The Personal Incharge, Icici ... vs Rallapalli Kullayappa And ...
2022 Latest Caselaw 8050 AP

                                   1                  MACMA.No.1131 of 2013


           HON'BLE SRI JUSTICE T MALLIKARJUNA RAO

                       MACMA.No.1131 OF 2013


JUDGMENT :

1. This MACMA is preferred by the person Incharge ICICI Lombard General Insurance Company Limited, who is arrayed as 2nd respondent in MVOP.No.693 of 2009 on the file of Chairman, Motor Accidents Claims Tribunal - Cum - III Additional District Judge (Fast Track Court), Anantapur questioning the order dt.30.04.2012 awarding compensation amount of Rs.36,000/- with proportionate costs to the claimant.

2. For convenience's sake, hereinafter, the parties will be referred to as they were arrayed in MVOP.No.693 of 2009.

3. The claimant filed the claim petition under Sections 140 and 166 of MV Act and Rule 455 of Motor Vehicle Rules, 1989, claiming a compensation amount of Rs.1,00,000/- together with interest and costs for the injuries sustained by the petitioner in a road accident. According to the petitioner, on 13.11.2008, he travelled in a 407 van bearing No.AP-03-V-5279 (hereinafter referred to as an offending vehicle) as Hamali, along with others, after loading Papaya fruits into the vehicle. When they reached Manella cross at about 04.00 PM, the offending vehicle's driver drove it rashly and negligently lost control of it; he applied sudden breaks. Due to this offending vehicle turned turtle and fell on the left side of the road. As a result, he sustained injuries. He got admitted to Government Hospital, Ananthapur. He took treatment as an inpatient for 40 days and underwent surgeries. Doctors inserted steel rods, and he became a permanently disabled person.

4. The 1strespondent remained set exparte. The 2nd respondent filed a counter by submitting that the accident occurred only due to the petitioner's negligence; he was an unauthorized passenger in a goods vehicle. The offending vehicle was not insured with the 2nd respondent company, and the driver of the offending vehicle did not have a driving license at the time of the accident.

5. Based on the pleadings, the Tribunal framed the relevant issues. Before the Tribunal on behalf of the petitioner, PWs.1 and 2 got examined, marked Exs.A1 to A3, Exs.X1. On behalf of the 2nd respondent RW., 1 got examined, marked Exs.B1 to B3.

6. After considering the evidence on record, the Tribunal held that the accident occurred due to rash and negligent driving of the offending vehicle driver, and the respondents are liable to pay compensation of Rs.36,000/- with interest and costs. The liability of the 2nd respondent is restricted to only one highest award (regarding families). The said amount can be distributed among the families/claimants based on the compensation amount awarded to them.

7. Heard the arguments of learned counsel for the appellant and the respondents and perused the record.

8. The learned counsel appearing for the insurer submits that in the case of sustaining injuries by the gratuitous passenger in the Motor Vehicle Accident, particularly while travelling in the transport/goods vehicle, the insurer's company is not liable to indemnify the insured. He submits that the goods vehicle cannot carry passengers gratuitously for payment. If the goods vehicle is not permitted by law to carry passengers, the insurer cannot be fastened with the liability to pay the compensation amount. He also

contends that the driver of the insured vehicle is not holding a valid and effective driving license to drive the insured vehicle. The driving license had expired on the date of the accident. The 1st respondent was an unauthorized passenger. He did not travel in the vehicle in the capacity of hamali. The insurance policy does not cover the risk of coolie for want of payment of the premium amount. The learned Tribunal awarded an excessive and exorbitant amount of Rs.36,000/- to the 1st respondent.

9. Per contra, the learned counsel appearing for respondents supported the findings and observation of the learned Tribunal.

10. Now the points for determination are whether the Tribunal is not justified in fastening the liability on the appellant/insurance company and whether the compensation amount awarded is just and reasonable.

11. There is no serious dispute with regard to the manner of an accident. The finding of the Tribunal that the accident occurred due to rash and negligent driving of the 1st respondent is also not disputed. It is not in dispute that the claimant sustained the injury while travelling in the offending vehicle and gave a report under Ex.A1. Thus, it is unnecessary to narrate the factual aspects of the accident in detail.

12. The petitioner examined himself as PW.1. To prove that he sustained injuries in the accident, he relied on Ex.A2. He also got examined PW.2 - Dr K.Satish to prove the injuries suffered by him in the accident. Ex.A1 report refers that the defacto complainant Pullamma and others proceeded in the offending vehicle as coolies after loading Papaya fruits into it, and they sat on the load. RW.1 - K.Leela Kumar, an employee of the 2nd respondent company,

contended that the accident occurred due to negligence of the petitioner who sat on the load; RW. 1 did not say his presence at the time of the accident. The offending vehicle's driver is the best person to speak about the manner of an accident. The insurance company has not taken steps to prove the manner of the accident by summoning the offending vehicle's driver. A reading of Ex.A1 FIR coupled with Ex.A3 charge sheet shows that the offending vehicle's driver drove it rashly and negligently. No evidence is placed by the insurance company to show that the contents of the charge sheet are incorrect. Nothing on record suggests that the Investigating Officer filed the charge sheet against the offending vehicle's driver without conducting a proper investigation. Thus the Tribunal has rightly accepted the petitioner's case regarding the negligence aspect.

