M/S Shriram General Insurance Co ... vs Kurru Nooka Ratnam 5 Others
2023 Latest Caselaw 5095 AP

       HON'BLE DR. JUSTICE K. MANMADHA RAO

       CIVIL MISCELLANEOUS APPEAL No.234 of 2017

JUDGMENT:

The present Civil Miscellaneous Appeal is filed under

Section 30 of the Workmen's Compensation Act, 1923 (for

brevity "the Act") aggrieved by the order dated 16.04.2014

passed in W.C.No.05 of 2011 by the Assistant Commissioner of

Labour, Circle-2 Visakhapatnam (for short "the

Commissioner").

2. The Appellant herein is the Respondent No.2/

Opposite Party No.2 and the respondents herein are the

applicants/claimants in W.C No.05 of 2011. For sake of

convenience, the parties are hereinafter referred to, as they are

arrayed before the Commissioner.

3. The applicants have filed the impugned W.C.No.05 of

2011 before the Commissioner seeking for a direction to

Opposite Parties No.1 and 2 for payment of compensation

under Workmen's Compensation Act, 1923 to extend of Rs

7,33,860/- with interest @18% p.a., from the date of accident

due to the deceased worker i.e., Kurru Rama Appa Rao died on

31.10.2010 during the course of employment with the

Opposite Party No.1, who worked as a driver with Opposite

Party No.1's vehicle Bolero Van bearing No. AP 31 TW 0585.

4. Brief facts of the case are that on 31.10.2010

morning the deceased started from Visakhapatnam to

Srikakulam in the crime vehicle Bolero and when he reached

Narsapuram Junction at 11.55 A.M while taking the turn the

deceased driver could not control over the said vehicle and

dashed a road side tree and sustained injuries and

immediately he was shifted to RMS Hospital and while taking

the treatment he died. The Opposite Party No.1 was also

attended the scene of offence and went to hospital and saw the

dead body of the deceased. The deceased died during the

course and out of his course of employment with Opposite

Party No. 1 as a driver. The deceased was of age 32 years and

was earning an amount of Rs.6,000/- towards monthly wages.

The applicants demanded the Opposite party No.1 to pay

compensation. But he failed to pay the same. The Opposite

Party No.1 duly insured the crime vehicle with Opposite Party

No.2 and the policy was valid at the time of the said accident

vide Policy No.10003/31/10/276485, from 16.02.2010 to

15.02.2011. Therefore, both the Opposite Parties are jointly

and severely liable to pay the compensation to the applicants.

5. Despite service of notice on the Opposite party

No.1, neither attended nor filed the counter and hence, he was

set ex parte before the Tribunal. The Opposite Party No.2 filed

counter and denied all the allegations made in the petition and

demanded to put strict proof that the deceased had holding a

valid and effective driving license to drive the crime vehicle and

registration certificate, permit and fitness certificate to ply on

the roads.

6. During course of trial, on behalf of the applicants,

AW.1 and AW.2 were examined and Ex.A1 to Ex.A6 were

marked. On behalf of the Opposite Parties, RW.1 and RW.2

were examined and Ex.B1 and Ex.B2 were marked.

7. The Commissioner framed the following issues for

consideration:

1) Whether there exists the employer and employee relationship between the Opposite Party No.1 and the deceased?

2) If such relation exists whether the deceased died during the course of his employment?

3) To what amount of compensation the applicants are entitled to receive and who has to pay the compensation?

8. The Commissioner, on appreciation of the evidence

on record, held that both the Opposite Parties are jointly and

severally liable to pay the compensation to the applicants and

directed to deposit the compensation of Rs.5,09,625/- towards

Workmen's Compensation by way of Demand Draft drawn in

favour of "Commissioner for Workmen's Compensation,

Visakhapatnam" with the Joint Commissioner of Labour,

Visakhapatnam within 30 days from the date of receipt of the

orders. Further, held that, if the opposite parties failed to pay

the compensation within the stipulated time as mentioned

above, they are liable to pay penal interest @ 6% p.a. until they

deposit the said awarded amount.

9. This Court, vide order, dated 20.03.2017 in CMA MP

No.408 of 2017, has granted interim stay as under:

".....Hence, there shall be interim stay of all further proceedings in W.C No.05 of 2011 on the file of the Commissioner for Workmen's Compensation Act, 1923, Visakhapatnam and Assistant Commissioner of Labour-II, Visakhapatnam, till further orders.

The respondents No.2 and 3 are minors; therefore, they are not entitled to withdraw the deposited amount till they attain the age of majority and are declared as such.

Having regard to the facts and circumstances of the case, the respondents No.1, 4 and 5-claimant Nos.1, 4 and 5 are permitted to withdraw 50% of their respective shares, as to be declared by the Tribunal, without furnishing any security."

10. Heard Sri V. Rupesh Kumar Reddy, learned

Standing Counsel appearing for the appellant-Insurance

Company and Sri G.Venkata Reddy, learned counsel appearing

for the respondents/claimants.

