M.N. Shukla, J.

1. The employer, Sital Prasad, in the present appeal under Section 30 of the Workmens Compensation Act challenges the order of the Workmens 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 under Section 3 of the Workmens Compensation Act (hereinafter referred to as the Act) read with Rule 8 of the Workmens 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 Workmens 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 compensationin 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 settled by a Commissioner.

The Use of the words "any person" demonstrates that the Commissioners jurisdiction to determine the liability of paying compensation is not confined to the liability of an employer. This liability may be of any person. Therefore, (Iven personl Who may have to pay indemnity or who may be placed on par with the employer as a result of legislative fiction come within the ambit of Section 19 and therefore their liability has to be determined by the Commissioner. There are several provisions in the Act which prove that the Commissioner is also competent to determine the liability of persons other than employer. Sections 12, 13 and 14 of the Act illustrate this position. In case of a contractor Who is the immediate employer, if the work is ordinarily part of the trade or business of the principal employer it is the principal employer who would have to pay compensation under Section 12(1), and he can claim an indemnity which would be determined by the Commissioner under Section 12(2). Likewise, Section 13 provides for an indemnity being determined when the employer has been made to pay compensation in respect of any injury caused under circumstances creating legal liability of some person other than the principal employer in question. Section 14 of the Act makes a provision in case of an insolvency of an employer by giving to the worker the right to proceed against the insurance company in respect of the liability ensured by the insurance company. Therefore, even though the insurance company may have entered into a contract with the employer, by reason of Section 14, the contract is given a statutory effect, creating a right in the workman of proceeding against insurance company, and his liability can be determined by the Commissioner. Although the Workmens Compensation Act was enacted in 1923 the legislature framed Section 19 in such wide terms as to include the determination of the liability of persons other than the employer also, even though such other persons were brought on the scene by later enactment, The language of the section was from the very inception wide enough in its amplitude to include all the subsequent exigencies, such as the creation of legislative fiction or the liability to pay indemnity etc.

6. The tangible effect of the wide scope of Section 19 can be best appreciated only by reading the Act along with the Motor Vehicles Act which Was enacted in the year 1939. Chapter VIII of the Motor Vehicles Act makes a provision for compulsory insurance in respect of third-party risks. Section 94 of the Motor Vehicles Act provides that a motor vehicle shall be insured against third-party risk. Section 95 of that Act prescribes the requirements of policies and limits of liability. It provides that in order to comply with the requirements of Chapter VIII, a policy of insurance must be a policy which

(a) is issued by a person who is an authorised insurer or by a co-operative society allowed under Section 108 to transact the business of an insurer and

(b) insures the person or classes of person specified in the policy to the extent specified in Sub-section (2) against any liability which may be incurred by him or them in respect of the death or bodily injury to any person caused by or arising out of the use of the vehicle in a public place....

Provided that a policy shall not be required, (i) to cover liability in respect of the death arising out of and in the course of his employment of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment (other than a liability arising under the Workmens Compensation Act, 1923, in respect of the death of, or bodily injury to, any such employee

(a) engaged in driving the vehicle, or (b) if it is a public service vehicle, engaged as a conductor of the vehicle or in examining tickets on the vehicle, or (c) if it is a goods vehicle, being carried in the vehicle").

7. It will be noted that the bracketed portion of Section 95 was inserted by Act 100 of 1956 with effect from 16-2-1957. This amendment introduced a radical change in the requirements of insurance policies and ultimately in the liability to indemnify the person or classes of persons specified in the policies. Prior to the amendment made in 1956 the third party risk was really the road insurance risk and that alone was compulsory and the employee risk was only voluntary. The proviso to Section 95(1) as it stands after the 1956 amendment requires that a policy shall cover liability arising under the 1923 Act in respect of death or bodily injury of certain employees such as the driver of the vehicle, a conductor of the vehicle or a person engaged in examining the tickets or the passengers, etc. Thus, a compulsory statutory insurance even in respect of employee risk has now been statutorily covered by the statutory insurance scheme embodied in Chapter VIII in the Motor Vehicles Act. The result desired by the amendment introduced in the year 1956 is fully achieved with the aid of the non obstentV clause contained in Section 95(5) which runs as under:

Notwithstanding anything elsewhere contained in any law, a person issuing a policy of insurance under the section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of person.

