Andhra Pradesh High Court - Amravati

Oriental Insurance Company ... vs Dhupam Bramaramba 5 Others on 7 February, 2023

            HON'BLE SRIJUSTICE T.MALLIKARJUNA RAO

                     M.A.C.M.A. No.1088 OF 2013

JUDGMENT:

1. Aggrieved by the judgment and decree dated 05.02.2013 in M.V.O.P.

No.294 of 2007 passed by the Chairman, Motor Accidents Claims

Tribunal-cum-III Additional District Judge, S.P.S.R. Nellore District,

the second respondent in the M.V.O.P., the Oriental Insurance

Company Limited, Visakhapatnam Divisional Office, filed this appeal

questioning the quantum of the compensation amount and fastening

the liability to pay the compensation amount and recover the same.

2. For convenience, the parties will be referred to as per their rankings

in the M.V.O.P.

3. The claimants have filed a claim petition under Section 166 of the

Motor Vehicles Act, 1988, claiming compensation of Rs.5,00,000/- for

the death of one D.Nagabasavaiah. The claimant No.1 is the wife,

claimants 2 to 4 are the child, and the claimant No.5 is the father of

D.Nagabasavaiah. The said D.Nagabasavaiah would be referred to as

the "deceased".

4. The claimants' case is that on 07.12.2006, the deceased and some

others engaged the bus bearing No. AP 07 X 8899 to go to

Sabarimalai. The said bus would be referred to as the "offending vehicle". On 08.12.2006 at about 5.30 A.M., while the bus reached

Kovvur by-pass road, the said offending vehicle's driver drove it rashly

and negligently and dashed a stationed lorry parked by the side of the

road; thereby, a case was registered against the offending vehicle's

driver.

5. The first respondent, the offending vehicle's owner, has remained ex

parte.

6. The second respondent, the offending vehicle's insurer, filed a counter

stating that the driver of the stationed lorry bearing No. AP 16 TV

3232 has not taken any preventive measures, and he was negligent in

stationing the vehicle, and the compensation claimed is highly

excessive.

7. Based on the pleadings, the tribunal framed relevant issues.

Accordingly, during the trial, on behalf of the claimants, P.Ws.1 and 2

got examined and marked Exs.A.1 to A.9; on behalf of the second

respondent, R.Ws.1 to 3 were examined and marked Exs.B.1, Ex.X.1

and Exs. C.1 and C.2.

8. Appraising the oral and documentary evidence, the tribunal held that

the accident occurred due to the rash and negligent driving of the

offending vehicle' driver. The deceased's death occurred due to the

injuries sustained in the accident. The tribunal awarded a compensation amount of Rs.3,60,500/- with interest @ 7.5% per

annum against the first respondent and directed the second

respondent to satisfy the award at the first instance and then recover

the same from the owner of the offending vehicle.

9. Heard the learned Counsel for respective parties and perused the

material on record.

10. Learned Counsel for the appellant/ second respondent contends that

the offending vehicle's driver did not possess a driving licence and he

had no driving licence at the time of the accident; there is a violation

of the conditions of the policy, and the award passed by the tribunal

is excessive.

11. Learned Counsel for the respondents/claimants supported the

tribunal's findings and observations.

12. Now the points for consideration are,

I. whether the tribunal erred in directing the insurance company to pay the award amount at first instance and recover the same from the first respondent.

II. Whether the award passed by the tribunal is just and reasonable or requires modification?

POINT No.I:

a. It is not disputed that the offending vehicle is insured with the

second respondent; the insurance policy was in force at the time

of the accident and is not in conflict.

b. It is the contention of the second respondent that the offending

vehicle's driver did not have a driving license to drive the crime

vehicle at the time of the accident. The second respondent

examined RW.2-M.Subramanyam, Administrative Officer of the

second respondent company. He deposed that the police, after

completion of the investigation, filed a charge sheet against the

offending vehicle's driver, and it relied on Ex.A.5-copy of the

charge sheet. It also examined R.W.3-M.Nageswara Rao, who is

working as typist in R.T.O. office. He deposed that no driving

licence was issued in the name of the offending vehicle's driver,

and to that effect, he produced a certificate.

