Sec 87 (insolvency of employer)& 88 & 89

Tuesday, 27 February 2024 10:53 PM

The question raised is whether in adjudicating the claim of a

dependant of a workman who died as a result of a motor
accident, the workmen's Compensation Commissioner can
direct the insurer to pay the amount awarded as compensation.
The appellants contend that the Workmen's Compensation
Commissioner has no jurisdiction or authority to pass an award
against the Insurance Company and the only occasion a liability
can be fixed on the insurer by the Commissioner is when the
conditions contemplated by Section 14 of the Act exist.

is a welfare legislation intended to

The Workmen's Compensation Act
provide speedy and cheap disposal of disputes relating to
compensation to workmen and their dependants. In construing
the provisions of the Act the purpose sought to be achieved by
the legislation has to be considered. Under the W.C. Act in
proceedings under Section 22 of that Act, the
Commissioner is empowered to enforce the liability of the
employer to pay the compensation to the employee by
directing the Insurer to discharge the liability in terms of
the policy which covers the liability. The Commissioner for
Workmen’s Compensation has jurisdiction to determine
the liability of any person to pay compensation, and such
jurisdiction is not limited by the provisions contained in
Section 14 of the Workmen’s Compensation Act.

This Section provides the safeguards in adjudicating upon the

employee’s claim in certain specified contingencies. Special
jurisdiction to proceed against the Insurance Company even in
such cases cannot be construed or treated as restriction on the
general powers. When a person becomes insolvent or the winding
up of a Company had commenced, all the rights and remedies of
such person enforceable against a third party under contract shall
stand transferred to and vest in the official receiver or the official
liquidator as the case may be. But in the interest of the workman
and in order to enforce the absolute liability of the employer and
the statutory liability of the Insurer in accident claims arising under
the Act, Section 14 provides that the rights of the employer
shall stand transferred to and vest in the workman. The
Commissioner is enabled to enforce the liability of the Insurer
making available the full amount assured for the satisfaction of
the employee’s claim even in such cases