Gujarat High Court
Reliance General Insurance Co. Ltd vs Vikramsinh Ranjeetsinh Zala on 18 July, 2025
NEUTRAL CITATION
C/FA/2586/2023 JUDGMENT DATED: 18/07/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 2586 of 2023
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS. JUSTICE NISHA M. THAKORE
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Approved for Reporting Yes No
No
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RELIANCE GENERAL INSURANCE CO. LTD.
Versus
VIKRAMSINH RANJEETSINH ZALA & ORS.
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Appearance:
MR RATHIN P RAVAL(5013) for the Appellant(s) No. 1
MR DK CHAUDHARI(5361) for the Defendant(s) No. 1,2
RULE SERVED for the Defendant(s) No. 3,4
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CORAM:HONOURABLE MS. JUSTICE NISHA M. THAKORE
Date : 18/07/2025
ORAL JUDGMENT
[1.] Heard Mr. Rathin Raval, learned advocate on record for the appellant- Insurance Company. The notice of admission issued by this Court upon the respondents, has been duly served; however, the respondent nos. 3 and 4 have chosen not to appear and contest the present proceedings. Learned advocate Mr. D.K. Chaudhari has entered appearance on behalf of respondent nos.1 and 2.
Page 1 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025 NEUTRAL CITATION C/FA/2586/2023 JUDGMENT DATED: 18/07/2025 undefined [2.] The present appeal is filed at the instance of the
Insurance Company under Section 173 of the Motor Vehicles Act, 1988, being aggrieved and dissatisfied with the impugned judgment and award dated 17.09.2022 passed by the Motor Accident Claims Tribunal (Auxi.), Mahesana in Motor Accident Claim Petition No. 336 of 2017.
[3.] This Court, noticing the grounds raised in the appeal and the submissions made by the learned advocate for the appellant, vide order dated 05.07.2023, has admitted the appeal, and in the application seeking stay preferred at the instance of the original appellant-Insurance Company, has stayed the impugned judgment and award, pending the appeal, on condition of deposit of the entire award amount with the concerned Tribunal. Thereafter, vide order dated 18.08.2023, this Court had confirmed the aforesaid ad-interim relief, and had permitted the original claimants to withdraw 30% of the deposited award amount, and 70% of the amount was directed to be invested in the fixed deposit with a Nationalized Bank, which was subject to the outcome of the present appeal.
[4.] Learned advocate Mr. Rathin Raval appearing for the appellant- Insurance Company has vehemently submitted that the Page 2 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025 NEUTRAL CITATION C/FA/2586/2023 JUDGMENT DATED: 18/07/2025 undefined Tribunal committed grave error in fixing the liability of the appellant- Insurance Company to pay the amount of compensation. Learned advocate has submitted that specific defence was raised before the Tribunal that there was breach of terms and conditions of policy and therefore the Insurance Company was required to be exonerated from its liability to indemnify owner and to make payment of compensation to the claimant.
[4.1] Learned advocate has invited my attention to the defence raised by the appellant-Insurance Company before the Tribunal, and has pointed out that despite the objection being raised with regard to the seating capacity, which was confined to 5 persons including the driver in the vehicle concerned; however, at the time of the accident, admittedly 12 persons were travelling, which was beyond the permissible seating capacity of the vehicle. He has, therefore, submitted that considering the terms and conditions of the policy, which was not beyond the seating capacity, the Insurance Company ought not to have been saddled with the liability to pay compensation. [4.2] He has further invited my attention to the findings and reasons assigned by the Tribunal while considering the aspect of liability and has submitted that, in fact, the Tribunal has completely Page 3 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025 NEUTRAL CITATION C/FA/2586/2023 JUDGMENT DATED: 18/07/2025 undefined ignored the specific defence of the appellant- Insurance Company merely by noticing the fact that the insurance policy was in force at the time of the occurrence of the accident, and the coverage being offered by the Insurance Company, had held the Insurance Company equally liable to pay the amount of compensation along with the rest of the original opponents. He has, therefore, submitted that the aforesaid order is a Non speaking order and has urged this Court to quash and set or else to reside the remand the matter to examine the aforesaid issue.
[4.3] At this stage, the reliance was placed on the decision of the Hon'ble Supreme Court in the case of United India Insurance Company Ltd. vs. K.M. Poonam reported in 2011(2) Scale 568. By referring to the aforesaid decision, the learned advocate has urged this Court to alternatively consider the issuance of appropriate directions of pay and recovery.
