National Insurance Co. Ltd. vs Smt. Mahasahar Jahan And Others
2022 Latest Caselaw 10572 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

RESERVED ON 01.08.2022
 
DELIVERED ON 18.08.2022
 
Court No. - 5
 

 
Case :- FIRST APPEAL FROM ORDER No. - 804 of 2005
 

 
Appellant :- National Insurance Co. Ltd.
 
Respondent :- Smt. Mahasahar Jahan And Others
 
Counsel for Appellant :- S.K. Mehrotra
 
Counsel for Respondent :- D.K. Tiwari,Mohd. Asim Zulfiquar,S.N. Singh,S.P. Tiwari
 

 
Hon'ble Salil Kumar Rai,J.

Heard Mr. S.K. Mehrotra, the counsel for the appellant and Mr. Mohd. Asim Zulfiquar, the counsel for respondent nos. 1 to 7.

The present appeal under Section 173 of the Motor Vehicles Act, 1988 (hereinafter referred to as, ''Act, 1988') has been filed by the Insurance Company challenging the judgment and award dated 4.2.2005 passed by the Motor Accident Claims Tribunal, Moradabad in Motor Accident Claim Case No. 226 of 2001 (Smt. Mahasahar Jahan & Ors. vs. Mohd. Saleem & Ors.).

The order-sheet indicates that notices were issued to the respondents by registered post. The respondent nos. 1 to 7 are represented by Mr. Mohd. Asim Zulfiquar and other Advocates. The notice could not be served on respondent no. 8 who is the owner of one of the vehicles involved in the accident. Regarding respondent no. 9, the office note indicates that neither undelivered cover nor any acknowledgment has returned. Regarding respondent no. 10, the office note indicates that notice has been served as acknowledgment has returned. No one has put in appearance on behalf of respondent nos. 9 and 10 in the present appeal. Service of notice on respondent nos. 9 and 10 is declared to be sufficient. Though, the respondent no. 8 has not been served notice of the case but considering the arguments raised by the counsel for the appellant, the respondent no. 8 is not required to be heard and, therefore, the Court proceeded to hear the appeal on merits as the same was pending in this Court since 2005.

At the very outset, it may be noted that the counsel for the claimants - respondents has argued that the compensation awarded by the Tribunal is to be enhanced. No cross-objection has been filed by the claimants - respondents. However, for arguments and reasons to be stated subsequently, the Court has considered the plea of the counsel for the claimants regarding enhancement of compensation as awarded by the Tribunal.

The facts of the case are that claimant - respondent nos. 1 to 7 instituted Motor Accident Claim Case No. 226 of 2001 under Section 166 of the Act, 1988 alleging that on 18.4.1998 at 02:30 a.m. while Mohammad Iqram (the deceased) was going with his goods in Truck Tata 407 bearing Registration No. U.P. 24/3308, an accident took place due to rash and negligent driving of Truck bearing Registration No. U.H.N. 1017 (hereinafter referred to as, ''the offending vehicle') which hit Truck Tata 407 bearing Registration No. U.P. 24/3308 as a result of which Mohammad Iqram suffered injuries and died on the spot. It was stated in the claim petition that the deceased was 32 years of age on the date of accident and was in the business of selling vegetables and milk and earned Rs.3,000/- per month. On the aforesaid pleas, the claimants claimed compensation of Rs.10,00,000/- for the death of Mohammad Iqram. The respondent no. 8 is the owner of Truck bearing Registration No. U.H.N. 1017, the respondent no. 9 is the insurer of Truck bearing Registration No. U.H.N. 1017, the respondent no. 10 is the owner of Truck Tata 407 bearing Registration No. U.P. 24/3308 and the appellant is the insurer of Truck Tata 407 bearing Registration No. U.P. 24/3308. The claimant - respondent no. 1 is the widow of the deceased, the claimant - respondent nos. 2, 6 and 7 are the daughters of the deceased and the claimant - respondent nos. 3, 4 and 5 are the sons of the deceased.

The owner of the offending vehicle, i.e., respondent no. 8 in the present claim petition did not appear in the proceedings before the Tribunal even though notice was issued to him. The owner of Truck Tata 407 bearing Registration No. U.P. 24/3308, i.e., respondent no. 10 appeared in the Tribunal but did not file his written statement. The appellant as well as the respondent no. 9 filed their written statements contesting the claim petition. In its written statement, the appellant admitted that Truck Tata 407 bearing Registration No. U.P. 24/3308 was insured with the appellant but pleaded that at the relevant time, the vehicle was being driven in violation of the terms of the insurance policy and, therefore, they were not liable to indemnify the owner of the vehicle.