13. The evidence of PW.1 and PW.2 shows that the petitioner sustained three injuries, as shown in Ex.A2 wound certificate. The petitioner suffered a fracture of the upper femur left hip. The petitioner has undergone an operation on his left leg, and there was a fracture of the left femur. He got admitted to the hospital on 13.11.2008 and discharged on 02.01.2009. In the said facts of the case, the Tribunal rightly granted compensation amount of Rs.25,000/- towards pain and suffering, Rs.6,000/- towards loss of earnings for two months, Rs.2,000/- for attendant charges, Rs.2,000/- towards extra nourishment, Rs.1,000/- towards transportation charges. The claimant has not disputed the quantum of the compensation amount. This Court views that the Tribunal granted a just and reasonable amount. Before the Tribunal, it was also contended that the offending vehicle's driver had no valid driving license. The Tribunal points out the burden on the insurance company to prove the contention. The petitioner has placed the copy of the driving license as evident from the order of the Tribunal. The 2nd

respondent has not taken steps by summoning the RTA officials to prove that the driver of the offending vehicle does not have a driving license. Ex.A3 charge sheet also does not show that the driver did not have a driving license. In the facts of the case, the Tribunal justified negativing the contention of the 2nd respondent - the insurance company. The burden is on the insurance company to establish the violation of the said condition. It is not in dispute that the insurance policy was in force as of the date of the accident. RW.1 produced Ex.B1 copy of the policy. The 2nd respondent also relied on an Ex.B2 office copy of legal notice and Ex.B3 postal receipt.

14. There is no dispute about sending a legal notice to the owner of the offending vehicle, which is evident by the Ex.B2 office copy of the notice. The evidence of RW.1 coupled with Ex.B1 shows that the insurance policy is a package policy. RW.1 claimed they had collected a premium for the driver and owner alone. The insurance company contended that the petitioner was an unauthorized passenger, not a hamalie. The 2nd respondent - the company is not liable to pay the compensation amount. A perusal of Ex.B1 shows that the risk covers the owner cum driver and driver; the carrying capacity is shown as three in number.

15. In a decision between Amritlal Sood vs Kaushalya Devi Thakar1 the Hon'ble Apex Court held that "the comprehensive policy issue covers the risk of gratuitous passengers, i.e., the car's occupants. Therefore, it is clear from the Act itself, the words of the policy and the decision in Amritlal Sood's case that a comprehensive policy covers the risk of gratuitous passengers to the extent of the liability incurred.

(1998) 3 SCC 744

16. A three-Judge Bench of the Hon'ble Apex Court in the case of National Insurance Co. Ltd. Vs Baljit Kaur and Others2, held that, considering the question of whether the insurance policy in respect of goods vehicle is required to cover the gratuitous passenger in view of the amendment to Section 147 of the Act. The apex court, after considering all the previous decisions, concluded that the Insurance Company was not liable as the risk of an unauthorized passenger in a goods vehicle or gratuitous passengers is not covered under the policy, and there is a breach of the condition of the policy in carrying a passenger in a goods vehicle. Therefore, the owner of the vehicle was held liable to satisfy the decree. However, in paragraph No. 21, the Court was of the opinion that the interest of justice would be sub-served if the Insurance Company was directed to satisfy the award in favour of the claimant, if not already satisfied and recover the same from the owner of the vehicle. The Court also observed that, for such recovery, it would not be necessary for the insurer to file a separate suit. Still, it may initiate a proceeding before the executing Court as if the dispute between the insurer and the insured was also determined by the Tribunal and the issue was decided against the owner and in favour of the insurer.

17. In a decision between National Insurance Co.Ltd., V. Anjana Shyam3 the Hon'ble Apex court held that "it does not mean that an insurer is not bound to pay amounts outside the contract of insurance itself or in respect of persons not covered by the contract at all. In other words, the insured is covered only to the extent the passengers are permitted to be insured or directed to be insured by the statute and actually covered by the contract. An insurance company can be made liable only in respect of the number of

(2004) 2 SCC 1

2007 CJ 2129 (SC)

passengers for whom insurance can be taken under the Act and not for the other passengers involved in the accident in a case of overloading. "Keeping that in mind, we think that the practical and proper course would be to hold that the insurance company, in such a case, would be bound to cover the higher of the various awards and will be compelled to deposit the higher of the amounts of compensation awarded to the extent of the number of passengers covered by insurance policy".

18. The identical issue once again surfaced in the case of United India Insurance Co.Ltd., v. K.M.Poonam4, the Hon'ble Apex Court reiterated the relevant provisions of the Motor Vehicles Act and, after taking note of its various earlier decisions, including Baljit Kaur (supra) and Anjana Shyam (supra), has resolved and settled the issue thus: "the liability of the insurer, therefore, is confined to the number of persons covered by the insurance policy and not beyond the same. In other words, as in the present case, since the insurance policy of the owner of the vehicle covered six occupants of the vehicle n question, including the driver, the liability of the insurer would be confined to six persons only, notwithstanding the larger number of persons carried in the vehicle. A such excess number of persons would have to be treated as third parties, but since no premium had been paid in the policy for them, the insurer would not be liable to make payment of the compensation amount as far as they are concerned".