8. But for the above overriding provision insurance companies could have avoided their liability in various ways. Perhaps they could take shelter under general insurance law or any other relevant law. Now the clinching effect of Section 95(5) is that the insurance companies can no longer urge that they are not bound to indemnify persons or classes of persons specified in the policies in respect of any liability which the policy purports to cover in case of persons or classes of persons. The entire Chapter VIII of the Motor Vehicles Act, reinforced by the amendment of 1956, was intended to provide an efficacious and speedy remedy to the claimants by placing an insurance company behind every driver, conductor, ticket examiner of the vehicle, etc. Since such category of persons are now com-pulsorily included within the scheme of statutory insurance, the liability of the insurance companies with respect to such classes of persons is absolute. I have already mentioned that the scope of Section 19 of the Workmens Compensation Act by expressly using the term person as distinguished from mere "employer" occurring in Section 3 was wide enough to include the determination of liabilities arising out of the statutory duty to indemnify a person or classes of persons. This demonstrates one remarkable manner in which the liability originally contemplated under the Workmens Compensation Act has been extended.

9. Yet another insurance of the same extension of the liability covered by the Workmens Compensation Act is manifested in the creation of a legislative fiction. Section 96 of the Motor Vehicles Act casts a duty on the insurance companies to satisfy judgments against persons insured in respect of third party risks. In short, Section 96(1) has created a statutory fiction that the insurance company has to be treated as if it were a judgment-debtor. Section 96(1) provides that if after a certificate of insurance has been issued under Sub-section (4) of Section 96 in favour of the person by whom a policy has been effected, judgment in respect of any such liability as is required to be covered by a policy under Clause (b) subjection (1) of Section 95 (being a liability covered by the terms of the policy) is obtained against any person insured by the policy, then, notwithstanding that the insurer may be entitled to avoid or cancel or may have avoided or cancelled the policy the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable thereunder, as if he were the judgment debtor, in respect of the liability, together with any amount payable in respect of costs and sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments. It is evident that the result of the amendment in the proviso to Section 95(1) (b) made by Act 100 of 1956 read alongwith the provision of Section 96 of the Motor Vehicles Act is that so far as the liability to indemnify a driver, conductor, ticket examiner, etc., is concerned it falls squarely on the insurance companies and they cannot avoid it under any subterfuge. The various steps in the process are quite clear. Firstly, there has to be a statutory compulsion to take a policy under Section 94 of the Motor Vehicles Act and the contents of that policy as defined by Section 95, with the amended proviso introduced in 1957, coupled with the statutory fiction created under Section 95 which requires the insurance companies to be treated as judgment-debtors, eventually lead to the conclusion that it is the insurance company which is liable and cannot escape the liability. Of course, the position was materially different as it existed prior to the amendment in Section 95 or as it obtained under the Workmens Compensation Act alone without being supplemented by Chapter VIII of the Motor Vehicles Act. This position was succinctly stated in a Division Bench decision of the Gujarat High Court in N.LM,O. Insurance Company v. M.S. Solanki : 1974 A.C.J. 55:

If, therefore, a compulsory statutory insurance even in respect of the employee risk has now been statutorily covered by the statutory insurance scheme by Chapter VIII of the Motor Vehicles Act, 1939, and the insurance company has in respect of such statutory insurance to satisfy the judgment obtained against the insured may be.

