Liability for penalty under the Workmen's Compensation Act rests on the employer, not the insurance company, and interests awarded are also subject to statutory amendments.

JUDGMENT :

HEMANT M. PRACHCHHAK, J.

1. Present appeal is filed by the appellant – New India Assurance Company Limited against the judgment and award dated 01.03.2007 passed by the learned Commissioner for Workmen's Compensation at Gandhidham-Kachchh in Workmen's Compensation Case (N.F.) No.11 of 2005, whereby the learned Commissioner has awarded compensation of Rs.2,41,920/- with interest @ 12% p.a. in favour of original claimant and also directed the appellant Insurance Company to pay 50% penalty to the tune of Rs.1,20,960/- alongwith other expenses including medical expenses to the tune of Rs.30,000/-.

2. The short facts giving rise to present appeal are that, the appellant is an Insurance Company and the respondent No.2 herein had obtained the W.C. Policy No. 212501/41/03/00044 for its worker. That, as per the claim petition, the claimant respondent No.1 herein was working with the insured as a Helper and he was earning Rs. 3500/- p.m. That, on 20.11.2004, while he was working on machine, he met with an accident and suffered serious injuries on his left leg, for which, he had claimed compensation by filing Workmen's Compensation Case being Workmen's Compensation Case (N.F.) No.11 of 2005, whereby the learned Commissioner has awarded compensation as aforesaid.

3. Being aggrieved and dissatisfied with the aforesaid judgment and award passed by the learned Commissioner, the appellant Insurance Company has filed the present First Appeal under Section 30 of the Workmen’s Compensations Act, 1923.

4. Heard learned advocate Mr. Yogi Gadhia, appearing for the appellant – New India Assurance Company Ltd. and learned advocate Mr. Harshad K. Patel, appearing for the respondent No.1 – original claimant.

5. Learned advocate Mr. Gadhia has submitted that the impugned judgment and award is challenged mainly on two counts viz., the direction fasten against the appellant Insurance Company to pay penalty @ 50% and the interest awarded by the learned Commissioner @ 12%. He has submitted that now it is well settled that so far as the liability of penalty is concerned, it cannot be fastened against the Insurance Company but, it is required to be borne by the employer who failed to pay the awarded amount within 30 days from the date of award and it is now covered by various decisions of the Hon’ble Apex Court as well as this Court and therefore, the directions qua payment of penalty @ 50% is absolutely illegal, unjust and against the settled principles of law. He has further submitted that the rate of interest awarded by the learned Commissioner is also unjust and disproportionate. Learned advocate Mr. Gadhia has submitted that the issue relating to liability of payment of penalty is directly covered by the decisions of the Hon’ble Apex Court and therefore, urged that the present appeal be allowed and the directions qua payment of penalty be appropriately modified. He has also submitted that so far as the interest awarded by the Commissioner @ 12% is concerned, the same is also to be borne by the employer. In support of his submissions, learned advocate Mr. Gadhia has referred and relied upon the decision of the Hon’ble Apex Court rendered in case of New India Assurance Co. Ltd. vs. Harshadbhai Amrutbhai Modhiya and another , reported in [2006] 5 SCC 192 and urged that the present appeal be allowed.

6. As against that, learned advocate Mr. Patel, appearing for the respondent No.1 – original claimant, has submitted that so far as the penalty is concerned, he has nothing to say further as it is already covered by numbers of decisions but, so far as the rate of interest is concerned, it is subsequently amended by the Act itself where the rate of interest is from 6% to 12% and theref