1. This appeal is filed by respondent No.3 - Insurer challenging the judgment and award dated 23.03.2012 in W.C.No.173/2007 passed by the Workman Compensation Commissioner and Labour Commissioner Division - II, Bellary (for short, 'the Labour Commissioner').

2. The parties are referred to as per their rankings before the Labour Commissioner under the Workmen's Compensation Act, 1923.

3. Deceased Virupakshi, who was father of claimant Nos.2 and 3 and husband of claimant No.1, was working under the respondent No.1 - Sri Hari Contractor of Delta Engineering Industries as an employee for respondent No.2 - Jindal Company. On 27.02.2006 around 10.45 am, when Virupakshi was doing welding work in the factory premises and also doing cutting of heavy iron rods. At that time concerned person unloading scrap and waste materials from a tipper lorry. All of a sudden scrap and metal materials of tipper lorry fell on the ground leading to lot of noise. The said Virupakshi thought that they were falling upon him and due to said shock and stress, he had a severe heart attack and died. Immediately he was shifted to Government Hospital, Toranagallu, wherein he was declared as brought dead. Thereafter, post - mortem was conducted in Primary Health Centre, Toranagallu. A report was given to Toranagallu police station and on that basis UDR No.6/2006174(c) was registered.

4. It is the further contention of the claimants that deceased Virupakshi was aged about 35 years at the time of the incident. Claimants being wife and children were depending upon the earnings of the deceased. He was the only breadwinner of the family. With these reasons they prayed to award compensation.

5. Respondent No.1 denied contents of the claim petition and prayed for dismissal of the claim petition against it. Respondent No.2 also denied existence of any employer and employee relationship between deceased and respondent No.2. Hence it is not liable to pay the compensation. Respondent No.3 in its written statement admitted that respondent No.2 obtained policy of insurance on its labourers. It denied other averments stated in the claim petition and it also stated that its liability is restricted to terms and conditions of policy of insurance. With these reasons prayed to reject the claim petition.

6. The Labour Commissioner framed necessary points for determination and recorded the evidence of both the parties.

7. Claimants examined claimant No.1 as PW1 and marked Exs.P1 to P5. Respondent No.2 examined RW1 and marked Ex.R1.

8. Learned Labour Commissioner heard the arguments and appreciating the evidence available on record, allowed the petition and awarded compensation of Rs.3,94,120/- and directed respondent No.3 to pay the said amount of compensation. Same is challenged in the present appeal by the insurer - respondent No.3.

9. This appeal was admitted to consider following substantive questions of law.
1. Whether the Labour Commissioner was justified in holding that death was occurred during the course of employment without appreciating evidence and documents on record?
2. Whether the Labour Commissioner is justified in settling its liability on respondent No.3 when the insurance company collected premium from the employer on the basis of wages paid to each employee, and restricting its liability to that extent?
3. Whether findings of the Labour Commissioner, is illegal, arbitrary and perverse and interference by this Court is required?

10. Heard the arguments of the learned counsel for the appellant. He contends that Virupakshi died due to heart failure and massive heart attack. It has no connection with the work he was doing at the time of accident. A story was built up by the claimants that when he was doing his work at that time some persons were unloading a tipper containing scrap and waste articles. The deceased suddenly heard the sound of unloading and thought that the said scrap materials were falling on his head and due to the said fear, he had a massive heart attac