14. It is obvious that Section 96(2) imposes a duty on the Court (or the Commissioner or any other Tribunal) to issue notice to the insurer by virtue of such notice the insurer becomes a party to the proceedings before the Commissioner. Their Lordships of the Supreme Court held in British India General Insurance Company Ltd. v. Captain Itbaf Singh and Ors. : A.I.R. 1959 SC. 1331 [LQ/SC/1959/113] that Sub-section (2) of Section 96 gives the insurer the right to be made a party to the suit and to defend it. The right, therefore, is created by statute and its content necessarily depends on the provisions of the statute. Sub-section (2) also provides that an insurer made a Defendant to the action is not entitled to take any defence which is not specified in it. In other words, the only manner of avoiding liability provided for in Sub-section (2) is through the defence mentioned therein. It passes comprehension as to how statutory defences can be raised unless the insurer is made a party. Thus, the practical result of enforcing the provisions of Section 96(2) is to make it imperative that the insurance company should be made a party to the proceedings before it can be made liable for the compensation claimed by the Appellant whether the proceedings are commenced under the Motor Vehicles Act before the Motor Accidents Claims Tribunal or before the Commissioner appointed under the Workmens Compensation Act. The mandatory procedure prescribed by Section 96 necessarily involves the making of the insurance company a party to the proceedings. I am fortified in the view that I have taken by several decisions. See M.P.S.R.T. Corporation v. Jahiram : 1969 A.C.J. 3 ; Northern India Motor Owners Insurance Company Ltd., Bombay v. Magan Shana-ji Solanki and Ors. 1974 A.C.3. 55 ; B. Srinivasa Reddy v. Khatumbi : 1974 A.C.J. 426. In an earlier case, The New Asiatic Insurance Company Ltd. v. Kulwanti Devi and Anr. A.I.R. J. & K. 90 it was held that Section 96(1) did not entitle a claimant to implead the insurance company in an application under the

Workmens Compensation Act as a person liable to pay compensation "and even the insurance company was not entitled to get itself impleaded as a party to the proper dings." The judgment was rendered on 15-7-57 while the amendment in the proviso to Section 95(1) of the Motor Vehicles Act came into effect on 16th February, 1957, Therefore, it appears that in all probability that case was decided prior to the amendr ment in|in the proviso to Section 95(1) which was vital. This view was dearly expressed by Bishamber Dayal, C. J. in Northern India Insurance Company Branch, Indore v. Commissioner for Workmens Compensation, Indore and Ors. : 1973 A.C.J. 428, and it was held that the insurance company was a proper party to such proceedings. Bishamber Dayal, CJ. speaking for the Court observed:

Since the insurance company has to be served with a notice of the proceedings under the said section and the company is ultimately liable to discharge the claim, it is but proper that the company be, impleaded in the proceedings and given a chance to see that the decree is not improperly passed. In this sense the company is certainly a proper party to all the proceedings m which a binding liability upon the company is to be deter- mined.

In Hindustan Ideal Insurance Company Ltd. v. Pappu Poojary and Ors. 1972 A.C.J. 433 , a Division Bench of the Mysore High Court repelled the contention that the insurance company could not be impleaded as a party under Sub-section (2) of Section 96 of the Motor Vehicles Act or that the Commissioner could not declare that the insurer was liable under Sub-section (1) of Section 96 of the Motor Vehicles Act to pay to the driver or his dependents any sum awarded against his employer under the Act. Chandra-shekhar, J. remarked "though the provisions of the Act do not expressly provide for impleading the insurer in an application under

Section 22 claiming compensation of for the Commissioner declaring the liability of the insurer to pay the sum awarded against the employer, their is no impediment for invoking the provision of Sub-sections (1) and (2) of Section 96 of the Motor Vehicles Act in proceedings under the Workmens Compensation Act.

