New India Assurance Company ... vs Smt. Renu W
2008 Latest Caselaw 81 Bom

                                  1

         IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                       NAGPUR BENCH : NAGPUR




                                                                         
                      First Appeal No.487 OF 2003




                                                 
    New India Assurance Company Limited,




                                                
    through its' Divisional Manager, D. O. I.,
    having its office at Gopalkrishna Bhawan,




                                     
    Jhansi Rani Square, Sitabuldi, Nagpur.       .. APPELLANT
                        
               .. Versus ..
                       
    1. Smt. Renu wd/o Major Nareshchandra
         Katoch, aged 40 years,
      

         Occupation : Service,
   



    2.   Ku. Heena d/o Major Nareshchandra
         Katoch, aged about 14 years, Student,





    3.   Master Himanshu s/o Major
         Nareshchandra Katoch, aged 12 years,





         Occupation: Student,
         All resident of 36/3, S.M. Lines,
         Kamptee Cantonment, Kampte,
         District Nagpur.




                                                 ::: Downloaded on - 09/06/2013 14:01:27 :::
                                   2

    4.   Jitendra s/o Yogendra Wahi,
         aged Major, Occupation: Business,




                                                                      
         R/o 64- Mall Road, Kamptee,




                                              
         District Nagpur.


    5.   Sheikh Vakil s/o Sheikh Yakub,




                                             
         Aged Major, Occupation: Service,
         R/o Bhjaji Mandi, Near Kasaipura,




                                     
         (In front of Doma Kirana Shop),
         Kamptee, Dist. Nagpur.
                       ig                    .. RESPONDENTS


    Mr. A.J. Pophaly, Advocate for the Appellant.
                     
    Mr. Anjan De, Advocate for the Respondents 1to 3.
    Nobody present for Respondents No.4 & 5.

                            ...
      
   



    CORAM : K.J. ROHEE & PRASANNA B. VARALE, JJ.

DATE OF RESERVING THE JUDGMENT : OCTOBER 13 , 2008 DATE OR PRONOUNCING THE JUDGMENT: OCTOBER ,2008

JUDGMENT : (PER : K. J. ROHEE, J)

1. The Insurer/original respondent no.3 has preferred

this appeal against the award passed by the Motor Accident

Claims Tribunal, Nagpur in Claim Petition No.399 of 1993 on

28.04.2003 in favour of the claimants (respondents no.1 to 3

herein) and against the appellant as well as the owner

(respondent no.4) and the driver (respondent no.5)

2. It is not disputed that the claimants are the legal

heirs of deceased Nareshchandra Katoch who died in an

accident on 1.11.1993. It is also not disputed that

Nareshchandra Katoch was serving as Major in Indian Army

and at the relevant time he was posted at Guards Regimental

Centre, Kamptee Cantonment, Kamptee. According to the

claimants the truck owned by respondent no.4 and driven by

respondent no.5 dashed against the scooter of Major

Nareshchandra with the result Major Nareshchandra died on

the spot. At the time of his death the salary of Major

Nareshchandra was Rs. 7395/- per month and he was 36 years

old. He was hail and hearty . He had earned all promotions

well in time. Had he been alive, he would have been promoted

as Lieutenant Colonel, Colonel, Brigadier and Major General.

According to the claimants, they are entitled to claim

Rs.50,00,000/- However, they restricted their claim to

Rs.35,62,000/-.

3. The owner and driver of the offending vehicle filed

joint written statement on 22.8.1995 denying the claim. They

contended that the deceased himself was negligent and was

responsible for the accident. They further submitted that the

truck in question was insured with the insurer.

4. The Insurer (present appellant) filed separate written

statement on 22.8.1995 taking the same defence like that of the

owner and driver of the truck involved in the accident.

5. Claimant no.1 Smt. Renu widow of Major

Nareshchandra examined herself as PW1. PW2 Captain

Kongarao Srihari Pongara produced the service record of the

deceased. It seems that the driver of the truck involved in the

accident was not examined as a witness.