On the pleadings of the parties, the Tribunal framed five Issues. Issue no. 1 was regarding the factum of accident and as to whether the accident occurred due to rash and negligent driving of the offending vehicle, Issue no. 2 was as to whether, at the time of accident, the driver of the offending vehicle had a valid driving licence, Issue no. 4 was as to whether, at the time of accident, the driver of Truck Tata 407 bearing Registration No. U.P. 24/3308 had a valid driving licence, Issue no. 5 was as to whether at the time of accident, Truck Tata 407 bearing Registration No. U.P. 24/3308 was being operated in violation of the terms of the insurance policy and Issue no. 3 was regarding the compensation payable to the claimants and the defendant liable to pay the said compensation.

The Tribunal decided Issue no. 1 in favour of the claimants - respondents though it held that the accident killing Mohammad Iqram was caused because of the composite negligence of the driver of the offending vehicle and the driver of Truck Tata 407 bearing Registration No. U.P. 24/3308 and the liability of the offending vehicle and Truck Tata 407 bearing Registration No. U.P. 24/3308 was in the ratio of 60:40. Issue nos. 2, 4 and 5 were decided against the Insurance Companies. So far as Issue no. 3 is concerned, the Tribunal held that the age of the deceased at the time of accident was 32 years old and also held that the income of the deceased was Rs.3,000/- per month. The Tribunal after deducting personal expenses of the deceased held the multiplicand to be Rs. 25,800/- and after applying a multiplier of 15, awarded a compensation of Rs.3,87,000/- for loss of pecuniary damages to the claimants. In addition to the aforesaid, the Tribunal awarded Rs.2,500/- to the claimants for loss of estate and Rs.5,000/- to claimant no. 1 for loss of spousal consortium. The said award has been challenged by the Insurance Company.

It was argued by the counsel for the appellant that the owner of Truck Tata 407 (respondent no. 10 in the present appeal) did not file the driving licence of the driver of the vehicle nor any document purporting to be the driving licence of the driver of the vehicle. It was argued that in the circumstances, it was not proved that at the time of accident, the driver of the offending vehicle had a valid driving licence and, therefore, the Tribunal has erred in holding the appellant liable to indemnify the owner of Truck Tata 407. It was further argued by the counsel for the appellant that compensation cannot be increased in an appeal filed by the Insurance Company and, in any case, just compensation has been awarded by the Tribunal to the claimants - respondents which does not require any increase.

Rebutting the arguments of the counsel for the appellant, the counsel for the respondents has argued that by virtue of Order XLI Rule 33 of the Code of Civil Procedure, 1908, the appeal court has the power to pass any orders in favour of the defendants even if no appeal or cross objection has been filed and further, the only restriction on the Tribunals and the appellate court in compensation cases under the Act, 1988 is that just compensation is to be awarded and the Tribunals or the appellate court are not to take hyper technical approach in compensation cases. It was argued that the Tribunal has wrongly applied a multiplier of 15 and has also paid very meager compensation under the conventional heads which requires to be increased. It was argued that no allowance has been made for future prospects while calculating the compensation payable to the claimants. It was argued that for the aforesaid reasons, the award of the Tribunal is to be modified and the compensation amount is to be increased. In support of his arguments, the counsel for the respondents has relied on a Division Bench judgment dated 27.7.2016 delivered in First Appeal From Order No. 2389 of 2016 (National Insurance Co. Ltd. vs. Smt. Vidyawati Devi & 2 Ors.) as well as the judgment of the Supreme Court reported in Surekha & Ors. vs. Santosh & Ors. (2020) ACJ 2126.

I have considered the rival submissions of the counsel for the parties and also perused the records.

The records indicate that the owner of Truck Tata 407, i.e., respondent no. 10 in the present appeal did not file his written statement disclosing the name of the driver of the vehicle and also did not file the driving licence of the driver of the vehicle. The appellant - Insurance Company had filed its written statement wherein Paragraph no. 17, it had averred that, at the time of accident, the driver of Truck Tata 407 did not have a valid and effective driving licence. The Tribunal has rejected the plea of the Insurance Company that it was not liable to indemnify the owner of Truck Tata 407 on the ground that the Insurance Company had not produced any evidence to prove that at the time of accident, the driver of Truck Tata 407 did not have a valid driving licence. The Tribunal has clearly erred on the aforesaid score. In Pappu & Ors. vs. Vinod Kumar Lamba & Anr. 2018 (3) SCC 208, the Supreme Court held that the onus would shift on the Insurance Company only after the owner of the offending vehicle pleads and proves the basic facts within his knowledge relating to the licence of the driver of the offending vehicle at the relevant time. The observations of the Supreme Court in Paragraph Nos. 12 and 13 of the aforesaid judgment are relevant for the purpose and are being reproduced below : -

"12. The Insurance Company is entitled to take a defence that the offending vehicle was driven by an unauthorised person or the person driving the vehicle did not have a valid driving licence. The onus would shift on the Insurance Company only after the owner of the offending vehicle pleads and proves the basic facts within his knowledge that the driver of the offending vehicle was authorised by him to drive the vehicle and was having a valid driving licence at the relevant time.