c. The evidence of R.Ws.2 and 3 shows that the offending vehicle's

driver had no driving licence at the time of the accident. The

owner of the offending vehicle-first respondent has a statutory

obligation to see that the driver of the vehicle who is authorised

to drive the same holds a valid driving licence. Despite the

service of notice in this proceedings also, the first respondent has not taken steps to establish that the offending vehicle's

driver holds a driving licence at the time of the accident.

d. It is an admitted position of the fact that there was a breach of a

policy condition. The fundamental duty is of the owner/first

respondent to discharge the obligation and to prove that the

driver of the offending vehicle had a proper driving license to

drive the vehicle in question involved in the accident. The

tribunal's finding shows that the owner of the offending bus

never produced a driving license, nor did he step into the

witness box. In the facts of the case, the onus could not be

shifted to the insurance company. Just because the vehicle was

insured with the 2nd respondent/insurance company, it cannot

be made liable unless it is proved that there was no violation of

the policy condition.

e. In Shamanna and another Vs. Divisional Manager, The

Oriental Insurance Company Limited and others1 in the facts

of the case that

"Jeep driver had no valid driving license at the time of the accident and there was a violation of the terms of the insurance policy, the Tribunal directed the insurance company to pay the compensation to

Civil Appeal No.8144 of 2018 (arising out of S.L.P. (C). No.26955 of 2017) the claimants and granted liberty to the insurance company to recover the same from the owner of the offending vehicle".

f. The Hon'ble Apex Court further observed at para Nos. 7

and 8, 12 are as follows:

"7.....As per the decision in the Swaran Singh case, the onus is always upon the insurance company to prove that the driver had no valid driving licence and that there was a breach of policy conditions. Where the driver did not possess a valid driving licence and there is a breach of policy conditions, "pay and recover" can be ordered in case of third- party risks. The tribunal is required to consider whether the owner has taken reasonable care to find out whether the driving licence produced by the driver does not fulfill the requirements of law or not will have to be determined in each case.

8...... The Supreme Court considered the decision of the Swaran Singh case in a subsequent decision in National Insurance Co. Ltd. v. Laxmi Narain Dhut, (2007) 3 SCC 700, wherein this Court held that "the decision in Swaran Singh case has no application to cases other than third-party risks and in case of the third party risks the insurer has to indemnify the amount and if so advised, to recover the same from the insured". The same principle was reiterated in Prem Kumari v. Prahlad Dev and others (2008) 3 SCC 193.

9......

10.....

11.....

12.......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, after that, recover the same from the owner of the vehicle in question is following 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."

g. Given the aforesaid legal proposition of law, this Court views that

the insurance company can be directed to pay the compensation

amount at the first instance and then recover the same from the

owner of the offending vehicle, as pay and recovery can be ordered

in case of third-party risk.

h. In the said facts of the case, the finding of the tribunal directing the

second respondent to pay the compensation amount and then

recover the same from the owner cannot be found fault with, and it

holds good.

POINT No.II:

a. The claimants have not disputed the quantum of compensation

awarded by the tribunal and ancillary findings regarding the

deceased's age and earnings. In the absence of any clinching

evidence to show the actual earnings of the deceased, the tribunal

assessed his earnings at Rs.3,000/-. Considering the strength of

the family members, it deducted 1/3rd of the earnings towards

personal and living expenses. As the age of the deceased was

assessed as 45 based on Ex.A.3-postmortem report, it applied

multiplier 14 by following the judgment in Sarala Verma v. Delhi

Transport Corporation2. The tribunal awarded compensation

2009 ACJ 1298 under the conventional heads and fixed the compensation at

Rs.3,60,500/- with interest at 7.5% per annum from the petition

date. Although, as already observed, the claimants have not

preferred any appeal or cross objection on the quantum of

compensation, after careful reading of the order passed by the

tribunal, by any stretch of the imagination, it cannot be held that

the compensation fixed by the tribunal is unreasonable.