[5.] Considering the aforesaid submissions of the learned advocate appearing for the appellant- Insurance Company and having perused the findings and reasons assigned by the Tribunal, in light of the judgment of the Hon'ble Supreme Court in the case of K.M. Poonam (supra), the only issue which is raised for consideration of this Page 4 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025 NEUTRAL CITATION C/FA/2586/2023 JUDGMENT DATED: 18/07/2025 undefined Court is, as to whether the Tribunal committed any error in imposing the liability of the Insurance Company along with the driver and owner of the vehicle in making the payment of compensation in a case where admittedly there was breach of the provisions by carrying passengers beyond the permissible limit. The Tribunal, upon appreciation of the evidence produced on record, has arrived at the conclusion that there were 12 passengers inside the vehicle at the time of the occurrence of the accident. As against that, upon appreciation of the R.C. book produced on record at Exh.69, the sanctioned seating capacity was confined to 5 persons only.
[6.] In light of the aforesaid document produced on record, after considering the terms and conditions of the policy, wherein it has transpired that the policy does not cover the risk of 12 passengers as they were travelling beyond the capacity, in the opinion of this Court, the Tribunal has miserably failed to consider the aforesaid defence raised by the appellant- Insurance Company. Upon perusal of the evidence brought on record, more particularly, the R.C. Book which is produced on record for consideration at Exh. 69, it is evident that the seating capacity of the vehicle was confined to 5 persons only, whereas upon appreciation of the evidence in the nature of the FIR placed on record at Exh. 63, it is evident that more number of Page 5 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025 NEUTRAL CITATION C/FA/2586/2023 JUDGMENT DATED: 18/07/2025 undefined passengers were travelling beyond the permissible limit. [7.] Having noted the aforesaid evidence on record, as regards the liability of the insurer is concerned, in view of the settled legal position as laid down by the Hon'ble Supreme Court in the case of K.M. Poonam (supra), would be confined to the number of persons covered by the insurance policy, and not beyond the same. In absence of any challenge being made by the original claimants as against the aforesaid foundational findings assigned by the Tribunal, this Court has reason to believe that the insurance policy was confined to the seating capacity of the vehicle. Thus, the Insurance Company can be held liable, at the most, to pay the amount of compensation to the five passengers occupied in the vehicle at the time of the accident. However, considering the ratio laid down by the Hon'ble Supreme Court in the aforesaid decision, and considering the facts of the case where this Court would have no occasion to pick and choose and to identify the five persons, excluding the driver, in order to issue directions to the Insurance Company to make the payment, this Court is inclined to issue directions to meet the ends of justice by adopting the procedure adopted by the Hon'ble Supreme Court in the aforesaid decision.
Page 6 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025 NEUTRAL CITATION C/FA/2586/2023 JUDGMENT DATED: 18/07/2025 undefined [8.] Thus, the Insurance Company is directed to deposit the
total amount of compensation awarded to all the claimants, and the amount so deposited is further directed to be disbursed in favour of the claimants in respect of their claims, with further liberty to the Insurance Company to recover the amounts paid by it, over and above the compensation amount payable in respect of the persons covered by the insurance policy from the owner of the vehicle. [9.] For the foregoing reasons, the appeal is partly allowed. The impugned judgment and award dated 17.09.2022 passed by the Motor Accident Claims Tribunal (Auxi.), Mahesana in Motor Accident Claim Petition No. 336 of 2017, is hereby modified in the aforesaid terms.
[10.] Since the appeal is partly allowed, in view of the order passed by this Court, while considering the interim relief of stay, and in view of the disposal of the First Appeal by this order, the Tribunal is directed to release the entire award amount in favour of the original claimants, preferably within a period of two weeks from the date of receipt of this order.
Page 7 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025 NEUTRAL CITATION C/FA/2586/2023 JUDGMENT DATED: 18/07/2025 undefined [11.] Needless to clarify that the aforesaid exercise shall be
undertaken by the Tribunal strictly in accordance with law and the guidelines issued by the Hon'ble Supreme Court in this regard. [12.] With these observations, present First Appeal stands disposed of.
(NISHA M. THAKORE,J) SUYASH SRIVASTAVA Page 8 of 8 Uploaded by SUYASH KUMAR SRIVASTVA(HC01570) on Sat Jul 19 2025 Downloaded on : Mon Jul 21 21:53:01 IST 2025