ORDER
N.K. Jain, C.J.
1. This Reference has been placed before this Full Bench as per the order of the Chief Justice, dated 31.10.2003, and has come up before us.
2. M.F.A. No. 1910/97 has been filed under Section 30 of the Workmen's Compensation Act, 1923 (for short the WC Act) against the judgment and award dated 12.2.97 in WCA:SR:111/95 for enhancing the compensation. The learned Single Judge on admitting the case found that the Division Bench of this Court in NATIONAL INSURANCE v. VALAWWA, : (1994)ILLJ433Kant has not taken into consideration another judgment of this Court in the case of NEW INDIA ASSURANCE CO. LTD v. RAJA NAIKA, : ILR1992KAR1325 wherein it was held that the Insurance Company can defend itself with all the defences available under Section 149(2) of Motor Vehicles Act, 1988 (hereinafter called the MV Act). The matter was referred to a Division Bench vide order dated 19.8.2003. The Division Bench considering that the two decisions appeared to be in conflict, referred the same to a Full Bench vide Order dated 10.10.2003.
3. The connected M.F.A. 792/95, M.F.A. 1424/95 and M.F.A. No. 2405/95 have also been referred to and placed before the Full Bench in view of the order dated 31.10.2003, as stated.
4. The other batch of appeals M.F.A. 3103/97, M.F.A. 2885/98, M.F.A. 2886/98 and M.F.A. 2727/98 are also filed under Section 30 of W.C. Act. The Division Bench on 20.8.2001 in M.F.A. 3103/97, observed that cases where a similar and identical question is involved are pending consideration. However another Division Bench considered the case at length and in view of the conflicting decisions, observed that the decision in NEW INDIA ASSURANCE CO. LTD. v. RAJA NAIKA requires reconsideration and thereby referred the following question to a Full Bench on 17.9.2003:-
'Whether the restrictions on the defences available to an insurance company in terms of Section 149(2) of the Motor Vehicles Act have any application to the proceedings under the Workmen's Compensation Act?'
5. M.F.A. 3103/97 and connected cases M.F.A. 2885/98; M.F.A. 2886/98 and M.F.A. 2727/98 were ordered to be placed before the Full Bench vide order dated 15.10.2003. The other question, which requires consideration, is:
Whether in an appeal against the award of the Commissioner for Workmen's Compensation, the Insurance Company can challenge the award on any grounds other than what is available to them under the provisions of the Motor Vehicles Act?
6. All these cases arise under the W.C. Act.
7. In M.F.A. No. 1910/97 the learned Counsel for the appellant submits that the Workmen's Compensation Commissioner holding that the deceased was a workman under respondent No. 1 and that the accident had occurred during the course of employment, has erred in holding that the insurance company is not liable to pay the compensation amount. The learned Counsel submits that the Commissioner should have made respondent No. 2 - Insurance Company liable to pay compensation as the requirements of the W.C. Act were fulfilled as the deceased was a workman and suffered death in an accident in the course of employment. He also submits that the compensation awarded and the penalty imposed by the Commissioner is on the lower side and requires modification.
8. Sri Poonacha, the learned Counsel for the appellant-Insurance Company in M.F.A. NO. 3103/97 submits that the insurance company can raise all defences in a suit. He has submitted that the restriction placed upon the defences available to the insurance company in proceedings under the W.C. Act, did not have any statutory sanction as the W.C. Act did not stipulate that an insurance company shall not be entitled to raise any defence other than those permissible under Section 149(3) of M.V. Act. He further submitted that the meaning given to a term or expression in one statute could not be extended to another statute in the absence of a specific provision permitting the same.
9. Sri A.N. Krishnaswamy, learned Counsel appearing for Respondent 2 - Insurance Company (M.F.A. No. 1910/97) supported the contentions of Sri Poonacha, learned Counsel for the Insurance Company in M.F.A. 3103/97.
