An insurer must indemnify the employer for compensation and interest under the Employees’ Compensation Act.

Ganpat Kumar Dhruv died by electrocution on 3 November 2017 while working for respondent No. 3, Sainath Construction Company.

His dependants sought compensation under the Employees’ Compensation Act, 1923.

The Commissioner awarded them ₹8,48,940, with interest at 12% per annum from 24 April 2019 until realization, and directed the Insurance Company to pay.

The Insurance Company appealed under Section 30, disputing both the finding that Ganpat was employed by respondent No. 3 and its liability for interest.

1. Whether the Commissioner erred in finding that the deceased was an employee of respondent No. 3.

2. Whether the finding that the Insurance Company was liable to pay interest on the compensation was perverse or illegal.

Section 30 of the Employees’ Compensation Act, 1923 provides for an appeal on a substantial question of law.

Under Ved Prakash Garg v. Premi Devi, (1997) 8 SCC 1, an insurer is liable to indemnify the insured employer for both the compensation and the interest payable on it.

On the employment issue, the Commissioner had considered the evidence and found an employer–employee relationship; respondent No. 3 had also expressly admitted in evidence that the deceased was employed by him. The Insurance Company produced no cogent evidence to rebut that finding, and the High Court found no basis to interfere with it.

On interest, the Court applied Ved Prakash Garg and held that the insurer’s liability to indemnify the employer extended to the interest awarded on the compensation.

The Commissioner’s award, including the direction that the Insurance Company pay the compensation with interest, remained undisturbed.