P. Somarajan, J.

1. These are the two appeals preferred against the order passed by the Employees Compensation Commissioner, Idukki, Peermade in E.C.C.No.25/2014 (W.C.C.No.92/2002). M.F.A.No.31/2017 is filed by the first opposite party and M.F.A.No.4/2016 is filed by the opposite party Nos.2 and 3 respectively. The proceedings were initiated on the application made by the legal heirs of one deceased V.S.Venugopala Pillai, on account of his death while he was engaged in painting work in a Post Office building situated in Peermade. Admittedly, the second and third opposite parties entrusted the work with the first opposite party, who is a Contractor under the second and third opposite parties. While the painting work was going on, one of the workers/employees engaged by the first opposite party, fell down from the first floor of the said building and succumbed to the injuries, which has resulted in a compensation application by the legal heirs.

2. The Employees Compensation Commissioner, on consideration of the evidence adduced by both the parties, passed the impugned order by which Rs.3,62,740/-, besides Rs.2,500/- for meeting funeral expenses, with 12% interest per annum was granted to the legal heirs of the deceased by holding that opposite party Nos.2 and 3 are principally liable to compensate the legal heirs of the victim, with a rider that the second and third opposite parties can recover the said amount from the first opposite party. Aggrieved by the said order, the respective opposite parties came up with these two appeals.

3. The main contention raised by the second and third opposite parties is by disputing the status of the victim as an employee under them. It is submitted that he was not a departmental employee and as such, no liability can be cast upon the second and third opposite parties. But, at the same time, they admitted that the work of painting of the building, wherein the Post Office was functioning, was entrusted with the first opposite party on a contractual basis. The first opposite party also took a contention that the deceased was not an employee arranged or employed by the first opposite party, and, as such, no liability can be cast upon either the first opposite party or the second and third opposite parties. It was also inter alia contented by the first opposite party that if at all any liability is found, the second and third opposite parties are principally liable to compensate the victim as they are the principal employers.

4. The main contention raised by the second and third opposite parties is based on the application of Section 12 of the Employee’s Compensation Act, 1923 (for short ‘the Act’), and it was submitted that Section 12 of the Act would come into play only when the employment, either directly or indirectly, is pertaining to the trade or business of the principal employer. Section 12 of the Employee’s Compensation Act, 1923, is extracted below for reference:

“12. Contracting - (1) Where any person (hereinafter in this section referred to as the principal) in the course of or for the purposes of his trade or business contracts with any other person (hereinafter in this section referred to as the contractor) for the execution by or under the contractor of the whole or any part of any work which is ordinarily part of the trade or business of the principal, the principal shall be liable to pay to any (employee) employed in the execution of the work any compensation which he would have been liable to pay if that (employee) had been immediately employed by him; and where compensation is claimed from the principal, this Act shall apply as if references to the principal were substituted for references to the employer except that the amount of compensation shall be calculated with reference to the wages of the (employee) under the employer by whom he is immediately employed.

(2) Where the principal is liable to pay compensation under this section, he shall be entitled to be indemnified by