10. On the other hand, Sri S.P. Shankar, learned Counsel for the respondent-claimant submits that the insurance company has no right to raise all defences as this point has been settled long back by the Apex Court in the decision in BRITISH INDIA GENERAL INSURANCE CO., LTD. v. CAPTAIN ITBAR SINGH AND ORS., : [1960]1SCR168 .
11. Sri M.B. Nargund, learned Counsel appearing for the appellants- claimants in M.F.A.No. 1910/97 has further submitted that the workman has an option either to invoke Section 167 of MV Act or the W.C. Act. It is submitted that under W.C. Act, the amount is fixed as per limit prescribed, whereas under M.V. Act, the compensation is unlimited subject to paying further premium as per the policy. It is also submitted that the objects of both the enactments are beneficiary, but in absence of any provision to make a defence, he cannot raise any defence except as provided in the policy, as the appeal lies only on substantial questions of law. The Insurance Company is only to indemnify the employer for the amount, which has been insured by the employer on behalf of the workman. He also submitted that this point has already been decided long back and it will not affect even though the Division Bench while referring the matter has broadly distinguished some of the Sections of the M.V. Act and the W.C.Act.
12. Heard the learned Counsel appearing for the respective parties. We have also heard Sri B.S. Kamate and Sri Basavaraj Kareddy, perused the material on record and the case laws cited.
13. It will be appropriate to consider the relevant provisions of the M.V. Act and the W.C. Act.
Section 167 of the M.V. Act, 1988:
167. OPTION REGARDING CLAIMS FOR COMPENSATION IN CERTAIN CASES:
Notwithstanding anything contained in the Workmen's Compensation Act, 1923 (8 of 1923) where the death of or bodily injury to any person gives give to a claim for compensation under this Act and also under the Workmen's Compensation Act, 1923, the person entitled to compensation may without prejudice to the provisions of Chapter X claim such compensation under either of those Acts but not under both'.Section 149 of M.V. Act
149. Duty of insurers to satisfy judgments and awards against persons inured in respect of third party risks:
(1) .........(2) No sum shall be payable by an insurer under Sub-section (1) in respect of any judgment or award unless, before the commencement of the proceedings in which the judgment or award is given the insurer had notice through the court or, as the case may be, the Claims Tribunal of the bringing of the proceedings, or in respect of such judgment or award so long as execution is stayed thereon pending an appeal; and an insurer to whom notice of the bringing of any such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely:-
(a) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely:
(i) a condition excluding the use of the vehicle-
(a) for hire or reward, where the vehicle is on the date of the contract of insurance a vehicle not covered by a permit to ply for hire or reward, or
(b) for organized racing and speed testing, or
(c) for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle, or
(d) without side-car being attached where the vehicle is a motor cycle; or
(ii) a condition excluding driving by a named person or persons or by any person who is not duly licenced, or by any person who has been disqualified for holding or obtaining a driving licence during the period of disqualification; or
(iii) a condition excluding liability for injury caused or contributed to by conditions of war, civil war, riot or civil commotion; or
b) that the policy is void on the ground that it was obtained by the non-disclosure of a material fact or by a representation of fact which was false in some material particular.
Section 30 of Workmen's Compensation Act, 1923:
(1) An appeal shall lie to the High Court from the following orders of a Commissioner, namely: -
(a) an order as awarding as compensation a lump sum whether by way of redemption of a half-monthly payment or otherwise of disallowing a claim in full or in a part for a lump sum;
[(a) to (e)] xxx xxx xxx
Provided that no appeal shall lie against any order unless a substantial question of law is involved in the appeal and, in the case of an order other than an order such as is referred to in Clause (b), unless the amount in dispute in the appeal is not less than three hundred rupees;
Provided further that no appeal shall lie in any case in which the parties have agreed to abide by the decision of the Commissioner, or in which the order of the Commissioner gives effect to an agreement come to by the parties;
Provided further that no appeal by an employer under Clause (a) shall lie unless the memorandum of appeal is accompanied by a certificate by the Commissioner to the effect that the appellant has deposited with him the amount payable under the order appealed against.