11. Learned Standing Counsel for the appellant-

Insurance Company submits that the Commissioner ought to

have taken the income of the deceased at Rs.3,000/- per

month for assessing the loss of dependency, but the

Commissioner did not look into the aspects of the case and

came to wrong conclusion and granted excess compensation.

He further submits that the Commissioner erred in granting

interest on the compensation amount, where the tribunal has

granted interest at 6% per annum on the compensation

amount which is excessive. He further submits that the

Commissioner even had not even applied the settled principles,

enunciated under Motor vehicle Act, and hence, the amount

awarded by the Commissioner is erroneous, exorbitant and

cannot be sustained in the eye of law, and hence, he prays to

allow the appeal.

12. To support his contentions, learned Standing

Counsel has placed reliance on the judgment of Hon'ble

Supreme Court reported in Bhuwan Singh v. Oriental

Insurance Company Ltd., and another1, wherein the Apex

Court held that :

"Rule 14 of the Central Motor Vehicle Rules, 1989 provides for the manner in which an application for driving licence is to be filed. Such an

2009 (3) ALD 35 (SC)

application is to be filed in form 4 and is required to be inter alia accompanied by an effective learner's licence to drive the vehicle of the type to which the application relates.

13. He also placed reliance on another judgment

reported in Oriental Insurance Co. Ltd., Rajahmundry v.

Bhimala Pavan Kumar and others2, wherein the High Court

of Judicature, Andhra Pradesh at Hyderabad held that :

"Liability of insurance company - Driver not holding valid licence- Failure of owner of vehicle to adduce any evidence in support of his plea that driver had a valid licence- appellant/insurance company established that driver not having valid driving licence to drive transport vehicle which was cause of accident and that accident occurred only due to his fault- appellant-Insurance company held, not liable for payment of compensation...."

... ..

The apex Court in National Insurance Company v. Swaran Singh3, wherein the Hon'ble Apex Court held that "the Tribunal should in each case take a decision whether the fact that the driver possessing licence for one type of vehicle but found driving another type of vehicle, was the main or contributory cause of accident. If in facts, it is found that accident was caused solely because of some other unforeseen or intervening causes like mechanical failures and similar other causes having no nexus with driver not possessing requisite type of licence, the insurer will not be allowed to avoid its liability merely for technical breach of conditions concerning driving licence. Minor breaches of licence conditions, such as want of medical fitness certificate, requirement about age of the driver and the like not found to have been the direct cause of the accident, would be treated as minor breaches of inconsequential deviation in the matter of use of vehicles. Such minor and inconsequential deviations with regard to licensing conditions would not constitute sufficient ground to deny the benefit of coverage of insurance to the third parties."

14. On the other hand, learned counsel for the

respondents-applicants submits that the Commissioner has

taken all the relevant factors into consideration and awarded

2007 (3) ALD 138

2004 (2) ALD 36 (SC)

just and reasonable amount as compensation, and the

submissions made on behalf of the appellant do not merit

consideration, and there is nothing to interfere with the

impugned Order and ultimately prayed to dismiss the appeal.

15. To support his contentions, learned counsel for the

respondents has placed reliance on a judgment reported in

New India Assurance Co., Ltd., Hyderabad rep. by its

Divisional Manager vs. Ramavath Bashya and another4,

wherein the High Court for the State of Telangana held that:

" mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards the insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant time."

16. As seen from the impugned order, this Court

observed that, on 31.10.2010 morning, the deceased while

travelling from Visakhapatnam to Srikakulam in Bolero van

bearing No.AP 31 TW 0585 of Opposite Party No.1 and when

reached Narsapuram Junction, Opposite VenkataRaju Cement

Brick Factory, at 11.55 A.M. while taking turn the deceased

2022(5) ALT 52 (S.B)

could not control over the said vehicle and dashed against a

road side tree and sustained injuries. Though he was shifted

to RIMS hospital immediately, he died while taking treatment.

It is further observed that, the accident was occurred during

the course and out of his employment with Opposite Party

No.1 as a driver. The deceased died during the course of

employment at the age of 32 years and was paid an amount of

Rs.6,000/- towards monthly wages.

17. On perusing the material available on record, it is

observed that, as per evidence of AW.s, A.W.2 and the

documents i..e, Ex.A1-FIR and Ex.A3-Inquest report, it is

proved that the deceased Kurru Rama Appa Rao worked as a

driver with Opposite Party No.1 and involved in an accident

occurred on 31.10.2010 and died during the course of his

employment with Opposite Party No.1. Hence, it clearly proves

the relationship between the Opposite Party No.1 and the

deceased. Further, as per Ex.A1-FIR, Ex.A2-P.M.Report and

Ex.A3-Inquest report stated that the age of the deceased was

mentioned as 32 years at the time of accident. Hence, the age

of the deceased is taken into consideration as 32 years in this

case. It is also observed that, the appellant herein has filed

certain citations before the Commissioner to prove their case

as who had not valid and driving license at the time of the

accident, the claimants are not entitled for getting Workmen's

Compensation and hence he is not liable to pay the

compensation.

