[Cites 9, Cited by 0]
Rajasthan High Court - Jodhpur
U.I.Ins.Co.Ltd vs Smt.Dhapu Bai And Ors on 30 April, 2026
[2026:RJ-JD:19181]
HIGH COURT OF JUDICATURE FOR RAJASTHAN AT
JODHPUR
S.B. Civil Miscellaneous Appeal No. 2101/2007
United India Insurance Company Ltd., Bhilwara through
Divisional Manager, United India Insurance Company Ltd., 12-D,
Residency Road, Jodhpur.
----Appellant
Versus
1. Smt. Dhapu Bai W/o Balu Ji Regar, resident of Kankrolia,
P.S. Kotadi, District Bhilwara.
2. Smt. Kamla W/o Nath Regar, resident of Kankrolia, P.S.
Kotadi, District Bhilwara
3. Rakesh S/o Nathu Regar, minor, through natural guardian
mother Smt. Kamla W/o Nath Regar, resident of Kankrolia,
P.S. Kotadi, District Bhilwara
4. Krishna D/o Nathu Regar, monor, through natural guardian
mother Smt. Kamla W/o Nath Regar, resident of Kankrolia,
P.S. Kotadi, District Bhilwara
5. Rameshwarlal S/o Girdhari Lal Dadhich, resident of
Bhagwanpura, Tehsil Mandal, District Bhilwara
----Respondents
For Appellant(s) : Mr. Hardik Kachhwaha for
Mr. Sanjeev Johri
For Respondent(s) : Mr. Kaushik Suthar for
Mr. J.V.S. Deora
HON'BLE MR. JUSTICE SANDEEP SHAH
Order
1. Date of conclusion of arguments 18.04.2026
2. Date on which judgment was reserved 18.04.2026
3. Whether the full judgment or only the
operative part is pronounced: Full Judgment
4. Date of pronouncement 30.04.2026
1. The present appeal has been filed by the appellant-
Insurance Company under Section 30 of the Workmen's
Compensation Act, 1923 (hereinafter referred to as 'the Act of
1923'), being aggrieved by the judgment dated 12.07.2007
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passed by the Workmen Compensation Commissioner, Bhilwara,
whereby, it has awarded a sum of Rs. 3,40,913/- as compensation
with interest from the date of passing of the judgment and further
in case of failing to deposit the sum within 60 days, awarded
additional interest @ 12% per annum till depositing the same.
2. Brief facts of the case are that on 22.06.2001, deceased
Nathu was driving a mini bus from Gangapur to Bhilwara and the
bus met with an accident, due to which, deceased Nathu expired.
Thereafter, the claim in question was filed by the claimants before
the Commissioner, impleading the Insurance Company as well as
the owner of mini bus as opposite parties. It was asserted by the
claimants that deceased Nathu was engaged as a driver under the
employment of owner Rameshwar Lal and was earning Rs. 3,000/-
per month and was aged 35 years at the time of incident.
3. In spite of service of notice, the employer did not appear,
therefore, ex parte proceedings were initiated against him. He
subsequently filed two different applications for setting aside the
ex parte proceedings under Order IX, Rule 7 of CPC; however,
both applications came to be rejected by learned Commissioner.
Thus, the owner was essentially unrepresented.
4. The Insurance Company filed a reply to the above-mentioned
claim and, while denying the factum of the deceased being
employed under Rameshwar Lal, also raised an objection
regarding the vehicle being plied without a valid permit.
5. The learned Commissioner after considering the pleadings,
framed five issues for adjudication and, vide impugned judgment
dated 12.07.2007, decided all the issues in favour of the
claimants. The Commissioner held the salary of the deceased to
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be Rs. 2,000/- per month and further held that the deceased was
under the employment of Rameshwar Lal. It was also held that the
question of validity of the permit cannot be adjudicated in such
summary proceedings and that the Insurance Company had failed
to prove that the permit was not valid. The Commissioner, thus
awarded compensation as stated supra. Being aggrieved, the
present appeal has been filed.
5. While challenging the impugned judgment, learned counsel
for the Insurance Company firstly raised an objection that the
burden was upon the claimants to show that the deceased was
under the employment of Rameshwar Lal. He submitted that the
claimants failed to prove or place on record anything to show such
employment, and therefore, unless the employer-employee
relationship was established, the claim under the Act of 1923
could not have been allowed. Learned counsel further submitted
that, as far as the interest part is concerned, the same could not
be saddled upon the Insurance Company, and the employer alone
was liable for delay in payment.
7. Learned counsel for the Insurance Company laid emphasis
on the permit issued and the report prepared by the Insurance
Company through one Avinash Kumar, Insurance Investigator, and
tried to assert that the permit was issued at 12:20 PM on
22.06.2001, whereas the incident took place at 11:45 AM on the
same day. He thus submitted that the permit was prepared post-
accident and was valid only from the time of issuance, and
therefore, the vehicle was being driven at the relevant time in
contravention of the insurance policy conditions as there was no
valid permit at the time of accident. He referred to Policy (Exhibit
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No. 4), wherein there was a specific condition that the vehicle
must be plied with a valid permit only. He thus submitted that all
the above-mentioned points, though raised before the
Commissioner, were rejected without justifiable reasons, and
therefore, the impugned judgment be quashed and set aside.