6. The Claims Tribunal held that the death of Major

Nareshchandra was the direct result of the rash and negligent

driving of the truck driver. While calculating the amount of

compensation, the Claims Tribunal took into consideration

further promotional avenues of the deceased. The Claims

Tribunal applied multiplier of 16 and held that the claimants

are entitled to compensation of Rs.23,33,500/- including the

amount of no fault liability and granted future interest @ Rs. 9

% per annum from the of petition till realisation. The Claims

Tribunal held the driver , owner and insurer of the offending

truck as jointly and severally liable to pay the said amount.

7. The owner and driver of the truck involved in the

accident did not challenge the said Award. It is the insurer who

has challenged this Award by preferring the present appeal

under Section 173 of the Motor Vehicles Act.

8. The claimants moved Civil Application No.

4914/2006 for dismissal of the appeal under section 149 (2)

and 170 of the Motor Vehicles Act,1988. The claimants moved

Civil Application No. 5830/2008 for final disposal of the

appeal. We have, therefore, taken up the appeal for final

disposal on preliminary objection raised by the learned counsel

for the claimants in respect of the maintainability of the appeal.

9. We have heard Shri A.J. Pophaly, Advocate for the

appellant/insurer and Shri Anjan De, Advocate for the

claimants.

10. Shri Anjan De urged that the grounds upon which the

insurer can deny its liability in relation to a third party are

contained in sub-section (2) of Section 149 of the Motor

Vehicles Act. Ordinarily the Insurance Company would have no

right to question the quantum of compensation in the absence

of leave having been granted in its favour in terms of Section

170 of the Motor Vehicles Act. Shri De pointed out that in the

present case no defence as is permissible under Section 149 (2)

(a)(b) has been raised by the appellant/insurer. Shri De

further pointed out that the appellant/insurer never sought

permission of the Tribunal under Section 170 of the Motor

Vehicles Act to contest the claim on the grounds that are

available to the person against whom the claim has been made.

The appellant/insurer , however, is trying to challenge the

award of the Tribunal on the ground of negligence of the

deceased as well as on the quantum granted by the Tribunal.

Such an appeal is not tenable. In order to substantiate his

submission Shri De relied on National Insurance Co. Ltd.

Chandigarh .vs. Nicolletta Rohtagi and others - (2002) 7

Supreme Court Cases 456, wherein the Apex Court

considered the following question:

"Where an insured has not preferred an

appeal under Section 173 of the Motor Vehicles Act, 1988 against an award given by

the Motor Accidents Claims Tribunal, is it open to the insurer to prefer an appeal against the award by the Tribunal

questioning ig the quantum of the compensation, as well as finding as regards the negligence of the offending vehicle?"

After considering the relevant provisions, the Apex Court in

para 18 observed as under:-

"The aforesaid provisions show two aspects.

Firstly, that the insurer has only statutory defences available as provided in sub-section

(2) of Section 149 of the 1988 Act and, secondly, where the Tribunal is of the view that there is a collusion between the claimant

and the insured, or the insured does not contest the claim, the insurer can be made a party and on such impleadment the insurer shall have all defences available to it. Then comes the provision of Section 173 which

provides for an appeal against the award given by the Tribunal. Under Section 173,

any person aggrieved by an award is entitled

to prefer an appeal to the High Court. Very often the question has arisen as to whether an insurer is entitled to file an appeal on the

grounds available to the insured when either there is a collusion between the claimants

and the insured or when the insured has not filed an appeal before the High Court

questioning the quantum of compensation.

The consistent view of this Court had been that the insurer has no right to file an appeal to challenge the quantum of compensation or

finding of the Tribunal as regards the

negligence or contributory negligence of offending vehicle."

After considering the case law, Apex Court observed in para 26

as under:-

"For the aforesaid reasons, an insurer if aggrieved against an award, may file an appeal only on those grounds and no other.

However, by virtue of Section 170 of the

1988 Act, where in course of an enquiry the Claims Tribunal is satisfied that (a) there is a

collusion between the person making a claim

and the person against whom the claim has been made, or (b) the person against whom the claim has been made has failed to contest

the claim, the Tribunal may, for reasons to be recorded in writing, implead the insurer and

in that case it is permissible for the insurer to contest the claim also on the grounds which

are available to the insured or to the person

against whom the claim has been made.