(2) The period of limitation for an appeal under this section shall be sixty days.
(3) The provisions of Section 5 of the Limitation Act, 1963 (36 of 1963), shall be applicable to appeals under this section.
14. From a reading of the above provisions, it is clear that the object of both the Acts, viz., the M.V. Act and the W.C. Act is to provide compensation to the victims of accidents. The only difference between the two enactments is that so far as the W.C. Act is concerned, it is confined to workmen as defined under that Act while the relief provided under Chapter X to XII of the M.V. Act is available to all the victims of accidents involving a motor vehicle. This conclusion is supported by Section 167 of M.V. Act, under which, it is open to the claimants either to proceed to claim compensation under the W.C. Act or under the M.V. Act. A perusal of the objects of the two enactments clearly establishes that both the enactments are beneficial enactments operating in the same field. It is seen that the W.C. Act does not make any provision either for payment of the claim by the Insurance Company or for the addition of the insurance company as a party to the proceedings before the commissioner. The question of proving negligence does not arise under the W.C. Act, whereas under M.V. Act negligence and quantum are to be proved. So far as relates to the interpretation of the word death'. In the W.C. Act it is certainly applicable to the interpretation of the word death' in the M.V. Act also, which is also clear from the decision in the case of RITA DEVI v. NEW INDIA ASSURANCE CO. LTD., : (2000)ILLJ1656SC .
15. It is seen that if the employer of a workman has insured his workman with the Insurance Company and if the workman sustains bodily injury or death occurs in an accident arising in the course of the employment, the workman is entitled for compensation as per the limit and the Insurance Company has only to indemnify the employer for the amount. More so, there is no privity of contract between the workman and the Insurance Company. Therefore, the question of raising defence now does not arise for the Insurance Company against the claim of workman, that too in the absence of the employer being made a party. The circumstances under which the Insurance Company would be made as a party in a proceeding before the Motor Accidents Claims Tribunal or before the Workmen's Compensation Commissioner and the scope of defence that is available to the Insurance Company so impleaded had come up for consideration before the Supreme Court even in later cases are well settled. Otherwise also, the appeal filed under Section 30 of W.C. Act is maintainable only on substantial questions of law. Under the circumstances, under W.C. Act, the Insurance Company can only agitate violation of any condition of the policy to make substantial question of law, and therefore, the question of raising other defences available in terms of Section 149(2) of M.V. Act does not arise.
16. As argued by the learned Counsel for the claimants, on the question whether the insurer has a right to take only the statutory defences as provided in Section 96(2) of the M.V. Act or whether he can take all the defences as an ordinary defendant, considering the Apex Court decision in BRITISH INDIA GENERAL INSURANCE CO. LTD v. CAPTAIN ITBAR SINGH AND ORS. the learned Single Judge in the case of KAMLA DEVI v. NAVIN KUMAR AND ANR., 1973 ACJ 115 answered that the insurer has a right to take only the statutory defences unless by the terms of the policy the right to defend the action in the name of the assured has been reserved.
17. The Division Bench in NEW INDIA ASSURANCE CO. LTD. v. RAJA NAIKA, on the question whether if a proceeding is taken for recovery of compensation impleading the insurer for such proceeding as required under Sub-section (1) of Section 149 of the MV Act by instituting an action (claim) therefor before the Commissioner under the WC Act, could the insurer defend such action on grounds other than those available to him under Sub-section (2) of Section 149 of the MV Act, it was observed as under:
'We find it difficult to think that the Insurer can defend such action taken under the WC Act on grounds other than those made available to him (it) under Sub-section (2) of the Section 149 of the MV Act because having regard to the 'Policy of Insurance' required to be compulsorily taken by the insured and issued by the insurer under the Statute to cover certain risks. Statute itself limits the ground on which action of compensation covered by the Policy could be defended by the Insurer. Scope of defence of the Insurer in an action brought by an employee or his legal representatives (dependants) for fixing the liability of the employer under the WC Act cannot therefore, be other than what is permitted under Sub-section (2) of Section 149 of MV Act when he (it) it impleaded as required under Sub-sections (1) and (2) of Section 149 of MV Act to make him liable to satisfy the judgment or award to be made by the Commissioner.'