13. ... The Insurance Company can be fastened with the liability on the basis of a valid insurance policy only after the basic facts are pleaded and established by the owner of the offending vehicle - that the vehicle was not only duly insured but also that it was driven by an authorised person having a valid driving licence. Without disclosing the name of the driver in the Written Statement or producing any evidence to substantiate the fact that the copy of the driving licence produced in support was of a person who, in fact, was authorised to drive the offending vehicle at the relevant time, the owner of the vehicle cannot be said to have extricated himself from his liability. The Insurance Company would become liable only after such foundational facts are pleaded and proved by the owner of the offending vehicle."

(emphasis added)

As noted earlier, the owner of Truck Tata 407 did not file any written statement disclosing the name of the driver of the offending vehicle and pleading that at the time of accident, the driver of the offending vehicle had a valid driving licence. The details of the driving licence were also not disclosed by the owner of the vehicle. No evidence was produced by the owner of the vehicle to show that at the time of accident, the driver of Truck Tata 407 had a valid driving licence. In the circumstances, the basic facts and pleading to shift the onus on the Insurance Company were not before the Tribunal and the appellant was not expected to prove that at the time of accident, the driver of the offending vehicle did not have a valid driving licence. In view of the aforesaid, the findings of the Tribunal on Issue No. 4 are set-aside and it is held that there is no evidence on record to indicate that at the time of accident, the driver of Truck Tata 407 had a valid driving licence. For the said reason, the Insurance Company, i.e., the appellant was not liable to indemnify the owner of Truck Tata 407 for the compensation amount payable by the owner of the said vehicle who is respondent no. 10 in the present appeal. In view of the aforesaid, the appellant - Insurance Company is entitled to recover from respondent no. 10 the compensation amount paid by it to the claimants.

So far as the plea of the counsel for the claimants for enhancement is concerned, the Division Bench of this Court in Smt. Vidyawati Devi (supra) after considering Order XLI Rule 33 of the Code of Civil Procedure, 1908 rejected the argument of the National Insurance Company that the appellate court under Section 173 of the Act, 1988 had no power to enhance the compensation in an appeal filed by the Insurance Company even if no cross-appeal or cross-objection has been filed by the claimants. Similarly, in Surekha (supra), the Supreme Court modified the order of the High Court, which, though agreed with the claimants that the compensation awarded by the Tribunal ought to be increased but declined to enhance the same on the ground that the claimants had not filed a cross-appeal. In this context, the observations of the Supreme Court in Paragraph no. 3 of the aforesaid judgment are relevant and are being reproduced below : -

"3. By now, it is well settled that in the matter of insurance claim compensation in reference to the motor accidents, the court should not take hyper-technical approach and ensure that just compensation is awarded to the affected person or the claimants."

There is no dispute that in normal circumstances, in appeal filed by the Insurance Company under Section 173 of the Act, 1988, the appellate court can enhance the compensation even if no cross-appeal or cross-objection has been filed by the claimants. However, the law laid down by the Division Bench of this Court in Smt. Vidyawati Devi (supra) and the observations of the Supreme Court in Surekha (supra) are not applicable in the present case. In the present case, the Tribunal has held that respondent no. 9 which is the insurer of Truck bearing Registration No. U.H.N. 1017 and the appellant are liable to pay compensation in the ratio of 60:40. The respondent no. 9 has no notice of the plea of the appellant to increase the compensation amount. In view of the aforesaid, the failure of the appellant to file a cross-objection in the present case is fatal to his plea to increase the compensation amount. Any increase in the compensation amount would also impose a liability on respondent no. 9 who has no notice of the case to be set-up by the claimants for enhancement of compensation. In view of the aforesaid, it would not be appropriate to increase the compensation amount as prayed by the counsel for the claimants even though it is apparent from the award of the Tribunal that the compensation awarded is quite less. For the aforesaid reason, the plea of the counsel for the appellant to increase the compensation amount is rejected.

The appeal is partly allowed. It is held that the appellant is entitled to recover the compensation amount paid by it from the owner of Truck Tata 407 bearing Registration No. U.P. 24/3308, i.e., respondent no. 10 in accordance with law. The award of the Tribunal is modified to the aforesaid extent.

The appeal is partly allowed.

Order Date :- 18.8.2022

Satyam