15. I am however, inclined to hold that even though there is no express provision for impleading the insurance company in the proceedings under Section 22 of the Workmens Compensation Act, yet the inevitable impact of Sections 95 and 96 of the Motor Vehicles Act is to make the insurance company a necessary party to such proceedings. In that view of the matter the Compensation Commissioner was in error in upholding the preliminary objection of the insurance company in the instant case and rejecting the claim of the applicant against the company summarily and by his order dated 19-3-1974 completely absolving the insurer of the liability for payment of compensation to the applicant.

16. The question, however, still remains as to whether a decree can be passed against the insurer and what is the precise legal form in which a Commissioner while determining the liability of any person under Section 19 of the Act should frame his order. The use of the word decree in this context appears to be a misnomer. The Workmens Compensation Act does not contemplate the passing of a decree agaisnt any person held liable. It is only the liability which has to be settled under Section 19 and the Commissioner is empowered under Section 31 of the Act to recover as an arrear of land revenue any amount payable by a person under the Act. Even the provision for appeal under Section 30 of the Act is not confined to the employer. In fact in majority of cases appeals have been preferred by insurance companies. A declaration of the liability of the insurer to pay the compensation can certainly be made under Section 19 as if it where the person against whom the award of the compensation had been made and the amount can be recovered from it under the provisions of Section 31 of the Workmens Compensation Act. As 1 have already noted the entire scheme of Chapter VIII of the Motor Vehicles Act which is now att inseparable appendage to the Workmens Compensation Act, is to make available to the claimant a speedy payment of the amount of compensation irrespective of the financial position of the employer. This perhaps would be frustrated ifthi Commissioner were deprived of the jurisdiction to declare the liability of the insurance company as well in these proceedings. Nevertheless, in view of the charging Section 3 of the Workmens Compensation Act the primary liability rests on the, employer who cannot be absolved of it. It is only when his primary liability has been established that the liability can be enforced against the insurer. If the primary liability of the employer is itself not proved, then no liability can be attach to the insurer. Thus, although the primary liability is that of the employer, the insurance company is liable to discharge that liability. Consequently, the order under Section 19 of the Workmens Compensation Act should be passed declaring the liability of the employer but it should be made clear in the order that by virtue of sectian 96(1) of the Motor Vehicles Act the insurer would be treated as judgment debtor for the purpose of compensation. That was also in substance the view of Asthana, J. in Oriental Fire and General Insurance Company Ltd. v. Govind Singh and Ors. : 1972 A.C.J. 137, where he held that the Compensation Commissioner had no jurisdiction to pass a decree against the insurer of a motor vehicle but it was also observed that the claimant ought to realise the compensation: decree from the insurance company under Section 96 of the Act.

17. For the above reasons this appeal is allowed. The order of the Compensation Commissioner dated 19-3-1974 absolving the insurance company of its liability is set aside and the impugned order dated 25-5-1974 is modified to this extent that though the Appellant is liable to pay the compensation awarded to the claimant, the amount of the compensation is recoverable from Respondent No. 7, Ruby General Insurance Company, Calcutta under Section 96(1) of the Motor Vehicles Act. In compliance with the terms of Section 30 of the Workmen1 s Compensation Act the Appellant had deposited the entire amount of compensation of Rs. 4,200/- with the Commissioner at Banda before preferring this appeal. During the pendency of the appeaf it is admitted that the claimant has withdrawn a sum of Rs. 1,050/- leaving a balance of Rs. 3,150/-. I order that the claimant Respondent shall be at liberty to withdraw the remaining sum of Rs. 3,150/- in deposit. I further direct the Respondent No. 7, Ruby General Insurance Company (now National Insurance Company, Unit Ruby General Insurance Company) to deposit the compensation amount of Rs. 4,200/- with the Compensation Commissioner, Banda, within two months, failing which it will be open to the Commissioner to recover the said amount from the insurance company as arrears of land revenue under Section 31 of the Workmens Compensation Act and pay the amount to Sital Prasad, Appellant. No order is made as to costs. The record of the case shall be sent down to the court below forthwith.