It was further held that:
'an appeal filed by the Insurer under Section 30(1) of W.C. Act, 1923, against an award made by the Commissioner for Workmen's Compensation, by which it is made liable to pay compensation for death or bodily injury of a person on the basis of Certificate of Insurance issued under Sub-section (3) of Section 147 in Chapter XI of M.V. Act, 1988, which is not founded on a ground by which an insurer was entitled to defend under Sub-section (2) of Section 149 of MV Act, an action for compensation, is unmaintainable'.
The Division Bench of this Court in the above case has in fact created a right in the insurance company to take up such defences which are available to them in law under Section 149 of the MV Act even though there is no such provision in the WC Act itself. It is because of that judgment the right of the insurance company to take up such defence is recognised. Otherwise, the insurance company had no such defence at all in a proceedings under the provisions of the WC Act. As held by the Supreme Court when the statute is silent we cannot add a provision to the Act which is not enacted or add words to a statute where the legislature has consciously avoided certain words.
18. In NATIONAL INSURANCE COMPANY LTD. CHANDIGARH v. NICOLLETTA ROHTAGI AND ORS., 2002 AIR SCW 3899 : AIR 2002 3350 the Supreme Court has specifically held after considering the previous judgment and overruling the decision in UNITED INDIA ASSURANCE CO. LTD v. BHUSHAN SACHDEVA, : [2002]1SCR352 that Insurance Company has no right to be a party to an action by the injured person or dependants of deceased against the insured. However, the provisions of Section 149 of M.V. Act 1988 Act corresponding to Section 96 of M.V. Act 1939 gives the insurer the right to be made a party to the case and to defend it. After the insurer has been made a party to a case or claim, it is clear from the plain, simple and unambiguous language of Section 149(2) read with provisions of Section 149(7) that insurer is permitted to contest the claim only on the ground mentioned in Section 149(2) of M.V. Act 1988 corresponding to Section 96 of M.V. Act 1988 and the Insurance Company cannot avoid its liability on any other grounds except those mentioned in the said sub-section and further observed that right to file an appeal is a statutory right and in view of the provisions of Section 149(2) of Motor Vehicles Act it cannot extend beyond the defences available under Section 149(2) and challenge in an appeal would confine only to those grounds. The Supreme Court observed in Para 31:
'We have already held that unless the conditions precedent specified in Section 170 of 1988 Act is satisfied, an insurance company has no right of appeal to challenge the award on merits. However, in a situation where there is a collusion between the claimants and the insured or the insured does not contest the claim and, further, the tribunal does not impleaded the insurance company to contest the claim in such cases it is open to an insurer to seek permission of the tribunal to contest the claim on the ground available to the insured or to a person against whom a claim has been made. If permission is granted and the insurer is allowed to contest the claim on merits in that case it is open to the insurer to file an appeal against an award on merits, if aggrieved. In any case where an application for permission is erroneously rejected the insurer can challenge only that part of the order while filing appeal on grounds specified in Sub-section (2) of Section 149 of 1988 Act. But such application for permission has to be bona fide and filed at the stage when the insured is required to lead his evidence. So far as obtaining compensation by fraud by the claimant is concerned, it is no longer res integra that fraud vitiates the entire proceeding and in such cases it is open to an insurer to apply to the Tribunal for rectification of award'.