Thus, unless an order is passed by the Tribunal permitting the insurer to avail the

grounds available to an insured or any other

person against whom a claim has been made on being satisfied of the two conditions specified in Section 170 of the Act, it is not

permissible to the insurer to contest the claim on the grounds which are available to the insured or to a person against whom a claim

has been made."

In para 27 it is observed as under:-

"This matter may be examined from another angle. The right of appeal is

not an inherent right or common law right, but it is a statutory right. If the law provides

that an appeal can be filed on limited

grounds, the grounds of challenge cannot be enlarged on the premise that the insured or the persons against whom a claim has been

made have not filed any appeal. Section 149(2) of the 1988 Act limits the insurer's

appeal on those enumerated grounds and the appeal being a product of the statute, it is

not open to an insurer to take any plea other

than those provided in Section 149(2) of the 1988 Act."

In para 32 the Apex Court answered the question as

under:-

"For the aforesaid reasons, our answer to the question is that even if no appeal is preferred

under Section 173 of the 1988 Act by an insured against the award of a Tribunal, it is not permissible for an insurer to file an

appeal questioning the quantum of compensation as well as findings as regards negligence or contributory negligence of the offending vehicle."

11. It would be seen that the Apex Court overruled the

decision in United India Insurance Co. Ltd. .vs. Bhushan

Sachdeva- (2002) 2 SCC 265. The decision in Nicolletta

Rohtagi's case (supra) has been followed by the Apex Court in

Sadhana Lodh .vs. National Insurance Co. Ltd. And another-

(2003) 3 Supreme Court Cases 524 and R. Mannakatti and

another .vs. M. Subramanian and another- (2005) 11

Supreme Court Cases 389. The learned Single Judge of this

Court has also relied on Nicolletta Rohtagi's decision in

Oriental Insurance Co. Ltd. .vs. Deoram Pandurang

Waghmare- I (2006) ACC 728 and Oriental Insurance Co.

Ltd. .vs. Rajkaur Ranjitsingh Bhatti and others- 2008(4)

Mh.L.J. 645.

12. Shri Pophaly, the learned counsel for the

appellant/insurer relying on National Insurance Co. Ltd. .vs.

Indira Srivastava and others - (2008) 2 Supreme Court

Cases 763 submitted that just compensation cannot be a

bonanza or source of profit. By relying upon the Oriental

Insurance Company Ltd. .vs. Jashuben and others- 2008 (2)

T.A.C. 12 (S. C.), he urged that the Tribunal could not have

taken into consideration the future prospects of the deceased

while calculating just compensation. According to Shri Pophaly

just compensation in the present case could not have exceeded

Rs.10 lacs and that the Tribunal has passed award for an

excessive amount.

13. As regards tenability of the appeal by Insurer, Shri

Pophaly submitted that the correctness of 3 Judges' Bench

decision of the Apex Court in Nicolletta Rohtagi's case(supra)

has been referred to a Larger Bench by order dated 3.12.2007

in United India Insurance Co. Ltd..vs. Shila Datta and ors in

SLP Nos. 17301-17302/2007 by the Apex Court. Hence he

urged that this Court may wait till the decision of the Larger

Bench.

14. We are unable to agree with the suggestion made by

Shri Pophaly because of the observations in State of Rajasthan

.vs. M/s R.S. Sharma and Co. - (1988) 4 Supreme Court

Cases 353 that Justice, between the parties in a particular case,

should not be kept in a suspended animation. Hence in view of

clear decision in Nicolletta Rohtagi's case (supra), we are of

the considered view that the present appeal preferred by the

insurer is not tenable and it will have to be dismissed. We,

therefore, pass the following order:-

The appeal is dismissed with no order as to costs.

The learned counsel for the appellant prays for

staying the effect and operation of this judgment for two

months. The prayer is rejected.

(PRASANNA B. VARALE, J.) (K.J. ROHEE, J.)

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