1. This appeal is against the order of the Commissioner for Workmen's Compensation, Madras, directing the appellant to indemnify the respondent who will hereafter be referred to compendiously as the Government, in respect of a sum of Rs. 1,800 paid by the latter to the widow of a workman under the provisions of the Workmen's Compensation Act, 1923.
2. The appellant is an engineering contractor. By a contract with the Government he undertook to form a link road between Aminjikarai and Villivakkam. For the purpose of this contract the appellant had to transport what are described as soling stones from a quarry at Chikarayapuram to the workspot. In respect of the transport of these stones, the Government agreed to hire out their lorries with drivers to the appellant for Rs. 45 per lorry per day for a run of 75 miles. The wages of the drivers, the taxes payable in respect of the lorries and all running and maintenance charges were to be borne by the Government. One of the lorries met with an accident on the evening of the 25th of November, 1944, at Maduravayal on the Great Western Trunk Road resulting in the death of the driver Raju on the 28th following. His widow made a claim for compensation tinder the Workmen's Compensation Act. The Government accepted the claim and paid the amount claimed, Rs. 1,800 to her on the 18th of May, 1945. Notice of these claim proceedings was not given to the appellant. The Government subsequently called upon the appellant to reimburse them in the amount that they had paid. When the appellant refused, the Government filed an application under Section 12(2) of the Workmen's Compensation Act and obtained an order in their favour and this appeal, as already stated, is against that order.
3. On behalf of the appellant, Mr. Sangameswara Aiyar has taken three points. I shall deal with them seriatim.
4. Firstly, he said that his client is not an employer within the meaning of Section 2(e) of the Workmen's Compensation Act, which is in these words:
employer' includes any body of persons whether incorporated or not and any managing agent of an employer and the legal representative of a deceased employer, and, when the services of a workman are temporarily lent or let on hire to another person by the person with whom the workman has entered into a contract of service or apprenticeship, means such other person while the workman is working for him;
Looking at the language of the section, it is difficult to see how it can be said that the services of the driver were not temporarily lent or let on hire to the appellant by the Government. Mr. Sangameswara Aiyar does not deny that if the appellant had obtained the services of the driver without the lorry it would be a case of temporarily lending such services; and if any payment was stipulated then it would be a case of letting the services on hire. He says, however, that the fact that the Government made the lorry also available would make a difference. I am unable to see how it does. A consolidated amount was stipulated for the use of the lorry and the driver, so that it can be taken that a portion of that amount must be referable to and be regarded as payment for the services of the driver which were placed at the disposal of the appellant. Mr. Sangameswara Aiyar drew my attention to Laugher v. Pointer (1826) 5 B.& C. 547 : 108 E.R. 204. Jones v. Scullard (1898) 2 Q.B. 565 and Century Insurance Co. v. Northern Ireland Road Transport Board (1942) A.C. 509 but I do not think that any of these cases helps the decision of the question which arises here.
5. It is well known that the Workmen's Compensation Act both in England and in this country departed to a considerable extent from the common law of master and servant. Even as between the Workmen's Compensation Act in England and our Workmen's Compensation Act there are considerable differences and it is somewhat curious that in regard to the particular provision with which we are concerned the English Act, at any rate till 1930. was just to the opposite effect as Section 2(e) of the Indian Act (See Halsbury's complete Statutes of England, Volume XI, page 531) where Section 5(1) of the Workmen's Compensation Act (England) 1925 is quoted).
6.Construing the relevant section I do not see any difficulty in holding that the appellant is an employer within the meaning of our Act.
7. It was next argued that in respect of the hire of the lorries the appellant must be regarded as the contractor and the Government must be regarded as a subcontractor or to use the language of Section 12, that the appellant is the principal and the Government is the contractor. I am unable to accept this argument also. The claim of the Government for indemnification is based, as already stated, on Section 12(2) of the Act. For its application this sub-section requires that the person claiming indemnification must be the principal while the person against whom indemnification is sought should be the contractor. The Government is having the road construction work carried out by the appellant and I do not see how the appellant can escape the conclusion that he is a contractor, within the meaning of Section 12. It has not been explained how the Government can be regarded as a sub-contractor. I have already dealt with the aspect as to whether having regard to the arrangement about the hire of lorries the appellant is or is not an employer within the meaning of the Act. If his liability as an employer is established and if the Government which is the principal within the meaning of Section 12 has paid the amount which is payable by him, the claim for indemnification under Section 12(2), would properly lie.
8. Finally, it was argued that Rule 39, Sub-rules (1) and (2) of the Rules framed under the Workmen's Compensation Act (1923) provide that where a claim for indemnification is made under Section 12(2), the person who is called upon to pay the amount in the first instance and who after payment applies to be indemnified under Section 12(2) must, when he was first called upon to answer the claim for compensation, see that notice is issued to the party against whom he subsequently proposes to proceed for indemnification. Mr. Sangameswara Aiyar's argument was that these provisions are mandatory and since in this case the procedure laid down was evidently not followed the claim for indemnification must fail. Leaving out the non-essential parts, Rule 39(1) runs as follows:.he (the person from whom compensation is claimed) shall when first called upon to answer the application present a notice of such claim (claim under Sub-section (2) of Section 12: to be indemnified) accompanied by the prescribed fee, and the Commissioner shall thereupon issue notice to such person in form J.
Sub-rule (2) provides that:
If any notice is so issued the person to whom it is issued shall have all the rights of a party to the proceedings; 'and that' in default of so appearing he shall be deemed to admit the validity of any award made against the opposite party and to admit his own liability to indemnify the opposite party for any compensation recovered from him.
It is obvious that the object of these rules is to prevent multiplicity of proceedings and to decide if possible not only the claim for compensation but also any claim for indemnification arising out of the payment of compensation. Otherwise, the person against whom indemnification is claimed may raise the question over again whether the person claiming compensation is entitled to it and also raise a dispute as to the amount which should have been awarded. If the procedure laid down in Rule 39(1) and (2) is followed he would be precluded from re-agitating these questions. But it seems to me that the effect of the non-observance of the procedure laid clown in Rule 39 (1) and (2) is not to work out an extinguishment of the claim for indemnification altogether which is in effect what Mr. Sangameswara Aiyar's argument would come to, I may point out that in this case it was not disputed before the Commissioner by the appellant that the claim of the widow of the deceased driver to compensation under the Act is a proper one, nor was any dispute raised as to the amount of compensation. It would no doubt have been open to the appellant, if he were so advised to agitate these two matters before the Commissioner in view of the fact that he was not a party to the proceedings between the claimant and the Government. But he rightly accepted the position that the claimant was entitled to compensation and raised no dispute about the amount.
9. From the construction that I am inclined to place on Rule 39 Sub-rules (1) and (2) it follows that the failure of the Government to have the appellant brought in, in the proceedings for compensation does not preclude them from claiming indemnification later on. The application under Section 12(2) was therefore maintainable notwithstanding the default on the part of the Government to pursue the procedure laid down tinder Rule 39, Sub-rules (1) and (2).
10. In the result the appeal fails and is dismissed with costs.