As stated, if the law provides that an appeal can be filed on limited grounds, the grounds of challenge cannot be enlarged. Section 149(2) of 1988 Act limits the insurer's appeal on those enumerated grounds and the appeal being a product of the statute, it is not open to an insurer to take any other plea other than those provided in Section 149(2) of 1988 Act. Unless an order is passed by the tribunal permitting the insured to avail the grounds available to an insured or any other person against whom a claim has been made on being satisfied of the two conditions specified in Section 170, it is not permissible to the insurer to contest the claim on the grounds which are available to the insured or to a person against whom a claim has been made. Thus, where conditions precedent embodied in Section 170 is satisfied and award is adverse to the interest of the insurer, the insurer has a right to file an appeal challenging the quantum of compensation on negligence or contributory negligence of the offending vehicle even if the insured has not filed any appeal against the quantum of compensation. Under the provisions of the Workmen's Compensation Act a statutory appeal is provided under Section 30 of the Act to the High Court on the orders enumerated therein. The proviso to that Section makes it very clear that no appeal shall lie against any order unless a substantial question of law is involved in the appeal. As stated earlier negligence or contributory negligence of the offending vehicle is not a ground to be considered at all while awarding compensation under the Workmen's Compensation Act. Therefore, the insurer cannot prefer any appeal either challenging the quantum of compensation or on any other grounds except the ground available to him under Section 149(2) of 1988 Act. When under the Compensation Act the insurer has no right to take any defence disputing the claim of the claimants and his defence is only confined to avoid the liability under the insurance policy as contemplated under Section 149(2) of the Act and when the appeal is confined to substantial question of law under the Act, it cannot be said that the right of appeal of an insurance company against the award under the Workmen's Compensation Act is broader than that right which is conferred on them under the Motor Vehicles Act. In fact, it would be narrower than what is provided to them under the Motor Vehicles Act as under the Workmen's Compensation Act, the appeal is only against a substantial question of law.
19. In BRITISH INDIA GENERAL INSURANCE CO. LTD. v. CAPTAIN ITBAR SINGH AND ORS., a suit claiming damages, for negligent driving was filed against the owner of a motor car, who was insured against third party risks. The insurer was subsequently added as defendant to the suit under Section 96(2) of the 1939 M.V. Act. It was contended that the defence available to it was not restricted to the grounds enumerated in Section 96(2) of Act, but that it was entitled to take all defences including those on which the assured himself could have relied for his defence, subject only to the restriction that it could not in view of Section 96(3) of the Act rely on the conditions of the policy as a defence, their Lordships held that an insurer made a defendant to the action under Section 96(2) of the Act was not entitled to defend it on a ground not specified in that Section. Further on the contention that all defences are open to an insurer excepting those taken away by Section 96(3), there Lordships not accepting the contention observed as under:
'The Statute has no doubt created a liability in the insurer to the injured person but the statute has also expressly confined the right to avoid that liability to certain grounds specified in it. It is not for us to add to those grounds and therefore to the statute for reasons of hardship. We are further more not convinced that the statute causes any hardship. First, the insurer has the right, provided he has reserved it by the policy, to defend the action in the name of the assured and if he does so, all defences open to the assured can then be urged by him and there is no other defence that he claims to be entitled to urge. He can thus avoid all hardship if any, by providing for a right to defend the action in the name of the assured and this he has full liberty to do. Secondly, if he has been made to pay something which on the contract of the policy he was not bound to pay, he can under the proviso to Sub-section (3) and under Sub-section (4) recover it from the assured'.
20. Under the circumstances and as discussed above, the point in question has already been covered by the above decision of the Apex Court.