19. In a decision between Manuara Khatun and others Vs. Rajesh Kr.

Singh and others5, it is a case where the Tribunal further held that all the passengers, including the two deceased, were travelling in Tata Sumo for hire and hence they were held to be gratuitous

2011 ACJ 917 (SC)

2017 (2) ALD 65 (SC)

passengers. Due to the said reason, United India Insurance Company Ltd., the insurer of Tata Sumo(offending vehicle) was not liable". In the said facts of the case the Hon'ble Apex Court held that "in view of the foregoing discussion, we are of the view that the direction to United India Insurance Company (respondent No. 3) - they being the insurer of the offending vehicle which was found involved in causing accident due to negligence of its driver needs to be issued directing them (United India Insurance Company- respondent No.3) to first pay the awarded sum to the appellants (claimants) and then to recover the paid awarded sum from the owner of the offending vehicle (Tata Sumo)-respondent No.1 in execution proceedings arising in this very case as per the law laid down in Para 26 of Saju P. Paul's case quoted supra". Shamanna and another Vs. The Divisional Manager The Oriental Insurance Co. Ltd. and Ors. The Hon'ble Supreme Court held that "to deny the benefit of pay and recover, what seems to have substantially weighed with the High Court is the reference to larger Bench made by the two-Judge Bench in National Insurance Co. Ltd. v. Parvathneni and another (2009) 8 SCC 785 which doubted the correctness of the decisions which in exercise of jurisdiction under Article 142 of the Constitution of India directing insurance company to pay the compensation amount even though insurance company has no liability to pay. In the Parvathneni case, the Supreme Court pointed out that Article 142 of the Constitution of India does not cover such types of cases and that if the insurance company has no liability to pay at all, then it cannot be compelled by order of the Court in the exercise of its jurisdiction under Article 142 of the Constitution of India to pay the compensation amount and later on recover it from the owner of the vehicle. The above reference in the Parvathneni case was disposed of on 17.09.2013 by the three- Judges Bench keeping the questions of law open to be decided in an

appropriate case. Since the reference to the larger Bench in the Parvathneni case has been disposed of by keeping the questions of law open to be decided in an appropriate case, presently, the decision in the Swaran Singh case followed in Laxmi Narain Dhut, and other cases hold the field. The award passed by the Tribunal directing the insurance company to pay the compensation amount awarded to the claimants and, thereafter, recover the same from the owner of the vehicle in question is in accordance with the judgment passed by this Court in Swaran Singh and Laxmi Narain Dhut cases. While so, in our view, the High Court ought not to have interfered with the award passed by the Tribunal directing the first respondent to pay and recover from the owner of the vehicle. The impugned judgment of the High Court exonerating the insurance company from its liability and directing the claimants to recover the compensation from the owner of the vehicle is set aside, and the award passed by the Tribunal is restored".

20. Coming to the instant case, the learned Tribunal observed that the Court presumes that capacity three includes hamalies. Because it is beneficial legislation, no other interpretation is also possible. The said observation of the Tribunal cannot be found fault with. A perusal of Ex.A1 FIR and report, Charge sheet shows that the petitioner and others were travelling on a load of Papaya in the offending vehicle as families. The 2nd respondent-insurance company has not placed any material to show that the plea taken by the petitioner is incorrect. By considering Ex.B1 policy, the Tribunal observed that the liability of the insurance company could be limited only to the extent of one hamalie. However, about 10 persons were travelling in the vehicle apart from the owner and driver of the offending vehicle. In the facts of the case, the Tribunal observed that out of the claims filed by the victims, the highest claim could be taken, and out of that amount, as per

ratio, the amount can be distributed among all the claimants. By giving said reasons, the Tribunal held that the 2 nd respondent's insurance company is liable only to the extent of one hamalie, whereas the 1st respondent is liable to pay the compensation along with the 2nd respondent.

21. In the light of the above principles laid down in the decisions, this Court views the finding of the Tribunal limiting the liability of the 2nd respondent insurance company as only one highest award and further directs to distribution among the hamalies as sustainable.

22. Given the discussion, as mentioned earlier, I do not find any substance in the appeal, and I do not see any reason to interfere with the impugned order in the present appeal. Accordingly, the appeal, devoid of merits, is dismissed without costs by confirming the order dt.30.04.2012 passed by the Tribunal in MVOP.No.693 of 2009.

23. Miscellaneous petitions, if any are pending, shall stand closed.

__________________________________ JUSTICE T MALLIKARJUNA RAO Date : 28.10.2022 BV/KGM

HON'BLE SRI JUSTICE T MALLIKARJUNA RAO

MACMA.No.1131 OF 2013

Dated 28.10.2022

BV/KGM