I am from a pvt construction copnay.Under workmen's compensation policy the insurance company has deposited the amount of compensation and interest as per order of Labour Court. The inerest portion alone comes to about Rs. 3 lakhs. Now the insurance company has demanded payment of interest portion as they say they are not liable to pay the interst portion. One of the conditions of the policy is that they willnot pay interest/penalty. We have given intimation of accident immediately after the occurrence of accident. Our Lawyer says that Insurance Company has to bear the interest also.

What is the actual position in Law?

dear mr raveendran

The order of the Commissioner under Employees Compensation court is to be followed.  Who are the parties in the claim application ?  In case it is the insurance co. and your co.  the responsibility to obey the order lies on both of you.  If the interest is not paid, it will amount to violation of the order and the consequences will be penal.