21. Reference can also be made of a five Judges Larger Bench decision of this Court in SMT. BHIMAVVA AND ORS. v. SHANKAR @ ADYA AND ORS., : AIR2004Kant58 wherein after detailed examination of the provisions of Section 147 and 167 of M.V. Act 1988, Section 95 of M.V. Act, 1939 which gives option to the claimant to file a petition either before the Workmen's Compensation commissioner or before Motor Accidents Claims Tribunal. This Court has held that act liability would include liability to cover injury or death arising out of all and in the course of employment in respect of the employees mentioned under Section 147 of the M.V. Act 1988 and the circular and the provisions of Section 96 of 1939 Act and Section 149 of 1988 Act make it clear that the Insurance Company can be impleaded as a party to the claim petition filed against an injured and it is a right created by the statute and its contents depend on the provisions of the Section. Mere fact that W.C. Act does not make any provision for impleading the Insurance Company in a claim petition filed before it would not make any difference as apprehended by the Division Bench referring the matter to the Larger Bench in view of the fact that the circumstances under which the Insurance Company would be liable to pay compensation in respect of an award passed under W.C. Act would also arise in view of its liable under the provisions of Section 149 of M.V. Act 1988 and corresponding to Section 96 of M.V. Act 1939. That question has specifically come up before the Supreme Court in VED PRAKASH GARG v. PREMI DEVI AND ORS., : AIR1997SC3854 wherein the Supreme Court after detailed consideration of the provisions for compulsory insurance, the provisions under Section 147, the provisions of the liability of the Insurance Company under Section 149 and the provisions of Section 4 of the W.C. Act has held that while considering the claim petition under W.C. Act it is necessary to refer to the provisions of M.V. Act as the workmen suffered personal or bodily injury while they were working on motor vehicles of their employers. If they had suffered from any personal injuries during the course of and arising out of the employment while working in the factory premises of the employers or while carrying on their service obligations as employees at any other place under the instruction of the employers, the question of interaction of the Compensation Act and the Motor Vehicles Act would not arise and such claims for compensation would have squarely been governed only by the Compensation Act and this would clearly bring out the manner in which the provisions of the W.C. Act and the M.V. Act have to be construed having regard to the provisions of the Act as laid down by the Apex Court in the above said case.
22. We may also refer a decision of three Judges Bench dated 17.9.2002, wherein the Supreme Court has considered the concepts, scope and extent of defence available to the Insurance Company in a claim petition and consequentially the scope of defence available in appeal, as it is well settled that the scope of defence in an appeal cannot be more than the defence available to the Insurance Company in the original proceeding itself.
23. Therefore, in view of the above said decision of the Apex Court, we are also of the view that the decision of the Division Bench of this Court in NEW INDIA ASSURANCE Co. Ltd. v. RAJA NAIKA, holding that the defences available to the insurance Company in an appeal filed under Section 30(1) of the W.C. Act against an award made by the Commissioner would not lie on the grounds other than those specified in Section 149(2) of the M.V. Act subject to other conditions that require to be considered in an appeal does not require reconsideration.
24. So far as regards the other argument regarding the power of the Commissioner as to whether he can enhance or modify the award, a Full Bench of this Court in the case of SHIVALINGA SHIVANAGOWDA PATIL v. NEW INDIA ASSURANCE CO. LTD., M.F.A. No. 27/96 and C/case disposed of on 1.12.2003 has held that the Commissioner has been empowered to decide and settle the disputes regarding the nature or extent of disablement as per the facts of the case. It was also made clear that the Commissioner while discharging the judicial functions can enhance, modify or correct the assessment made by a qualified medical practitioner.
25. As discussed above, our answers to the questions, which arose for our consideration, are as under:
a) The Insurance Company cannot take up defences other than what is available to them under the terms of the insurance policy and which are specified in Section 149(2) of the Motor Vehicles Act even in proceedings under the provisions of the Workmen's Compensation Act.
b)As under Section 30 of the Workmen's Compensation Act an appeal lies only against a substantial question of law, the Insurance company cannot urge any other ground other than what is available to them under the provisions of the Motor Vehicles Act and even in respect of those grounds unless a substantial question of law is made out. Accordingly, the questions are answered.
In view of the above discussion, the questions are answered accordingly. Place all the cases before the concerned Single Judge/ Division Bench.