18. In the present case, there is no dispute with regard

to the employment of the deceased with Opposite Party No.1

and as per Ex.A4 i.e., coverage of Insurance Policy to the

vehicle Bolero Van bearing No.AP 31 TW 0585 of the Opposite

Party No.1 at the time of accident occurred. But there is a

dispute with regard to the driving license of the deceased

driver. Either of the parties did not produce driving license of

the deceased before the Commissioner. And as seen from the

evidence of RWs.1 and 2 and Ex.A6-MVI Report, the MVI

mentioned about driving license of the deceased was not made

available at the time of the accident. It is also observed that,

as the deceased driver had a valid driving license, but the

same was not traced out at the time of occurrence of the

accident.

19. It is also observed from the evidence of RW.1, he

categorically stated that the Opposite Party No.1/owner of the

crime vehicle had intentionally and willfully entrusted the

vehicle to the driver K. Rama Appa Rao, who had not holding a

license to drive the said vehicle and thereby contravened the

provisions of M.V Act as well as M.V. Rules. RW.1 further

stated that the driver of the vehicle without a valid and

effective driving license is breach of the terms and conditions

of the insurance policy issued to the above said crime vehicle

bearing No.AP 31 TW 0585. In view of the above, the appellant

is not liable to pay any compensation to the

respondents/applicants.

20. In a case of the Hon'ble Supreme Court reported in

S. IYYAPAN v. UNITED INDIA INSURANCE CO.LTD AND

ANOTHER5 , the Apex Court held that the insurer cannot

disown its liability on the ground that the driver was holding a

licence to drive a light motor vehicle but before driving light

motor vehicle used as commercial vehicle, no endorsement was

obtained to drive commercial vehicle. The apex Court in the

above mentioned case has categorically held that it is a

statutory right of a third party to recover the amount of

compensation so awarded from the insurer and further held

that it is for the insurer to proceed against the insured for

recovery of the amount in the event there has been violation of

any terms and conditions of the insurance policy. The

(2013) 7 SCC 62

judgment of the apex Court referred to above dealt with a

similar situation where the offending vehicle was Mahindra

Maxi Car and the driver of the said vehicle was not having any

endorsement in the licence to drive such vehicle. In such a

situation, the Apex Court held that insurer cannot get rid of

their liability. The Court directed the insurance company to

pay the amount to the claimants and recover the same from

the owner of the vehicle.

21. The heading "Insurance of Motor Vehicles against

Third-Party Risks" given in Chapter XI of the Motor Vehicles

Act, 1988 (Chapter VIII of the 1939 Act) itself shows the

intention of the legislature to make third-party insurance

compulsory and to ensure that the victims of accident arising

out of use of motor vehicles would be able to get compensation

for the death or injuries suffered. The provision has been

inserted in order to protect the persons traveling in vehicles or

using the road from the risk attendant upon the user of the

motor vehicles on the road. To overcome this ugly situation,

the legislature has made it obligatory that no motor vehicle

shall be used unless a third-party insurance is in force.

22. On a perusal of the above citation, this Court is of

the opinion that the above principle applicable to the facts of

the case, as it is a statutory right of a third party to recover the

amount of compensation so awarded from the insurer and

further it is for the insurer to proceed against the insured for

recovery of the amount in the event there has been violation of

any terms and conditions of the insurance policy.

23. On perusing the entire material placed before the

Court would indicate that the accident in the instant case took

place in the year 2010 and the injured who was aged about 32

years. It would be very difficult for the claimants to seek the

relief from the owner of the vehicle. The claimants who have

been fighting for compensation since 2010 cannot be

compelled to struggle further for recovery of the amount by

directing him to recover the same from the owner. Having

regard to the peculiar facts and circumstances of the case, I

am satisfied that the Insurance Company can be directed to

pay the entire amount to the claimant and recover the same

from the owner.

24. In view of the above, it would be appropriate to

direct the appellant to pay the compensation as awarded by

the Tribunal to the claimants and recover the same from the

owner of the vehicle in accordance with law. In view of the

interim order passed by this Court, dated 20.03.2017 in CMA

MP No.408 of 2017, if at all the respondents/claimants are

withdrawn the amount, the appellant is directed to recover the

same from the owner.

25. With the above observation, the Civil Miscellaneous

Appeal is disposed of. There shall be no order as to costs.

26. As a sequel, all the pending miscellaneous applications shall stand closed.

______________________________ DR. K. MANMADHA RAO, J.

Date :    18-10-2023
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      HON'BLE DR. JUSTICE K. MANMADHA RAO




      CIVIL MISCELLANEOUS APPEAL No.234 of 2017


                 Date :   18 .10.2023




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