The insurance company is a necessary party to proceedings under the Workmen's Compensation Act for determining the liability to pay compensation to employees covered by the statutory insurance scheme under Chapter VIII of the Motor Vehicles Act.

JUDGMENT :

M.N. Shukla, J.—The employer, Sital Prasad, in the present appeal u/s 30 of the Workmen's Compensation Act challenges the order of the Workmen's Compensation Commissioner, Banda dated 25-5-1974, holding the Appellant liable to pay compensation to the dependents of the deceased workman Abdul Hamid, a bus conductor, to the tune of Rs. 4,200/-. The two substantial questions of law which have arisen in this appeal are:

(i) Whether the Compensation Commissioner had jurisdiction to award compensation against the insurance company ? and

(ii) Whether the insurer i.e. the company was a necessary or proper party to the proceedings before the Compensation Commissioner ?

2. The material facts of the case are that Abdul Hamid, workman, was employed by Sital Prasad, in whose name there was a permit to ply the vehicle which was being actually plied by the proprietor of the vehicle viz. M/s. New Buland Gupta Transport Company. The aforesaid employee received personal injury on 9-11-1969 by accident arising out of and in the course of his employment, resulting in his death the same day. The Respondent No. 1, who is the widow and Respondent Nos. 2 to 5, who are the other dependents of the deceased, filed an application in the prescribed form u/s 3 of the Workmen's Compensation Act (hereinafter referred to as the Act) read with Rule 8 of the Workmen's Compensation Rules, against the following:

1. Sital Prasad, resident of 883/7 Dari-yabad, Allahabad. (Employer),

2. M/s. New Buland Gupta Transport (Proprietor of the vehicle), 84/74, G.T. Road, Kanpur, and

3. Ruby General Insurance Co., Ruby House, Calcutta (Insurer).

3. On service of notice issued by the Compensation Commissioner the employer filed a written statement stating that he was the employer. The Ruby General Insurance Company filed a preliminary objection on 19-2-74 stating that the insurance company was not directly involved in the matter and prayed that the claim be summarily rejected so far as the objector company was concerned. After hearing the parties concerned the objection of the insurance company was upheld and the claim of the applicants so far as the insurance company was concerned was rejected and the insurance company was absolved of the responsibility and liability for payment of compensation to the applicants by the order of the Commissioner dated 19-3-1974.

4. Later the authority framed issues in thd case and proceeded to record evidence and decide the same on merits. The findings recorded by the Compensation Commissioner Were that Sital Prasad was the employer of the deceased, that the deceased was a conductor in the bus in Question and received injuries, during employment and that the Respondents. Nos. 1 to 5 were the dependents of the deceased workman. As regards the amount of compensation it was found that the claimants were entitled to receive a sum of Rs. 4,200/- as compensation from Sital Prasad employer. In these circumstances the present Appellant has preferred this appeal and his main contention is that the insurer was a necessary party to the case and the Commissioner acted illegally in exempting it from the array of parties and fastening the liability on the Appellant.

5. Section 3 of the Workmen's Compensation Act, 1923 provides that if personal injury is caused to a workman by accident arising out of and in the course of his employment, his employer shall be liable to pay compensation in accordance with the provisions of Chapter II of that Act. It is true that this section uses the word 'employer' alone but Section 19 is indicative of much wider scope and provides as under:

19. Reference to Commissioners ?(1) If any question arises in any proceedings under this Act as to the liability of any person to pay compensation (including any question as to whether a person injured is or is not a workman) or as to the amount or duration of compensation (including any question as to the nature or extent of disablement), the question shall, in default of agreement, be