8. Learned counsel for the Insurance Company placed reliance
upon the judgments of the Apex Court in National Insurance
Co. Ltd. v. Challa Upendra Rao & Ors. reported in (2004) 8
SCC 517, as well as Amrit Paul Singh & Anr. v. Tata AIG
General Insurance Company Ltd. & Ors. reported in (2018) 7
SCC 558, to fortify the argument that if a vehicle is plied without
a permit, there is a violation of Section 149 of the Motor Vehicles
Act, 1988, and the Insurance Company cannot be held liable for
payment of compensation under the Act of 1988, and the liability
should fall upon the owner.
9. Per contra, learned counsel appearing for the owner
supported the impugned judgment. Nobody appeared for the
claimants. Learned counsel for the owner asserted that,
considering the entire evidence on record, the Commissioner, had
rightly allowed the claim in favour of the claimants.
10. Heard learned counsel for the parties and perused the record
of the case.
11. As far as the objection regarding the existence of an
employer-employee relationship is concerned, the claimants
stated in the claim that respondent No. 5 was the employer of the
deceased and the deceased was drawing a salary of Rs. 3,000/-
per month. To fortify this stand, Smt. Dhapu Bai (mother of the
deceased) and Kamla (wife of the deceased) were examined, who
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remained firm on their stand regarding the deceased being
employed under respondent No. 5. Even in their cross-
examination, they remained firm, and the appellant was unable to
shake their testimony.
12. The insurance cover note as well as the registration
certificate of the vehicle, which were exhibited before the learned
Commissioner also proved that the vehicle was registered in the
name of respondent No. 5, and the insurance cover note was also
issued in his name. Not only this, the FIR lodged by the conductor
of the same vehicle, who was working under respondent No. 5,
specifically stated that the deceased was working as a driver of
the vehicle in question. The same is evident from the FIR as well
as the crime detail report submitted in the criminal proceedings
initiated thereafter.
13. Further, even the report prepared by the private investigator
on behalf of the appellant-company also fortified that the
deceased was driving the vehicle owned by respondent No. 5.
Thus, the existence of an employer-employee relationship and the
deceased being in the employment of respondent No. 5 stands
sufficiently proved by the claimants.
14. Furthermore, ex parte proceedings were initiated against the
employer and his applications under Order IX, Rule 7 CPC were
rejected twice. Thus, merely because in those applications the
employer stated that he did not employ the deceased, the same
cannot be read against the claimants, as those applications were
rejected.
15. The initial burden was upon the claimants to prove the
existence of employer-employee relationship. Once the claimants
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discharged their burden, the burden shifted upon the appellant to
prove otherwise, the appellant failed to rebut the same. The
finding given by the learned Commissioner on Issue No. 1 does
not call for any interference.
16. As far as the issue of grant of interest is concerned, the
matter stands settled by the Hon'ble Apex Court in New India
Assurance Co. Ltd. v. Harshadbhai Amrutbhai Modhiya &
Anr. reported in AIR 2006 SC 1926, wherein it has been held
that liability for payment of interest lies upon the Insurance
Company. It is only in the case of penalty that the liability is upon
the employer. This position has also been reiterated by this Court
in S.B. Civil Misc. Appeal No. 2451/2011 (National
Insurance Company Limited v. Smt. Hagami & Ors.) decided
on 13.02.2026.
17. In view of the settled position of law, the learned
Commissioner has rightly fastened the liability of interest upon the
Insurance Company.
18. As far as the issue regarding the permit is concerned, a bare
perusal of the permit reveals that though it was issued on
22.06.2001, it was valid for the entire date, and it has nowhere
been specified that it would be valid only after 24 hours from the
time of issuance. The argument that the permit is valid only after
24 hours is not supported by the language of Section 88 or
Section 66 of the Motor Vehicles Act, 1988, or the relevant rules.
19. The contention that the permit was issued post-accident is
also without substance, as such argument is based only upon the
report of the Insurance Investigator, which in turn relies upon an
alleged oral statement of the DTO, Bhilwara. Neither the DTO,
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Bhilwara was examined nor any correspondence was placed on
record to support this claim. Therefore, the Insurance Company
has failed to disprove the validity of the permit.
20. As far as the judgments relied upon by the Insurance
Company are concerned, they relate to cases under the Act of
1988, where the vehicle was being plied without any permit at all.
In the present case, a permit has been placed on record.
Moreover, the present case arises under the Workmen's
Compensation Act, where such issues cannot be adjudicated upon,
the present proceedings being summary in nature and hinging
around the liability of employer in case of accident of employee
during the course of employment.
21. In view of the above findings, the appeal is bereft of merit
and is accordingly dismissed. The judgment dated 12.07.2007
passed by the Commissioner, is upheld. The appellant is directed
to immediately make payment of the residual amount, if any,
within a period of one month from today.
22. The record of the proceeding of the Commissioner be sent
back forthwith.
23. All pending applications stand disposed of.
24. No order as to costs.
(SANDEEP SHAH),J
21-mohit/-
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