a of the W. C. Case. On going through the record of the case it appears that the employer opponent No. 1 has not paid the amount of compensation or any part of the compensation within the prescribed period of one month as stipulated in the Act, even though he was knowing about the accident and the permanent disability sustained by the applicant in the said accident. It is also on record that as the employer has not paid the amount of compensation, the applicant-employee served the employer with the notice which was duly served on him is on record showing that such notice was issued to the employer. In spite of the said fact, the employer has not cared to pay the compensation to the applicant, therefore, being aggrieved with the same the applicant has come before this Court for recovery of the compensation under section 4 of W. C. Case. Now, on going through the record of the case it appears that the insurance policy is produced on record, which shows the coverage of the insurance of the clay grinders-19, clerical staff-110, drivers -22, and watchmen-9 at the time of accident. When such is the situation, it was also duty of the insurance company to indemnify the insured-opponent no. 1 and to pay the compensation to the applicant-employee within the prescribed period as per the Act. Since, the insurance company has also9 not cared to pay the compensation to the applicant nor any amount is deposited with this Court, there are sufficient reasons for this Court to believe that either the insured or the insurer are negligent for paying the compensation. It is apparent from the record of this case that the opponent no. 1 has repeatedly wrote letters to the opponent No. 2 insurance company regarding the incident but the insurance company has not cared to pay the compensation nor they have tried to deposit the said amount before this Court. It has come out from the record that opponent No. 1 has informed to the insurance company after the incident, immediately, with all the relevant documents regarding the injured person, instead of that insurance company has not cared to settle the claim case. On the other hand, as per the say of applicant the opponent No. 1 employer has spent two to two and half lacs rupees for the medical treatment of the applicant. Looking to the above facts, there appears no negligence on the part of applicant No. 1. therefore, the opponent No. 1 is not liable to pay any penalty to the applicant. Further, the learned advocate Mr. S. D. Rathod, has submitted at the Bar that the applicant waives the penalty payable by the opponent No. 1 because the opponent No. 1 has spent sufficient amount, amounting to more than Rs. 2,50,000/- on the medical treatment of the applicant and till today the opponent No. 1 is taking care of the applicant. In view of the above circumstance, this Court holds that the opponent No. 1 is not liable to pay any penalty to the applicant. 23. The learned advocate Shri S. D. Rathod for the applicant have vehemently argued that since the insured is liable to pay the compensation along with interest and the insurance company being the insurer should indemnify the Award that may be passed against the opponent No. 1 employer. He has further submitted that the liability of the insurer to pay the compensation under section 3 (1) of W. C. Act and to pay the amount of interest under section 4a is the statutory liability of the employer and under the statutory policy of insurance, it is the statutory liability of the insurance company to indemnify the insured. Therefore, this Court holds that the insurer opponent no. 2 is liable to pay the compensation amount of Rs. 3,14,596/- along with interest at the rate of 9% per annum from the date of accident till realization of the amount of compensation. " there is no dispute about contention that insurance company is not liable to make payment of interest to workman as per decision of Apex Court in case of Modhia, but in this case, Commissioner has hold that insurer appellant Company - opponent no. 2 is liable to pay amount of compensation along with interest at the rate of 9% interest from date of accident jointly and severally with opponent no. 1. So, final direction in order is that opponent no. 1 and 2 both are liable jointly and severally to pay amount of compensation with 9% interest. Therefore, it is not decided liability of insurance company to pay interest but employer and insurance company both are liable to pay interest jointly and severally. If, according to insurance company, they are not statutorily liable, then, they can recover from employer if terms and conditions permitted. The insured employer obtained insurance policy paying premium to insurance company for covering risk of employee and if insurance company is not discharging his legal obligation as well as contractual obligation in time and if any burden of interest is to be bared that should be decided interse by insured and insurance company, but victim or claimants, those who are beneficiary and they were not party to contract should not have to be suffered for getting amount of interest either from employer or from insurance company. The co-ordinate Bench has considered decision of Apex Court in para 3 which is relevant therefore, quoted as under: "3. Heard learned counsel for the respective parties. The issue involved in this appeal is squarely covered by a decision of the Apex Court in the case of New India Assurance Co. Ltd. V. Harshadbhai Amrutbhai Modhiya, reported in 2006 AIR SCW 2352 in paras 14, 15 and 21 it is held as under: 14. By reason of the provisions of the Act, an employer is not statutorily liable to enter into a contract of insurance. Where, however, a contract of insurance is entered into by and between the employer and the insurer, the insurer shall be liable to indemnify the employer. The insurer, however, unlike under the provisions of the Motor Vehicles Act does not have a statutory liability. Section 17 of the Act does not provide for any restriction in the matter of contracting out by the employer vis-a-vis the insurer. 15. The terms of a contract of insurance would depend upon the volition of the parties. A contract of insurance is governed by the provisions of the Insurance Act. In terms of the provisions of the Insurance Act, an insured is bound to pay premium which is to be calculated in the manner provided for therein. With a view to minimize his liability, an employer can contract out so as to make the insurer not liable as regards indemnifying him in relation to certain matters which do not strictly arise out of the mandatory provisions of any statute. Contracting out, as regards payment of interest by an employer, therefore, is not prohibited in law. 21. For the reasons aforementioned, the impugned judgement cannot be sustained. It is set aside accordingly. The appeal is allowed. The appellant is not liable for the interest. However, we make it clear that the employer shall be liable to pay the amount of interest to the claimant. In the facts and circumstances of the case, there shall be no order as to costs. " considering aforesaid decisions of Apex Court and Co-ordinate bench, Apex Court has held that appellant insurance company is not liable for interest but employer shall be liable to pay amount of interest to claimant. In the present case, Commissioner has held that both are liable to pay interest jointly and severally, so workman should not be suffered. Therefore, insurance company or employer shall have to decide interse that who will pay interest to workman, otherwise, both are liable to pay interest to claimant /workman and they can recover amount of interest either from employer or insurance company. The Commissioner has rightly not decided issue in respect to liability of insurance company to pay interest, otherwise, question of giving direction to pay interest jointly and severally does not arise. Therefore, considering direction given by Commissioner holding both jointly and severally liable for interest. The insurance company can recover amount of interest from employer but atleast workman should not have to be suffered because of interse dispute between employer and insurance company. In respect to contention raised by learned advocate Mr. Gadhia that there were delay of two years in filing application before Commissioner by workman, even though, interest awarded from the date of accident, which was raised in written statement, but no specific argument was made by insurance company before Commissioner. Therefore, it is not open for insurance company to be raised first time before this Court. Considering reasoning given by Commissioner while dealing with such application and awarding compensation to workman who loss his four fingers of right hand, which has been cut and enhancing permanent disability from 25% to 60% having impact on earning capacity of workman. According to my opinion, Commissioner has rightly examined matter while keeping in mind object and beneficiary legislation of Workman Compensation Act, for that, Commissioner has not committed any error which would require interference by this Court. The Commissioner has discussed each and every aspects while considering documentary and oral evidence which are led before Commissioner and giving reason can not consider that finding given by Commissioner is baseless and perverse. Therefore, contention raised by learned advocate Mr. Gadhia can not be accepted and rejected. Hence, there is no substance in the present appeal. Accordingly, present appeal is dismissed. Today, first appeal is dismissed by this Court, therefore, no order is required to be passed in civil application. In light of aforesaid discussion in respect to liability of interest of insurance company, it is open for insurance company, if, terms and conditions permit then they can recover amount of interest from employer.;